Kuwait industrial engine runs low on ‘investment’

According to the report, the information technology sector ranked first -- accounting for 33.87 percent of total investments, oil and gas sector ranked second with 27.65 percent, construction and infrastructure sector ranked third with 14.36 percent, energy and electricity sector ranked fourth with 5.36 percent, human health sector ranked fifth with 4.10 percent, education and training sector ranked sixth with 3.75 percent, insurance sector ranked seventh with 2.76 percent, consulting sector ranked eighth with 2.70 percent, and aviation sector ranked ninth with 2.67 percent. Other sectors accounted for less than one percent each, including agriculture, market research, promotion, arts, entertainment, financial services, and scientific research and development. This disparity in investment raises fundamental questions about economic diversification plans and the vision of the state.

While the service, information and oil sectors have the largest share, the production and industrial sectors suffer from a noticeable weakness in attracting foreign partners. An official source said this is linked to structural challenges in the local business environment. He attributed the foreign reluctance to invest in the industrial sector to several major obstacles that the investors are facing. He confirmed that the government is currently addressing the lack of plots allocated for industrial businesses, in addition to resolving the administrative bureaucracy issue in order to minimize the complexity of business licensing procedures and facilitate obtaining approvals. He stated that there are government initiatives to resolve the crisis and create an attractive environment for industry. He pointed out that the economic and legislative institutions recognize the importance of implementing reforms to improve the legislative environment and enact several reform measures, including granting long-term residency to foreign investors. He indicated that transforming Kuwait into a regional financial and commercial hub requires a complete overhaul of the industrial strategy, opening the door to international partnerships in the manufacturing sector, and not relying solely on digital and service-sector growth. He affirmed that increasing the industrial sector’s contribution to the gross domestic product (GDP) of the country is crucial, while stressing the need to enhance the added value of national industries and attract both local and foreign direct investments.