Kuwait plans to increase spending by 9.3 percent in the current fiscal year, as the International Monetary Fund forecasts a slowdown in the economy of OPEC’s third-biggest producer.
The 2012-2013 budget, approved late yesterday by the Cabinet, has projected spending of 21.2 billion dinars ($75.5 billion), above expenditures of 19.4 billion dinars forecast in the last fiscal year that ended on March 31, state-run KUNA news agency reported, citing Finance Minister Nayef Al-Hajraf. Revenue is forecast at 13.9 billion dinars. KUNA didn’t say what oil price the budget is based on.
“It’s good news, because the initial spending forecast was 22.7 billion dinars,” Jassim Al-Saadoun, head of Kuwait-based Al-Shall Economic Consultants, said by phone today. “Spending is still too high and unsustainable, and in the medium to long term it will be disastrous.” Spending projections include about 9 billion dinars for salaries and wages, he said.
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