VII. INVESTMENT CLIMATE A. Openness to Foreign Investment Government Policy: Foreign investment is welcome in Kuwait, though restrictions remain on the sectors in which foreigners may become involved. In general, Kuwaitis are expected to maintain control of ventures in which foreigners are involved and foreign shareholdings in joint venture companies are currently restricted by law to a share of 49 percent or less. Since the 1970's, Kuwait's economy has been dominated by the state and the nationalized oil industry. State intervention increased in the 1970's and early 1980's as the government tried to solve a stock market collapse. The invasion of Kuwait exacerbated economic problems. After liberation, the government purchased outstanding debts from the banks and put through a debt settlement law. In the short term, this increased the government involvement in the economy. Government officials have said they intend to reverse the trend. The means of reversing government control would be a privatization program. Hence, the entire foreign investment scene could change dramatically in a short time. At the time of this writing in July, 1994, Kuwait has before it a number of World Bank studies recommending privatization of large segments and key sectors of its economy. A number of industries, starting with the telecommunications sector, may actually be privatized this year. In addition, large investments in joint ventures are underway. Union Carbide and the Petrochemical Industries Corporation (PIC) have planned a $2 billion petrochemical complex here that will primarily serve the emerging Asian markets. Foreign finance, particularly officially supported export credits, is an increasingly important element in large sales or projects here. Foreign owned firms and the foreign owned portions of joint ventures are subject to corporate income tax as high as 55 percent. GCC-wide agreements may alter particular provisions of the Kuwaiti tax laws as efforts to harmonize GCC laws move forward. Kuwait has no personal income tax. Commercial Agency & Commercial Representatives' Law: Kuwait's Commercial Law No. 68 of 1980 describes contract and commission agents and commercial representatives and Law No. 36 of 1964 requires agents to be Kuwaiti nationals. In the post-liberation period there were exceptions made to these laws during the emergency period, but there have not been any exceptions made recently. It remains a matter of GOK interpretation whether exceptions are available for particular purchases. Other Barriers: Agent and Distributor Rules: The requirement that a local agent must be used in all sales transactions, as currently exists, can create problems for some U.S. firms, particularly those that signed hastily without consulting with local lawyers before signing an agency agreement. The Embassy can provide a list of lawyers. Amendments have been proposed to Kuwait's commercial law, which may permit foreign joint ventures in banking (up to 40 percent ownership) and GCC branch banking. In addition, the Kuwait Petroleum Company, for the first time in its history, has concluded a joint venture agreement with a U.S. firm for a major (USD 2 billion) investment in petrochemicals. Screening of Foreign Investment: All proposals for direct foreign investment are screened by the licensing authority of the Ministry of Commerce and Industry. In the past, this authority has been used to encourage investments in higher technology industries and to discourage investments in sectors in which there was judged to be significant overcapacity; e.g. the pre-war hotel industry. Major Sectors/Matters in which Foreign Investors are Denied National Treatment of MFN Treatment: Under current laws, some specific sectors of the economy -- including upstream oil development; banking; insurance; and real estate -- have traditionally been closed to foreign investment. There are some limited exceptions to this for citizens from GCC states. There are domestic and GCC reference regulations in force that allow discrimination against some suppliers. The primary boycott of Israel is in place and articles 3 and 43 of Law No. 37 allow the Central Tenders Committee to award contracts to suppliers of local products with prices up to ten percent higher than imports. Foreigners (with the exception of nationals from some GCC states) are forbidden to trade in Kuwaiti stocks on the Kuwaiti stock exchange, except through the medium of mutual funds. Kuwaitis, GCC nationals and resident expatriates in Kuwait will be permitted to purchase shares in a new public investment fund being launched by the KIA that will consist of shares on the Kuwait stock exchange. Services Barriers - Shipping: In the past, Kuwait prevented access to government project cargo by U.S. shipping lines by giving the United Arab Shipping Company (UASC) the right of first refusal on all government project cargoes. Embassy Kuwait has been assured by the GOK that this no longer applies to shipments from U.S. ports. Privatization Programs: The Government of Kuwait is sensitive to the problems caused by state participation in Kuwait's commercial economy and has indicated that it will shortly begin a large privatization program. As noted above, the entire foreign investment scene could change dramatically. As this report is being drafted in June 1994, Kuwait has before it a number of World