Kuwait, Gulf-rich state , economic activity picked up in 2014 , said a recent report compiled by International Monetary Fund (IMF).
The medium-term economic outlook is favorable as Non-oil GDP growth is expected to pick up to 4.0-5.0 percent in the medium term, supported by government investment in infrastructure and the oil sector, and by consumption, said IMF.
The state's fiscal and current account surpluses are projected to be significantly lower in the baseline scenario. The main downside risk to the outlook arises from a sustained decrease in oil prices as well as slow implementation of the Development Plan , noted the fund.
Meanwhile, Kuwait’s Non-oil growth is projected at 3.5% driven by a combination of continued increase in domestic consumption and some pick-up in government capital spending and private investment ,added IMF.
IMF pointed out that , flat oil production would keep the overall real GDP growth positive at 1.3%.
However, the average inflation rate is forecast to remain at about 3%. The current account and fiscal surpluses are expected to remain high, added IMF.
It is vital for the government and the parliament to agree on an agenda to place the public investment program on track, and continue with economic reforms to achieve this growth, IMF said.
The Fund also said that Kuwait's banks are amply capitalised and liquid with stable profits.
Banks have a combined capital adequacy ratio of 18.3%, falling gross non-performing loans of 3.5% and a growing provisioning ratio of 139%."
Risks to Kuwait's financial system from investment companies are contained, although a few companies continue to make losses and deleverage and restructure their balance sheets and operations, IMF said.
The medium-term economic outlook is favorable as Non-oil GDP growth is expected to pick up to 4.0-5.0 percent in the medium term, supported by government investment in infrastructure and the oil sector, and by consumption, said IMF.
The state's fiscal and current account surpluses are projected to be significantly lower in the baseline scenario. The main downside risk to the outlook arises from a sustained decrease in oil prices as well as slow implementation of the Development Plan , noted the fund.
Meanwhile, Kuwait’s Non-oil growth is projected at 3.5% driven by a combination of continued increase in domestic consumption and some pick-up in government capital spending and private investment ,added IMF.
IMF pointed out that , flat oil production would keep the overall real GDP growth positive at 1.3%.
However, the average inflation rate is forecast to remain at about 3%. The current account and fiscal surpluses are expected to remain high, added IMF.
It is vital for the government and the parliament to agree on an agenda to place the public investment program on track, and continue with economic reforms to achieve this growth, IMF said.
The Fund also said that Kuwait's banks are amply capitalised and liquid with stable profits.
Banks have a combined capital adequacy ratio of 18.3%, falling gross non-performing loans of 3.5% and a growing provisioning ratio of 139%."
Risks to Kuwait's financial system from investment companies are contained, although a few companies continue to make losses and deleverage and restructure their balance sheets and operations, IMF said.
Source:
Mubasher
