End deficit nightmare or go

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IT did not come as a surprise when the Cabinet officially admitted to “liquidity depletion in the general reserve”. This was expected a decade ago despite many warnings of excessive consumption behavior, which did not help, let alone the failure of those concerned in following the advice to take advantage of Kuwait’s financial position and work on shifting to productivity. However, the executives gave a deaf ear to all the suggestions given in this regard.

This unfortunate admission has been caused by chronic mismanagement due to diseases that were not treated from the start, and ended up becoming difficult to treat.

Therefore, the government today has no choice but to work seriously towards eradicating the disease if its intention is sincere in terms of getting out of the current impasse, and benefiting from the experiences of the Gulf countries. This is what we have mentioned hundred times before, so as to strengthen the sovereign wealth and diversify its assets both locally and abroad by borrowing from international markets. This is because, despite the decline in the sovereign rating, it is still able to utilize its tools in this regard.

The reasons behind the depletion of the general reserve were not hidden from anyone, especially the constant tension between the National Assembly and the ministers, the dialogue of the deaf, and the struggle over crumbs.

This situation was perpetuated by many concessions made to gluttonous MPs by the current government and its predecessors. From their point of view, these MPs do not bear any responsibility for what the situation has become. Rather, they are taking advantage of the situation to carry out more electoral blackmail. They know that the citizens will not hold them, but instead the executive authority, accountable.

The Public Debt Law expired in 2017 and for four years, the government lacked courage to introduce a new law in this regard in order to avoid further deterioration of the situation.

But the MPs took the issue as their masterkey to pass all their demands. Because of that, the new debt law became a summer night’s dream, incurring the state to lose over twenty billion dinars, in the past years, especially during the COVID-19 pandemic, as a requirement for the new law. This manifests itself in that huge deficit, which exceeded 125 billion dollars.

We beg to ask – When will this deterioration stop? And how?

Kuwaiti assets are huge, and its banks have very high ratings. Also, its sovereign investments are manifold and big. All this qualifies the state to borrow from abroad like the way the Emirates, Saudi Arabia, Qatar and Bahrain did during the COVID-19 pandemic. These funds are used in actual projects both internally and abroad, and would ensure exit from the dark financial tunnel if the same methods used by other Gulf countries are utilized.

What is most baffling is the statement made by the official spokesman for the Cabinet about “the necessity of finding radical solutions to confront the deficit in the state’s general budget”, which suggested that the executive authority does not bear responsibility.

Undoubtedly, whoever caused the problem seems unable to solve it, but should rather “cut to the chase” from oneself with courage, but nonetheless, treating a mistake with a mistake is suicide.

Kuwaitis today are fuming with anger over what their governments have brought them to, especially with their permanent submission to semi-educated MPs, who see in their legislative mission nothing but employment services and intercession for accused persons.

From here, it is likely that the deficit nightmare would turn into a reality if the government does not take the initiative to remedy the dire situation; otherwise it would have no choice but to go without any regrets for its departure.

By Ahmed Al-Jarallah

Editor-in-Chief, the Arab Times

This news has been read 13201 times!

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