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KUWAIT CITY, Oct 12: The International Monetary Fund has raised its expectations for the growth of Kuwait’s economy during 2022 from its previous estimates, suggesting that it will register the largest growth in the Gulf this year, reports Al-Rai daily. In its report on growth prospects, the IMF expected Kuwait’s real GDP to grow by 8.7 percent this year, compared to its previous forecast last April, with a growth of 8.2 percent and predicted the expectations for real GDP growth for Kuwait in 2023 at 2.6 percent, a percentage that reflects the expected slowdown in growth, but it is greater than the growth recorded by the output in 2021 of 1.3 percent. Regarding the consumer price index in Kuwait, the IMF lowered its growth forecast for this year to 4.3 percent instead of its previous estimate of 4.8 percent, suggesting a slowdown in its rate in 2023 to 2.4 percent.
In its report, the Fund also lowered its forecast for Kuwait’s current account balance surplus to record 29.1 percent of GDP in 2022, compared to previous estimates of 31.3 percent, which was the highest since 2014, and also reduced its estimates regarding the current account balance surplus for next year at 23 percent of GDP, compared to its April 2022 estimate of 27.2 percent of GDP.
The Fund expected Saudi Arabia to record the second largest growth in the Gulf, after Kuwait, in its GDP by 7.6 percent (the same previous estimate), followed by Oman with 4.4 percent, i.e. an expected growth less than the Fund’s estimates in April of 5.6 percent; the UAE in the fourth place in the Gulf with a weighted growth of 5.1 percent, higher than last April’s estimates of 4.2 percent, then Qatar with 3.4 percent, and Bahrain with 3.4 percent.
The IMF raised its forecast for the growth of the economies of the Middle East and Central Asia to 5 percent this year, compared to its previous estimate of 4.6 percent, and it is likely that growth will slow to 3.6 percent next year. On the other hand, the Fund stressed that global economic activity is witnessing a widespread slowdown that exceeded expectations, with inflation rates exceeding their levels recorded during several previous decades, pointing out that the prospects for the global economy are heavily burdened as a result of the cost of living crisis, tightening financial conditions in most regions, and the invasion Russia, Ukraine, and the ongoing Covid-19 pandemic.
The International Monetary Fund expected a slowdown in global growth from 6 percent during 2021 to 3.2 percent this year and then 2.7 percent next year, which represents the weakest growth pattern ever since 2001, with the exception of the period of the global financial crisis and the critical stage of the pandemic. “The worst is yet to come, and for many people in 2023 it will feel sluggish,” he said, echoing warnings from the United Nations, the World Bank and many global CEOs.