The government last week unveiled the programs and plans it intends to pursue and implement over its current four-year parliamentary term. Submitting the work plan to parliament on 18 July, His Highness the Prime Minister Sheikh Ahmad Al-Nawaf Al-Ahmad Al-Sabah emphasized at the onset that the success of the national plan pivots on cooperation and coordination with the National Assembly, and engaging the private sector, and civil society organizations, to work together in the best interests of the people, the nation, and its future.
The prime minister commended the fruitful cooperation that was evidenced over the past week in parliament, when the executive and legislative arms worked together to enact a law that allows private companies to establish new residential cities and housing areas, as well as a law to amend the health insurance law to include more citizens in the scheme. He indicated that such cooperation was vital to ensure the welfare of citizens and the sustainable growth of the country.
Addressing the parliamentary session, the premier pointed out that the government’s work program for the period 2023 to 2027 is rooted in the executive and legislative authorities continuing to work jointly to realize projects and programs, as well as to remove obstacles and address challenges in a constructive partnership that keeps national interests at its forefront.
He noted that the government’s work document also envisages close cooperation with the private sector to help fulfill its role in sustainable development, and with civil society organizations, both of which have a central role to play in achieving progress and development of Kuwait, in accordance with the country’s vision for a future that serves the best interests of citizens and that of generations to come.
The work document titled ‘Correcting the course: product-based economy and sustainable wellbeing’, is a multi-program plan that traces its path along five axes — stabilizing public finances; economic development and promotion; job creation and capacity building; sustainable well-being and strong human capital; and strengthening the government structure.
The program includes over a hundred major economic and social initiatives and development projects that aim to promote diversification of the economy, improve performance of projects, and address economic and financial challenges. The plan also looks to improve living conditions and answer social needs of citizens, mainly in the housing, education, health and entertainment sectors.
Among the social and economic initiatives underlined in the program document are
30 legislative requirements for successfully implementing other programs; 13 projects to raise Kuwait’s educational rating; 9 projects to raise the health rating; 15 projects to improve the quality of life of citizens and enhance their well-being; and 36 projects that aim to promote private sector participation and public subscriptions.
On housing for citizens, the government’s plan pledges to distribute 43,000 houses and land to help resolve the housing problem facing Kuwaiti citizens. More than 90,000 Kuwaiti families are currently registered on the waiting list for government houses or land. The action plan also sets a number of initiatives to develop the transport sector, including opening the new Kuwait International Airport, Terminal 2 (T2) , launching the joint Gulf rail link project, completing the development of Mubarak Al-Kabeer Port on Boubyan Island, and developing the road network.
Among the mega projects to be launched, or brought to fruition during the four-year period is opening of the new T2 Airport, which is projected to increase passenger capacity to 25 million travelers annually. Developing three new runways and expanding existing ones to allow the landing and takeoff of more than 650,000 flights annually, up from the current 240,000 flights per year.
Other major construction projects include operationalizing ongoing work to build the mega Mubarak Al-Kabir Port with a projected capacity of over 8 million containers, and the building of Kuwait’s section of the pan-Gulf Railway Network that will, when completed, link Kuwait with all six Gulf Cooperation Council (GCC) states. In addition, the project for a rapid-rail link between Kuwait and Riyadh in Saudi Arabia is also under review by the public works ministry.
Additionally, the government plan calls for speedy implementation of the Failaka Island Resorts, and the Entertainment City projects. The Failaka Island Resorts, to be built over an area of 1.8 million square meters, is projected to be a major leisure, tourism and cultural attraction featuring family resorts and luxury chalets, as well as shopping and entertainment centers, along with restaurants and cafés.
On the other hand, the planned Entertainment City, to be built over an area of 2-6 million square meters in Doha to the west of Kuwait City, is projected to feature a world-class amusement park, as well as have facilities and amenities for various entertainment and recreation activities. The City is expected to draw nearly a million visitors and contribute around KD85 million to the state’s revenues by 2035 while creating over 4,000 jobs for young nationals.
