KUWAIT: Finance Minister Anas Al-Saleh will brief the National Assembly Financial and Economic Affairs Committee today with the government program for financing the expected budget deficit due to the drop in oil prices. The minister is expected to explain to the committee members government plans to meet the budget deficit and its plans to issue conventional bonds and Islamic sukuk as a way of tapping into the debt market to finance the deficit.
The government is projecting a deficit of KD 7 billion before deducting 10 percent of revenues in favor of the future generations fund which the government normally adds to expenditures. But actual finances, particularly revenues have so far been higher than projections. The government has projected revenues to be at KD 12.2 billion for the whole fiscal year 2015/2016 which ends on March 31 next year.
But after six months, revenues reached KD 7.8 billion due to high oil prices in the first quarter of the fiscal year -April to June-. If income continues at the same level, total revenues will be higher than projected and this means that the budget will be lower. National Bank of Kuwait said in report last week that Kuwait will post its first budget deficit this year after 16 consecutive years of surplus. But it estimated the deficit to be much lower than projected. Saleh told reporters yesterday the government will not cancel any mega development project because of the drop in revenues. He also said that the government will issue bonds and sukuk to borrow funds to finance the deficit. But he gave no time frame for the process.
Head of the Interior and Defense Committee M Sultan Al-Shemmari said the committee will discuss during this term the issue of stateless people, locally known as Bedoons, in addition to draft laws on election and prisons. The lawmaker said the committee will discuss a mechanism for naturalization and will invite Interior Minister Sheikh Mohammad Al-Khaled Al-Sabah to discuss the issue of Bedoons.
The committee will also discuss with the head of the Bedoons department Saleh Al-Fadhalah a proposal to solve the Bedoons issue he calls the roadmap to solving Bedoons problem. The committee will also discuss issues related to the election law besides several other issues. In a related development, the National Assembly human rights committee will study today a draft law proposing a set of social and civil rights for bedoons.
Meanwhile, the liberal Kuwait Democratic Forum (KDF) said yesterday that the solution to the country’s domestic problems is by activating and respecting the constitution and the activation of the role of institutions. In a statement on the anniversary of issuing the constitution in 1962, KDF said that those who wrote the constitution had the objective of seeing Kuwait become a modern civil state governed by the constitution and law but the result has been the opposite as the country has slipped into disputes and problems.
By B Izzak