Kuwait's economy faces a prolonged recession due to ongoing OPEC oil production cuts, highlighting the country's dependence on oil revenue and the urgent need for economic diversification.
The International Monetary Fund IMF has predicted that Kuwait ’s economy will remain in a recession due to the ongoing OPEC oil production cuts . “The economy is projected to remain in recession under the baseline in 2024, then to recover over the medium term,” the IMF said a week after OPEC announced it was extending voluntary cuts of 2.2 million barrels per day until April 2025. Kuwait ’s GDP contracted by 3.6% last year, thanks in large part to a 4.
That’s a sharp contrast from just two years ago when high oil prices powered 85% growth in Kuwait’s oil revenue, translating into 8.5% GDP growth and a 70% decrease in the fiscal deficit--the first drop since Covid hit. In the same year, NBK-Kuwait, the country’s largest bank, saw its net profits increase 40.5% Y/Y to reach $1.7 billion. Kuwait is a wealthy petroleum-based economy and the fifth richest country in the world by gross national income per capita.
Recession OPEC+ Oil Production Cuts GDP Contraction Inflation Economic Diversification Oil Prices IMF GCC Economies
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