The Economist Intelligence Unit expects the ruling Al Sabah family to remain in power in 2009-13. Its dominance of the government will be underpinned by its extensive use of patronage, keeping the national population broadly contented. Internal family disputes will be contained, and Sunni-Shia divisions should die down. The authorities will make some effort to address the grievances of the large expatriate workforce, which will nevertheless remain unable to challenge the status quo.Opposition groupings are not expected to form into coherent parties. Nevertheless, the National Assembly (parliament) is set to grow in confidence in 2009-13, with ad hoc coalitions of Islamist and centrist MPs opposing the government on many issues. Bureaucratic processes will remain slow.Internationally, the main threat is the dispute between the US—Kuwait's strategic ally—and neighbouring Iran. Relations with the rest of the Gulf Co-operation Council will strengthen further in 2009-13, with the introduction of a currency union.Kuwait will follow an expansionary fiscal policy, using its oil revenue to raise spending on infrastructure and redistribute wealth. The fiscal surplus is forecast to average 5.6% of GDP a year in 2010-13.The oil sector will drive most economic activity. Real GDP growth is set to decline from the highs of recent years, as oil output rises only slowly (following recent OPEC cuts) and efforts to draw in foreign investment to boost production in the northern oilfields remain stalled, despite the fact that some new energy projects will be initiated towards the end of the forecast period.We expect the current-account surplus to narrow sharply in 2009, but to record strong surpluses over the remainder of the forecast period, averaging around US$19.2bn (12.7% of GDP). The non-merchandise account is forecast to remain in deficit in 2009-13, but this shortfall will only partly erode the trade surplus, which will continue to be supported by reasonably high oil revenue.Kuwait's consumer price inflation is projected to decline over the forecast period, from an estimated average of 10.6% in 2008 to just over 3% in 2013—still high compared with previous decades.The net flow of foreign direct investment into Kuwait should rise modestly over the forecast period. Nevertheless, apart from Equate II (a petrochemicals venture) and some smaller-scale projects, most developments will be financed almost exclusively from domestic sources. The upstream oil and gas sectors will remain largely closed to foreign investors, limiting technology transfer.Key indicators200820092010201120122013Real GDP growth (%)8.5-0.74.45.25.55.2Consumer price inflation (av; %)10.67.05.64.54.03.2Budget balance (% of GDP)30.5-2.74.26.66.15.5Current-account balance (% of GDP)40.07.514.714.912.78.4Exchange rate KD:US$ (av)0.2690.2860.2890.2780.2740.273Exchange rate KD:€(av)0.3950.3780.4000.3930.3960.401