A World Bank delegation is visiting the oil-rich nation of Kuwait, as part of an attempt to spark the private sector, which contributes 25 percent of total Gross Domestic Product (GDP).
Having already met with government officials, economists and representatives from the private sector, the team will examine barriers to real economic reform. The delegation will also propose methods of transferring and reforming state-run services to the private sector.
"This is not the first visit. World Bank and International Monetary Fund (IMF) teams have been visiting Kuwait since 1992 to advise on liberalizing the economy," remarked Mahdi al-Jazzaf, a Kuwaiti economics professor.
Some of the practical measures being adopted and that will be taken in the future to stimulate the private sector include: a field study of 600 private firms, focus on attracting foreign investment, the use of advanced technology, and general economic reform.
Privatization in Kuwait has been hampered in the past by opposition from parliament, and due to a lack of clear privatization plans.
"Kuwait needs technology and capital to be invested in strategic sectors. This can be brought by foreign firms," Jazzaf commented.
Kuwait boasts 10 percent (96.5 billion barrels) of the world's proven oil reserves, according to the Energy Information Administration. Furthermore, the nation is experiencing the best economic results in two decades, with a surplus of more than $3.9 billion posted in 1999. Kuwait's real GDP grew by 2.1 percent in 1999, after sinking by 10.5 percent during the slump in oil prices in 1998. Real GDP growth for 2000 is projected at 5.5 percent. Along with Saudi Arabia and the United Arab Emirates, Kuwait remains one of the few oil producing countries with significant excess oil production capacity. The country has been profiting from recent oil price skyrocketing. –(Albawaba-MEBG)
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