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04/05/2017 - 18:24hs
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Kuwait posts current account deficit

The price of oil weighed down on the country’s finances in 2016, and on its transactions with the rest of the world. The deficit was to the tune of 1.5 billion Kuwaiti dinars.



São Paulo – Kuwait posted a KWD 1.5 billion current account deficit last year, or USD 4.9 billion at current exchange rates, Kuwait News Agency (Kuna) reported this Thursday (4) based on Kuwaiti Central Bank data. The deficit is tantamount to 4.5% of Gross Domestic Product (GDP).

In 2015, Kuwait had seen a KWD 1.2 billion current account (USD 3.9 billion), at 3.5% of GDP. The number consists of transactions with the rest of the world, including trade in goods, services and transfers, which comprises spending by foreigners in the country, and spending by locals in other countries.

The numbers are from a Central Bank report containing preliminary 2016 figures and revised 2015 ones. According to the material, the deficit is a result of weaker oil export revenue, with imports remaining virtually flat, which took the Kuwait trade balance result from KWD 8.3 billion (USD 27 billion) in 2015 to KWD 6 billion (USD 19.9 billion) in 2016.

The services account, a current account component consisting of inbound and outbound foreign travel-related expenditure, ran a KWD 6.3 billion deficit (USD 20.8 billion), which is wider than the KWD 6 billion deficit (USD 19.7 billion) from 2015.

Current transactions also include, for instance, financial transfers with the rest of the world. Kuwait’s economy is primarily oil-based. The commodity accounts for the near-entirety of exports and revenue, and for over half the GDP.

*Translated by Gabriel Pomerancblum

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