Kuwait may face budget deficit, warns minister
Kuwait, May 21, 2014
Kuwait's finance minister has warned that the country will face a certain budget deficit because growth in spending has outpaced a rise in public revenues.
"A budget deficit is inevitable... as the average annual growth in public spending was 20.4 per cent during the past decade against a 16.2 per cent average rise in revenues," mostly from oil, Anas Al Saleh told a special debate in parliament on government policy to diversify income sources.
"This is not only the view of the government but also that of the International Monetary Fund, the World Bank and other institutions," the minister said.
Finance ministry under-secretary Khalifa Hamada explained spending had soared mainly because of a sharp rise in public wages and subsidies on services and commodities. Dependence on oil income also increased.
Between 2005 and 2013, government wages increased from $11.4 billion to $33.8 billion, a massive 25 per cent annually on average.-Reuters