As Kuwait’s economy continues to adjust to the new oil price environment the country’s government is pushing ahead with investment plans and reforms that promise to put the country on a sustainable growth path in the coming years.
Kuwait has moved to increase private sector participation in the economy as part of broader diversification plans, calling for offers from companies to build and operate two utilities projects under a public-private partnership (PPP) model.
Kuwait’s stock exchange is accelerating efforts to raise its profile both internationally and at home, expanding the range of products on offer and easing listing requirements, moves that could see it granted emerging market status by 2020.
Increased government spending and higher oil prices are set to drive growth in Kuwait’s banking sector, with increased profits and liquidity supporting a recent rebound in activity.
Amid a backdrop of recovering commodity prices and stronger economic growth, in mid-May Kuwait decided to postpone introduction of value-added tax (VAT) until 2021, although it still intends to implement an excise tax as scheduled.
Stronger economic growth and increased domestic employment levels could increase access to credit for real estate in Kuwait, although a decline in the number of expatriates, along with excess stock, may pose challenges for the rental market.
An airport infrastructure expansion set to come into operation this year will help Kuwait keep pace with strong growth in passenger movements, as local carriers continue with network expansions and fleet upgrades.