Kuwait: 2024 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Kuwait
IMF Staff Country Reports, December 9, 2024
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- Kuwait: 2024 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Kuwait
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Bibliographic details
- Published: December 9, 2024
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400294303.002
Economic outlook and inflation
- The economy is projected to remain in recession under the baseline in 2024, then to recover over the medium term.
- The economy remains in recession, but a recovery has begun in the non-oil sector.
- Inflation is moderating.
External and fiscal balances
- Lower oil prices and production have weakened the external and fiscal balances.
- Fiscal consolidation of about 13 percent of gross domestic product (GDP) should be implemented.
- Recommended fiscal consolidation pace: 1 to 2 percent of GDP per year to reinforce intergenerational equity.
Monetary policy and exchange rate
- The exchange rate peg remains an appropriate nominal anchor for monetary policy.
- Continued efforts are needed to strengthen monetary policy transmission.
Financial sector and stability
- Financial stability has been maintained.
- Systemic financial risks remain contained and prudently managed.
- Continued efforts are needed to maintain financial stability and enhance financial intermediation.
Structural reforms and economic diversification
- The authorities aim to implement reforms to support the transition to a dynamic and diversified economy.
- A comprehensive and well-sequenced structural reform package is needed to:
- Improve the business environment by raising efficiency,
- Enhance transparency,
- Further open up the economy.
Risks and buffers
- The risks around the outlook are skewed to the downside.
- Substantial financial buffers are a source of resilience to external shocks.
IMF Staff Country Report: Kuwait: 2024 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Kuwait
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- 1kwtea2024001-print-pdf