A MASTER PLAN

Kuwait 2017 | ECONOMY | FOCUS: THE 2017-2018 DEVELOPMENT PLAN

Under the umbrella of Kuwait's Vision 2035, the 2017-2018 development plan's multiple policy initiatives bring Kuwait one step closer to becoming a regional hub for finance and investment.

The General Secretariat of the Supreme Council for Planning and Development (GSSCPD), the architects of Kuwait's ambitious Vision 2035, seeks to attain a wealth of structural economic reforms through various one-year and five-year development plans. As part of the current five-year development plan (2015-2020), the GSSCPD recently announced that the KWD4.75 billion financing of the upcoming 2017-2018 development plan would be partially borne by not only the government, but also by the private and oil sectors. In line with the government's long-term goal of diversification and privatization, the 2017-2018 development plan primarily envisages key investments in the country's large-scale infrastructure projects, the privatization of healthcare services, and human capital development.

Targeting to transform the government from an operator into a regulator, the plan is principally composed of seven cornerstones listed as short-term goals to meet the country's 2035 objectives. In view of overstaffed government bodies and complex bureaucratic regulations, the plan's first pillar will consequently introduce various e-government initiatives in 2017/18 to ensure effective government administration. Moreover, Kuwait's core endeavour of diversifying its economy will primarily be facilitated through the continuation of converting governmental bodies or state corporations into private entities, the promotion of FDI through the Kuwait Direct Investment Promotion Authority (KDIPA), fiscal budget reforms, and most notably through SME development.

With approximately 90% of Kuwait's workforce employed in the public sector, the 2017-18 development plan accordingly looks to encourage and incentivize the country's youth to either become entrepreneurs or to seek employment in Kuwait's burgeoning SME segment. In this regard, the KWD2 billion National Fund for SME Development had already been installed to enable development in this area along with initiatives from private actors, such as Arzan Financial Group or the National Technology Enterprises Company (NTEC). In light of this, the upcoming development plan additionally fosters the formation of the Kuwaiti knowledge economy by prioritizing human capital development. This does not only entail investments into domestic basic-level, vocational as well as higher-level educational institutions, but also into boosting capacities of university campuses such as Kuwait University's Sabah Al-Salem University City. In addition, the plan's fourth pillar targets to improve the capacities of Kuwait's healthcare facilities by not only increasing the number of hospital beds, but also by building new hospitals and medical centers such as Sabah Hospital, which is scheduled to open in 2018.

Yet, new healthcare facilities merely constitute one out of many ambitious infrastructure projects that are outlined as the guarantor of success for the government's long-term vision. This is why the 2017-2018 development plan particularly prioritizes public-private partnership (PPP) projects to solidify Kuwait's infrastructure. Whether it is road extensions, port redevelopments, the installation of a sophisticated ICT infrastructure, or the launch of a national railroad service—targeting significant progress or completion of up to 32 large-scale infrastructure projects—the plan most notably highlights the inauguration of the Sheikh Jaber Al-Ahmad Al-Sabah Causeway, which is set to be finished by the end of 2018. At the same time, the plan also stipulates that infrastructure projects are implemented in accordance with environmental standards to reduce the country's carbon footprint. In order to address the problem of waste management, PPP projects for solid waste and wastewater treatment facilities are currently under tender.

In addition to working towards the 2020 objective of renewables generating at least 5% of Kuwait's electricity, new smart cities, most notably South Al-Mutlaa, are considered to play a key role in ensuring a sustainable living environment. Finally, it is the development plan's cornerstones of effective governance, a diversified economy, human capital development, high-quality healthcare services, infrastructure projects, and sustainable living that are set to not only make the country more competitive in the long haul, but to put Kuwait on the map as a regional hub for finance and investment.