For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.
Kuwait is a very rich country and has developed a welfare state for its nationals, who enjoy a very high per capita income. Kuwait's economic growth was negative at -0.6% in 2019 as lower oil output and weaker oil prices offset the steady expansion of the non-oil sector. Due to the COVID-19 pandemic, it plummeted to -8.9% in 2020 but came back to positive territory at 1.3% in 2021 before reaching over 8.7% in 2022. It was expected to slow down to 2.6% in 2023 and 2024, subject to the post-pandemic global economic recovery (IMF, January 2023). Government spending, employment and credit growth are expected to support economic activity in the short term; nonetheless, this will depend on stable oil prices and higher oil output.
Kuwait’s public finances were relatively healthy in 2020, with a debt-to-GDP ratio of 11.7% that year. Despite the international context created by the COVID-19 pandemic the ratios decrease to only 8.7% in 2021 and 7.1% in 2022. It is expected to remain low with 6.9% in 2023 and 6.5% in 2024. Government spending is also expected to increase in the coming years amid plans to boost credit, employment and wages. At the same time, tax collection remains low as the government has delayed the introduction of a VAT and an excise tax on tobacco and sugary drinks. The excise tax and the VAT are set to be introduced in 2023. Low fiscal revenues combined with reduced oil export earnings, due to falling global oil prices and OPEC oil production in the wake of the Covid-19 pandemic, haven't put pressure on the current account surplus: it went from 3.2% in 2020 to 16.3% in 2021 and 29.1% in 2022. The current account balance is estimated to decrease to 23% in 2023 and 19.8% in 2024 (IMF, January 2023). Inflation ticked up to 3.4% in 2021 from 2.1% a year earlier, and then 4.3% in 2022. It should stabilise at 2.4% in 2023 and 2024 (IMF, 2023). Kuwait's plans to introduce a new debt law continues to be delayed, with the Parliament expected to review the law proposal in the medium term. Contrary to most countries, Kuwait can’t borrow money on international markets, for lack of legislation. A lack of debt law means that the government has been unable to issue debt since October 2017 and had to resort to General Reserves Fund for financing purposes. The continued drawdown from the Fund also weighed on Kuwait Investment Authority's assets - manager of the said fund - despite mandatory transfers from the government to its Future Generations Fund.
Persian Gulf nations, among the world’s richest at the turn of the century, have lost ground as the oil price receded. Bahrain, Kuwait, Oman and Saudi Arabia are all dropping out of the global top 20 as living standards stagnate or decline. Most of the country's wealth is concentrated in the hands of local citizens, while the majority of workers (especially from Asia) live in poor conditions. Unemployment rate is almost non-existent.
The Kuwait Investment Authority’s assets will continue to act as a fiscal backstop. It is the world's oldest sovereign wealth fund. As of April 2022, it was the world's 3rd largest sovereign wealth fund with 738 billion USD in assets under management. As oil export earnings recover in the medium term, underpinned by improvements in global demand conditions, and as concerns over the pandemic wane, the current account balance will continue to expand. A downside risk to this is economic recovery in China, which constitutes 25 percent of Kuwait’s exports (World Bank, 2022).
|Main Indicators||2020||2021||2022 (E)||2023 (E)||2024 (E)|
|GDP (billions USD)||105.95||136.80||184.56||164.71||165.21|
|GDP (Constant Prices, Annual % Change)||-8.9||1.3||8.2||0.9||2.7|
|GDP per Capita (USD)||22,684||28,884||38,329||33,646||33,194|
|General Government Gross Debt (in % of GDP)||11.7||8.7||2.9||3.0||3.0|
|Inflation Rate (%)||2.1||3.5||3.9||3.3||2.6|
|Unemployment Rate (% of the Labour Force)||1.3||1.3||0.0||0.0||0.0|
|Current Account (billions USD)||4.22||32.38||52.58||32.44||27.69|
|Current Account (in % of GDP)||4.0||23.7||28.5||19.7||16.8|
Source: IMF – World Economic Outlook Database , Latest available data
Note: (e) Estimated Data
Agriculture is very limited in the country due to lack of water and fertile land. The agricultural sector is constituted mainly by fishing activities and contributed only 0.5% to the GDP, employing 2% of the workforce in 2022 (World Bank, 2023).
With 102 billion barrels of oil in reserve (i.e. 6% of the world's total and representing 100 years of production), the country's industry is based on oil exploitation. This sector accounts for nearly half of Kuwait’s GDP, around 95% of exports, and approximately 91% of government revenue.(OPEC, 2023). By 2030, Kuwait is planning to invest more than USD 87 billion in the oil sector, especially in creating new oil refineries. Overall, the industrial sector contributed more than half of GDP (45.4%) and employed 22% of the total workforce in 2022 (world Bank, 2023).
The services sector represented around 69.1% of the GDP and employed 76% of the active population in 2022 (world Bank, 2023). The most important sub-sectors are mostly real estate and financial services, which were recently recoverd from the global financial crisis.
|Breakdown of Economic Activity By Sector||Agriculture||Industry||Services|
|Employment By Sector (in % of Total Employment)||1.8||22.1||76.1|
|Value Added (in % of GDP)||0.5||45.4||69.1|
|Value Added (Annual % Change)||-3.9||-12.2||-3.2|
Source: World Bank - Latest available data.
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|Kuwaiti Dinar (KWD) - Average Annual Exchange Rate For 1 MUR||0.01||0.01||0.01||0.01||0.01|
Source: World Bank - Latest available data.
Find out all the exchange rates daily on our service Currency Converter.
The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.
