sarmad 2026-09-01 17:39

Decree-Law Issued Authorizing Borrowing from the Future Generations Fund to Support the State's General Reserve - Sarmad

The Cabinet held a meeting on Tuesday, presided over by His Highness Prime Minister Sheikh Ahmad Abdullah Al-Salim Al-Sabah.

A decree-law No. 81 of 2026 was issued amending certain provisions of Decree-Law No. 106 of 1976 concerning the Future Generations Fund, following a review of the Constitution, the Emiri Order dated 2 Dhu al-Qi’dah 1445 AH (corresponding to May 10, 2024), Decree-Law No. 106 of 1976 concerning the Future Generations Fund and its amendments, Decree-Law No. 31 of 1978 on the rules for preparing general budgets, supervising their implementation, and the final accounts and its amendments, and Law No. 47 of 1982 establishing the Public Authority for Investment, after approval by the Cabinet and based on a proposal from the Minister of State for Economic Affairs and Investment.

Article One stipulates the replacement of the text of the first paragraph of Article One and the second paragraph of Article Two of the aforementioned Decree-Law No. 106 of 1976 with the following texts:

Article One (First Paragraph): In the event that annual revenues exceed expenditures, a percentage of the actual surplus from the state’s final accounts shall be deducted annually. This percentage shall be determined based on a proposal by the Minister responsible for chairing the board of directors of the Public Authority for Investment and with the approval of the Cabinet, effective from the results of the fiscal year 2018/2019.

Article Two (Second Paragraph): The Public Authority for Investment shall invest these funds and may use all necessary financial, investment, and financing instruments for this purpose. The returns on its investments shall be added to this account.

Article Two stipulates the addition of two new paragraphs to the text of Article Three of the aforementioned Decree-Law No. 106 of 1976, and a new article numbered “Article Three (bis)” to the same decree-law.

Article Three, in its two new paragraphs, states that as an exception, the Cabinet may, upon a proposal from the Minister responsible for chairing the board of directors of the Public Authority for Investment and after approval by the board, borrow from the Future Generations Fund to support the state’s general reserve. Such a decision must include the following:

- The loan amount.

- The purpose of the loan and the returns thereon.

- The duration and the repayment schedule for the loan or its installments and returns.

- Conditions and regulations for rescheduling or restructuring the loan repayment.

- Any other data and provisions necessary to regulate and implement the loan.

In accordance with the aforementioned provisions, the loan amount and accrued returns shall be recorded as a receivable asset in the Future Generations Fund account. The loan shall have priority for repayment from state revenues in the event of a surplus in the general budget after the approval of the state’s final accounts. Under no circumstances may the loan be written off or reduced except by law.

Article “Three (bis)” stipulates that borrowing from the Future Generations Fund shall adhere to the following controls:

- The total loans during a single fiscal year shall not exceed 100% of the average returns achieved by the Fund over the last five audited fiscal years.

- The total outstanding cumulative loan balance shall not exceed 10% of the net asset value of the Fund according to its audited financial statements for the last fiscal year.

- No new loans shall be contracted if either of the ceilings specified in items (1) and (2) of this article is exceeded. This prohibition shall not be lifted until the borrowing ratios fall within the prescribed limits.

Article Three stipulates the repeal of any provision contrary to the provisions of this decree-law.

Article Four stipulates that the Prime Minister and the ministers shall each be responsible for implementing this decree-law within their respective areas of competence, and that it shall be published in the Official Gazette and take effect from the date of its publication.

The decree-law was issued at Bayan Palace on 19 Rabi’ al-Awwal 1448 AH, corresponding to 1 September 2026 CE, and was signed by the Emir of Kuwait, Mishal Al-Ahmad Al-Jaber Al-Sabah; the Prime Minister, Ahmad Abdullah Al-Ahmad Al-Sabah; and the Minister of State for Economic and Investment Affairs, Abdulaziz Nasser Abdulaziz Al-Marzouq.