Bank studies recommending the privatization of large segments and key sectors of its economy. A number of Industries, starting with the telecommunications sector, may actually be privatized this year. Discrimination against Foreign Investors at the Time of the Initial Investment and after the Investment is Made: Foreign investment is discriminated against in several ways: through the bar on majority ownership; the bar on investment in prohibited sectors such as oil and financial services; and the different corporate tax treatment (foreign firms pay to the extent of their ownership while Kuwaiti firms do not pay at all). U.S. and Foreign Firms Participation in Government Financed and/or Subsidized Research and Development Programs on a National Treatment Basis: Post is not aware of any U.S. firms interested in R & D in Kuwait. That could change if offset requirements are put into place. Kuwait does have the Kuwait Institute for Scientific Research (KISR), which wants to work with foreign firms. That said, there has been little foreign firm participation in government financed research and development work in Kuwait. While there are no specific bars to foreign participation in this area, any program would likely be evaluated on a case by case basis. U.S. participation that brought expertise unavailable locally would be welcomed in most cases. Discriminatory or Excessively Onerous Visa, Residence or Work Permit Requirements, or Similar Requirements Inhibiting Foreign Investors: Kuwait has a stringent visa and work permit scheme. There have recently been reciprocal liberalizations that have benefitted U.S. citizens coming here on business. A local sponsor is required for most work permits. Any problems experienced by potential U.S. visitors should be referred to the Bureau of Consular Affairs, Department of State. Investment Incentives and Favored Treatment for Foreign Investors: Investment Incentives (e.g. grants, tax deferrals, special access to credit, import quota exceptions, etc.) Available to Foreign Investors and Favored Treatment Given to Foreign Investors: There is a movement underway to expand the investment incentives available to foreign investors. At the moment, incentives -- in the form of exemptions from import duties and corporate income taxes for periods of up to ten years -- are officially available only for industrial undertakings approved by the Council of Ministers in which Kuwaiti citizens hold a majority share. Efficient Capital Markets and Portfolio Investment: Kuwait has an open financial system and policies facilitate the free flow of financial resources. There is a free flow of resources in the product and factor markets of Kuwait subject to the legal restrictions outlined above. Efficient Capital Markets: Kuwait has a free, but, to date, not very efficient, capital market. Underpinned by government subsidies, that market -- and particularly Kuwait's commercial banks -- functioned throughout the 1980's basically to collect funds for relending to favored customers. Payment discipline was lax and real economic losses common, though disguised by government programs, including, in particular, government guarantees for all the liabilities, equity and profits of Kuwaiti banks. Under a bank stabilization program introduced in 1992, the Central Bank purchased all of the outstanding domestic credits of Kuwait's commercial banks, while eliminating all guarantees for profits as well as equity and liabilities other than the bank's deposit liabilities. Henceforth, all losses will stay with the banks, which will be responsible for the management of all their assets and liabilities. The Central Bank has also taken steps to sharply improve bank supervision. As a result, credit distribution through Kuwait's banking system should be far more efficient and rational in the future than it has been in the past. Kuwait maintains a well-regulated stock exchange, which reopened on September 28, 1992 for the first time since the war, and which now lists 41 stocks, including 5 companies from other Gulf states. To date, only Kuwaiti citizens and nationals from some GCC states are permitted to trade stocks on the exchange, but there are plans, reportedly, to broaden participation, both as regards the parties that may trade on the exchange and the companies that may be listed there. Credit is allocated on market terms and under a variety of government programs. Foreign investors are able to get credit on the local market. The private sector has access to a variety of credit instruments through local banks. Legal, regulatory, and accounting systems tend to be more opaque than transparent, but are generally consistent with international norms. The Central Bank of Kuwait requires annual reports for local banks to meet international accounting standards. Local legal and financial advice should be sought for complicated investments and transactions. There is not an effective regulatory system established to encourage and facilitate portfolio non-GCC investment in the local stock market. Kuwait is a major overseas investor. The estimated total assets of the country's five largest banks in Kuwait as of December 31, 1993 were: Bank KD USD National Bank of Kuwait 2,789,126 9,483,028 Gulf Bank 1,249,944 4,249,809 Bank of Kuwait and the Middle East 781,431 2,656,865 Burgan Bank 771,178 2,622,005 Kuwait Real Estate Bank 