The balance of payments, inflation rates and the government’s financial position are affected by the rise in food prices globally, and to measure the extent to which countries are exposed to the shock of price increases, MUFG Bank, one of the largest Japanese banks, compares the ratio of food commodity imports to GDP in emerging economies, including Kuwait, which represent about 4% of the country’s GDP.
A local Arabic daily said, the gross domestic product of Kuwait is 36 billion dinars for 2020, and it has shrunk by 9% as a result of the repercussions of the Covid-19 pandemic and the decision taken by the government of Kuwait to contain it, while the International Monetary Fund expects the growth of the non-oil sector’s GDP by 3.5% and a rise in the inflation rate by 4.4%.
Data from the Central Administration of Statistics showed that inflation rose by 4.30% last December on an annual basis. The statistics said in a statement that the inflation rate in Kuwait rose by 0.73% last December on a monthly basis, as a result of the rise in prices of most of the main groups affecting the movement of indices, especially foodstuffs and education.
The index of the food and beverage group increased last December by 7.20% compared to the same period in the year 2020.
In terms of the ratio of the value of food imports to the gross domestic product, Kuwait ranked fourth in the Gulf region in the list, which was led by Bahrain, followed by Oman and the UAE, with rates ranging between 4 and 5%. Saudi Arabia came in fifth place with a share of about 2.5% of the GDP, followed by Qatar with less than 2%.
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