In few words, His Highness our Amir last week expressed his vision for the enhancement of our economy and creation of jobs for new graduates entering the local labor market, and emphasized on enhancing competitiveness.
His Highness the Amir was last week addressing the committee responsible for improving work environment when he had outlined his vision for the progress of our economy for years to come (Al-Qabas daily — January 17).
Our Amir’s statement came at the right time when the oil prices are increasing to reach a comfortable position particularly for Kuwait. It is stabilizing at a rate higher than $68, which is the level of breakeven with the current budget until end of March. That means the deficit will reduce to less than KD4 billion, which is the lowest it will be in the past four years. It definitely has been a good year for all oil producers.
Of course, we have to enhance our investments, divert away from oil and find new sources of revenues instead of depending solely on oil. Our domestic investments in oil and gas sector for maximizing production are more than enough. Time has come to move away from investing in overseas oil projects such as in oil stocks and oil companies. Simply leave the overseas oil projects to others.
Perhaps time has come to implement our leader’s vision, move forward to fulfill his aims and form team leaders to ensure progress in an organized way based on a fixed schedule. We indeed have the green light to move ahead without any obstacles.
Creating job opportunities cannot be achieved without the direct involvement of the private sector. Only this sector can upgrade and provide young graduates with the required experiences, skills and determination to be competitive.
However, the private sector cannot function if the government does not free its sectors that are not part of its core functions and have to be privatized. There are many examples of such sectors like the communication, telephone, postal and telegraph sectors. These sectors are obsolete and can be easily run by the private sector such as the three telecommunication companies. Even the sea port, land authority and airport can be easily sold to the private sector. Also Kuwait Airways, which is yet to be privatized despite the many approvals from the parliament.
The examples in this regard are many and include oil divisions, some of which were completely formed by the private sector such as Oil Tankers Company, and petrochemical and marine/shipping company. There is also our overseas oil exploration company KUFPEC, which can be sold while the oil prices are stable and can ensure positive returns.
The path is clear with some unambiguous objectives set by the few words of His Highness the Amir — diversify, enhance our overseas investments and create jobs for the young ones. Kuwait has enough resources to implement and move ahead. It has the required experience in the field of investments and in dealing with selling domestic and overseas assets within a short time. Our private sector is successful and has enough experience to move our economy forward.
The time has come to shine and for our government to implement in few years our Amir’s economic vision which was summarized in three words — Enhance, Divert and Create.
By Kamel Al-Harami – Independent Oil Analyst