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Govt practically cannot pay consumer loans of Kuwaitis’

January 6, 2019

Loans close to KD 12 billion

KUWAIT CITY, Jan 5: The government cannot practically pay the consumer loans of the citizens, which are close to 12 billion dinars, since the government deposits with local banks according to the latest statistics are barely enough to pay half this amount which indicates that the total government deposits in the banks is close to 6 billion dinars, reports Annahar daily quoting government sources familiar with the issue.

The sources told the daily, it is not logical for the government to use all its deposits in local banks and liquidate part of its assets, or withdraw from the already shrinking reserve to carry out a financially cumbersome operation. The sources noted, 99.5 percent of the borrowers are committed to repay their loans.

It is only 0.5 percent are not, especially as the government has been facing a deficit in its budget during the past four fiscal years and was forced to withdraw from the general reserve fund. It has also borrowed locally through bonds, ‘Tawarruq’ (to buy on credit and sell at spot value) and internationally through bonds offered at a value of close to $10 billion. The sources pointed out that the government will face a major crisis if it took the step of repaying the loans of citizens, especially since the law of government debt has expired and the Parliament did not approve the new law.

Response
The Central Bank of Kuwait pointed out in its response to a parliamentary question that the number of borrowers in Kuwait is 73,945, including 429,000 citizens, representing 90 percent of the total labor force under 50 years, and making 58 percent of the total borrowers.

Meanwhile, The General Secretariat of the Supreme Council for Planning and Development said that developing its website Kuwait jadeeda (modern Kuwait) aims to monitor the execution of governmental projects.

The website will also allow officials and citizens to follow up on the processing of these projects, the secretariat’s Assistant Secretary General Talal Al-Shammari said in a press statement on Saturday.

He added that the website will also include pictures and videos on development topics and the number of days left until the completion of the project as well as information on costs. Moreover, it will also be a source of accurate and transparent information for all types of media on the “New Kuwait 2035” developmental vision, Al-Shammari noted.

Arabtimesonline