Kuwait Surplus Soars on High Oil Price – Ministry

KUWAIT CITY, Kuwait (AFP)–Kuwait posted a record provisional budget surplus of 17.2 billion dinars ($60.2 billion) in the first 10 months of the fiscal year on high oil price, government data showed Wednesday.

The surplus up to the end of January was achieved on the back of a huge income of KWD27 billion and a low spending of KWD9.8 billion, according to data on the ministry of finance website.

The 10-month revenue was up 11.6% on the same period of the last fiscal year and almost twice the budget projections for the whole year of KWD13.9 billion, according to the figures.

Spending during the same period was just 46.2% of budget projections of KWD21.2 billion and was almost unchanged from last fiscal year.
Local economic reports have expected the budget surplus to be lower at around KWD14 billion at the end of the fiscal year following accounting adjustments.

Oil revenue rose 11.6% from last year to hit KWD25.5 billion, twice the budget estimates of KWD12.8 billion, according to ministry figures.
Earnings from oil made up over 94% of total revenue. Kuwait produces around 3.0 million barrels per day and has estimated oil income at a conservative price of $65 a barrel while actual price has topped $100 a barrel.

Kuwait’s fiscal starts April 1 and ends March 31.

The previous highest budget surplus of $47 billion was achieved in the 2011-2012 fiscal year during which Kuwait also posted an all-time high income of $107.5 billion.

Kuwait has projected a deficit in each of the past 13 fiscal years, but ended in surplus mainly by calculating oil income at a very low price.

During that period, the emirate has accumulated about $250 billion in budget surpluses.

Under Kuwaiti law, 10% of revenue is deducted every year in favor of the emirate’s sovereign wealth fund, the assets of which are estimated at about $400 billion.

This fiscal year, Kuwait decided to transfer 25% of revenue into the fund, the returns on which are not included in the budget.

The Gulf state has a native population of 1.2 million, in addition to 2.6 million foreigners.

(END) Dow Jones Newswires

Zawya, Mar 27, 2013