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The following table sets out the actual historical budget outcome of the Government for thefiscal years 1998/1999 to 2004/2005 as reported by Kuwaiti Ministry of Finance:2004/2005 2003/2004 2002/2003 2001/2002 2000/2001 (1) 1999/2000 1998/1999(KD Millions)Revenues:Oil ........................................................... 8,170 6,150 5,498 4,525 6,037 4,794 2,254Non-oil................................................... 792 787 718 787 583 447 543Total revenues .................................... 8,962 6,937 6,216 5,312 6,620 5,241 2,798ExpendituresWages and salaries ............................ 1,754 1,637 1,368 1,305 1,414 1,339 1,300Goods and services............................ 870 668 321 375 489 338 309Vehicles and equipment .................. 44 41 11 11 32 23 29Projects and maintenance............... 578 570 267 217 286 315 377Transfers and miscellaneousexpenditures.................................... 2,968 2,607 2,153 2,118 2,031 1,995 2,027Total expenditures............................. 6,315 5,523 4,120 4,027 4,251 4,010 4,040Surplus (deficit) before RFFG ....... 2,647 1,414 2,096 1,285 2,370 1,231 (1,243)RFFG allocation................................... 896 693 622 531 662 524 280Surplus (deficit) after RFFG........... 1,751 721 1,474 754 1,708 707 (1,522)(1) For fiscal year 2000/2001, figures have been annualised to ensure comparability with other fiscal years. The fiscal year 2000/2001 covered an exceptional nine month period from I July 2000 through 31 March 2001 due to a decision to change the fiscalyear to start in April instead of July.Source: Ministry of Finance and National Bank of Kuwait ‘‘Economic Brief’’ (Vol. 5, No.36) dated 24 October 2005In March 2003, the National Assembly approved an extraordinary budget of up to KD 500million to cover expenses arising from the internal security and civil defence measures undertakenin preparing Kuwait for the US-led war in Iraq.The Financial SystemCentral BankEstablished in 1969, the Central Bank is charged with setting and executing the country’smonetary policy, as well as regulating and supervising the operations of local banks, investmentcompanies and exchange companies. The Central Bank’s monetary policy is primarily focused onmaintaining a stable exchange rate which was closely tied to a basket of major currencies with adominant US dollar weighting between 1975 and January 2003 and which is now linked to a dollarpeg, and managing domestic liquidity through setting the interest rate at a level that ensures theexchange rate regime is defendable.Financial SectorKuwait has a sound financial sector, with some of the more prominent financial institutions inthe Arab world. The banking system receives high credit ratings from major international and localcredit rating agencies. This is largely due to the system’s sound regulatory structure that followsthe banking supervision standards set by the BIS.109