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Kuwait Finance Minister sees a boost in projects and diversification due to suspension of parliament

Kuwait's acting Finance Minister said that the temporary suspension will allow the government to be more flexible in its decision-making, and also carry out infrastructure projects. This is part of the efforts being made by the government to diversify their economy and implement structural changes.

Kuwait's non-oil industry is expected to grow "slightly" by 3.6% in 2024. However, the Acting Minister for Finance Subaih Al-Mukhaizeem stated in his most recent economic report that it will see a stronger growth due to what he called "fiscal consolidate."

Kuwait has experienced two decades of political crisis marked by clashes between appointed government and directly elected Parliaments. This resulted in a stalling of economic reforms and a delay to much needed development projects.

The Emir, Sheikh Meshal al-Ahmad al-Sabah, dissolved the parliament in May to "review the democratic experience" and assumed its powers.

The Kuwaiti government expects the Global Minimum Corporate Tax that came into effect on January 1 to boost growth in non-oil sectors. It also plans a new policy for repricing public services. Al-Mukhaizeem called this tax a "strategic move".

The oil revenues were 19.36 billion dinars (about $63.4 billion), which is 87.8% the actual revenues for the fiscal year 2024/2025 ending March 31. However, the budget had a deficit of 1,06 billion dinars.

Al-Mukhaizeem stated that "the Kuwaiti economy is still largely dependent on the oil industry", which will account for 43.4% GDP in 2024. The non-oil sectors would make up 56.6% of the GDP.

(source: Reuters)