Kuwait to pay the first tranche of $8 billion loan in March 2022 that the country has borrowed in 2017 from international banks.
24 January 2022, 12:00 AM
31 January 2022, 12:00 AM
Kuwait is preparing to repay, in March 2022, the first tranche of $8 billion loan at an interest rate of 2.75% that the country borrowed in 2017 from international banks, reports Al- Jarida daily.
The value of the first tranche set for 5 years is $3.5 billion, while the second tranche $4.5 billion of the loan will be due in 2027.
According to the current economic and financial factors, Kuwait does not face any problem in paying the full amount of the first tranche or the loan, or even double its value, but the issue is deeper than just the ability to repay the debt, especially in light of the pledge given by the Minister of Finance to work on approving the public debt law in parallel.
With the support and perhaps promotion of credit rating institutions, most recently “Standard & Poor’s” last week, to address the issue of the budget financing crisis through debt, and even consider what is known as the national dialogue as paving a way to pass the Public Debt Law.
The repayment will be made through the returns of the investments of the Kuwait Investment Authority, such as the interests of bank deposits, bonds, sukuk, or returns on shares, funds, foreign real estate, and others. Therefore, this way foretells two things, the first is that borrowing funds did not achieve any returns that finance the repayment because they were spent in aspects of current spending, not the supposed investment, and the second is that the funds of the Future Generations Reserve Fund were indirectly affected.