Kuwait approves 2026/2027 budget; deficit set to surge to 9.8 billion dinars

2026-02-14 - 07:29

The Ministry of Finance has released the full details of the 2026/2027 fiscal year budget, highlighting a focus on salaries, subsidies, and capital investment amid projected revenue challenges. The new budget, covering April 1, 2026, to March 31, 2027, estimates total revenues at approximately 16.3 billion dinars, a decrease of 10.5% from the 2025/2026 fiscal year. Oil revenues account for the bulk, contributing 12.8 billion dinars (79%), while non-oil revenues rose by 19.6% to reach 3.5 billion dinars (21%), reports Al-Anba daily. Total expenditures are projected at 26.1 billion dinars, a 6.2% increase over the previous year. Salaries and subsidies make up 76% of spending, totaling 19.8 billion dinars, while capital expenditures rise 36.8% to 3.1 billion dinars, and other expenses account for 3.2 billion dinars (12.2%). The Ministry projects a budget deficit of 9.8 billion dinars, marking a 54.7% increase from the 2025/2026 fiscal year. Historical data show deficits of 3 billion dinars in 2021/2022, 1.6 billion in 2023/2024, and 1.1 billion in 2024/2025, while a surplus of 6.4 billion dinars was achieved in 2022/2023. The current 2025/2026 fiscal year is expected to close with a deficit of 6.3 billion dinars. Oil production for 2026/2027 is estimated at 2.6 million barrels per day, up from 2.5 million in the current year. The budget uses a benchmark oil price of $57 per barrel, with gas revenues projected at 289.8 million dinars after production costs of 4.08 billion dinars. The Ministry has set the budget’s breakeven oil price at $90.5 per barrel. The 2026/2027 budget reflects a balance between sustaining public sector spending, boosting capital investment, and managing a widening deficit amid fluctuating oil revenues.