Kuwait rankings need a relook
Numerous economic indicators place Kuwait at the bottom of rankings among its peers in the Gulf Cooperation Council. But this situation is not truly reflective of the country’s economic potential, and requires a review by the many stakeholders, including the appointed cabinet and elected parliament.
For example, Kuwait lost 14 positions, the worst performance among the GCC economies, in the 2017-18 competitiveness index by the World Economic Forum. It grants Kuwait the 52nd ranking among 137 economies, and translates into a ranking only ahead of Oman.
The index classifies covered economies on the basis of three broad categories, namely in having the basic infrastructure, efficiency, and innovation and evolution.
Kuwait ranked 96th among 130 countries in the 2017 human capital index, also from the World Economic Forum. This is the worst among GCC members. Reviewed economies are classified on the basis of education, participation in the labour force, gender gap, unemployment, vocational training and knowledge of skilled personnel.
In addition, Kuwait is placed 102nd out of 190 economies classified in the Doing Business 2017 report, published by the World Bank. Again, this is the worst among GCC states.
Undoubtedly, Kuwait’s placement on some global indicators is not commensurate with the country’s human and material potential on the one hand, and its historical successes on the other.
The Kuwait Investment Authority was set up in 1953, a year after the Saudi Arabian Monetary Agency (SAMA). Currently, Kuwait’s sovereign wealth ranks third in the GCC after the UAE and Saudi Arabia.
In reality, Kuwaiti investments via KIA have been an important source of non-oil revenues. It benefited from investment-led revenues to finance the war of liberation in 1990 and to provide a decent way of life for its citizens during the Iraqi occupation.
The way Kuwait treated its citizens during the invasion is extraordinary by any standard.
Moreover, the oil sector, through Kuwait Petroleum Corporation has been noted for its international outlook, including exploration and the development of refineries. The Q8 brand of KPC in parts of Europe became known for selling petroleum products at the retail level and as a supplier of aviation fuel.
Kuwait pioneered the liberalisation of the telecom industry in GCC by allowing Wataniya to compete in the mobile telephony market. Currently, there is competition in the telecom sector in all GCC countries, unquestionably the right thing in an industry known for producing exceptional profits thanks to steady demand.
The Kuwaiti mobile telephony firms of Zain and Wataniya were ahead of other GCC countries in expanding their presence in Asia and Africa. Zain emerged as the first external telecom company to operate in Bahrain’s mobile telecom market. Wataniya has presence in Algeria and Tunisia.
In short, the Kuwaiti economy has the ability to achieve enhanced results. And its investors have international horizons. However, the authorities and legislators need to create the right conditions, including an absence of trade barriers.