Kuwait on Monday (January 29th) approved its budget for the 2018-2019 fiscal year, projecting a huge deficit for the fourth year in a row because of low oil prices, AFP reported.
Next year's deficit is estimated at $16.7 billion, or 13.5% of its gross domestic product (GDP).
Finance Minister Nayef al-Hajraf said the government will withdraw from the state reserve fund and borrow on the domestic and international debt markets to finance the shortfall.
After posting healthy surpluses for 16 successive years, Kuwait has posted a budget deficit in each of the past three years after oil prices began to slide in mid-2014.
The budget projects revenues at $50 billion, and spending at $66.7 billion, the minister said.
Government wages and subsidies account for 73% of the budget, which takes effect on April 1st, and has yet to be passed by parliament.
Kuwait will not impose value-added tax or other taxation without parliamentary approval, al-Hajraf said, but said the government may raise charges on public services.
