We noticed you're blocking ads.

Keep supporting great journalism by turning off your ad blocker.

Questions about why you are seeing this? Contact us

Font Size

- Aa +

Tue 2 Apr 2013 02:46 PM

Font Size

- Aa +

Kuwait debtors' bailout may cost $2.61bn

Gov't discussing with lawmakers plan to write off interest on Kuwaiti citizens' personal bank loans

Kuwait debtors' bailout may cost $2.61bn
Kuwaiti Finance Minister Mustapha Al-Shamali (R) (AFP/Getty Images)

A government bailout of Kuwaiti debtors is expected to cost KWD744m (US$2.61bn), finance minister Mustapha al-Shamali said on Tuesday.

The government, under pressure from members of parliament, is discussing with lawmakers a plan to write off the interest on Kuwaiti citizens' personal bank loans taken out before the end of March 2008.

"This is an issue that will be raised tomorrow in parliament," Shamali told reporters on the sidelines of a meeting of Arab finance ministers and central bankers in Dubai.

Asked what the total size of the bailout would be, he replied: "KWD744m. The payment mechanism is that they will pay their debts all the way directly to the government."

The parliament gave initial approval to a bill last month, under which the government would buy the loans from banks, pay off the interest and reschedule the loans.

The bill still needs a second approval and the cabinet has said changes were needed to the initial plan.

Many lawmakers elected in December made debt relief in the oil-rich state a priority of their campaigns. Economists have voiced concerns about the long-term sustainability of such measures.

Arabian Business: why we're going behind a paywall

For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Real news, real analysis and real insight have real value – especially at a time like this. Unlimited access ArabianBusiness.com can be unlocked for as little as $4.75 per month. Click here for more details.
Nader 7 years ago

This news is about Kuwait. Why there is a picture of Libya and its flag associated with this news?