Economic trends
Kuwait is a rich country with a high per capita income of about 30,000 USD. Its GDP has experienced a growth rate of more than 20% during the past five years. The country has 9% of the world oil reserves. Kuwait is trying to position itself as the entrance gate for investment in the area. The public sector dominates the economy and concentrates three quarters of the country's wealth. It represents three fourths of GDP. The government is currently trying to transfer the 95% of Kuwaitis who work for the government from the public sector to the private sector. In February 2010, a 2010-2015 plan to develop infrastructure has been signed, worth USD 100 billion, with the special aim of opening the country's economy to the private sector.
Kuwait was affected by the financial crisis of 2008 (in the 4th quarter of 2008, revenues from oil decreased by 51% compared to the previous quarter) and the central bank had to provide help to one of the main banks of Kuwait which was experiencing cash shortage. The country's poorest were hurt by the crisis too. However, the country is currently coming out of crisis, namely thanks to the increase in the production of oil, and recorded a 3% growth in 2010, hoping to reach 4% in 2011. In addition to this, each year the country shows a surplus budget of between 10 to 20%, which in 2010 reached USD 29 billion.
The income from the country's oil allows to fuel a particularly generous welfare system (automatic access to public employment, artificial maintenance of public prices and prices of basic products at a very low level, high subsidies for home-buyers, generous medical insurance, etc.)
Main branches of industry
Agriculture activity is very limited due to lack of water and arable land. Agriculture contributes only 2% to GDP.
With 100 billion barrels of oil in reserve (i.e. 9% of the world's total and representing 100 years of production), the country's industry is based on oil exploitation. Income from this sector represents more than half of GDP and more than 90% of exports, i.e. more than 95% of the country's income. By 2030, Kuwait is also planning to invest more than USD 87 billion in the oil sector, especially in creating new oil refineries.
The non-oil sector is dominated by services, mostly real estate and financial services, which were relatively hit by the financial crisis.
For further information, consult the "Doing Business in Kuwait" guide by the National Bank of Kuwait.
International trade
Kuwait is highly dependent on foreign trade, which represents nearly 95% of the GDP. Kuwait's imports total 16 billion USD. The country depends especially heavily on imports of foodstuffs, consumer goods (40% of total) and semi-finished products (38% of total), which ranks it among countries with the highest per capita import rate. The imports have been increasingly quickly due to the country’s undertaking of large projects and a high private consumption demand.
Kuwait’s largest suppliers are Germany, the United States, Japan and Saudi Arabia. Imports from other Gulf countries have increased since the introduction of the GCC (Gulf Cooperation Council). The main products imported are cars, agricultural and food products, as well as mechanical industrial products, electric and electronic products.
Kuwait’s exports quadrupled between 2002 and 2008 (USD 87 billion in 2008). Exports of crude oil and refined products account for 95% of the total. The remaining amount consists of re-exports, mainly of machinery and transportation equipment.
Kuwait’s main clients are the Asian countries, especially Japan (17.5%), South Korea (13.9%), Taiwan (9.3%), as well as Singapore, India and China, but also the United States (8.2%) and some of the countries of the EU. The trade balance of Kuwait is largely positive due to the high prices of oil.
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