‘Needs to diversify economy to face long-term challenges’
KUWAIT CITY, Nov 14, (KUNA): The State of Kuwait is taking confident steps towards a bright future with the promising Vision 2035 aimed at bolstering the country’s financial status to include a variety of income resources other than oil revenues.
The plan, considered as a gateway to the future, helped Kuwait recently to jump in the World Bank Group’s (WBG) ease of doing business index. Kuwait was amongst the 10 best improvers reaching the 66 position in the list, which included 190 countries. Last year also saw Kuwait improving its position in the Middle East region by developing its competitive standards, a matter acknowledged by the World Economic Forum’s (DAVOS) global index, which saw the GCC country jumping eight positions to rank 46 out 141 countries.
According to Ernst and Young, the Boursa Kuwait will attract around USD 10 billion in investments as a result of various promotion by international entities such as Morgan Stanley (MSCI), Britain’s FTSE Russell and Standard and Poor’s Dow Jones and so on.
The International Monetary Fund (IMF) is predicting a 3.5 percent growth in the non-oil sector the Kuwaiti economy in 2020. Kuwait is well aware of the importance of diversifying income away from oil, which represented 90 percent of the country’s national production.
Speaking on the issue to KUNA, Mamdooh Salam – an international oil economies expert – affirmed that Kuwait was capable of overcoming short-term crises at the current moment; however, long-term challenges should and must be met by diversifying the economy of the country.
He stressed that Kuwait must follow other GCC countries steps to meet future economic challenges, saying that depending on oil will not serve the ambitions of the country.
The Kuwait Vision 2035 was launched by His Highness the Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah some two years ago to transform Kuwait to an international hub for business and commerce. Since then, Kuwait launched various projects within Vision 2035 in coordination between the public and private sectors.
With the opening of the Jaber Causeway project, which links Kuwaiti City with Subiya area in the north of the country, the development plan saw a boost, paving the way for future Silk City project.
In a previous statement to KUNA, Dr Kristian Ulrichsen of Rice University’s Baker Institute for Public Policy said that the success of Vision 2035 depended on finding balance in political and economic spheres. He indicated that Kuwait was able to achieve the plan via executive and legislative powers’ cooperation; otherwise, conflict between the two entities might affect the development strategy.
Kuwait seeks to put the private sector on the forefront of its efforts to reshape the economy especially with the IMF indicated that the sector was able to assimilate 100,000 Kuwaiti citizens in its workforce within the upcoming five years.
On this matter, Research Officer at the London School of Economics and Political Science (LSE) Dr Sophie Olver-Ellis said that the “New Kuwait” strategy was promising, stressing that the private sector will be on the forefront of development efforts in the country.
The academic, who is preparing a study on bolstering the private sector role in the post-oil Kuwait economy, indicated that the government was gearing towards decreasing government involvement in development projects by 30 to 40 percent. She said that Kuwait was not far off in its efforts to “liberate” its economy; however, she warned that the country must take necessary steps to compete in the 21st century economic world.
By Al-Haitham Saleh