Kuwait’s Budget Deficit Drops to $3.46B Despite High Spending
Kuwait ended the 2024-2025 fiscal year with a budget deficit of $3.46 billion (KD1.056 billion), much lower than the $18.4 billion (KD5.6 billion) that was expected, Reuters reported.
This is also a big improvement compared to the $21 billion (KD6.4 billion) deficit in the previous year. The smaller gap is mainly due to higher oil revenues and better control over spending.
For the year ending March 31, Kuwait’s revenues reached $72.2 billion (KD22.06 billion). Oil made up most of this, bringing in $63.4 billion (KD19.36 billion), which was higher than the forecast of $61.9 billion (KD18.9 billion).
Government spending was $75.7 billion (KD23.11 billion), lower than the planned $80.2 billion (KD24.5 billion), according to Zawya.
However, several government agencies reported big losses. For example:
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The Kuwait Authority for Partnership Projects (KAPP) spent $10.99 million but earned only $338,844, leaving a $10.66 million gap.
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The Kuwait Investment Authority (KIA) had expenses of $146.4 million but made just $186,672, resulting in a $146.4 million shortfall.
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The Kuwait Direct Investment Promotion Authority (KDIPA) spent $29 million but earned $3.27 million, creating a $25.6 million deficit.
The Ministry of Finance covered these losses using money from the main budget, showing how dependent many agencies are on central government funds.
Looking ahead, Kuwait’s economy is expected to grow by 2.5% in 2025-2026, supported by steady oil output and strong global prices, according to the World Bank.
The government is also working on reforms to reduce reliance on oil, attract investment, and raise revenue. Plans include re-entering debt markets and introducing a 15% corporate tax on big multinational companies earning over $868.8 million.
Still, Kuwait lags behind other Gulf countries in attracting foreign investment and faces long-term challenges such as oil dependence, population growth, and a rigid economy.
Published: 26th August 2025
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