329,946 1,121,816 KD 1 equals USDOLS 3.40 The quality of local banks varies from Blue Chip World Class operations to very weak. Portions of some bank assets have been non-performing in the past. The balance sheet of some local banks are heavily weighted toward lower yielding government bonds. There are no "cross-shareholding" and "stable shareholding" arrangements used by private firms to restrict foreign investment through mergers and acquisitions because there is very little foreign investment in Kuwait. As there are very few hostile takeovers in Kuwait, there are few defensive measures to protect against this practice. There are no laws or regulations specifically authorizing private firms to adopt articles of incorporation/association which limit or prohibit foreign investment, participation, or control. Private Sector and/or Government Efforts to Restrict Foreign Participation in Industry Standards-Setting Consortia or Organizations: Post is not aware of any specific cases of such restrictive participation. U.S. suppliers have difficulty complying with specifications that are technologically tailored closely to equipment offered by other (mostly European) suppliers. Existing standards favor European (especially U.K.) suppliers. U.S. suppliers' preference for turnkey projects does not match the GOK's preference for splitting large projects into a series of small ones (with each one tendered separately). The role of GCC-wide standards will be critical in the future. Other Practices by Private Firms to Restrict Foreign Investment, Participation, or Control in/of Domestic Enterprises: Kuwait is a very big small town. Family, clan and tribal ties throughout the business community and government can restrict foreign participation, investment and control of domestic enterprises. Foreign Direct Investment Statistics: Kuwaiti public investments abroad consist of the portfolio investments held by the Kuwait Investment Authority, which are now estimated at between USD 35 billion and USD 40 billion, and the direct investments of the Kuwait Petroleum Corporation in oil production, refining and distribution. Specific investments of KIA are not divulged and are protected by state secrecy laws. In addition, private Kuwaitis hold foreign assets, in the form of both direct and portfolio investments, of about USD 30 billion. B. Conversion and Transfer Policies Convertibility Policies The Kuwaiti Dinar is freely convertible at an exchange rate calculated daily on the basis of a basket of currencies which is weighted to reflect Kuwait's trade and capital flows. In practice, the Kuwaiti Dinar has closely followed the exchange rate fluctuations of the U.S. Dollar. Transfer Policies There are no restrictions on current or capital account transactions in Kuwait, beyond a requirement that all foreign exchange purchases be made through a bank or licensed foreign exchange dealer. Equity, loan capital, interest, dividends, profits, royalties, fees and personal savings can all be transferred in or out of Kuwait without hindrance. However, on capital transfers in or out of Kuwait, a large portion of Kuwait's foreign investment is mediated by public agencies and corporations, such as the Kuwait Investment Authority and the Kuwait Petroleum Corporation, which are subject to government guidance regarding both the form and the direction of those investments. C. Expropriation and Compensation There have been no recent cases of expropriation or nationalization involving foreign investments in Kuwait. In the past, when foreign companies were nationalized (as in the case of the nationalization of Kuwait's oil industry during the 1970's), the foreign interests were compensated promptly and effectively. D. Dispute Settlement Kuwait does not generally permit international arbitration in the case of commercial or investment disputes. Kuwait, however, is a member of the International Center for the Settlement of Investment Disputes (ICSID) and has adhered to the New York Convention on the Recognition and Enforcement of Arbitral Awards. Clauses specifying recourse to international arbitration are only occasionally written into commercial contracts. As a result, many disputes are still settled in local courts or through traditional commercial and political negotiations. Central Bank of Kuwait experts told us that Kuwait's judicial system recognizes and enforces foreign judgments only when reciprocal arrangements are in place. Investment Disputes: There have been few investment disputes involving American firms in Kuwait. Commercial disputes are much more common. In both cases, the slow pace of the legal system here can be very frustrating to American claimants. Legal System: Kuwait has a developed legal system. It is a civil code system influenced by traditional Islamic Sharia law. As a traditional trading nation, the judiciary here is familiar with international commercial laws. Kuwait has been a GATT member since 1963 and has signed the WTO agreement. Kuwait is not a signatory to the GATT government procurement code. Boycott: While Kuwait in June 1993 publicly announced the end of enforcement of the secondary and tertiary Arab League boycotts of Israel, official publication of implementing regulations continues to be delayed. Some contracts continue to contain boycott clauses reportable under U.S. antiboycott laws. However, when these