Oil Revenue Puts Kuwait’s Budget Surplus At $52bn

Kuwait’s government budget surplus stood at 14.7 billion dinars ($52 billion) in the first eight months of its fiscal year thanks to strong oil revenues, data from the Gulf country’s finance ministry showed.

The April-November surplus accounts for around 33.1 per cent of the OPEC member’s 2011 gross domestic product, according to a Reuters calculation based on the latest official data.

A Reuters poll in September forecast Kuwait would record a budget surplus of 23.8 per cent of GDP in fiscal year 2012/13, which began in April.

Total revenue was 21.6 billion dinars while spending reached a mere 6.9 billion dinars, around a third of the 21.2 billion dinar total projected for the year. Kuwait had originally wanted to spend 14.2 billion dinars by November, the data showed.

The surplus is already larger than the figure for full year 2011/2012, when Kuwait booked a record 13.2 billion dinar surplus thanks to robust oil income and lower spending.

Receipts from crude exports account for around 95 per cent of the government’s income. Kuwait’s cabinet approved a revised budget for the current fiscal year in October.

While its fiscal position is strong, political upheaval in the Gulf Arab state has stalled implementation of major parts of a 30 billion dinar ($107 billion) economic development plan announced in late 2010.

Analysts say Kuwait needs to diversify its oil-reliant economy and control wage growth.

As part of plans to invest revenues more efficiently, authorities decided to increase the amount channelled into Kuwait’s Future Generations Fund, a nest egg for when oil supplies diminish or for when the economy suffers other shocks.