RIYADH: With the passage of a long-awaited public borrowing law intended to alleviate fiscal strains and finance infrastructure projects, Kuwait is expected to rejoin the global debt markets after an eight-year hiatus.
The Ministry of Finance claims that the law, which is the longest-term legal framework the nation has ever established for managing public debt, permits the government to issue debt instruments worth up to 30 billion Kuwaiti dinars ($98 billion), either in local or major foreign currencies, with maturities of up to 50 years.
Kuwait has been unable to issue sovereign bonds since its debt code expired in 2017. Although the government has so far used significant assets to meet its funding needs, Fitch Ratings stated earlier this month that enacting the financing and liquidity bill will increase budgetary flexibility.
According to Noura Suleiman Salem Al-Fassam, Minister of Finance and Minister of State for Economic Affairs and Investment, the law represents a strategic change that would improve Kuwait’s capacity to fulfil its financial commitments and foster long-term development. In order to improve liquidity management, this law offers Kuwait the opportunity to access both domestic and international financial markets, increasing its financial flexibility. In keeping with Kuwait Vision 2035, this law supports government initiatives to promote economic growth and bolster financial stability,” she continued.
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