Kuwait considers bailout for consumer debt

Kuwait is considering plans for a $6bn consumer debt write-off that would be the latest mass official bailout of Gulf citizens who have broken the region’s harsh debt laws and sometimes ended up in jail.
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Weeks after the United Arab Emirates released hundreds of debtors from prison, Kuwaiti ministers and the central bank are pushing back at proposals from a parliamentary committee to scrap interest payments equivalent to an average of $6,000 per Kuwaiti on all bank loans taken out by nationals between January 2002 and April 2008.
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The battle has reignited debate over how to control ever-climbing personal debt levels in the oil-rich Arabian peninsula. The indebtedness has left Gulf leaders in a bind, as they have to balance enforcement of their strict financial laws – including jail terms for bouncing cheques – against the need for the kind of benevolent gestures the citizenry expects from them in exchange for not challenging their right to rule.
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