KUWAIT -- The Kuwaiti government is in the middle of a seemingly unrestrained multibillion-dollar spending spree, raising fears among Kuwaiti economists and opposition figures that this once fabulously wealthy nation could end up in debt in a matter of just a few years.
While much of the money is going to meet the huge expenses of the Persian Gulf War and rebuilding in the aftermath of the country's occupation by Iraq, billions of dollars are committed to programs that critics are calling unwise.
For instance, the government plans to bail out private Kuwaiti banks by assuming all their bad loans to Kuwaitis.
Recent government spending commitments add up to at least $65 billion, or more than two-thirds of Kuwait's estimated assets of $100 billion, held abroad in the form of real estate, stocks, treasury bonds and cash.
Government officials say the spending programs are vital to economic recovery and prudent.
But many Kuwaitis and foreign diplomats say that as spending rises and income from the vital oil industry remains static because of heavy damage inflicted by the Iraqis, there is a clear risk that all of Kuwait's reserves will be quickly wiped out.