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Kuwait 2015 oil-hit budget deficit could be $27bn

Kuwait's budget deficit in the first five months of its fiscal year stood at $3.6bn after a deduction for the Future Generations Fund

Kuwait's fiscal budget for 2015-2016 is feeling the heat of oil price fluctuations.
Kuwait's fiscal budget for 2015-2016 is feeling the heat of oil price fluctuations.

Kuwait’s budget deficit in the first five months of its fiscal year stood at $3.62bn (KWD1.1bn) after a deduction for the Future Generations Fund, the finance ministry said last week.

The deficit from 1 April to 31 August, 2015, stood at $1.2bn (KWD361.38m), before the 10% contribution of $2.4bn (KWD733.50m) to the Future Generations Fund, part of Kuwait’s sovereign wealth fund, the statement said.

According to Gulf News, Kuwait's finance minister Anas Al Saleh had said on Tuesday, 15 September, 2015, that Kuwait plans to issue bonds in local currency by the end of the year to help bridge its budget deficit.

Kuwait’s parliament in July 2015 approved a state budget for the current 2015-16 fiscal year, which begins on 1 April, 2015, that envisages a budget deficit of $27bn (KWD8.18bn) because of low oil prices.

However, the actual deficit may not turn out to be nearly as large.

The size will depend on oil prices, while Kuwait has in the past often underspent its budget because of bureaucratic red tape and tensions between the cabinet and parliament that have slowed economic projects, the report continued. 

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