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Country ProfileStrategically located at the head of the GulfPopulation numbers about 3.5m peopleEducation and development remain prioritiesBoubyan Island set to receive a new port facility

COUNTRY PROFILE

The population numbers about 3.5m, with 25% Kuwaiti nationals

Since gaining independence in 1961, Kuwait has beenof the most economically productive and politicallyliberal nations in the Gulf Cooperation Council (GCC)and the wider Arab world. With strong public finances,a young and well-educated population, and vast oildeposits, the country also has a bright future in theglobal economy, where it looks set to play a moreassertive and influential role. Yet, despite past andongoing success, Kuwait has entered a challengingperiod in its history, one that will have a profoundimpact on the country’s long-term growth prospects.DEVELOPMENT: In 2010, the government initiateda five-year KD31bn ($111.76bn) development plan fea-turing ambitious capital projects designed to pro-mote economic diversification, upgrade the country’sinfrastructure and boost oil production capacity.Although the plan’s approval in the National Assem-bly was an historic achievement, many are concernedthat recurring political disputes between ministersand parliamentarians will delay its implementation. Fur-ther, Kuwait’s continued progress depends on thestate’s ability to shift more economic activity to theprivate sector, which currently accounts for only 37%of GDP. By passing new legislation regarding privati-sation, capital markets and labour laws, and by encour-aging public-private partnerships, officials plan toincrease the private sector’s share of GDP to 44% bythe time that the development plan ends in 2014. HISTORY: Modern-day Kuwait was established dur-ing the 17th century by the Bani Khalid tribe in Ara-bia. In the mid-1800s, the Al Sabah dynasty came topower, a ruling family that still governs the countrytoday under a hereditary constitutional monarchy.

As the area came under pressure from the OttomanEmpire during the 19th century, Kuwait sought pro-tection from the West, and became a protectorate ofthe British Empire. Throughout the 19th century,Kuwait benefitted from its strategic location alongtrade routes, and became a major centre for theexchange of spices and pearls. The government began

creating internationally-recognised boundaries in thedecades following the First World War, and in 1938oil was first discovered. After declaring independencefrom the British in 1961, the nation accelerated oilproduction and signed new border agreements withIraq and Saudi Arabia. However, recurring border dis-putes with Iraq culminated in that country’s invasionof Kuwait in 1990, followed by a UN-mandated inter-vention, led by the US. Kuwait was liberated in 1991after a seven-month Iraqi occupation, but fleeing Iraqiforces set fire to 749 oil wells, which caused huge finan-cial losses for the state as well as widespread envi-ronmental devastation.

Kuwait has largely recovered from the Iraqi invasion,and has regained its status as one of the world’slargest oil exporters. Many are looking towards a newera, characterised by improved relations betweenKuwait and the Iraqi government.

Kuwait maintains excellent diplomatic and econom-ic relations with the international community. Tieswith the US are particularly strong, as reflected byKuwait’s public support for the US-led invasion of Iraqin 2003. While the US has begun reducing its pres-ence in the region, Kuwait continues to serve as animportant logistics base for American military andcivilian reconstruction operations. POPULATION: Kuwait’s population is roughly 3.5m,about one quarter of which are Kuwaiti nationals. Tra-ditionally Kuwaitis have favoured working in the pub-lic sector, but they are now joining the private labourforce in rising numbers, a trend the authorities wantto encourage going forward. In 2010, some 20% ofKuwaiti nationals were privately employed, up from16% in 2007. Numbering about 2.4m, the nation’sexpatriate community is predominantly comprised ofworkers from the Indian subcontinent, the MiddleEast, and South-east Asia. Given the anticipated rateof construction over the next several years, it is expect-ed that in the medium term these numbers mayincrease further. In the long term though it is hoped

