Expatriates aren’t generally allowed to become part of the permanent population. Foreign workers are dealt with in a fair but controlled way, paid and treated well, and at the end of their time in the region, thanked and rewarded for their efforts. On the other hand, the government is conscious of the need to provide decent jobs with career paths for their own young people, who are increasingly educated and aware of the attractions of the outside world – many attend universities in the USA or UK. Having made major investments in education and social welfare, they hope that eventually Kuwait will become almost self-sufficient in terms of labour.
A majority of outside observers, however, believe that expatriates will have a substantial role to play for many years to come, and it seems likely that expatriates will continue to be important for the next two or three decades, although there will undoubtedly be changes in the number of people employed and the type of skills required. For example, the vast construction projects currently found throughout the region (e.g. road systems, airports, ports and trading zones) will become less numerous, with a resulting decline in the number of manual workers required. Commercial development, however, will lead to further building programmes as Kuwait’s economy continues to grow. Managerial, professional and particularly technological experience will still be in strong demand for many years to come. But there will be none of the mass immigration and resulting demands for citizenship that have been experienced in western societies, or the current trend of economic refugees looking for a better way of life. Kuwait will simply not allow it. Foreigners cannot become citizens or own land and property, although there appears to be some lessening of the restrictions, certainly as regards owning one’s own business.
There are other general issues to consider: you’re contemplating a move to a culture that’s almost certainly different to your own; will the way of life, and particularly the restrictions imposed on you, suit you? Will the relocation benefit your long-term career prospects? Will your family (especially any children) cope with and benefit from the move? What impact will it have on their education and employment prospects? If you aspire to be your own boss, as many people do, be aware that starting a business in the region can prove difficult and that you will almost always be required to have a local partner who has a majority holding. Is that acceptable to you?
The Middle East has been the scene of considerable conflict and unrest in recent decades, although the Gulf states are generally safe places to live and work. However, before travelling anywhere in the Middle East, it’s wise to obtain advice from your country’s foreign office. Note also that homosexuality is regarded as a criminal offence throughout the region.
You should ideally have a firm offer of employment before travelling to Kuwait. Speculative visits are occasionally successful, but you need to be notably lucky and have high-grade qualifications and experience to stand any chance. In addition, you will almost certainly need knowledgeable local contacts and have done some research into the types of company which would most value your experience.
Kuwait is the third-largest oil producer in the Middle East, after Saudi Arabia and Iraq. It has great wealth and is of tremendous strategic importance, as was shown by the world’s response to the Iraqi invasion of 1990/91. The Iraqi invasion had a significant impact on the Kuwaiti economy, both in terms of damage to the oil industry and exports and because of the cost of paying the military forces called in to eject the Iraqis. Kuwait and its people also lost a significant portion of their wealth through its unlawful ‘confiscation’ by the Iraqis. In spite of this, however, much of the country’s assets were safely invested overseas and the government in exile managed to retain control of these vital resources.
Since the war, the economy has gradually recovered, and recent oil price increases are allowing further expansion. (Kuwait’s financial assets were greatly, if momentarily, diminished by the decision to compensate its people for losses suffered as a result of the Iraqi conflict.) Foreign investment has increased, largely as a result of a decree of 1999, which approved the 100 per cent foreign ownership of certain companies registered in the country, a significant departure from the original ruling of a maximum equity holding of 49 per cent. These companies will be those that contribute to a more diverse economy and the provision of advanced technology and industry.
Oil production and associated downstream industries, including refining and petrochemicals, account for around 90 per cent of foreign earnings and nearly three quarters of Kuwait’s gross domestic product, which is estimated at around $30 billion annually. Kuwait has tremendous reserves of oil, with an estimated 90 billion barrels in the Burgan area alone. Oil production is estimated to be around 1.8 million barrels per day, with the majority of oil exports sent east. The Kuwait Petroleum Company (KPC) controls the country’s oil interests, including many overseas downstream assets, in addition to home production. Kuwait Petroleum International has several refineries in Europe and the Far East, and operates the thousands of Q8 petrol service stations in those regions.
The petrochemicals industry has recently diversified and produces polyethylene, polypropylene, fertilisers and other products for export to Kuwait’s neighbours and international markets. A free trade zone in the port of Al-Shuwaikh is expected to encourage further diversification of the overall economy and the development of trade with neighbouring countries and the Far East. Local and international investors in the industrial, service and commercial sectors are encouraged by the 100 per cent foreign ownership concession, with no corporate taxes or currency restrictions and the free movement of funds. New highways and the modern shipping port at Shuaiba add to the attraction of the zone.
Kuwait has a healthy financial and banking sector, with commercial banks owned by the government or by wealthy trading families. The National Bank of Kuwait is the main retail bank, with over 35 branches. Other banks, such as the Commercial Bank of Kuwait and The Credit and Savings Bank, also offer full service banking facilities. The Industrial Bank of Kuwait deals mainly with the funding of industrial, manufacturing and agricultural programmes. The Central Bank of Kuwait is responsible for regulating the financial industry as a whole. The Kuwait Stock Exchange was successfully reopened in 1992, after experiencing major problems following its initial formation in 1977 and the suspension of trading during the Iraqi conflict. Other significant financial institutions include (ARIG) the Arab Reinsurance Group, which deals with major insurance such as aviation and shipping.
Kuwait’s telecommunications network is state-of-the-art, well able to meet the demands of the rapidly developing economy. Agriculture and fishing, on the other hand, which are among the country’s traditional industries, contribute relatively little to the gross domestic product, and Kuwait relies heavily on food imports.
A downturn in oil prices in 1998/99 prompted the Kuwaiti government to to reduce the dependency on state subsidies by moving towards the privatisation of its consumer utilities, electricity, health etc. This process continues, with proposals to privatise the airline and telecommunications industries and to encourage foreign investment.
Kuwait is a significant member of the GCC (Gulf Co-operation Council), enjoys vast resources and has largely overcome the serious problems experienced as a result of the Iraqi invasion. The repatriation of foreign workers at the start of that conflict allowed the authorities to adjust the volume and nationalities of foreign workers permitted to return when the conflict was over. (Workers from countries or groups of people whose sympathies were believed to lie with Iraq – notably Palestinians and Yemenis – weren’t allowed to return.) The expatriate work force is concentrated in oil-related activities and the service sector.