The financing provided by local banks to the industrial sector saw a significant increase in January compared to December 2023, rising by 123.5% to 148.9 million dinars from 66.6 million dinars. This surge represents a noteworthy boost in funding for industrial activities within Kuwait. Moreover, on an annual basis, this increase amounted to 38.3% from 107.6 million dinars in January 2023. The rise in financing indicates a positive trend in supporting industrial development and growth in the country. Simultaneously, the accumulated balance of industry financing also witnessed growth, indicating sustained investment in the sector.
The balance increased by 1.5% monthly, reaching 2.686 billion dinars in January 2024 from 2.646 billion dinars in December 2023. Despite this monthly increase, there was a 6.1% decrease in the accumulated balance compared to January 2023, where it stood at 2.861 billion dinars. While there was a slight decline from the previous year, the ongoing investment in industry financing underscores the importance of this sector in Kuwait’s economic landscape.
Monthly statistics from the Central Bank of Kuwait for the year 2023 provide further insights into the dynamics of financing within the industrial sector. Total monthly financing to the industrial sector witnessed a notable decline of 31% during the fiscal year, amounting to 1.033 billion dinars in December 2023 compared to 1.499 billion dinars in December 2022.
This significant reduction reflects various challenges faced by the industry sector, including the impacts of the COVID-19 pandemic and disruptions in global supply chains. Moreover, December 2023 saw a staggering 90.7% decrease in financing compared to the same period in 2022, dropping from 73.8 million dinars to 7.2 million dinars. This drastic decline underscores the volatility and uncertainties that characterized the industrial sector during the past year.
However, despite these challenges, the resilience of the industry sector remains evident, with ongoing efforts to navigate through turbulent times and adapt to changing market conditions. The industry sector has faced numerous challenges over the past three years, exacerbated by the COVID-19 pandemic. Restrictions on corporate activities, disruptions in supply chains, and decreased demand have all contributed to the sector’s struggles.
Additionally, bureaucratic hurdles in completing transactions, reliance on imported goods, and high rental prices for industrial facilities have further compounded the challenges faced by industrial enterprises. Despite these obstacles, the Kuwaiti government continues to prioritize the development of the industrial sector and has implemented various initiatives to support its growth. These efforts include addressing bureaucratic inefficiencies, promoting domestic manufacturing, and enhancing infrastructure to facilitate industrial activities. By addressing these challenges and capitalizing on emerging opportunities, the industrial sector in Kuwait can overcome current obstacles and realize its full potential in driving economic growth and prosperity.
Source:https://www.arabtimesonline.com/news/kuwaiti-banks-increase-industrial-sector-financing-by-123-5-in-jan/