Kuwait posts smaller deficit for last fiscal year on higher oil

SYDNEY: Kuwait’s fiscal deficit narrowed to three billion dinars (Us$9.8bil or Rm44.6bil) in the year through March, a drop of more than 72% on the previous year as oil prices recovered.

The Organisation of the Petroleum Exporting Countries or Opec member recorded the highest non-oil revenue in seven years, up 38.5% to 2.4 billion dinars (Rm35.5bil), according to a Finance Ministry statement.

Oil revenue surged 84.5% to 16.2 billion dinars (Rm239.7bil).

Years of political tensions have thwarted Kuwait’s fiscal reforms and stymied efforts to diversify the oil-reliant economy and promote foreign investment.

Squabbling between previous elected legislatures and cabinets appointed by the ruling Al-sabah family has prevented the government from passing laws to allow it to borrow and withdraw from the Future Generations Fund – a more than Us$700bil (RM3.2 trillion) savings pot designed for life after oil.

The country hasn’t been to the market since a debut eurobond in 2017. Lawmakers have said the government should better manage its finances and fight corruption before resorting to debt.

“Naturally, the rebounding oil price in the second half of the fiscal year helped shore up Kuwait’s revenue,” said Finance Minister Abdulwahab Al-rasheed.

“Kuwait has one of the strongest sovereign balance sheets in the world.”