Reporter Fheed Alswiri outlines Kuwait's recent development milestones and its emergence as a prominent business and tourism hub in the Gulf Cooperation Council (GCC) region.
Signs of Progress in Kuwait's Economy
Key economic indicators for the year 2020 highlight Kuwait's economic advancement: Gross Domestic Product: $306.4 billion. Economic growth rate: 1.7% Compound annual growth over the past five years: 0.5%. Average annual per capita income: $67,000. Unemployment rate: 2.1% Inflation rate: 0.7% Foreign direct investment amount: $345.5 million. These indicators have propelled Kuwait to an economic freedom index of 63.2, positioning it as the 79th most economically free country globally. This achievement reflects the government's dedication to upholding integrity and fostering economic freedom, ranking Kuwait eighth out of 14 countries in the Middle East and North Africa region, surpassing regional and global economic integrity averages.
Kuwait has transitioned from a period of moderate economic freedom since its inclusion in the economic index in 1996. The economy faced stagnation in GDP growth in the five years leading up to 2020, prompting the government to prioritize economic reform, diversification, and reducing reliance on oil. To address impediments to economic growth such as corruption and bureaucratic inefficiencies, Kuwait focused on enhancing the investment climate. The Kuwaiti economy revolves around three primary sectors:
1. Oil Sector: With around 100 billion barrels of oil reserves, Kuwait accounts for 9% of global reserves. The oil sector contributes significantly to the economy, representing approximately 48.4% of GDP and over 90% of exports. By investing $87 billion by 2030, Kuwait aims to increase the sector's contribution to GDP to around 59.6% and employ 25.4% of the workforce.
2. Services Sector: Comprising about 51.1% of GDP, this sector employs roughly 72.4% of the population, including sub-sectors like real estate and financial services.
3. Agricultural Sector: Due to water scarcity and desert conditions, agriculture plays a minor role in the economy, primarily focusing on fishing and employing only 2.2% of the workforce.
Construction Landscape in Kuwait
Kuwait's construction sector features diverse projects across commercial, residential, industrial, infrastructure, and energy segments as part of its development plan spanning 2015-2020. The nation aims to become a regional financial and commercial hub by 2035, emphasizing economic reform and diversification away from oil and gas. This long-term vision involves implementing major economic reforms to boost the private sector and undertaking ambitious projects over five years, supported by an initial budget of $155 billion.
orting the development of renewable energy projects, including solar and wind power. Upgrading and expanding the healthcare infrastructure by constructing new hospitals and healthcare facilities. Enhancing the education sector by building new schools and universities. Improving the transportation network by expanding roads and public transportation systems. Investing in technology and innovation to support digital transformation initiatives. Overall, this budget aims to drive economic growth, create job opportunities, and enhance the quality of life for the people of Kuwait.
