$4 billion shortage in new Kuwaiti budget

The Kuwaiti government is currently studying methods of confronting the anticipated shortage in the 1998 -1999 budget resulting from the reduction of petroleum prices.

Economic experts believe that the procedures aimed at enhancing income may include raising fees on government services in addition to imposing new taxes.

Sheikh Ali Salem al-Ali al-Sabah, the Kuwaiti minister of finance, said, "The state must consider the reduction in petroleum prices as a motive for making economic reforms in the country."

He also suggests reducing production expenditures as a way of enhancing petroleum income, which may indicate that an increase in the state's income from non-petroleum activities will not take place except through imposing fees on public services.

Sheikh Salem added that the effect of the collapse of petroleum prices slightly figured into the budget of the current year, pointing out that petroleum prices started to fall at the end of 1997.