Kuwait Economic Forecast

Kuwait Economic Outlook

November 28, 2017

Kuwait’s economy, which has suffered from weaker oil production this year, faces political instability as the year draws to a close. On 30 October, the prime minister and his entire cabinet resigned. Re-appointed by the emir, the prime minister is now in the process of forming a new cabinet. On 15 November, following a staff visit, the IMF highlighted that the country’s fiscal position remains vulnerable and dependent on transfers from its financial reserves. However, it also noted the non-oil sector stands to improve this year, moderating the expected economic contraction due to a weaker oil sector. On 21 November, Iraq agreed to resume compensating Kuwait for costs related to the 1990–1991 Gulf War, which should provide a slight fiscal dividend over the coming years.

Kuwait Economic Growth

A pick-up in the oil sector on higher oil prices should benefit the economy next year, which will also be boosted by resilient private consumption. Our panel expects GDP to increase 2.5% in 2018, which is unchanged from last month’s estimate. For 2019, panelists see GDP growth of 3.2%.

Kuwait Economy Data

20122013201420152016
Population (million)3.83.94.04.14.2
GDP per capita (USD)45,98544,51141,10127,617-  
GDP (USD bn)174173164114-  
Economic Growth (GDP, annual variation in %)6.61.20.51.9-  
Consumption (annual variation in %)10.45.62.61.3-  
Investment (annual variation in %)5.18.94.513.0-  
Unemployment Rate2.12.12.12.12.1
Fiscal Balance (% of GDP)33.222.219.9-11.0-  
Inflation Rate (CPI, annual variation in %)2.92.72.93.33.2
Policy Interest Rate (%)2.002.002.002.252.50
Exchange Rate (vs USD)0.280.280.290.300.31
Exchange Rate (vs USD, aop)0.280.280.280.300.30
Current Account (% of GDP)45.539.933.45.2-  
Current Account Balance (USD bn)79.169.155.05.91.0
Trade Balance (USD billion)95.489.678.327.820.6
Exports (USD billion)12011510655.146.7
Imports (USD billion)24.225.427.327.226.1
Exports (annual variation in %)15.6-3.8-8.2-47.9-15.2
Imports (annual variation in %)6.64.97.2-0.2-4.0
International Reserves (USD)29.029.532.228.431.1
External Debt (% of GDP)17.220.821.432.0-  

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Kuwait Facts

ValueChangeDate
Exchange Rate0.30-0.05 %Dec 06
Stock Market6,1970.22 %Dec 06

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