Kuwait's Current Account Surplus Expected to Decline in 2024

Kuwait, 05 March, 2024 : Kuwait's current account surplus is projected to shrink in 2024 due to increased government spending on public sector salaries and subsidies, supported by rising global oil prices. The surplus is expected to decline from 26.4% of GDP in 2023 to 24.9% in 2024, down from the previous estimate of 28.8%.

The reduction is driven by higher imports of goods fueled by boosted local demand for consumer goods, alongside a widening trade deficit in services, particularly in the travel sector. Despite this, there's a slight improvement expected in services exports, primarily in communications.

There's also an anticipation of a moderate expansion in the primary income surplus, driven by positive performance in global stocks and bonds. However, a slight increase in the deficit in financial transfers abroad is foreseen.

Potential risks to Kuwait's external balance include regional conflicts affecting global oil prices and economic growth slowdowns impacting current account surpluses. Nonetheless, Kuwait's substantial financial reserves, currency peg, and significant assets are expected to provide stability amid global economic uncertainties.

Source : www.zawya.com