Kuwait's finance minister warned in remarks published on Saturday that a recent decline in oil prices might force the Gulf Arab state to cut spending and revise downward its 2009-2014 five-year plan.Kuwait would have to cut spending in its next budget if the price of its crude fell below $60 per barrel, Mustapha Al-Shamali told Al-Rai newspaper.
Asked if the current budget with expenditures of almost 19 billion dinars ($70.71 billion) would be affected by a slide in oil prices, Al-Shamali said: "The estimated budget of 19 billion dinar will not be affected but the new budget could be affected depending on an increase or decrease of oil prices."
Al-Shamali added that a fall in revenue, almost entirely made up of oil exports, would also mean Kuwait could spend less on its five-year development plan initially estimated at 35 billion dinars, part of efforts to become a regional financial centre.
Kuwait had based the current budget on a conservative oil price forecast of $50 a barrel. State news agency KUNA said Kuwait's crude oil fell to $59.15 on Thursday, as US oil prices touched a 15-month low before rebounding partly on Friday.
OPEC-member Kuwait, which sits on 10 percent of global oil reserves, posted a 7.55 billion dinars preliminary surplus in the first half of its 2008/09 fiscal year on higher than expected oil revenues. (Reuters)For all the latest business 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.
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