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An Amiri decree issued on Tuesday amends a 1976 law and ends a decades-long prohibition on government borrowing from the sovereign wealth fund known as the Future Generations Fund. The decree allows the Cabinet to authorize loans from the fund managed by the Kuwait Investment Authority to bolster the General Reserve Fund whose assets derive from state budget revenues. Kuwait Times reported that the decree sets out detailed preconditions for each borrowing transaction while preserving priority protections for the fund’s core assets.
The decree requires that any loan agreement specify the principal amount its purpose the applicable interest the repayment duration and a clear timetable for settling both principal and returns. Provisions for potential rescheduling of payments must also be defined in advance according to the text published in the official gazette. Repayment from future state revenue surpluses receives priority and the loan cannot be reduced or cancelled except by a separate law the decree states.
Total borrowing in any single fiscal year must not exceed the average returns recorded by the fund across the previous five audited fiscal years Kuwait Times reported. Outstanding loans overall cannot surpass 10 percent of the fund’s total asset value based on the latest audited statements. Once either limit is reached no additional loans may be contracted until balances fall back within the ceilings.
The Future Generations Fund was established in the 1950s to invest fiscal surpluses for future generations and forms the primary long-term component of assets overseen by the Kuwait Investment Authority. A Bloomberg report published on the day of the decree placed the sovereign fund’s total assets above 1 trillion dollars. S&P Global Ratings estimated in a May 2026 assessment that the authority’s liquid assets would exceed 550 percent of GDP over the course of the year.
Kuwait has faced persistent fiscal pressures in recent years with consolidated deficits recorded even after mandatory transfers to the wealth fund according to earlier assessments from international financial institutions. The new decree provides a regulated channel for support to the General Reserve Fund while maintaining safeguards against depletion of the intergenerational savings vehicle. The Cabinet referred the finalized text to Amir Sheikh Meshal Al-Ahmad Al-Jaber Al-Sabah who issued it on Tuesday.
On the same day the Cabinet also approved draft decree-laws covering media regulation and the issuance of governmental sukuk referring both measures to the Amir for final ratification Kuwait Times reported. The borrowing framework adds to a series of fiscal management adjustments pursued by Kuwaiti authorities in response to fluctuating oil revenues and expenditure demands. The decree explicitly records each loan and its returns as an asset owed back to the Future Generations Fund.
