Kuwait Planning to Finance Budget Deficit by Issuing Bonds

Kuwait is considering issuing bonds among various options to finance a budget deficit created by low oil prices, Finance Minister Anas al-Saleh said on Thursday.

The Finance Minister Anas al-Saleh said on Thursday that Kuwait is considering issuing bonds among various options to finance a budget deficit created by low oil prices. In an interview with Al Arabiya television he said that there was a possibility of going to the market and issuing bonds and so on this year. A specialized team at the central bank is currently studying this issue and the most important factor will be what's best for the country and economically beneficial to the markets.

He however did not specify whether Kuwait was considering issuing international or domestic bonds. The government currently does not have outstanding dollar bonds and only a modest domestic debt.

Saleh said the figures which came as a surprise, showed a budget deficit of 2.31 billion dinars ($7.6 billion) in the last fiscal year to March 31, and it was the first since 1999/2000.

The parliament approved a budget for the current year which forecasts a deficit of 8.18 billion dinars.

Like Saudi Arabia, Kuwait may run down assets in its sovereign wealth fund in addition to issuing bonds.

The Sovereign Wealth Fund Institute, which tracks the industry estimates that the Kuwaiti fund holds $548 billion of assets.