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Sun 22 Feb 2009 09:14 AM

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Kuwait's private sector proposes 'salvation' fund

Kuwait Economic Society suggests local companies donate 7.5% profits, foreign 5%.

The private sector in Kuwait should set up a special fund to bailout failing companies rather than relying on government money, it was reported on Sunday.

The Kuwait Economic Society (KES) suggested the private sector should compensate public funds that were lost as a result of government funds being used to rescue private companies during the economic downturn.

KES chairperson Rola Dashti described the fund as a 'salvation project', to which local companies could contribute up to 7.5per cent of their profit and foreign firms five percent, she told a press conference, according to Kuwait daily Kuwait Times.

”With this fund, the private sector will partake in solving the economic problem and, at the same time, ensure citizens that funds used to save certain companies would be regained in full," Dashri said.

Her comments come as the Kuwaiti finance and economic department considers a $5bn rescue package drawn up by the Kuwait government for struggling companies.

Dashri called on this department to include the KES in its meetings, adding that any company that took advantage of the governemnt’s rescu package should be mandated to ensure up to 35 percent of their workforce were Kuwaitis.  .

KES member Abdul Hameed Hussein added that despite the economic problems there were investment opportunities, pointing out that the current climate was leading to reform and revival of the country’s private sector.

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