Kuwait-Mubasher: The five-year average capital spending of Kuwait continued to improve while pressures from falling oil last year were eroding revenues, according to a recent report issued by NBK.
Kuwait recorded a preliminary deficit of KWD 1.8 billion during the period before fulfilling transfer payments to the Reserve Fund for Future Generations (RFFG).
However, the interim balance sheet for the first seven months of Kuwait’s financial year 2015/16 indicated increasing government spending as the oil fell below the budgeted price of $45 per barrel,
NBK estimated FY15/16 to close with a deficit of KWD 2.5 billion, accounting for 6.2% of GDP.
Until October, the government spending stood at KWD 5.7 billion, 24% lower when compared to the same period in 2014.
“However, at 30% of the FY15/16 budget, the spending rate is in line with the five-year October average. Actual spending was even higher at KD 10.0 billion according to new data being published by the Ministry of Finance on actual withdrawals made from the government accounts at the Central Bank of Kuwait,” noted the report.
The country’s current spending, which constitutes the bulk of total spending, reached KWD 5.1 billion fiscal-year-to-date (FYTD), down 27% y/y.
NBK added that “capital spending was KWD 0.7 billion FYTD in October, up 11% y/y. It currently stands at 29% of the full-year budget, compared to the five year average of 22%.”
