São Paulo – Kuwait has seen an economic recovery as COVID-19 vaccination rolls out. So says a report made public on Wednesday (20) by International Monetary Fund (IMF). According to the report, about 80% of the target population in the country had been at least partially vaccinated and over 70% fully vaccinated as of mid-September 2021. This helped significantly slow the pace of infection, allowing for a pickup in economic activity.
In addition to strict disease control actions, fiscal, monetary and financial support measures introduced by the Central Bank of Kuwait (CBK) have helped ease the burden on households, firms, and the financial sector.
IMF reported that besides the direct impact of COVID-19 on economic activity in Kuwait, sharp declines in oil prices and cuts to oil production under the OPEC+ agreement weighed on the oil sector.
Last year, Brent oil came to cost around USD 23. Cuts were established to balance prices. This year, the organization also established cuts to keep prices on the rise.
The report estimates that the real gross domestic product (GDP) of the Arab country contracted 8.9% in 2020. Non-oil GDP growth of 3.0% is projected for 2021, as economic activity gradually recovers and the global environment improves.
IMF projects Kuwait’s oil production to rebound as OPEC+ quotas are relaxed. Overall, GDP is projected to grow around 2.7% over the medium term. Inflation is expected to average 3.2% in 2021 given increases in food prices and costs of travel-related services.
Translated by Guilherme Miranda
