RIYADH: Kuwait brought its budget deficit down to 2.99 billion Kuwaiti dinars ($9.7 billion) in 2021/22, a 72.2 percent fall from the previous year as oil revenue boosted its exchequer, the finance ministry has announced.
Kuwait, whose financial year ends on March 31, saw its deficit shrink for the first time since the fiscal year 2018/19, even though a budget deficit of 12.1 billion Kuwaiti dinars was originally forecast.
Kuwait beat the ministry’s actual budget deficit as it recorded higher than the forecasted oil revenue. It expected oil revenues to reach 9.1 billion Kuwaiti dinars this fiscal year, but recorded almost double that figure.
The ministry noted that the country’s oil revenues recorded around 16.22 billion Kuwaiti dinars in the fiscal year 2021/22, up 84.5 percent from the previous year.
Since a surplus of 5 billion Kuwaiti dinars was recorded in the fiscal year 2013/14, Kuwait has been witnessing yearly deficits, with its narrowest coming in 2018/19 at 1.3 billion Kuwaiti dinars.
The succeeding deficits continued to expand, reaching 3.9 billion Kuwaiti dinars the following year, and 10.8 billion Kuwaiti dinars the year after that, according to the ministry data.
The report estimated that Kuwait will record a deficit of 0.1 billion Kuwaiti dinars in the coming financial year, with oil accounting for 91 percent of the revenue.
Its expenditure will hit 23.5 billion Kuwaiti dinars in the fiscal year of 2022/23, and its revenue coming in at 23.4 billion Kuwaiti dinars, thus yielding 0.1 billion Kuwaiti dinars deficit projected by the ministry.
Kuwait is to spend 75 percent of its total expenditure on salaries and subsidies, 12 percent on capital expenditure, and 13 percent on the rest of its expenditures.
Kuwait’s oil revenue projection is based on oil production which is expected to increase to 2.73 million barrels per day in the coming fiscal year from 2.43 million bpd. The report projects the average price of oil will increase to $80 from $45, while Kuwait’s natural gas revenue will grow to 326.9 million Kuwaiti dinars from185.4 million Kuwaiti dinars.
Non-oil revenues are expected to increase by 15 percent year-on-year in 2022/23, reaching 2.1 billion Kuwaiti dinars.