Oil rev­enue man­age­ment chal­lenge fac­ing Kuwait’s econ­omy: Ex­pert

Kuwait Times - - LOCAL -

KUWAIT: The main chal­lenge fac­ing the Kuwaiti econ­omy lies in “how to man­age oil rev­enues and pre­pare for the post-oil era,” an in­ter­na­tional eco­nomic ex­pert said in re­marks pub­lished on Mon­day.

The bud­get deficit for the cur­rent and next years is not a real prob­lem, but the real chal­lenge is in the post-oil pe­riod that “we must pre­pare for with a clear vi­sion,” Shanta De­vara­jan, Chief Econ­o­mist of the World Bank’s Mid­dle East and North Africa Re­gion, told the Kuwaiti Ara­bic-lan­guage daily news­pa­per Al-Qabas, which pub­lished his re­marks in its yes­ter­day’s edi­tion.

Kuwait’s econ­omy needs fur­ther re­forms in the in­fra­struc­ture, as the lo­cal mar­ket is dom­i­nated by monopoly, he said, and stressed the need for “open­ing wider prospects in the mar­ket, lead­ing to di­ver­sity in dif­fer­ent sec­tors.”

The busi­ness en­vi­ron­ment in Kuwait is rel­a­tively lim­ited where the “so­lu­tion is sim­i­lar to what some of Gulf Co­op­er­a­tion Coun­cil (GCC) coun­tries are do­ing to open the doors for com­pe­ti­tion and give small and medium com­pa­nies the op­por­tu­nity to grow,” De­vara­jan said.

Kuwait’s econ­omy needs to re-direct the na­tional la­bor where 90 per­cent of the jobs are con­cen­trated in the gov­ern­ment ap­pa­ra­tuses, “which is not cor­rect,” he said, not­ing that Kuwait has to cre­ate a com­pet­i­tive econ­omy for the in­volve­ment in the pri­vate sec­tor rather than the pub­lic.

He also called for match­ing grad­u­ates’ spe­cial­ties with the na­tional econ­omy re­quire­ments, adding that “Kuwait spends more on ed­u­ca­tion but should look at the ef­fi­ciency of the out­put for en­hance­ment of the econ­omy with skilled employees.”

The bank­ing sec­tor needs more real com­pe­ti­tion with al­low­ing for­eign banks to open sev­eral branches in­stead of one branch, which will re­duce com­pe­ti­tion in the mar­ket, he said, call­ing to fa­cil­i­tate the pro­ce­dures for ob­tain­ing ad­e­quate fund­ing for small and medium projects. —KUNA

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