clauses are brought to the attention of the GOK officials, these officials see to it that the clauses are not enforced. Kuwait has said it will wait for Arab League action before eliminating the primary boycott of Israel. Import Policies: Changes to adopt a "highest common denominator" tariff in Kuwait have been supported by local industries seeking tariff protection. In addition, local industrial protection rules, including higher tariffs, are under consideration by the GOK. These rules were waived in the post-liberation period. Efforts to harmonize GCC tariffs have lead to suggestions to harmonize "upward" rather than "downward" for some products. Secured Interests in Property: Kuwaiti law permits private ownership of property by its citizens, but severely restricts the types of collateral creditors may have recourse to in the event of default by a borrower. Banks may not foreclose on residential real property or personal property in the event of default, but they may, however, sue the borrower for the balance due under the loan contract. Borrowers normally pledge a portion of their future severance benefits as collateral for a bank loan. Non-GCC foreigners are not permitted to own land. Commercial Environment: The central role of the government throughout the economy cannot be underestimated. In one way or another, the GOK owns or controls over 70 percent of the local economy. The economic recovery of in Kuwait should be somewhat stronger and broader in 1994 than in 1993. For 1993, GDP should be in the range of USD 22 billion, before increasing in 1994 to slightly more than USD 23 billion, largely on the strength of increased oil production and in spite of lower world oil prices. That said, the Kuwaiti business community and many Kuwaitis feel poorer than before. The decline in the consumer sector continues, caused by profound population shifts within Kuwait. The current population is estimated at 1.6 to 1.7 million (43 percent Kuwaiti), down from the prewar population of 2.3 million. Over 300,000 middle class consumers are gone, replaced by lower paid workers who seek to minimize their in country expenditures in order to maximize their remittances back home. The IMF team prescribed a program that is classic for a country with a budget deficit - reduce subsidies, raise taxes and fees, reduce the public sector and promote privatization and free enterprise. Whether this will work in Kuwait remains to be seen. The Kuwaiti population has grown used to its welfare state benefits and is likely to resist reductions. The government may privatize part of its holdings. In theory, this should work. In practice, this is a small country and privatizations here could be subject to abuse and manipulation unless they are carefully planned. A key question is whether portions of privatizations will be placed overseas and/or with expatriates. A recently announced investment fund here would permit expatriates here to participate. Government Tenders: For some tenders, Embassy intervention may be required to get suppliers onto lists of prequalified companies or onto the selected tender short lists. The same criteria for foreign and domestic suppliers may be used, but domestic suppliers often have an advantage with their knowledge of the local market. In some cases, the tailoring of bid specifications to favor particular companies has been alleged. Ministries and government departments may sole source, i.e. may purchase or tender independently of the Central Tenders Committee, if the value of the purchase is less than KD 5,000 (USD 17,000). The CTC may allow a GOK ministry or department to exceed this limit if the sole sourcing is in "the public interest" (article 3 of law No. 37). Some tenders have been issued on short notice. Standards and specifications have been tailored to favor particular suppliers or bidders in the past. Binding International Arbitration of Investment Disputes between Foreign Investors and the State: Kuwait is a signatory to the International Center for the Settlement of Investment Disputes (ICSID - also known as the Washington Convention) and the New York Convention of 1958 on the Recognition and Enforcement of Foreign Arbitral Awards. E. Political Violence Politically Motivated Damage to Projects and/or Installations: There have been isolated bombings (primarily of video stores which carry Western videos), but no group has claimed responsibility. There have been no politically motivated attacks on U.S. projects and/or installations in Kuwait since liberation other than a mysterious drive-by shooting in which a building housing U.S. contractors was fired upon. F. Performance Requirements/Incentives The only trade-related performance requirements in prospect in Kuwait involve a new offset program, which has established offset obligations (to be settled through countertrade, training or investment programs) in the case of all government contracts in excess of KD 1.00 million (i.e., USD 3.5 million). These obligations can range from very low levels to as much as 30 percent of the value of the contract, depending on the type, area and structure of the investment. All obligations are to be settled within eight years, with a penalty (equivalent to 6 percent of the value of the contract) payable in the case of non-performance. G. Right to Private Ownership and Establishment Rights to private ownership and