During the first six months of this year the income for Kuwait reached $35.3 billion, exceeding the full year target for the nation’s budget and creating $19.3 billion in provisional surplus, according to official figures released this week.
Based on data posted on the website of the nation’s central bank, Kuwait’s earnings for the six months leading up to September 30 were 2.4 per cent above the $34.5 billion of estimated revenue for the entire 2010-2011 fiscal year.
These earnings were 23 per cent higher than the $28.7 billion revenue brought in over the opening six months of the last fiscal year due to rising oil prices and more production.
Revenue from oil hit $33.2 billion (or 94.2 per cent of revenue totals) and rose 8.8 per cent over the $30.5 billion expected for the entire year.
Oil earnings were 22.5 per cent higher than the $27.1 billion brought in over the first six months of the previous fiscal year.
Budgeted spending is $57.8 billion for the whole year and actual spending figures for the first six months were well below target, landing at $16 billion.
At the midway point in the year Kuwait has reported a $19.3 billion provisional surplus, in stark contrast to the $23.3 billion deficit that was forecasted through the budget.
Economic reports from local sources forecasted that the oil-wealthy nation would see another healthy surplus due to a significant climb in oil prices, a consistent budget trend over the last 12 years.
Kuwait’s largest lender, the National Bank of Kuwait, released a report in the last two weeks that forecasted a budget surplus ranging from $8.3 billion to $13.8 billion, dependent on the oil revenues generated.
The national budget estimates $34.5 billion in revenue and $57.8 billion in spending, although NBK forecasts $64 billion in revenue and $50 billion in spending.
The Kuwait budget expected oil prices to come in at $43 per barrel, a conservative estimate, while NBK’s figures are based on oil prices in Kuwait landing between $72 and $73 per barrel. March 31 marks the fiscal year end for Kuwait.
Law in Kuwait designates 10 per cent of the nation’s revenues to their sovereign wealth fund. Assets within the Emirate’s fund are valued at approximately $277 billion.
The fund’s returns are not incorporated into the budget.
Even though Kuwait, which is the fifth largest oil producer in OPEC, has forecasted a deficit every year for the last eleven fiscal years, all of those have ended with actual surpluses amassing to over $140 billion over that period.
The nation declares that 10 per cent of global crude reserves are under its control and that production is at 2.3 million barrels per day.Paul Holdsworth, Staff Writer, Gulf Jobs Market News