KUWAIT: Kuwait’s sovereign wealth fund has reached an initial agreement with Kuwait Petroleum Corporation (KPC) on new payment terms for over $20 billion in accrued dividends, a government source said, as the Gulf state seeks ways to counter a liquidity squeeze.
KPC has owed for years about 7 billion Kuwaiti dinars ($23 billion) in dividends to the General Reserve Fund (GRF), one of Kuwait’s sovereign funds.
GRF, which is used to cover state deficits, has been squeezed by the coronavirus-driven drop in oil prices and a continued stand-off between government and parliament on implementing measures such as a law to allow state borrowing.
The agreement between GRF and state-owned KPC on a new payment schedule has not been signed yet but the government source said it would be submitted to the finance and oil ministries for approval. He was confirming a report by Kuwaiti newspaper Al-Rai, which said KPC and the Kuwait Investment Authority - which manages Kuwait’s sovereign wealth funds - reached an initial agreement to transfer the dividends to the public treasury within a 15-year timetable.
The report said the accrued funds amounted to about 7.75 billion dinars. The source did not specify a time frame for the payment but said the final terms would not impact the financial position of the company or its ability to honour obligations linked to its investments.
Comments
Comments are closed.