Credit rating agencies cannot be blamed for being generous with Kuwait, thanks to the country’s strong fiscal and external position notwithstanding the plunge in oil prices. The comfort is partly derived from Kuwait’s substantial reserves, whose return on investments somehow compensates for lower oil revenues.

Recently, Fitch joined other agencies in affirming solid ratings, specifically AA+ for the long-term on the back of resilient reserves and absence of a potential fiscal catastrophes.

Already, Kuwait enjoys AA and Aa2 from Standard & Poor’s and Moody’s respectively. The three rating agencies have one thing in common, particularly in the stable outlook assigned for the economy.

It is not unfair to project firmer revenues during the current fiscal year. Such is the case as the Kuwaiti government prepared the budget for fiscal year 2015-16 with projected revenues of $40.7 billion and expenditures of $64.5 billion.

The authorities used a conservative oil price of $45 per barrel for calculating oil revenues. This rate is below the prevailing market rate, yet in line with the Gulf state’s ongoing conservative economic choices. The petroleum sector is vital by virtue of contributing around 80 per cent of treasury revenues.

Fitch puts the break even export price at $57 per barrel, clearly above the rate used in the budget, in turn useful for boosting revenues.

Other than oil, there is the subject of the return on investments on the country’s considerable sovereign wealth funds (SWFs), which amounted to some $548 billion in April, the latest available statistics.

This is a sizeable amount by virtue of representing a robust 7.7 per cent of the world’s total. Only two Gulf countries — the UAE and Saudi Arabia — have more SWFs than Kuwait’s.

The UAE’s SWF was nearly $1.2 trillion as of April, in turn compromising nearly 16 per cent of the world’s total.

Understandably, Fitch contends Kuwait would still post a budgetary surplus in the new fiscal year, albeit at a lower level. It projects a budgetary surplus of 10.6 per cent of GDP in fiscal year ending in March 2016, down from 20.7 per cent in fiscal year 2014/15. Certainly, this is a substantial figure amid sustained low prices for several months in a row.

Notably enough, Kuwait has been recording budgetary surplus for more than a decade, in turn providing a sort of cushion.

Additionally, Fitch projects positive results in the country’s external account surplus, at 15 per cent of GDP in 2015, down by some 50 per cent from 2014. The fall reflects the drop in oil price. Nevertheless, the size of the surplus provides necessary comfort for international entities doing business with Kuwait.

Collectively, Kuwait maintains a stable macroeconomy reflecting surpluses in budget and external accounts. Other positives entail the near absence of inflationary threats, reportedly at around 3 per cent.

Still, another noteworthy quality concerns the relatively low unemployment rates, around 1.5 per cent among Kuwaiti nationals. The figure emerged in a survey by the World Economic Forum released late in 2014.

A major reason behind the non-existence of serious joblessness is the willingness of state entities to employ Kuwaiti nationals. It is believed that some 90 per cent of nationals work for the government and other state agencies including the petroleum sector, in turn a major employer.

Some might question the viability of sustaining such an employment practices.

The writer is a Member of Parliament in Bahrain.