Font Size

- Aa +

Fri 12 Aug 2011 10:41 AM

Font Size

- Aa +

Kuwait posts budget surplus of more than $19bn

Oil revenues make up large percentage of total income but surplus down 38% from preliminary figure

Kuwait posts budget surplus of more than $19bn

OPEC-member Kuwait posted a budget surplus of KD5.28 billion ($19.4 billion) in the 2010/11 fiscal year, down 38 percent from the preliminary figure, finance ministry data showed.

Revenues reached KD21.5 billion, with oil revenues contributing KD19.9 billion, while spending amounted to KD16.2 billion in the fiscal year which ended in March, the data showed.

In May, the country posted a preliminary budget surplus of KD8.5 billion, or 23.1 percent of Kuwait's gross domestic product, above market expectations and the 6.4 billion seen in the previous fiscal year.

Kuwait transfers ten percent of its revenues to a future generations fund, managed by the country's sovereign wealth fund. The net surplus for 2010/11 after the transfer is KD3.13 billion, the final data showed.

Kuwait had set its 2010/11 budget with a deficit of KD6.6 billion, assuming that crude, its main revenue earner, would fetch $43 per barrel.

US benchmark crude prices floated between $65 and $115 per barrel last year.

Kuwait, the world's fourth-largest oil exporter, posted an KD8.18 billion surplus in its 2009/10 budget.

In June, Kuwait's parliament approved a budget of KD19.4 billion for the 2011/12 fiscal year, the biggest since at least 2003 and a 19 percent jump from the previous year, basing it on an oil price of $60 per barrel.

Analysts polled by Reuters in June forecast that given the higher oil prices, Kuwait will post a fiscal surplus of 20.2 percent of GDP in 2011/12, the highest in the Gulf.

Concerned about regional unrest, Gulf oil exporters have boosted government spending to ease social tensions.

Kuwait has seen limited protests and frequent challenges to the government by its parliament, the most outspoken in the Gulf Arab region. In January, the government announced plans to spend nearly $5 billion, or around 4 percent of its GDP, on cash grants and free food rations.