Kuwait’s cabinet resigned for the fourth time in just over two years which is likely to further weigh on efforts to pass structural reforms, i.e., pave the way for passing the long-awaited debt law.
With oil accounting for around 90% of government receipts and over 50% of its GDP, Kuwait is the most energy-dependent GCC economy. It is also the wealthiest, as measured by assets held in the Kuwait Investment Authority (KIA), estimated at 400% of GDP. Kuwait also enjoys the largest proven oil reserves in the region, estimated at around 90 years at the current rate of production. Similar to all other GCC nations, the exposure to geopolitical uncertainty and possible ramifications could prove to be high.
The country’s credit outlook is stable due to its extremely high fiscal strength, which provides ample capacity to support the economy and absorb oil price shocks. The large current account surplus, ongoing infrastructure projects, and potential for raising oil production are positive credit drivers. Key to watch are energy prices, geopolitics, and reforms, whose prospects are closely related to the next legislative election.
GDP forecast 2024: 3.3 %