The Economist Intelligence Unit expects the Al Sabah family to remain in power in 2014-18, with internal differences over the political succession likely to spill over into parliamentary affairs. The family's dominance will be underpinned by the extensive use of patronage.
Although the government has announced its intention to cut subsidies and rationalise public spending, we expect Kuwait to continue to raise spending, using its oil revenue to boost recurrent spending and redistribute wealth. Despite an easing in global oil prices from their 2012 peak, energy prices will remain high by historical standards, thereby underpinning government revenue. As a result we forecast that the fiscal surplus will average a healthy 21% of GDP in 2014-18.
We expect consumer price inflation to average 4.1% a year over the forecast period. Inflation will pick up in line with strong domestic demand growth and a rise in global food prices in 2017. Extensive government subsidies will mitigate inflationary pressures.

Country forecast overview 6

Highlights 6

Business environment rankings 7

Fact sheet 8

Outlook for 2014-18 9

Political outlook 9

Economic policy outlook 10

Economic forecast 12

Data summary 15

Data sources and definitions 20

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