Kuwait needs to rationalize expenditure

With the growing state expenditures and falling oil prices, Kuwaiti economists highlighted the requirement to rationalize the country's spending.

Talal Al-Seef, a professor at the College of Engineering and Petroleum at Kuwait University said,” Cancelling unneeded huge capital projects would reduce Kuwait's budget from 22.5 billion U.S. dollars to 15 billion dollars.”

Expecting the recovery of Kuwait's economy to start after the first quarter of 2021, Al-Seef said the quick solution to the current budget deficit is "to approve the public debt law and take advantage of low-interest rates in the global market."

"The year 2021 will be a disaster if the world economy did not recover. We will have to borrow twice, not only to cover the budget deficit but also the interests of the previous borrowing," he explained.

Kuwait and other Gulf Cooperation Council (GCC) countries are suffering from their overstretched budget with a drastic fall in oil demand and the stoppage of factories in Asia- the main market for Gulf oil companies,

Maitham Al-Shas, an economic analyst and general manager of a real estate company stated the coronavirus has prompted the Kuwaiti government to spend additional money on the needed expenses.

"But because of its small population, these pressures would be alleviated if the health ministry controlled the coronavirus spread," Al-Shas noted.