The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.
Kuwait is highly dependent on foreign trade, which represented 98 % of the GDP in 2021, the latest World Bank data available. As the fourth largest OPEC oil producer, Kuwait's exports earnings mainly come from mineral fuels, oils and distillation products (over 95% of total exports and accounting for almost 50% of the GDP). On the other hand, the country depends particularly on imports of food products, consumer goods and semi-finished products. Imports have increased quickly in recent years due to the country’s undertaking of large projects and a high private consumption demand, and for 2022 they were led by motor cars, radio-telephony transmission tools, medicines, electronics equipments, and jewellery.
Kuwait exports to a wide number of countries, the main ones being United Arab Emirates (1.3%), Saudi Arabia, China, India and Iraq. Kuwait’s largest suppliers are China (18%), the UAE (11.9%), the United States (8%), and Japan with 5.8% (Trading Economics, 2023). Imports from other Gulf countries have increased since joining the GCC (Gulf Cooperation Council).
The county’s exports largely depend on its oil output and global oil prices. In 2021, export of goods increased from 40.11 billion USD in 2020 to 63.12 billion USD, while imports of goods increased from 27.73 billion USD in 2020 to 31.88 billion USD in 2021. This figure is low compared to 2013-14, when the country exported more than double this value. Kuwait has a structurally positive trade balance; however, the country is a net importer of services. In 2021, Kuwait's trade balance excluding services was USD 28.16 billion against USD 3.40 billion a year earlier. Kuwait has been recording trade surpluses since 1993 due to shipments of oil.
|Foreign Trade Indicators||2017||2018||2019||2020||2021|
|Imports of Goods (million USD)||33,573||35,864||33,574||27,738||31,889|
|Exports of Goods (million USD)||55,015||71,938||64,483||40,116||63,128|
|Imports of Services (million USD)||27,180||35,388||28,650||17,464||20,675|
|Exports of Services (million USD)||4,722||7,561||7,480||6,703||10,838|
|Imports of Goods and Services (Annual % Change)||9.2||1.5||-10.4||n/a||n/a|
|Exports of Goods and Services (Annual % Change)||-4.8||-0.4||-10.1||n/a||n/a|
|Imports of Goods and Services (in % of GDP)||46.6||45.6||44.9||n/a||n/a|
|Exports of Goods and Services (in % of GDP)||51.2||57.5||53.3||n/a||n/a|
|Trade Balance (million USD)||25,648||45,711||35,361||15,412||40,550|
|Trade Balance (Including Service) (million USD)||2,727||16,994||13,180||3,401||28,167|
|Foreign Trade (in % of GDP)||97.8||103.1||98.2||n/a||n/a|
Source: WTO – World Trade Organisation ; World Bank , Latest Available Data
(% of Exports)
|United Arab Emirates||1.3%|
|See More Countries||94.5%|
(% of Imports)
|United Arab Emirates||11.9%|
|See More Countries||51.1%|
Source: Comtrade, Latest Available Data
|63.1 bn USD of products exported in 2021|
|Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude||66.2%|
|Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals||20.8%|
|Petroleum gas and other gaseous hydrocarbonsPetroleum gas and other gaseous hydrocarbons||4.7%|
|Sulphonated, nitrated or nitrosated derivatives of...Sulphonated, nitrated or nitrosated derivatives of hydrocarbons, whether or not halogenated||1.6%|
|Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702)||1.2%|
|See More Products||5.5%|
|31.9 bn USD of products imported in 2021|
|Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702)||9.3%|
|Telephone sets, incl. telephones for cellular...Telephone sets, incl. telephones for cellular networks or for other wireless networks; other apparatus for the transmission or reception of voice, images or other data, incl. apparatus for communication in a wired or wireless network [such as a local or wide area network]; parts thereof (excl. than transmission or reception apparatus of heading 8443, 8525, 8527 or 8528)||4.3%|
|Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses "incl. those in the form of transdermal administration" or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006)||3.5%|
|Gold, incl. gold plated with platinum, unwrought...Gold, incl. gold plated with platinum, unwrought or not further worked than semi-manufactured or in powder form||3.2%|
|Motor vehicles for the transport of goods, incl....Motor vehicles for the transport of goods, incl. chassis with engine and cab||1.6%|
|See More Products||78.1%|
Source: Comtrade, Latest Available Data
To go further, check out our service Import Export Flows.
|7.4 bn USD of services exported in 2020|
|Telecommunications servicesTelecommunications services||57.56%|
|Sea transportSea transport||6.57%|
|Air transportAir transport||2.44%|
|Personal travelPersonal travel||9.84%|
|Miscellaneous business,...Miscellaneous business, professional, and technical services||0.36%|
|Legal, accounting, management...Legal, accounting, management consulting, and public relations||0.72%|
|18.0 bn USD of services imported in 2020|
|Personal travelPersonal travel||31.95%|
|Construction in the compiling...Construction in the compiling economy||19.66%|
|Sea transportSea transport||0.05%|
|Miscellaneous business,...Miscellaneous business, professional, and technical services||8.67%|
|Legal, accounting, management...Legal, accounting, management consulting, and public relations||17.35%|
|Telecommunications servicesTelecommunications services||1.27%|
Source: United Nations Statistics Division, Latest Available Data
Hadas, officially the Islamic Constitutional Movement, is a Kuwaiti Islamist political organization, offshoot of the Muslim Brotherhood.
The National Islamic Alliance is another (Shia) political party in Kuwait.
The National Democratic Alliance (Centre right)
Kuwait Democratic Forum (Centre left)
The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).
The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
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