With regards to initiatives to develop the energy sector, the program includes raising the production capacity of oil to 3.2 million barrels per day before the end of 2024 from the current 2.7 million barrels, and increasing natural gas production to 930 million cubic feet per day by 2027, from the current production of 521 million cubic feet. The program also calls for increasing output from sustainable energy sources to eventually contribute 15 percent of the country’s total energy mix.
The work plan also outlines developing new economic zones to boost investment and support trade through strategically located,industrial clusters in the Al Abdali Special Economic Zone to the north of Kuwait, the Al Na;ayem Economic Zone to the west, and the Al Wafra Economic Zone to the south of the country. These zones are expected to attract impact investments and create employment opportunities for Kuwaitis in line with the New Kuwait 2035 development plan.
Pointing out that the plan includes value-added, implementable projects with specific timetables, the premier noted that it calls for the setting up of an integrated framework for reviewing public sector salaries and stimulating interest and incentivizing national youth to work in the private sector. The plan also stresses the need to create an atmosphere of confidence and reassurance in the market to encourage local investment and attract foreign capital, and to formulate a revised framework for corporate tax.
Moreover, the program will initiate steps to reform fees and taxes to ensure that they are fair, efficient, and in line with best international practices. This would entail among others, issuing a general framework for periodically reviewing and re-pricing the state’s real estate property; launching a pricing mechanism for public services, fees, and irregularities; as well as, establishing a public authority to manage and invest the state’s real estates.
Under the section on financial stability projects, the action plan seeks to initiate measures to control government expenditure, including by setting a ceiling for budget spending over the mid-term; launching a standard central platform for government procurement and linking all government agencies with the platform; and diversifying income sources by promoting non-oil revenue sources.
In addition, the plan includes steps on restructuring the subsidies system that currently accounts for nearly a quarter of budget expenditure, and redirecting subsidies to only sections of society that deserve it; initiating a comprehensive framework for the restructuring of public government agencies; and launching a national framework for Kuwaitization.
On a related note, the government is pushing ahead with its program to adjust the country’s demographic imbalance by reducing the number of expatriates, who account for over 68 percent of the total population as per latest statistics. Recent data on the labor market also reflects the outcome of this retrenching policy, with more than 10,000 expat employees in the public sector terminated during the first half of this year. Plans are also reportedly underway to terminate a further 3,000 expat employees in government entities before the end of the year.
The government’s commitment to empowering human resources and enhancing the educational level is also reflected in the action plan.The cabinet recently gave its approval for the ‘Horizon Schools’ project, as well as a ‘Teacher’s License’ project, submitted by the education ministry. The Horizon project aims to launch new schools that follow a higher standard educational system, while the licensing project aims to guarantee higher quality standards for teachers. In addition, a digital learning platform will seek to provide self-learning courses, and a ‘unified national tests’ project will help enhance academic output in the country.
As part of efforts by the government to initiate economic reforms, the action plan stresses the need for preparing a general framework for restructuring the subsidy model; approving the public debt law and the framework regulating it; and revising the country’s residence law for foreign investors to attract long-term foreign investments to the country. In this regard it is interesting to note that last week, parliament’s financial and economic affairs committee approved a draft law that removes the need for foreign companies to have a local agent to work in Kuwait.
In its remarks attached to the draft law, the committee pointed out that the revised law would encourage competition in the domestic economy, improve the quality of services to the public, and reduce the overall cost of projects and services. The draft law adds that existing agencies will continue to remain valid, but foreign companies will be free to cancel their contract with their local agent after its expiry period and operate directly in the Kuwaiti market.
Establishing of a Kuwait Post Company and a company to manage fixed communications networks and optical fibers; launching the comprehensive national project for digital transformation; issuing the national strategy for privatization; developing a general framework for preparing six projects annually for partnership between the public and private sectors; privatizing the North Shuaiba Power Generation and Water Desalination Plant in the second year of the plan; and setting up a sovereign fund for domestic investments, are also among the plans and policies announced in the four-year action plan.
However, implementing the government’s plans and enacting necessary laws to buttress the policies outlined by the premier hinges on the continued cooperation of legislators in parliament. Unless this support is forthcoming, the government’s endeavor to lead the country towards sustainable development and a brighter future will likely remain largely on paper.
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