Kuwait Plans to Return to Globat Debt Market to Finance Development Projects

Undersecretary of the Ministry of Finance Aseel Al-Munifi and Director of Public Debt at the Finance Ministry Faisal Al-Muzaini speak during a presentation of the new debt law. (KUNA)
Undersecretary of the Ministry of Finance Aseel Al-Munifi and Director of Public Debt at the Finance Ministry Faisal Al-Muzaini speak during a presentation of the new debt law. (KUNA)
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Kuwait Plans to Return to Globat Debt Market to Finance Development Projects

Undersecretary of the Ministry of Finance Aseel Al-Munifi and Director of Public Debt at the Finance Ministry Faisal Al-Muzaini speak during a presentation of the new debt law. (KUNA)
Undersecretary of the Ministry of Finance Aseel Al-Munifi and Director of Public Debt at the Finance Ministry Faisal Al-Muzaini speak during a presentation of the new debt law. (KUNA)

Kuwait plans to return to the global debt market this year and is expected to borrow between $10 to $20 billion during the current fiscal year to finance development projects, a finance ministry official said on Monday.

On March 26, the Kuwaiti government issued a debt law that sets the public debt ceiling at a maximum of 30 billion Kuwaiti dinar (about $97 billion), or its equivalent in major convertible foreign currencies. The law also allows the issuance of financial instruments with maturities of up to 50 years.

It is valid for 50 years from the date of its entry into force, establishing a long-term legal framework for regulating public borrowing and liquidity management in Kuwait.

Director of Public Debt at the Finance Ministry Faisal Al-Muzaini said during a presentation of the new debt law that the ratio of debt to gross domestic product (GDP) in Kuwait is minuscule at just 2.9%, whereas it is 60 to 70% in many countries.

Al-Muzaini announced that Kuwait is returning to the financial markets, both domestic and international, for borrowing in the 2025/2026 fiscal year.

He described the move as the largest financial market entry in over eight years, hailing the law as a landmark in public finance reform and saying stating it provides the government with a robust legal framework for managing public debt.

The framework allows for debt maturities of up to 50 years and sets a borrowing ceiling of 30 billion Kuwaiti dinar (approximately $92 billion).

Al-Muzaini added that the Ministry of Finance has outlined a flexible strategy to engage confidently with financial markets while prioritizing competitive financing costs and diversifying the investor base both geographically and institutionally.

One key focus, he said, is developing the local debt market by establishing a yield curve that will serve as a benchmark for future issuances.

“This law sends a strong message of fiscal discipline and credibility to global markets,” Al-Muzaini said. “It is expected to contribute to enhancing Kuwait’s credit profile, drawing wider investor interest, and advancing the country’s transition toward a diversified economy.”

Undersecretary of the Finance Ministry Aseel Al-Munifi said on Monday that the law aims to stimulate the economic environment, attract foreign investments and boost developmental and economic returns for the state. The law, which came into effect on March 27, also seeks to bolster the banking sector and improve fiscal stability, she said.

Al-Munifi explained that the legislation equips the government with modern financial tools, enabling access to both local and international financial markets. These tools, she said, will help secure funding for key development projects.

“The law will support the restructuring of government financing, reduce borrowing costs, and strengthen Kuwait’s credit rating,” she said. “It reflects positively on the state’s borrowing capabilities under competitive conditions and helps build up financial reserves to meet commitments amid evolving economic circumstances.”

Al-Munifi also noted that the new law will serve as an essential mechanism for financing major national projects, particularly in infrastructure, housing, education, and healthcare — sectors included in the government’s general budget for the next five years.

Moreover, she revealed that preparations for the issuance of the long-anticipated Sukuk Law have been finalized. “The draft has been completed by the Ministry and is currently under discussion in relevant Cabinet committees. It will soon proceed through the constitutional procedures for final approval,” she said.



Oil Slips as Iran-Israel Conflict Enters Sixth Day

FILE PHOTO: A view shows an oil pump jack outside Almetyevsk in the Republic of Tatarstan, Russia, June 4, 2023. REUTERS/Alexander Manzyuk/File Photo
FILE PHOTO: A view shows an oil pump jack outside Almetyevsk in the Republic of Tatarstan, Russia, June 4, 2023. REUTERS/Alexander Manzyuk/File Photo
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Oil Slips as Iran-Israel Conflict Enters Sixth Day

FILE PHOTO: A view shows an oil pump jack outside Almetyevsk in the Republic of Tatarstan, Russia, June 4, 2023. REUTERS/Alexander Manzyuk/File Photo
FILE PHOTO: A view shows an oil pump jack outside Almetyevsk in the Republic of Tatarstan, Russia, June 4, 2023. REUTERS/Alexander Manzyuk/File Photo

Oil prices fell on Wednesday, after a gain of 4% in the previous session, as markets weighed up the chance of supply disruptions from the Iran-Israel conflict and as they ponder a direct US involvement.

Brent crude futures fell 93 cents, or 1.2%, to $75.52 a barrel by 0918 GMT. US West Texas Intermediate crude futures fell 88 cents, also 1.2%, to $73.96 per barrel.

US President Trump warned on social media on Tuesday that US patience was wearing thin, and called for an "unconditional surrender" from Iran.

While he said there was no intention to kill Iran's leader Ali Khamenei "for now," his comments suggested a tougher stance toward Iran as he weighs whether to deepen US involvement.

A source familiar with internal discussions said one of the options Trump and his team are considering included joining Israel on strikes against Iranian nuclear sites.

A direct US involvement threatens to widen the confrontation further, putting energy infrastructure in the region at higher risk of attack, analysts say.

"The biggest fear for the oil market is the shutdown of the Strait of Hormuz," ING analysts said in a note.

"Almost a third of global seaborne oil trade moves through this chokepoint. A significant disruption to these flows would be enough to push prices to $120 [a barrel]," the bank added.

Iran is OPEC's third-largest producer, extracting about 3.3 million barrels per day (bpd) of crude oil.

Meanwhile, Iranian ambassador to the United Nations in Geneva Ali Bahreini said on Wednesday that Tehran has conveyed to Washington that it will respond firmly to the United States if it becomes directly involved in Israel's military campaign.

Markets are also looking ahead to a second day of US Federal Reserve discussions on Wednesday, in which the central bank is expected to leave its benchmark overnight interest rate in the range of 4.25% to 4.50%.

However, the conflict in the Middle East and the risk of slowing global growth could potentially push the Fed to cut rates by 25 basis points in July, sooner than the market's current expectation of September, said Tony Sycamore, market analyst with IG.

Lower interest rates generally boost economic growth and demand for oil.

Confounding the decision for the Fed, however, is the Middle East conflict's potential creation of a new source of inflation via surging oil prices.

US crude stocks fell by 10.1 million barrels in the week ended June 13, market sources told Reuters, citing American Petroleum Institute figures on Tuesday. Official Energy Information Administration data is due later on Wednesday.