High Oil Prices Save Kuwait from Financial Crises

  • Kuwait, State of Kuwait
  • 29 June 2020

The Kuwaiti government expressed its satisfaction with the start of the second phase of the gradual return to normalcy and the resumption of economic activities within the second stage in Kuwait, indicating that in conjunction with the rise in prices of a barrel of oil that revolves around $40, revenues increased, which will save Kuwait from multiple financial crises, the most important of which is depletion of liquidity of the general reserve and the problem of paying salaries.

According to the Kuwaiti government, the improved revenues will enable the government to provide the difference in the budget deficit that was expected to reach 55 billion dollars with the collapse of oil prices in previous periods, as after the rise in prices, the deficit will decrease by about 20 billion dollars, to reach 35 billion only.

The Kuwaiti Cabinet announced that it would review the budget deficit financing plans after increasing oil revenues with the rise in crude prices and the resumption of economic activities, within the second stage of the return to normal life, as well as mandating ministries and government agencies to reduce their budget for the current fiscal year.

The government announced that it will proceed with plans to reform the economy during the coming period through a series of measures being studied, such as imposing value-added tax, reviewing subsidies, reducing concessions, increasing fees for expatriates and transfers abroad.

Source (The New Arab Newspaper, Edited)