Kuwait’s Economy in Crisis a Sideshow as Nation Goes to Polls

Kuwaitis get another chance Saturday to do something rare in the Arab Gulf — elect lawmakers with a real say in how their country is run.

Yet it’s hard to detect much enthusiasm. The parliamentary election comes at a make-or-break moment for an economy reeling from lower oil prices, the pandemic and stalled reform. But rescue efforts are stuck as a government appointed by Kuwait’s ruler and lawmakers with enough power to probe and delay legislation disagree over the best way forward.

The nation’s financial plight was often a sideshow in campaigning, as candidates pledged to write-off personal loans or protect salaries even after warnings the Treasury is running short of cash and as parliament blocks plans to borrow overseas.

“The issue of utmost importance, diversification of the economy, isn’t really being discussed,” said Ayed Al-Manna, a political analyst and columnist. “There’s no systemic plan to transform the country.”

Kuwait is a key member ofOPEC and plays an outsized role in mediating regional disputes, including recent efforts toheal a rift between regional powerhouse Saudi Arabia and major gas exporter Qatar.

Some 568,000 Kuwaitis, just under half of the citizen population, are eligible to choose from 326 candidates, including 28 women, vying for the National Assembly’s 50 seats.

A loosely aligned opposition has largely boycotted elections since 2012 to protest changes to the election law. It includes Sunni Islamists, liberals and tribal representatives who want more powers for elected lawmakers. The government says the current voting system ensures accountability while safeguarding stability.

The pandemic upended the typical election season atmosphere, ruling out the lavish banquets where politicians normally issue their appeals, and pushing campaigning online. It could also lower voter turnout, from about 70% recorded in 2016.

Kuwait is facing a record budgetdeficit and the International Monetary Fund expects the economy to contract more than 8% this year. In August, the finance minister warned money for wages could be exhausted in two months.

S&P Global Ratings revised to negative the outlook on Kuwait’s AA- sovereign score, predicting the main source of budget financing, the General Reserve Fund, wouldn’t be enough to cover the fiscal shortfall on its own.

Authorities have talked for decades about promoting private business and reforming a costly system of handouts. But they’ve never progressed past a blueprint. A group of 29 academics at Kuwait University wrote in a recent report the country might have already missed its opportunity to avert “the inevitable catastrophe.”

Parliament has refused to reallocate subsidies or allow the government to issueinternational bonds, querying how the money would be spent and arguing it’s preferable to better manage existing income.

Some Kuwaitis are losing faith, said Al-Manna, the analyst, as it becomes clear “parliament isn’t that effective or able to get laws for development enforced.”

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