THE huge revenues that Kuwait continues to receive from its oil industry have made it a wealthy country with less need of foreign capital than other developing nations.

What the emirate does need, however, is advanced technology, expertise, and know-how in areas such as oil production, power generation, and telecommunications, in addition to access to international marketing networks. These are requirements that U.S. firms are in a good position to provide.

Kuwait is now taking active steps to attract investment, particularly into the non-oil sectors of its economy that it would like to develop, such as tourism.

In a speech during his recent visit to Washington, Prime Minister Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah extended a particular welcome to U.S. investors.

“We emphasize that we will facilitate the participation of the American business community in the private sector when it implements ambitious economic projects in the State of Kuwait,” he said.

The emirate has revised its former restrictive investment rules with a new Foreign Investment Law that allows 100% foreign ownership in companies in most sectors.

The law also grants a 10-year tax exemption to foreign businesses. Before it came into effect, the 55% tax that foreign companies had to pay on profits from the start of operations had deterred investment. 

Just before the National Assembly went into recess for the summer, the Financial and Economic Affairs Committee agreed with a government proposal to reduce corporate tax on foreign companies to 15%.

Steps are being taken to cut through red tape and to simplify and streamline bureaucratic processes. Visa regulations have been relaxed for 34 nationalities that are now able to obtain entry visas at the airport or other points of arrival.
The emirate has also established the Kuwait Foreign Investment Bureau (KFIB), tasked with facilitating procedures and formalities for foreign investors.
The Kuwait Stock Ex-change (KSE), the most developed financial market in the region, is also now open to foreign investors, and there are extensive opportunities in the privatization program.

Kuwait itself is an affluent, if small, market with a taste for American products. For U.S. companies with wider ambitions, it can provide a secure, reliable base. The emirate’s location at the top of the Arabian Gulf makes it an ideal gateway to the other member states of the Gulf Cooperation Council (GCC) —Bahrain, Oman, Qatar, Saudi Arabia, and the United Arab Emirates—as well as the big potential markets of Iran and Iraq.