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Under its overarching economic development plan, New Kuwait 2035, the government is working to strategically harness the country’s location on the Gulf to transform its transport and logistics industries into key contributors to GDP. Several significant upgrades to existing transport infrastructure are at an advanced stage, while a new logistics belt is a key component of the Madinat Al Hareer, or Silk City, development – New Kuwait 2035’s flagship project. However, progress on a raft of other proposed developments that could, if completed, unlock latent economic potential for the country has stalled in recent years due to both internal and external factors, including political disagreements, complex business procedures and fluctuating international oil prices. Within the context of the Covid-19 pandemic, the importance of strong infrastructure and logistics became more evident than ever. It brought a renewed determination from Kuwait’s authorities to modernise transport infrastructure to the level required to fully realise its economic diversification plans, and facilitate the movement of people and goods within and across borders. 

This chapter contains an interview with Maen Mahmoud Razouqi, CEO, Kuwait Airways. 

Kuwait is largely reliant on oil for exports, government revenue and GDP contribution. The country is therefore particularly sensitive to fluctuating global hydrocarbons prices and the long-term financial risks associated with the global shift towards lower-carbon sources of energy. Transitioning towards a more diversified and sustainable energy mix is an ongoing challenge for the country, as for much of the region, in light of the industry’s long-standing history and key contributions to the economy.
A raft of ongoing energy projects seek to promote progress towards Kuwait’s goal of enhanced in-country value addition, as well as economic diversification and resilience to turbulent hydrocarbons prices, while also aligning the country with the international sustainability agenda. Increasing non-associated gas production, heavy oil production and crude oil processing are particularly compelling opportunities to meet Kuwait’s energy needs and align the country’s development with long-term goals.

This chapter contains an interview with Sheikh Nawaf Al Sabah, CEO, Kuwait Petroleum Corporation.

While many established global stock markets have seen mixed performance in recent years, Kuwait’s has shown positive gains, highlighting the robust nature of its capital markets. With an economy backed by rising oil prices and a solid, well-capitalised financial sector, the country continues to see international investor interest grow. Indeed, its benchmark indices recorded positive performances throughout 2021 and were among the best-performing markets in the Gulf region. A stronger regulatory framework has been created, while new products and financial technology developments have helped the country’s capital markets recover rapidly from the economic impact of the Covid-19 pandemic. Further regulatory reform, more listings and the expansion of a wider bond and sukuk (Islamic bonds) market are in the pipeline, as the financial sector looks to capitalise on Kuwait’s strong economic performance amid global uncertainties.

This chapter contains an interview with Mohamed Al Osaimi, CEO, Boursa Kuwait.

The Kuwaiti insurance sector is undergoing a period of change and growth, as a new regulatory body finds its feet and companies emerge from the Covid-19 pandemic. Stronger oversight and a move towards greater standardisation, coupled with the continuing evolution of digital insurance technology, are likely to see that trend continue, with the country’s crowded insurance field likely to consolidate in the medium to long term. Sector players remain convinced that the future will see their businesses expand; Dubai-based investment bank Alpen Capital predicts that the Kuwaiti insurance sector will outperform the regional average in the years ahead, growing by an annualised 5.3% between 2022 and 2026.

One of the world’s largest Islamic finance markets, Kuwait has a wide range of banking, sukuk (Islamic bonds) and takaful (Islamic insurance) entities and products on offer, with recent headwinds such as the Covid-19 pandemic proving little obstacle to the sharia-compliant sector’s continuing robust growth. Indeed, the country’s Islamic banks have been expanding faster than its conventional ones in recent years, with a new merger making an Islamic banking provider an even bigger player in the local market. At the same time, sukuk issuance continues to bolster the country’s capital markets, while takaful products compete for market share with well-established conventional players. Increasingly, Islamic financial technology is playing a role, with Kuwait home to many innovative fintech outfits benefitting from a central bank-supported drive towards digitalisation.

This chapter contains an interview with Abdul Wahab Al Rushood, Acting Group CEO, Kuwait Finance House.

An easing of disruptions associated with the Covid-19 pandemic, a sustained increase in oil and gas receipts, and the rollout of a new law providing a framework for establishing digital offerings have given Kuwait’s banking sector renewed confidence that has been supported by the country’s wider economic recovery. Indeed, with real GDP returning to growth in 2021 and expected by the IMF to reach as high as 8.7% in 2022, credit and profitability look set to see further expansion. The sector is notable for its high liquidity and strong capitalisation, both of which helped it navigate the uncertainties associated with the pandemic and other global headwinds. Government-led pandemic amelioration and recovery measures helped support depositors and banks, a trend reinforced by the stable rate of deposits from the retail sector and government-related entities observed during the second half of 2021.

This chapter contains an interview with Basel Al Haroon, Governor, Central Bank of Kuwait, and a dialogue with Sheikh Ahmad Duaij Jaber Al Sabah, Chairman, Commercial Bank of Kuwait; and George Richani, CEO, Al Ahli Bank of Kuwait.