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Kuwait 2010/2011 Budget Deficit at KD7.4bn
In a new development on the fiscal front, preliminary figures for 2010/2011 budget were announced with expected KD7.4bn of deficit. The announcement followed lots of major developments on the Kuwaiti economic arena for the last three weeks. It started with the approval of Kuwait Economic Development Plan 2013/14 coupled with the approval of Capital Market Authority Law and finally the latest movement by Central Bank of Kuwait (CBK) to cut its discount rate by 50 basis points.
Such movements are reflecting the quick response by the government to support economic activity and to help it facing recessionary pressures. In addition it reflects a new approach regarding the relation between the Government -as an executive authority- and the National Assembly -as a legislative authority- to put Kuwait economic development and sustainability of growth as a major priority. The latest developments show a clear conversion in the views of both authorities regarding the urgency of supporting the whole economy. Similarly, on the monetary and fiscal policies fronts, we can see a clear interdependence as both policies are currently adopting expansionary loose policies to support quick economic recovery.