Kuwait Economic Forecast

Kuwait Economic Outlook

February 5, 2019

On 18 January, S&P confirmed the country’s AA rating with a stable outlook on the back of solid government finances. Particularly, the country’s large foreign exchange reverses should somewhat shield Kuwait from external shocks. However, its over-reliance on oil makes the country susceptible to external shocks. On 28 January, the IMF also underscored improved fiscal and external metrics and the need to diversify the economy in its annual Article VI statement. Meanwhile, the economy likely experienced some pain closing out 2018 due to a significant drop in oil prices and output, capping off a year of underwhelming growth. Still relatively low oil prices should leave a mark opening the new year.

Kuwait Economic Growth

Economic reforms to attract more FDI and a large infrastructure investment push are expected to support the economy this year. Low oil prices and production cuts, and regional and domestic tensions hampering diversification efforts, remain the key risks to the outlook. Met the why particular panelists expect growth of 2.7% in 2019, which is down 0.7 percentage points from last month’s forecast, and 3.0% in 2020.

Kuwait Economy Data

20132014201520162017
Population (million)3.94.04.24.34.4
GDP per capita (USD)44,48811,24827,01425,85927,260
GDP (USD bn)173163115111120
Economic Growth (GDP, annual variation in %)1.20.50.63.5-2.9
Consumption (annual variation in %)5.62.61.54.8-  
Investment (annual variation in %)8.94.515.52.0-  
Unemployment Rate2.62.92.22.12.1
Fiscal Balance (% of GDP)22.219.9-11.9-  -  
Inflation Rate (CPI, annual variation in %)2.72.93.33.21.5
Policy Interest Rate (%)2.002.002.252.502.75
Exchange Rate (vs USD)0.280.290.300.310.30
Exchange Rate (vs USD, aop)0.280.280.300.300.30
Current Account (% of GDP)11.333.83.5-4.56.3
Current Account Balance (USD bn)69.855.04.0-5.07.6
Trade Balance (USD billion)89.678.327.820.123.5
Exports (USD billion)11511654.246.655.0
Imports (USD billion)25.427.326.426.431.5
Exports (annual variation in %)-3.8-8.2-48.7-14.118.2
Imports (annual variation in %)4.97.2-3.10.119.2
International Reserves (USD)29.532.228.431.133.7
External Debt (% of GDP)11.414.732.637.2-  

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Kuwait Facts

ValueChangeDate
Exchange Rate0.30-0.05 %Feb 19

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