What's emerging in Kuwait? | KUW8
Kuwaiti development vision:
Kuwaiti policy makers, like many of
their regional peers, are responding to an age of declining energy prices and
economic de-carbonisation through a series of economic diversification and
development plans designed to reduce dependency on oil revenues, transforming
Kuwait into a regional commercial and financial hub.
A key strategic initiative is the “New
Kuwait” development plan - designed to transform Kuwait’s economy through more
than 150 strategic programmes
across public administration reform, economic diversification, skills and
education, urban development, tourism, technology, transport healthcare and
sustainable energy. Through these projects, Kuwait aims to reduce dependency on
oil revenues, enhance sustainability and attract more foreign investment and
Examples of infrastructure developments
already underway or near completion include the Sheikh Jaber Al-Ahmad Al-Sabah
Causeway (SJSC) Project - the largest transport infrastructure endeavour in
Kuwait. Spanning the Kuwait Bay, the 36-km Subiyah Link links the capital
Kuwait City with the northern Subiyah area. Its main cable stayed bridge, is
scheduled for completion in 2019.
is also upgrading airport infrastructure with a new Foster & Partners
designed T4 terminal for the national carrier, Kuwait airlines and a new KD 1.3
Billion T2 general passenger terminal with an annual capacity of 25 million
passengers (pictured below).
This increase in passenger handling
capacity is partly due to the expanding tourism industry in Kuwait. According
to the World Travel and Tourism Council (WTTC), tourist arrivals are expected
to increase from 270,000 in 2014 to 440,000 by 2024, with foreign corporations
providing the much needed additional hotel space. The Four Seasons has recently
opened at the Burj Alshaya Centre, with Hilton, Mercure and Grand Hyatt under
construction and expected to open by 2020.
Energy market diversification is also
occurring, including the construction of 25,000 megawatts renewable energy
complex located at Shagaya, Jahra, Kuwait.
In one of the largest developments of
2018, Kuwait and China signed a memorandum of understanding in November of
2018, forming a strategic partnership to further the development of the Silk
City in Kuwait which is a proposed 250 KM squared area in the Subiya area. The
$86bn project is designed to help promote Kuwait to a global investment hub. The
MOU also includes development plans for five islands off the coast of Kuwait.
Developments have also occurred in the
infrastructure of Kuwaiti capital markets.
In mid-December, 2018 the Ministry of Commerce and Industry announced
changes that allow for foreign ownership of domestic bank shares.
Under the reform, foreign investors
will now be able to hold up to 5% of the capital of a Kuwaiti bank, with
investors able to increase participation above this threshold with
authorisation from the Central Bank of Kuwait.
The ceiling on overall foreign
ownership in any single lender has been set at 49%. The move to open up the
banking industry is the latest in a series of measures aimed at encouraging
investment in the financial sector, including reclassifying of Kuwaiti Stock
Exchange indices into three groupings – Premier, Main, and Auction in April