Monday, 6 July 2020

#Kuwait’s Savings for Life After Oil May Be Needed a Lot Sooner - Bloomberg

Kuwait’s Savings for Life After Oil May Be Needed a Lot Sooner - Bloomberg:

Kuwait, one of the world’s wealthiest countries, is in a budget crunch so severe that it may have to soon begin leaning on a fund intended to prepare it for a future without oil.

Running a deficit that could reach 40% of its economy this year, and unable to borrow due to a showdown between the government and parliament, Kuwait is running out of options. The General Reserve Fund, essentially its Treasury, has been tapped so aggressively that its liquid assets could come close to being depleted within the current fiscal year, or by April 2021.

That has attention turning to its Future Generations Fund, the world’s oldest sovereign wealth fund and estimated to be the fourth-largest globally. As its name implies, the savings vehicle is meant to secure the wellbeing of future generations of Kuwaitis, who probably won’t be able to rely on oil to sustain one of the world’s most prosperous populations.




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