Kuwait is facing confusion over using Future Generations Fund. Influential voices question government’s intent on cutting this year's topping up of the Fund.
kuwait , Kuwait
26 June 2020, 12:00 AM
10 July 2020, 12:00 AM
Kuwait is yet to see a consensus build up over whether it should be using its Future Generations Fund to tackle the economic fallout from the ongoing COVID-19 pandemic.
Former ministers and officials have called for the setting up of an economic team to work out a proper austerity plan and arrive at ways to balance the budget. And to ensure the rights of current and future generations are not compromised.
A former minister, Bader Al Humaidi, said suspending the allocation to the Fund is “evidence of weak financial management”.
A former finance minister, Bader Mishari Al Humaidhi, said the Fund was set up to be used in [future] critical times and not for the present. He is not the only one voicing such an opinion.
By law, 10 per cent of Kuwait’s revenues is transferred annually into the Fund, which invests abroad. The government will provide more than 1 billion dinars ($ 3.25 billion) in the current fiscal year alone.
The fund is run by the Kuwait Investment Authority. While a withdrawal from the fund would require an enabling law, taking out a loan or investment from the Fund would not.
Government sources say the plan is to send a bill to parliament, with a plan to stop deducting the share of the Fund from budget. This will save more than 1 billion dinars in the current fiscal year.