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KUWAIT: Cabinet ministers attend the extraordinary meeting.
KUWAIT: Cabinet ministers attend the extraordinary meeting.

Kuwait’s Cabinet passes 2025-2026 budget with KD 6.3 deficit

Both income, spending slightly lower than current year

KUWAIT: Kuwait’s Cabinet on Sunday passed the state budget for the 2025-2026 fiscal year projecting a deficit of KD 6.3 billion, slightly higher than the estimated shortfall of KD 6.5 billion for the current fiscal year which ends March 31. The cabinet said in a brief statement following an extraordinary meeting that revenues were projected at KD 18.2 billion compared to KD 18.9 billion estimated for the current 2024-2025 fiscal year.

on Sunday passed the state budget for 2025-2026 fiscal year projecting a deficit of KD 6.3 billion, higher than estimated shortfall of KD 5.6 billion for the current fiscal year which ends March 31. The cabinet said in a statement following an extraordinary meeting that revenues were projected at KD 18.2 billion compared to KD 18.9 billion estimated for the current 2024-2025 fiscal year.

Spending is projected at KD 24.5 billion, just slightly lower than estimated spending for the current fiscal year at KD 24.6 billion. The new budget will be issued in an Amiri decree shortly and is expected to become effective before the April 1 constitutional date to enact the new budget.

Later, Finance Minister Noura Al-Fassam said in a statement that oil income in the budget is projected at KD 15.3 billion, a drop of 5.7 percent on the current year’s estimates. Non-oil revenues are projected at KD 2.9 billion, up 9 percent on this year’s estimates. Oil income was calculated at an average oil price of $68 a barrel for the whole year 2025-2026 fiscal year.

The minister said that wages and subsidies are estimated to constitute 79.5 percent of total spending, while capital spending is estimated at just 9.1 percent of spending. The minister said that the price of oil needed to balance the budget is $90.5 a barrel.

Although the budget projected a huge deficit for the whole fiscal year in the current year, Kuwait posted a budget surplus of KD 150.4 million in the first half of the 2024-2025 fiscal, according to figures released by the ministry of finance in November.

The surplus resulted from an increase in revenues and a drop in spending. Kuwait has been posting budget deficits for most of the past decade, with the exception of 2022-2023 fiscal year when it posted a surplus of KD 6.5 billion. Kuwait depends for over 90 percent of its revenues on oil income and its revenues fluctuate with the spikes in crude income.

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