Kuwait gov't set to issue bonds to cover budget deficit

Finance minister says country will issue both international and domestic bonds in era of low oil prices
Kuwait gov't set to issue bonds to cover budget deficit
Kuwaiti Finance Minister Anas Al-Saleh. (Getty Images)
By Reuters
Tue 08 Mar 2016 01:48 PM

Kuwait's government plans to issue both international and domestic bonds to help cover a budget deficit caused by low oil prices, finance minister Anas Al-Saleh said on Tuesday.

Saleh told Reuters on the sidelines of a financial conference that the issues would be conducted once government committees had agreed on a plan. He did not give further details.

Previously, Saleh had suggested Kuwait might issue bonds in U.S. dollars or in Kuwaiti dinars. It originally aimed to make its first issue by the end of last year, but officials have not yet come up with a final plan.

The ministry projected in January that the government would run a deficit of 12.2 billion dinars ($40.7 billion) in the next fiscal year starting on April 1, nearly 50 percent higher than the deficit estimated for the current year, after contributions by the government to the sovereign wealth fund.

The government has begun drawing down its huge financial reserves to cover part of the deficit, but it wants to issue debt to limit the speed of the drawdown and also develop Kuwait's financial markets.

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