Kuwait's government projected its budget deficit to rise by 11.9 per cent to 6.31 billion Kuwaiti dinars ($20.4bn) for the fiscal year 2025-26, up from the 5.6bn dinars shortfall estimated for the current fiscal period, reports Arab News.
The Cabinet approved the draft budget on Sunday for the upcoming fiscal year, which will be submitted for final approval by the Amir, Shaikh Meshal Al Ahmed Al Sabah.
In a brief statement following an extraordinary meeting, the Cabinet said the government expects revenues to total 18.2bn dinars, a decrease from the 18.9bn dinars forecast for 2024-2025. Expenditures are projected at 24.5bn dinars, slightly lower than the 24.6bn dinars allocated for the current year.
Despite the projected deficit for the full fiscal year, Kuwait posted a budget surplus of 150.4 million dinars in the first half of 2024-25, according to Finance Ministry figures released in November. The surplus was attributed to higher revenues and reduced spending.
The draft budget for the period from April 1, 2025, to March 31, 2026, includes projected oil revenues of 15.3bn dinars, reflecting a 5.7pc decline from the current budget. Non-oil revenues are expected to rise by 9pc, reaching 2.92bn dinars, as stated by Minister of Finance and Minister of State for Economic and Investment Affairs Noura Al Fassam.
The finance minister stated that total estimated revenues decreased by 3.6pc, with oil revenues, estimated at 15.3bn dinars, falling by 5.7pc for the current budget ending on March 31, 2025.
She added that wages and subsidies are expected to account for 79.5pc of total spending, with capital expenditures estimated at just 9.1pc. Additionally, non-oil revenues are projected at 2.92bn dinars, reflecting a 9pc increase from the current budget.
The finance minister noted that the government is budgeting for an oil price of $68 per barrel for the upcoming fiscal year, although the breakeven price needed to cover the fiscal deficit is pegged at $90.5 per barrel.
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