The State Audit Bureau in Kuwait has issued a warning about the high-risk issues associated with the country’s national budget deficit and the increasing reliance on government bonds to pay it off. The report highlights the lack of a long-term strategy to manage expected budget deficits, and the absence of the General Secretariat of the Supreme Council for Planning and Development in the Public Debt Committee. There are also concerns about incomplete organizational structures within public debt management, reported Al-Rai Daily.
One of the most significant risks is the charging of the state’s general reserve with the interest and costs of issuing public debt for foreign bonds. The cost of external borrowing is increasing more than the return on net general reserve assets. The Audit Bureau has made a number of recommendations, including improving Kuwait’s credit rating, addressing negative impacts on the economy, coordinating borrowing operations better, and developing the state’s general reserve funds. The report emphasizes the importance of taking the necessary steps to complete the organizational structure for public debt management.