#Kuwait's debt law gridlock poses first economic test for new emir | Reuters

Kuwait's debt law gridlock poses first economic test for new emir | Reuters:

Kuwait’s new Emir Sheikh Nawaf al-Ahmad al-Sabah faces the urgent task of overcoming legislative gridlock on debt legislation needed to tackle a liquidity crisis in the wealthy oil producing country.

Parliament has repeatedly blocked the bill, which would allow Kuwait to tap international debt markets, but the issue has gained urgency as low oil prices and COVID-19 strained state finances and led to the rapid depletion of available cash reserves.

“The country needs to quickly pass a new public debt law to ease liquidity shortages,” said Mohamed Abu Basha, head of macroeconomic analysis at EFG Hermes.

The new ruler, sworn in on Wednesday after the death of his brother Emir Sheikh Sabah al-Ahmad al-Sabah, takes the helm with the nearly $140 billion economy facing a yawning deficit of $46 billion this year.