Kuwait's diversification agenda might be less well developed than the UAE or Saudi Arabia, but its efforts to boost its non-oil economy are key to future prosperity.
As the Gulf country that relies the most on oil – it still accounts for 60 percent of its GDP – Kuwait had to confront the same economic realities as many of its neighbours when the price per barrel slipped below $30 in 2016, perhaps even more so. The country, however, has been able to face them head on with a combination of strong financial buffers, a growing service economy and an increasing appetite for foreign investment.
According to a recent report from National Bank of Kuwait (NBK), the country’s non-oil economy grew by 3.3 percent in 2017, up two percent from the previous year and slightly above NBK’s own forecast of three percent. While the pace of growth tailed off slightly in the fourth quarter to 2.4 percent, overall the economy has continued to recover from its drastic slowdown in 2014 and 2015.
However, lower oil output led GDP to shrink by 2.9 percent over the course of the year, with oil output down eight percent due to cuts imposed by OPEC and its non-OPEC partners.
In this edition of Inside AB, Jeremy Lawrence and Bernd Debusmann discuss Kuwait’s plans to reshape its economy for the future.
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(Source: Arabianbusiness.com YouTube channel)