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Economic Growth Can Only Be Sustained Through Diversification – Kuwait

A government report on future oil price changes scenarios, and their impact on the performance of the Kuwaiti economy, concluded that the sustainability of the economy’s growth can only be through diversifying sources of income, which requires a concerted national effort in all its scopes.

 

The report, showed that in all cases, once oil prices drop in the medium term, the economy may be clearly affected, indicating its weakness through its dependence on oil as a main source of income if it does not rise to the required level to rely on it in the event of the collapse of the global oil markets.

 

The report added that this requires the need to make optimal use of the high global oil prices at the present time and direct revenues towards diversifying sources of income in various sectors of the state, and to develop serious policies in developing the agricultural, industrial, health, tourism, educational and other sectors, and eradicating corruption of all kinds, to achieve sustainable economic growth of Kuwait.

 

According to the report, which was based on the use of the macroeconomic model of the General Secretariat of the Supreme Council for Planning and Development, the expectations of rising world oil prices for the year 2022 were modeled, bringing the average price of a barrel of global crude oil to $99 during the year, assuming unified estimates of the increase in the volume of Kuwaiti oil production during the years ( 2022-2026) and then 3 scenarios were applied assuming a drop in global crude oil prices and its impact on the performance of Kuwait’s economic indicators in the medium term.

 

The report stressed that the private sector must be involved to have an effective role in the growth and prosperity of the national economy, whose role is still marginal. It must witness a broad and great renaissance in order for it to lead economic activity under a supportive institutional state apparatus, which is what Vision 2035 aspires to.

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