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20-07-13

Kuwait plans to spend USD3.5b less in 2013/14 budget

(MENAFN) Kuwait Ministry of Finance said the Gulf state is looking to spend around USD3.5 billion less in the 2013/14 fiscal year, despite forecasting higher revenue from crude oil sales, Reuters reported. . Kuwait, one of the world's richest countries per capita, boosted spending by 13 percent in the last fiscal year to cool down a wave of industrial unrest. However, since then, the International Monetary Fund (IMF) warned Kuwait risks exhausting its entire oil savings by 2017 if it keeps spending money at the current rate. A recently approved budget bill estimated overall revenues, after deducting 25 percent for the Future Generations Fund (FGF), at USD47.5 billion compared with an expected total expenditure estimated at about USD73.5 billion, Kuwait's state news agency (KUNA) reported citing Khalifa Hamada, undersecretary at the ministry of finance. Kuwait plans to more than double the portion of revenues it puts into the FGF fund for when oil runs out or the economy faces severe shocks. The Opec member's state budget for the 2013/2014 fiscal year is projected to face a deficit of around USD26 billion, according to Hamada. KUNA said that Kuwait had projected a budget deficit for the last 14 fiscal years but the country had ended up with a healthy surplus on each occasion. Kuwait booked a record budget surplus of 13.2 billion dinars in 2011/2012 thanks to strong oil income and lower spending. Hamada added that the approved budget for the fiscal year ending in March 2014 estimated oil revenues at USD59 billion, and non-oil revenues at USD4.23 billion. He also noted that the state would allocate up to USD15.82 billion for the FGF, managed by Kuwait Investment Authority.

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