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Construction contracts awarded in Kuwait stayed below 1 billion Kuwaiti dinars ($3.23 billion) in the first nine months of 2022, Isam Al-Sager, Vice-Chairman and Group CEO of National Bank of Kuwait (NBK) Group, said in a press statement related to the Analyst Conference for NBK’s third quarter 2022 results.
He said the government is likely to award more contracts, given the political stability, adding that he expects spending on infrastructure to continue, which will accelerate tendering and awarding.
Furthermore, the government plans to give a bigger role to the private sector in the future, offering an opportunity for banks to accelerate credit growth, the CEO noted in the statement dated Sunday, 23 October.
In another press statement on Tuesday, NBK said no projects were awarded in the construction, industrial, and oil and gas sectors in the third quarter 2022, likely reasons being higher inflation that pushed up the cost of materials, ongoing supply chain difficulties and labour shortages.
The cost of borrowing rose amid tighter central bank monetary policy, as the Central Bank of Kuwait followed the US Federal Reserve in increasing interest rates this year.
However, NBK also noted that government capital expenditure rationalisation, political uncertainty and public sector bureaucracy have been important factors affecting project implementation.
(Writing by P Deol; Editing by Anoop Menon)
