Kuwait's Finance Ministry announced on Tuesday the signing of a fiscal balance program with the Ministry of Finance & National Economy (MOFNE) in Bahrain.
The agreement comes as part of several measures to support the economic reforms in Bahrain, and aims at strengthening the financial and economic rules of the GCC countries, Kuwait's ministry said in a statement.
Arab Monetary Fund and the Kuwait Fund for Arab Economic Development observed the signing of the agreement.
In Oct, Kuwait – along with the UAE and Saudi Arabia – announced a USD10 billion financial aid package to Bahrain to prevent the country from falling into a debt crisis. After that, Bahrain announced a program to regulate the financial conditions of the country due to the drop in oil prices and the imbalance between expenditures and revenues of the public treasury.
Bahrain’s economy is expected to grow around 1.8 percent in 2019, like last year, the International Monetary Fund said in March in 2018. The program, together with the USD10 billion in aid, “marks a major step in Bahrain’s reform agenda and has alleviated near-term financing constraints,” the IMF said in a statement following its recent visit to the country.
Bahrain’s budget deficit fell to 11.7 percent of GDP last year from 14.2 percent in 2017, partly because of higher oil prices, cuts in utility subsidies, and new excise taxes, the IMF estimated.
