Non-oil Kuwait deficit amounts to 16bn Kuwaiti dinar

GMT 11:12 2014 Monday ,04 August

Arab Today, arab today Non-oil Kuwait deficit amounts to 16bn Kuwaiti dinar

Kuwait's non-oil GDP
Kuwait - KUNA

Non-oil deficit of Kuwait's 2013-2014 fiscal year amounted to KD 16.4 billion as compared to KD 17.3 billion in the 2012-2013 fiscal year, the Ministry of Finance said in a statement released on Monday.
The ministry statement said the State actual financial status could not be determined by comparing total income with overall expenditure, along with the deficit or surplus, but by making a comparison between the whole non-oil proceeds with the overall spending.
Data of the final accounts of the 2013-2014 revealed that the total revenues reached KD 31.811 billion, compared to the previous fiscal year, where they amounted to KD 32.009 billion -- a fall by 0.6 percent.
Initial signs of decline of the oil revenues, that had been forecast by international agencies namely the International Monetary Fund, started to emerge, with their drop from KD 29.970 billion in the 2012-2013 fiscal year to KD 29.292 billion in the following year, a fall of 2.3 percent, the ministry statement said, warning that in case decrease of the income persisted, the general State financial status would be negatively affected.
Oil revenues constituted 92.1 percent of the overall government returns for the 2013-2014 fiscal year, in contrast to 93.6 percent in the previous fiscal year. This led to improvement of the ratio of non-oil proceeds in contrast to the overall financial returns for the 2013-2014 fiscal year -- 7.9 percent in contrast to 6.4 percent for the 2012-2013 fiscal year.
This year's final account showed continuing hike of the non-oil sector in the State finances (the difference between the non-oil returns and overall expenditure), which is the most accurate index to assess the actual status of the general financial status, where the value of the non-oil income amounted to KD 2.519 billion.
Taxation proceeds for the 2012-2013 fiscal year amounted to KD 350.7 million, some 17.1 percent of the overall returns. In the 2013-2014 fiscal year, they constituted some 15.4 percent of he total income.
Non-taxation proceeds reached KD 2131.1 million, some 84 percent of the non-oil proceeds, as compared to 1688.2 million for the 2012-2013 fiscal year, some 82.8 percent of the total non-oil returns.
The final account explicitly reveals continuing structural flaws in the state finances, along with mounting risks emanating from heavy dependence on the oil proceeds, which constitute up to 90 percent of the overall state income -- thus placing the entire government income structure at mercy of the international oil market development and the crude oil prices trends.
Non-oil returns continue to constitute a small portion of the state financial proceeds, 10 percent, and this underlines the need for modifying the state income structure, particularly in shadow of increasing expenditure, particularly the hefty allocations for civil servants' payments.
Moreover, the final accounts data for the 2013-2014 fiscal year showed the non-oil deficit amounted to KD 16.384 billion, as compared to the previous fiscal year, where it reached KD 17.292 billion.
The statement, anew, underlined the necessity to increase the non-oil proceeds, noting that its call does not imply an urge for enforcing taxes, however, this proposed approach implies stemming expenditure and reviewing subsidies.

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