The Kuwaiti parliament yesterday passed an unprecedented law that requires the government of the oil-rich Gulf state to buy up some $21.6 billion (Dh79.2bn) of citizens' private debt.
Thirty-five MPs voted for the law, 22 against while one lawmaker abstained in the second and final round of voting. The legislation also requires the government of Opec's fourth largest producer to reschedule the repayment of the principal in interest-free installments over 10 years and forgive the interest currently owed, which is estimated at more than $5.2bn.
The government immediately said it will reject the law. Finance Minister Mustafa al-Shamali said after the vote the government will not accept the law because of "technical, constitutional and procedural violations". He said the law is almost impossible to apply. Under Kuwaiti law, the government can reject legislation passed by MPs, but it must then go back to parliament, which can override the veto if it can muster a two-thirds majority in a new vote.
Keep up with the latest business news from the region with the Emirates Business 24|7 daily newsletter. To subscribe to the newsletter, please click here.