establishment are respected in Kuwait, though, as noted above, foreigners face special restrictions. Licenses from the Ministry of Commerce and Industry are required for the establishment of all new companies. In addition, some sectors of the economy, including oil production and refining, are dominated by state-owned monopolies. Government ownership is common in other sectors of the economy, including banking and insurance, in part as a result of stock interests acquired during rescue programs following the crash of the Souk Al Manakh in 1982. H. Protection of Property Rights Intellectual property rights protection remains extremely lax in Kuwait. Kuwait is not party to any worldwide conventions for the protection of intellectual property rights. While it has had patent and trademark laws since 1962, the penalties under both are so low (a maximum fine of USD 2100) as to be ineffective in deterring illegal activities. The patent law, moreover, excludes certain chemical inventions involving food, pharmaceuticals and medicines, and offers a term of protection of only fifteen rather than 20 years. It also contains extraordinary provisions for compulsory licensing whenever a patent is insufficiently used in Kuwait or is of "great importance to national industry." Patents: Patent laws in Kuwait are under examination. Current laws do not meet currently accepted international standards. Copyrights: Kuwait also has no copyright law, with the result that there is now a large, overt market for pirated software, cassettes and videotapes, as well as unauthorized Arabic translations of foreign language books. The new draft law on copyrights which was submitted to the National Assembly early in 1993 continues to languish in committee. The draft still does not provide adequate protection for foreign works, sound recordings or compilations of facts and data. The terms of protection for different types of works are also short and penalties for infringement relatively light. Trademarks: In the past, companies on the boycott list have been denied trademark protection in Kuwait. Trade Secrets: There are no statutory provisions for the protection of trade secrets in Kuwait; protection depends entirely on that negotiated in a contract between the party disclosing the trade secret and the party exploiting that secret commercially in Kuwait. Semiconductor Chip Layout Design: Semiconductor chip layout design is not protected under Kuwaiti law. I. Regulatory System: Laws and Procedures The government has not adopted a transparent policy and effective laws to foster competition since there is no meaningful antitrust division in the GOK. In addition, there are few tax, labor, health and safety, and other laws and policies designed to avoid distortions or impediments to the efficient mobilization and allocation of investment. Kuwait's low tariff barriers and open market are the most important factors in the allocation and mobilization of investment. The Kuwaitis are sophisticated international investors. Bureaucratic procedures can be time consuming and prone to the red tape that is a feature of this part of the world. Regulatory Policies: Kuwait is a small, open economy, which has generally been able to rely upon a flood of foreign goods and services to maintain fair competitive conditions. However, where government intervention has occurred, it has tended to favor Kuwaiti citizens and Kuwaiti-owned companies. Income taxes, for instance, are currently levied on foreign corporations and foreign interests in Kuwaiti corporations at rates that may range as high as 55 percent of all net income. Government procurement policies, similarly, generally specify local products, when available, and prescribe a 10 percent price advantage for local companies on government tenders. There is also a blanket agency requirement, which requires all foreign companies trading in Kuwait to either engage a Kuwaiti agent or establish a Kuwaiti company, with majority Kuwaiti ownership and management. Finally, in labor markets, resident foreign nationals are subject to special taxes and fees that are intended to both discourage their employ and limit their tenure in Kuwait. Government Procurement: Law No. 37 of 1964, as modified by laws Nos. 18/70 and 81/77, governing public tenders in Kuwait requires a foreign person or company to bid on public tenders through a Kuwaiti agent or partner (article 5). Local Preference: Kuwait government procurement policies specify local products when available and prescribe a 10 percent price advantage for local firms in government tenders. Offset regulations introduced in Kuwait in 1992 specify that foreign firms awarded government contracts worth over KD 5 million (about USD 17 million) must invest 30 percent of the contract value in a project in Kuwait, the GCC or the rest of the Arab world. Offset regulations are changing and complicated. U.S. firms affected by Kuwaiti offset regulations should consult with Embassy Kuwait, the GOK and local expert advisors on the particular provisions and obligations that will apply. Although U.S. companies have been successful in increasing their sales in Kuwait, discrimination against U.S. products and services has occurred in many sectors of Kuwait's public purchasing. Evidence of this is anecdotal and based on input provided sporadically by local business executives to post. In