Oil-rich Kuwait on Monday ordered cabinet ministers to “rationalise spending” after considering measures to counter the sharp decline in oil prices, an official statement said.
“The government asked ministers to control expenditure and rationalise spending in such a way to serve citizens and achieve the country’s higher interests,” said a statement following the weekly cabinet meeting.
The statement said the cabinet had studied proposals presented by the finance ministry about the slide in oil prices and “emphasised it will continue with capital spending and projects under the development plan”.
Oil income makes up around 94 percent of public revenues in the emirate which pumps around 3.0 million barrels per day.
Oil prices have lost around 30 percent of their value since June, amid a surplus in supplies and a weak global economy, hitting the state coffers of energy-dependent countries like Kuwait.
The head of parliament’s budget committee, lawmaker Adnan Abdulsamad, has said if oil prices continue at the current level, the budget surplus would shrink to just $3.1 billion from $45 billion last year.
The emirate has decided to end subsidies on diesel, kerosene and aviation fuel as a first step in revising heavily-subsidised electricity, water and petrol.
Local media said Kuwait’s fiscal reserves grew to $548 billion as of June 30.
The tiny emirate has a native population of 1.25 million and is also home to about 2.8 million foreigners.