
Kuwait: Risk February 2019
Kuwait will enjoy 4%+ growth after 2017’s slump thanks to higher oil output and prices. Risks remain relating to the geopolitical and domestic political backdrop and the commercial environ- ment.
• Economic risk (MEDIUM): Kuwait may take a knock from tighter OPEC caps but the rise in prices and diversi cation away from hydrocarbons will support growth.
• Political risk (HIGH): The antagonistic political system could slow down implementations of reforms and policy initiatives in the wake of the Cabinet resignation and the election that weakened the government’s majority. Succession to the 89-year-old Emir remains an issue.
• Financial risk (LOW): The main risks for banks are adverse domestic political and geopolitical develop- ments or renewed weakness in oil prices. Foreign investors are now allowed to take up to 5% stakes in banks.
• Commercial risk (MEDIUM): The country has slipped further down the World Bank’s Doing Business index but reducing excessive regulations would foster private sector opportunities, competition, and diversi cation.