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SINCE the head and the members of the Cabinet have been sworn in before His Highness the Crown Prince, and since the wheel of government work has begun, it has become necessary to look into the many files pending with the government, especially those related to the economic and financial affairs of the state.
In order to avoid repeating the experiences that caused the country’s financial crisis, it is necessary to put things right in terms of the country’s sovereign fund, which is the backbone of development and the blood that runs through the arteries of prosperity and progress of Kuwait.
In all countries of the world, there is a supreme leadership that supervises the sovereign wealth fund, starting from China through Norway to the other Arabian Gulf countries. This leadership is directly supervised by the head of state or whoever is responsible for it. It works on directing the right investments, and prevents any abuses or manipulation of it.
In the past three decades, Kuwait, which was the first country in the world to establish a sovereign wealth fund in 1953, seemed to have lost the ability to manage this sovereign money, despite going through one of the most painful experiences, and the urgent need to learn from that experience to prevent the recurrence of crises involving it.
Here, we mean the brutal Iraqi invasion, the painful memories of which we are recalling, and how some Kuwaiti officials at the time, who supervised the management of the sovereign fund in Britain and Spain, sought to loot the funds entrusted to them, believing that Kuwait was lost forever.
At that time, the country’s leaders acted wisely and asked the countries to freeze the Kuwaiti sovereign assets in the world. This led to a halt to the looting that some had started. These funds later helped in managing the crisis, rebuilding the country, and starting over.
Throughout the past three decades, scandals began to unfold involving most of the country’s sovereign funds, in the face of complacency, inaction, deals made between parliamentary and ministerial parties, and random appointments or based on seizing opportunities to control public money. Not even the pension fund for the military was spared.
These scandals should have served as a lesson for everyone – that idle money attracts looters, and that the corrupt would strive to capitalize in usurping such wealth.
Therefore, the time has come, in light of what we consider as a reform revolution initiated by the political leadership under the supervision of His Highness the Crown Prince, for these funds to fall under the direct supervision of His Highness the Crown Prince Sheikh Mishaal Al-Ahmad, and for him to choose the best economic and financial minds to run the fund.
His choice of personnel does not necessarily mean that they should be locals. Like in all countries of the world, it will require the use of experts, usually from abroad.
This is especially necessary after we experienced the effects of personal relationships, tribal kinship, family ties, and political endorsements of the financial officials in that docket, which led to the looting of the lost billions today and which the state could not recover.
We did not go back to talking about this serious matter until after the scandal of the London office, where young people with limited experience have been entrusted with billions of dollars, as if this is a game of Monopoly.
Therefore, when we talk about sovereign funds, we are highlighting a group of Kuwaiti funds, the spending of which is multifaceted, especially those that provide grants, aid and loans to countries to buy loyalty or relationships.
The annual return from sovereign wealth funds, according to financial data, can cover the state budget, and be a source for diversifying sources of income and helping in getting rid of the dependence on oil, the negative fluctuations of which we have experienced on the national economy.
By Ahmed Al-Jarallah
Editor-in-Chief, the Arab Times