73,700 dormant companies purged to streamline business environment, boost economic growth

The Ministry of Commerce and Industry has completed a sweeping cleanup of the commercial register, removing 73,700 inactive companies — representing roughly 35% of the total 210,000 entities recorded — as well as canceling 589 mobile vehicle licenses during 2024–2025.

While the sheer scale of the purge may suggest challenges for small and medium-sized businesses, a deeper analysis highlights a strategic initiative aimed at enhancing transparency and sustainability in the local commercial ecosystem.

Ministry officials describe the exercise as a “constructive demolition,” designed to eliminate dormant or paper-based licenses that have accumulated, in some cases, since the 1960s, reports Al-Rai daily.

This process strengthens Kuwait’s commercial registry by creating an accurate and up-to-date database that reflects active business operations.

It also supports broader reforms under the “Trade” project, which identifies the real beneficial owners of companies, helping prevent the use of fictitious names and enhancing anti-money laundering and counter-terrorism financing measures.

Disclosure rates for this initiative are now close to 98%, signaling a significant procedural achievement.

The Ministry’s efforts appear to have bolstered investor confidence. Data from the first nine months of 2025 show the issuance of 32,710 new commercial licenses across various sectors, including individual businesses, micro-enterprises, freelance professionals, and special entities.

Monthly averages suggest that the total number of new licenses issued in 2025 could reach 43,000, reflecting a resilient demand for business establishment amid expectations of a strong market recovery in 2026.

Economic indicators support this optimism. MEED magazine estimates a 50% increase in contract awards during 2025, positioning Kuwait third regionally in economic activity.

Meanwhile, the International Monetary Fund projects GDP growth of 2.6% in 2025 and 3.8% in 2026, buoyed by fiscal surpluses and a robust current account exceeding 10%.

The Ministry has also streamlined procedures for establishing companies and conducting subsequent transactions, eliminating unnecessary steps to facilitate investment and support economic diversification.

Officials emphasize that the purge of inactive companies does not represent contraction but rather a targeted measure to enhance the efficiency, credibility, and resilience of Kuwait’s commercial environment.