August 3, 2010
Kuwait outlook broadly positive, says IMF
Kuwait’s economic outlook for 2010 is “broadly positive” but beyond that will depend on the pace of global recovery and domestic issues, the International Monetary Fund said.
Oil-rich Kuwait is expected to see real gross domestic product growth of 2% this year, with the non-oil sector to grow at about 2.5%, on the back of government spending under its recently approved development plan, the IMF said in a report.
Oil GDP will increase by about 1% this year, the IMF added.
Kuwait’s real GDP is estimated to have shrunk by about 4.5% last year, the weakest performance among Gulf Co-operation Council states, according to the report.
“Although Kuwait has the financial strength to smooth out the impact of short-term oil price fluctuations on its fiscal position, a weaker than expected global recovery and a decline in oil prices could impact regional and domestic asset markets, investor confidence, and government spending, leading to a worsening of the balance sheet of financial institutions,” the IMF said.
In addition, deterioration in the regional economic or political environment “might have an impact on investor confidence and Kuwaiti entities’ access to and pricing of international funding,” the IMF added.
Kuwait’s economic outlook will also depend on domestic downside risks, notably whether the government can meet its development plan spending targets , according to the report.
Zawya Dow Jones/Dubai
Kuwait outlook broadly positive, says IMF
Kuwait’s economic outlook for 2010 is “broadly positive” but beyond that will depend on the pace of global recovery and domestic issues, the International Monetary Fund said.
Oil-rich Kuwait is expected to see real gross domestic product growth of 2% this year, with the non-oil sector to grow at about 2.5%, on the back of government spending under its recently approved development plan, the IMF said in a report.
Oil GDP will increase by about 1% this year, the IMF added.
Kuwait’s real GDP is estimated to have shrunk by about 4.5% last year, the weakest performance among Gulf Co-operation Council states, according to the report.
“Although Kuwait has the financial strength to smooth out the impact of short-term oil price fluctuations on its fiscal position, a weaker than expected global recovery and a decline in oil prices could impact regional and domestic asset markets, investor confidence, and government spending, leading to a worsening of the balance sheet of financial institutions,” the IMF said.
In addition, deterioration in the regional economic or political environment “might have an impact on investor confidence and Kuwaiti entities’ access to and pricing of international funding,” the IMF added.
Kuwait’s economic outlook will also depend on domestic downside risks, notably whether the government can meet its development plan spending targets , according to the report.
Zawya Dow Jones/Dubai
