The recession in 2017 should be a one-off but Kuwait still faces risks relating to the geopolitical and domestic political backdrop and the commercial environment.
Economic risk (MEDIUM): Kuwait can expected a recovery after 2017’s oil-based recession but it needs to take action to diversify away from oil.
Political risk (HIGH): Political tensions in Kuwait have heightened, in the wake of the Cabinet resignation and the election that weakened the government’s majority. Kuwait’s role as a broker in Qatar row is under threat from the Saudi/UAE alliance.
Financial risk (LOW): The financial and banking systems are seen as stable thanks to a raft of new regulations, while the country has substantial foreign reserves.
Commercial risk (MEDIUM): The country ranks in the middle of the World Bank’s Doing Business index and the government has embarked on reforms. The World Bank has also approved progress on business reform.