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Friday, August 29, 2025
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The government’s good intentions, but flawed execution

publish time

28/08/2025

publish time

28/08/2025

The future of Kuwait depends on a strong and diversified economy. Such an economy cannot exist without a dynamic private sector that drives development, creates jobs, and fosters innovation. Supporting it does not mean handing privileges to a few business elites at the expense of society. It means building a balanced environment where the entire community benefits. Recent government policies, while presented as reformist, have often produced the opposite effect. Instead of boosting confidence, they have created uncertainty and inconsistency. The government has promoted Kuwaitization in the private sector, encouraging firms to employ more nationals. Yet at the same time, it has imposed new fees and restrictions that raise operating costs and complicate hiring.

The result is a mixed message. Companies are urged to expand employment, but face increasing financial pressure. Even if the intent was regulatory, the outcome conveys instability more than genuine reform. The government has moved beyond its role as regulator, venturing into logistics, retail, and real estate. State entities now oversee markets, warehouses, and even islands connected to the Jaber Bridge, assigning them to government firms instead of opening fair opportunities to local investors. Such blurred boundaries make the state appear less a referee and more a competitor, undermining private sector confidence and discouraging enterprise.

Rising fees on visas, permits, and licenses have strained small and medium firms, driving up consumer costs and deterring investors. With no parallel support or incentives, international reports now point to waning confidence in Kuwait’s business climate. Kuwait needs more than quick decrees that are soon reversed. What is missing is a coherent plan. Government intentions are seldom questioned, but the real issue is in presentation and impact. Headlines dominated by cancellations, restrictions, and penalties create the image of a country under emergency rule. In the process, trust, the most valuable form of economic capital, is steadily eroded. Neighboring states offer models of successful reform.

The United Arab Emirates and Saudi Arabia have embraced privatization and partial listings of national champions in energy, transport, and utilities. Their goal was not to shed ownership completely but to attract foreign capital, modernize management, and increase efficiency. The results have included improved services, stronger competition, and sustainable fiscal returns for the state. Kuwait also has its own success stories. Companies such as Zain, Agility, and Mabanee began under state ownership and evolved into global players.

Today, they provide jobs, generate non-oil revenues, and deliver far more to the economy than they could have if left in government hands. If the government sees itself as the physician of the economy, then it must listen to the patient. Reform cannot be designed in isolation or delivered only as a list of penalties. A genuine dialogue with citizens, entrepreneurs, and investors is essential. Without it, Kuwait risks remaining caught in a cycle of reactive policymaking that weakens trust before real progress can be achieved. Good intentions matter, but in economics, execution matters more, and results matter most.

By Abdulaziz Mohammad Al-Anjeri