The International Monetary Fund has said that economic activity in Kuwait is “rebounding,” adding that real GDP will expand by 3.8 percent in 2026.
In concluding the 2025 Article IV consultation with Kuwait, IMF Executive Directors endorsed staff’s appraisal, as follows: “An economic recovery is underway, in spite of lower oil prices. Growth is rebounding, driven by the unwinding of OPEC+ production cuts and robust non-oil growth. Inflation continues to moderate, reflecting lower core and food inflation.”
“Real GDP will expand by 3.8 percent in 2026, driven by the unwinding of OPEC+ production cuts and robust non-oil growth, estimated at 3.0 percent of GDP,” the IMF said in a statement.
“Headline CPI inflation will moderate to 2.1 percent in 2026 and then stabilize just below 2.0 percent over the medium term,” it added.
“Staff welcomes the authorities’ Vision 2035 aspirations to implement economic reforms in pursuit of a more diversified economy. To sustainably boost non-oil growth, a comprehensive and well-sequenced package of fiscal and structural reforms is needed,” said the statement.
It said that to reform energy subsidies, retail fuel, electricity and water prices should be gradually raised towards their GCC-average levels while providing targeted cash transfers to vulnerable groups.
To improve infrastructure, on-budget public investment should be further scaled up, by around 2 percent of GDP over the medium term, the statement added.