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THE REPORT Kuwait 2012

Strong and steadyEducation and development remain priorities

COUNTRY PROFILE

continued infrastructure development will stimulateprivate consumption and the real estate market. RELIGION & CULTURE: According to the Kuwaiticonstitution, Islam is the official state religion, andsharia law is one of the key sources of legislation.Compared to other Gulf nations, such as the UAE,Bahrain or Qatar, Kuwait adheres to a fairly conser-vative interpretation of Islam. However, Islamic prac-tices in Kuwait are considered more liberal than thosein Saudi Arabia, where Wahabism is dominant. Thoughmost of Kuwait’s Muslims are Sunni, including the rul-ing family, there is a substantial Shia minority thatrepresents between 15% and 30% of the total popu-lation. Kuwait also has sizeable Christian, Hindu andBuddhist communities, which have been granted free-dom of worship under the constitution. LANGUAGE: The official language in Kuwait is Ara-bic, which is used in all government announcementsand documentation. It is recommended correspon-dence with government offices be conducted in Mod-ern Standard Arabic, as English speakers are not alwaysavailable. Nevertheless, English is widely used andunderstood, especially in academia and the businesscommunity. English is also included in the national cur-riculum, and it is quite common for Kuwaitis to studyabroad at universities located in the US or UK. TheKuwait Times and the Arab Times are the country’s twomain English-language newspapers. EDUCATION: Overseen by the Ministry of Education(MoE), public schooling is compulsory for all childrenaged 6-14. After kindergarten, the general educationsystem is divided into three tiers – elementary, inter-mediate and secondary – each of which entails fouryears of study. Although public schools are segregat-ed by sex, women are granted the same rights to edu-cation as men, and account for just under half ofenrolment in domestic universities. Public educationis completely free for nationals, with the governmentpaying for transportation, meals, books and medicalattention for students. The government also provides

generous subsidies for nationals attending privateand international schools, which are monitored bythe Private Education Department at the MoE. Privateschools have expanded rapidly in recent years, withKuwaiti families increasingly opting to send their chil-dren to academies that offer Western-style curricu-la taught in English. Private schools also cater to thecountry’s large expatriate population.

Post-secondary schooling is overseen by the Min-istry of Higher Education, which regulates universityaccreditation and staff qualification. Established in1966, Kuwait University is the country’s first and onlypublic higher education institution. There are also anumber of private tertiary schools, including the GulfInstitute of Science and Technology, the AmericanUniversity of Kuwait, the Arab Open University and theAustralian College of Kuwait. Overall, around 75% ofthe eligible population is currently using higher edu-cation facilities in one form or another. GEOGRAPHY & CLIMATE: Kuwait is strategicallylocated at the head of the Gulf in the north-east cor-ner of the Arabian peninsula. It shares land borderswith Saudi Arabia to the south and Iraq in the north,and a sea border to the east with Iran. At 17,818 sqkm, it is one of the world’s smallest countries, thoughit has 500 km of coastline, and its sovereign territo-ry includes nine Gulf islands. The island of Failaka, atthe mouth of Kuwait Bay, is densely populated and con-tains an ancient Greek temple built by the army ofAlexander the Great. Boubyan Island, meanwhile, hasbeen slated for significant development, with nearly$4bn allocated for a new port facility.

Kuwait is primarily flat desert plain, and only 20%of the nation’s land area is currently inhabited. Thecountry has no access to natural water reservoirs,and has one of the lowest per capita fresh water sup-plies in the world, with roughly 90% of its waterresources derived from seawater desalination.

The country has an arid climate, with hot and drysummers lasting from April to September, when tem-peratures can climb past 50° Celsius. Winter weath-er typically begins in November, when temperaturesrange from 15-20° Celsius, but can drop in the evening,sometimes to as far as 0° Celsius. Rainfall only aver-ages 110 mm per year, occurring intermittently in thewinter and spring seasons. NATURAL RESOURCES: Kuwait has an abundantsupply of hydrocarbons, as it contains nearly 10% ofthe world’s oil reserves. In the 2010/11 fiscal year, oilrevenues grew 17% to KD19.4bn ($69.9bn), account-ing for 93% of total revenue. Each day, the country’smajor refineries produce over 3m barrels of oil, withplans in place to boost production capacity to 3.5mbarrels per day by 2015, and 4m by 2020.

Outside of the oil and gas section, the country hassufficient seafood to support an active fishing indus-try. Overall, around 50% of seafood comes from localfisheries, though concerns exist regarding overfish-ing and seafood depletion. Generally, the nation’soverall food requirements are served by imports froma variety of foreign markets, instead of domestically.

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Public education is completely free for nationals, with the government also covering most related costs

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