Mubasher: Kuwait has recorded a budget deficit during the first nine months of fiscal year 2019/2020 after transferring the future generations’ reserve, pressured by low income and higher expenses, according to a statement by the Ministry of Finance on Tuesday.
The country saw a budget deficit worth KWD 2.276 billion ($7.515 billion) during the nine-month period ended 31 December 2019, after transferring KWD 1.268 billion ($4.186 billion) to the future generations’ reserve.
In the meantime, the country’s surplus amounted to KWD 2.009 billion after transferring KWD 1.569 billion to the future generations’ reserve.
In addition, total revenues decreased by 19.20% from KWD 15.686 billion to KWD 12.675 billion during the nine months period, accounting for 80.2% of the estimated income of KWD 15.812 billion for fiscal year 2019/2020.
Kuwait’s expenditures and commitments surged by 13% from KWD 12.109 billion to reach KWD 13.684 billion in the nine months period in 2019/2020, representing 60.8% of the expected spending of KWD 22.500 billion during fiscal year 2019/2020.
The finance ministry has forecast a budget deficit of KWD 5.27 billion and revenues of KWD 15.81 billion during fiscal year 2019/2020, versus expenses of KWD 22.50 billion.
It is worth noting that the Kuwaiti fiscal year starts in April each year and ends on 31 March the following year. The country transfers 10% of its total revenues to the future generations’ reserve.
Recently, editorial director at GlobalData, Richard Thompson, said, “The news that Kuwait is not only running a budget deficit but that the deficit is increasing will come as a surprise to many companies in the country who are struggling to find new business opportunities. Where they are winning work, they are often not being paid. They will be asking how Kuwait can be overspending when they are seeing no spending happening."
Translated by: Amal A. Wahaab