We expect the Kuwaiti economy to see modest growth over ---- and ----, forecasting real GDP growth of -.- and -.- respectively. After a long period of stagnation, the Kuwaiti investment outlook ap- pears to be improving, while the prospects for consumption remain bright. ...Kuwait has seen a flurry of populist legislation recently, including several measures specifically targeting expatriate workers. This runs the risk of increasing uncertainty within the private sector, as well as cementing perceptions of the country as a hub of policy instability. We expect tensions to remain between the government and the legislative branch, even with the election of a renewed loyalist parliament. We forecast average consumer price inflation for Kuwait of -.- and -.- for ---- and ---- respectively, up from -.- in ----. While we expect a slight fall in Kuwaiti food inflation over the near term on the back of lower global prices, a tight supply picture in the real estate market will fuel housing inflation over the coming quarters, in a trend seen across the Gulf Cooperation Council.
...Kuwait has made substantial fiscal and structural progress but remains somewhat vulnerable to fluctuations in global energy markets. We forecast the end of the massive budget surpluses seen over the past few years, as our Oil and Gas research team forecast the OPEC bas- ket to remain around USD----- per barrel over the coming five years. ...Kuwait has made substantial fiscal and structural progress but remains somewhat vulnerable to fluctuations in global energy markets. We forecast the end of the massive budget surpluses seen over the past few years, as our Oil and Gas research team forecast the OPEC bas- ket to remain around USD----- per barrel over the coming five years. We stress that if dependency on the energy sector is not reduced and substituted by non-oil industries, threats could emerge to long-term economic sustainability. ...We stress that if dependency on the energy sector is not reduced and substituted by non-oil industries, threats could emerge to long-term economic sustainability. Despite efforts by the government to diversify, oil exports remain the backbone of Kuwait s economy, and we do not expect this to change any time soon.
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