Kuwait: 2020 Article IV Consultation-Press Release; Staff Report; and Staff Supplement

March 30, 2020

Preview Citation

Format: Chicago

Kuwait: 2020 Article IV Consultation-Press Release; Staff Report; and Staff Supplement, (USA: International Monetary Fund, 2020) accessed December 23, 2024

Summary

This 2020 Article IV Consultation with Kuwait highlights that non-oil growth strengthened to estimated 3 percent in 2019, propelled by government and consumer spending. The challenge to reduce dependence on oil and boost savings has become more urgent. The subdued forecast for oil revenues is weighing on near-term growth and fiscal and external balances. Embedding fiscal measures in a comprehensive reform package that promotes private sector growth, strengthens governance and accountability, and improves public services would help build broad support for reforms. A rules-based fiscal framework would improve management of oil revenues. A rule-based framework would help anchor fiscal policy on a long-term objective of intergenerational equity. It should include a well-calibrated operational rule that helps reconcile long-term savings and near-term economic stabilization objectives. Financial sector reforms should focus on bolstering resilience and deepening inclusion. Sustaining reforms to foster private sector-led and diversified growth will be critical. With limited scope for public employment going forward, a vibrant private sector must emerge to absorb the large number of Kuwaitis entering the labor market in coming years.

Subject: Banking, Financial institutions, Fiscal policy, Loans, National accounts, Oil prices, Personal income, Prices

Keywords: CR, Excl. investment income, Export price, Global, ISCR, Kuwait, Loans, Market forces, Nonoil balance excl. investment income, Nonoil GDP, Oil prices, Personal income, Spending envelope

Publication Details

Pages:

80
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2020/089
Stock No:

1KWTEA2020001
ISBN:

9781513538563
ISSN:

1934-7685

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