Kuwait Economic Forecast

Kuwait Economic Outlook

May 8, 2018

Oil production cuts in line with the OPEC deal held back the economy in 2017, and oil production will remain hampered this year. However, the non-oil economy was likely lifted last year by infrastructure spending and growth in private consumption. Signs point towards improving household expenditure this year, as consumer sentiment in the first quarter improved sharply. Credit growth, however, has moderated notably so far in 2018. On 2 May, Fitch Ratings confirmed Kuwait’s AA rating with a stable outlook due to solid fiscal and external metrics.

Kuwait Economic Growth

Higher oil prices and a pick-up in fixed investment should drive economic activity this year, while private consumption will likely be underpinned by a stronger labor market and improving liquidity. Progress in liberalizing reforms and economic diversification should attract stronger FDI inflows in the longer term. However, the large role of the public sector in the economy poses risks to the government’s finances and the economic outlook. Met the why particular panelists expect growth of 2.0% in 2018, down 0.4 percentage points from last month’s forecast, and 2.9% in 2019.

Kuwait Economy Data

20132014201520162017
Population (million)3.94.04.14.24.3
GDP per capita (USD)44,51141,11127,617-  -  
GDP (USD bn)173164114-  -  
Economic Growth (GDP, annual variation in %)1.20.51.9-  -  
Consumption (annual variation in %)5.62.61.3-  -  
Investment (annual variation in %)8.94.513.0-  -  
Unemployment Rate2.12.12.12.1-  
Fiscal Balance (% of GDP)22.219.9-11.0-  -  
Inflation Rate (CPI, annual variation in %)2.72.93.33.2-  
Policy Interest Rate (%)2.002.002.252.50-  
Exchange Rate (vs USD)0.280.290.300.31-  
Exchange Rate (vs USD, aop)0.280.280.300.30-  
Current Account (% of GDP)39.933.45.2-  -  
Current Account Balance (USD bn)69.155.05.91.0-  
Trade Balance (USD billion)89.678.327.820.6-  
Exports (USD billion)11511655.146.7-  
Imports (USD billion)25.427.327.226.1-  
Exports (annual variation in %)-3.8-8.2-47.9-15.2-  
Imports (annual variation in %)4.97.2-0.2-4.0-  
International Reserves (USD)29.532.228.431.1-  
External Debt (% of GDP)20.821.432.0-  -  

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Kuwait Facts

ValueChangeDate
Exchange Rate0.30-0.05 %May 21

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