most sectors, some U.S. suppliers have overcome such discrimination through aggressive pricing, thorough presentation of their products or services' technical merits, quick responses to foreign competitors' claims and financial packages and vigilant lobbying by energetic local agents. U.S., British and French firms have announced offset projects in Kuwait. J. Bilateral Investment Agreements Kuwait has concluded bilateral investment treaties with Germany, France, Italy, Russia, China, Romania, Poland, Hungary, Turkey, Malaysia and Malta. It has initialled an agreement on bilateral investment with Denmark and has an agreement with Switzerland under negotiation. K. OPIC and Other Investment Insurance Programs In 1989, Kuwait concluded an agreement with the United States on investment guaranty programs, which facilitated the extension of programs from the Overseas Private Investment Corporation (OPIC) to Kuwait. Activity under the OPIC program has increased noticeably as Kuwait's recovery has gained momentum and foreign investment has resumed. Kuwait is a member of the Multilateral Investment Guarantee Agency (MIGA). L. Labor Since liberation, the government of Kuwait has adopted policies intended to limit the resident expatriate population, which, before the war, accounted for approximately 80 percent of Kuwait's 700,000 person work force. To enforce this program, the government has instituted a quota system on work permits, forbade the transfer of workers from one sponsor to another within the private sector and levied relatively high residency fees on the families of foreign workers. These measures, in turn, have raised the cost of employing foreign workers and produced labor shortages, particularly in the private sector. Kuwaiti workers have the right to organize and bargain collectively, but Kuwaiti law prevents the establishment of more than one union per functional area or more than one general confederation. Foreign workers, who still constitute the vast majority of the work force, are permitted by law to join unions as nonvoting members after five years of residence in Kuwait. The right to strike is also recognized for private sector workers, though that right is limited by provisions calling for compulsory negotiation and, eventually, arbitration in the case of disputes. Kuwaiti labor law prohibits antiunion discrimination. Kuwaiti labor law sets work conditions for both the public and private sectors, with the oil industry treated separately. Forced labor is prohibited, and the minimum age for employment is eighteen years. A two-tiered labor market ensures high wages for Kuwaiti employees while foreign workers, particularly unskilled laborers, receive substantially lower wages. There is no minimum wage for the private sector; in the public sector, the current effective minimum wage is KD 226 (i.e., USD 775) per month for Kuwaiti bachelors and KD 301 (i.e., USD 1,030) per month for married Kuwaitis. The basic labor law also limits the work week to 48 hours, provides for a minimum 14 days leave per year and establishes a compensation schedule for industrial accidents. The ILO's Committee of Experts (COE) reiterated in 1993 its longstanding criticisms of a number of discrepancies between the Kuwaiti labor code and ILO conventions 1, 30 and 87 on hours of work and freedom of association. Areas criticized by the ILO included the prohibition on establishing more than one trade union for a given field, the requirement that a new union must have at least 100 workers, the requirement that foreign workers must reside in Kuwait for five years before joining a trade union, the denial of foreign trade unionists, the right to vote and to be elected, the prohibition against trade unions engaging in any political or religious activity, and the reversion of trade union assets to the Ministry of Social Affairs and Labor in the event of dissolution. M. Foreign Trade Zones/Free Ports There are no free trade zones or free ports in Kuwait. However, as part of a study on the future of Kuwait's ports, the Kuwaiti Public Ports Authority has contracted for a feasibility study on the possibility of a free trade zone. N. Capital Outflow Policy Kuwait has an open capital market and is a major overseas investor. Kuwait offers no incentives for investment in developing countries. O. Major Foreign Investors There are only two major foreign investors in Kuwait, both of which are oil companies operating in the divided Neutral Zone between Kuwait and Saudi Arabia under concession agreements that involve Saudi Arabia, either wholly or in part. The first of these is the U.S.-owned Getty Oil Company which holds a Saudi concession of one-half of the on-shore oil rights in the divided zone. The second is the Japanese-owned Arabian Oil Company, which holds offshore concessions in the divided zone from both Saudi Arabia and Kuwait. Union Carbide has a joint venture with KPC's Petrochemical Industries Company for a USD 2 billion dollar petrochemical project, construction of which is underway. There are also proposals for private power plants under consideration by the Ministry of Electricity and Water. Sprint International has a joint venture with the Ministry of Communications to provide telecommunications services in Kuwait. Investments by all other countries in all other sectors of the economy in Kuwait are, to date, extremely small.