Kuwait faces severe fiscal challenges into medium term

Significance

Finance Minister Anwar al-Mudhaf has repeatedly stated his intention to pursue radical fiscal and economic reform. As directed by the emir, the new government, appointed in May, aims to exploit the indefinite suspension of parliament to push through measures long blocked by elected representatives.

Impacts

• The unusually technocratic make-up of the new administration will improve policymaking and implementation.
• Medium-term fiscal planning will be entrenched as the new norm.
• The sovereign wealth fund will be allotted a larger role in funding major public projects.