About Kuwait

1.88%

Population Growth Rate

98.28%

Urban Population

1961

Year of Independence

93%

Adult Literacy

1.8%

GDP Annual Growth Rate

About Kuwait

Introduction

kuwaitKuwait City

Kuwait is a sovereign Arab state situated in the north-east of the Arabian Peninsula in Western Asia. It is bordered by Saudi Arabia to the south at Khafji, and Iraq to the north at Basra. It lies on the north-western shore of the Arabian Gulf. The name Kuwait is derived from the Arabic أكوات ākwāt, the plural of كوت kūt, meaning a fortress built near water. The country covers an area of 17,820 square kilometers (6,880 sq mi) and has a population of about 3.9 million.

History

 

Kuwait 's early beginnings go as far back as the early 17th century, known at the time as al-Qurain. It appeared in a Dutch map dated in the mid-17th century, the earliest known map showing present-day Kuwait as al-Qurain. At the time, it was under the control of the house of Khaled, who dominated the eastern part of the Arabian peninsula.

The name Kuwait, which is derived from Kout (fort), came about when the sheik of the house of Khaled, Barrak, built a fort in al-Qurain in the latter part of the 17th century as a summer house In the early 18th century, several clans from the Al Aniza tribe migrated to the northern shore of the Gulf from the Najd, their famine-stricken homeland in central Arabia, and settled in Kuwait, a small village at the time.

With the rule of the house of Khaled weakening, the Al Sabah emerged as the dominant clan, and were formally established as rulers of Kuwait in 1752. These new settlers combined to create an oligarchic merchant principality, whose economic prosperity was based on fishing, pearling, and trade.

On June 19, 1961 Kuwait gained full independence from Britain. Iraq initially refused to accept Kuwait's independence and threatened to annex its neighbor, falsely alleging that Kuwait had once been part of Iraq. Iraq's military threats resulted in a deployment of British troops, which were soon replaced by an Arab League force, and the crisis subsided. In 1963 Kuwait became a member of the United Nations, and later that year Iraq agreed to abandon its threats and recognize Kuwait's independence and borders in a treaty signed by both governments.

 

Economy

KW_CO_kuwait-economy-gdp-intro

The discovery of oil in 1934 transformed the economy. Kuwait's enormous oil reserve of 94 billion barrels and huge quantities of natural gas have provided the base for an economic presence of worldwide significance. The Kuwaiti standard of living was among the highest in the Middle East and in the world by the early 1980s. Oil wealth has stimulated trade, fishery development, and service industries. The government has used its oil revenues to build ports, roads, an international airport, a seawater distillation plant, and modern government and office buildings. The public has also been served by the large-scale construction of public works, free public services, and highly subsidized public utilities, transforming Kuwait into a fully developed welfare state.

Prudent management of budgetary allocations and development priorities, as well as substantial interest from overseas investment, helped cushion the adverse impact of the collapse of the Souk al-Manakh—an unregulated curbside securities market—in 1982, the collapse in world oil prices during the mid-1980s, and the 1980–88 Iran-Iraq War. In addition, acquisition of 5,000 retail outlets in Western Europe (marketed under the name "Q-8") and expansion into the manufacture and sale of refined oil products have bolstered the Kuwaiti economy.

Oil extraction and processing accounts for about 50% of GDP, 95% of export earnings, and 75% of government revenues. Kuwait's economy suffered enormously from the effects of the Gulf War and the Iraqi occupation, which ended in February 1991 with the destruction of much of Kuwait's oil production capacity and other economic infrastructure. The damage inflicted on the economy was estimated at $20 billion.

The Gross Domestic Product (GDP) in Kuwait was worth 112.81 billion US dollars in 2015. The GDP value of Kuwait represents 0.18 percent of the world economy. GDP in Kuwait averaged 41.81 USD Billion from 1962 until 2015, reaching an all time high of 174.16 USD Billion in 2013 and a record low of 1.83 USD Billion in 1962. GDP in Kuwait is reported by the World Bank.

 

Water resources are very scarce in Kuwait due to the desert nature of the country. Therefore, Kuwait does not have any agricultural lands, which prevents any development of the agricultural sector. Actually, the major part of the production of this sector is fish, cattle, and pearls.

Kuwait depends on several other sectors that play a considerable role in elevating the economy of the country, including the banking and financial sector, which covers local banks, Islamic local banks, foreign banks subject to the control of the Central bank of Kuwait, the investment sector, Kuwait Stock Exchange, the industrial sector, the services sector and some other sectors that humbly participate in the GDP, like wholesale trade, retail trade and real estate, etc.

 

Economic Role of Kuwait in the region

 

 

Kuwait adopted the first Arab economic summit on the 19th of January 2009 under the title of “The Arab Economic Developmental and Social Summit”, which aimed at enhancing economic integration among Arab countries and completing the elements of the Arab Common Market.

Kuwait also established The Kuwait Fund for Arab Economic Development in 1961 as a Kuwaiti organization concerned with providing and managing financial and technical aid to developing countries. The Activity of the fund was confined to providing economic assistance to Arab countries till 1974, after which it extended to cover all the countries of the developing world.

Most of the fund projects were in the fields of agriculture, irrigation, transportation, communication, power, industry, water and sanitary. Social fields were later added, including educational and health constructions.

 

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