[Source: NUSACC's U.S.-Arab Trade Outlook 2013]
Kuwait is the world’s fourth largest exporter of oil, and it is investing heavily to produce even more oil and gas for export during the coming years. Kuwait Oil Company’s (KOC) goal is to boost the country’s oil output capacity from 3.1 million bpd in 2010 to four million bpd by 2020. The Government of Kuwait plans to increase gas production to 4 billion cubic feet per day (cfd) by 2030. Kuwait’s oil exports supply more than 90 percent of that nation’s revenues.
In late 2010, Kuwait was on track to post a budget surplus of almost $21 billion – its twelfth consecutive surplus. The only Gulf nation to drop its peg to the U.S. Dollar in favor of a basket of currencies, Kuwait exerts extensive control over monetary policy while exercising caution over petroleum price forecasts. Kuwait’s 2010 – 2011 budget was based on $74 per barrel. This strong position has allowed Kuwait to plan construction of four 1,000-megawatt nuclear reactors, scheduled to go online by 2022, in order to satisfy demand for an increase in power from 11,000 megawatts to 22,000 megawatts.
Services are a booming part of Kuwait’s economy. The Gulf nation’s discount air carrier, Jazeera, was launched in 2005 and now competes head-to-head with UAE-based Air Arabia and Flydubai. Surging net profits and plans to expand to 82 routes across the Middle East by 2015 are spurring demand for new jetliners.
Ford Middle East and Arabian Motors Group are the first in the region to roll out “Quick Lane Tire and Auto Center” services. Ford and its local partner are looking for a growing share of the after sales market through improved delivery of high quality retail servicing and repair.
Drawing inspiration from the historic Silk Road, the Kuwait Government plans to transform the emirate into a major regional financial and trade hub through the $77 billion “City of Silk” (Madinat Al-Hareer) project, which has the full support of H.H. Emir Sheikh Sabah al-Ahmad al-Sabah. According to designer Eric Kuhne, Managing Director of London-based Eric R. Kuhne and Associates, this project is currently the largest single real estate development in the Middle East.
Upon completion in 2030, the seaside city, located in Subbiya, at the northernmost tip of Kuwait Bay, will house 750,000 people. The city will include four major zones – Leisure and Recreation City, City of Commerce, City of Diplomacy and Education, and City of Ecology. A sixteen mile bridge will link the City of Silk to Kuwait City. Two artificial islands are expected to be constructed along the causeway.
Kuwait is one of the most tech-savvy consumer markets in the region. Business Monitor International forecasts that Kuwait’s annual per capita consumer electronics spending will surge from $194 in 2010 to $232 per annum by 2014, creating $893 million in total electronics market demand.
The United States and Kuwait have a long-standing strategic alliance, one which creates significant opportunities for U.S. defense contractors. The Kuwaiti Government is boosting its air logistics capability through the purchase of a C-17 Globemaster, made by Boeing, with support services. It has also contracted with Raytheon for a Patriot missile defense system costing nearly $1 billion.