By Market Research Kuwait | Posted February 27, 2019
Kuwait has launched an ambitious plans to transforms the country’s economy off from oil dependence. Through the strategy of Kuwait 2035 Vision, announced in 2017, Kuwait has undertaken several projects worth more than USD 60 billion, with a further USD 100 billion to be invested by 2035. The approach as set by the Vision of His Highness Emir is aspire to be in the lead of renewable and sustainable energy producer as well as developer of the infrastructure and human capital.
Infrastructure is among sectors that undergone rapid development and considered vital for realizing the vision.. Kuwait infrastructure sector is expected to grow by 15-20% as a part of government’s five-year plan (2015-2020). The plan focuses on economic reform and implementation of mega development projects, estimated at USD 124 billion. The USD 2.6 billion Sheikh Jaber Causeway, the USD 7 billion Kuwait City Metro, the USD 4 billion new airport, five new planned cities, and the development of the Mubarak Al-Kabeer Port and Boubyan Island are among infrastructure upgrades throughout the five year-plan period.
The rising demand for public housing is also driving the long-term residential construction growth in Kuwait. The Public Authority for Housing and Welfare announced a plan to build 174,000 housing units by 2020 and employ public-partnership model.
For instance, Sabah al-Ahmad City will have 107 apartment building from six to eight storeys high. The city is being developed to accommodate ~2,000 villas and apartments, as well as 52 schools and 70 mosques. The other housing complexes planned including the USD 10-15 billion South Saad al-Abdullah New Town and the USD 3.6 billion South al-Mutlaa City.
High quality healthcare
Kuwait recorded as the third largest total healthcare expenditure across the GCC region after UAE and Qatar, according to Business Monitor International (BMI). The evolving healthcare industry is expected to rise significantly and characterized by a large public sector infrastructure and growing private sector. The report estimates USD 6.4 billion government spending in 2019.
The Kuwait Direct Investment Promotion Authority (KDIPA) underlined healthcare sector as one of the country’s major destinations for investment. Around 70 primary healthcare centers, including dentistry, maternity care, nursing care, preventive care, pharmaceuticals, and family medicine, are run by Kuwait Ministry of Health (MoH).
The government has begun implementing several reforms aimed at expanding the country’s healthcare infrastructure and controlling lifestyle-related diseases. The MoH plans to establish eight hospitals and extensions worth USD 1 billion. Alongside the plan, the Ministry of Public Works allocates USD 4.2 billion to build another nine hospitals to create new jobs. This strategy will enable government to provide more specialized treatment and reduce the number of people going abroad for medical treatment.
Another strategy is to promote medical tourism by developing world-class healthcare facilities. Private companies are starting to place investments to strengthen the infrastructure and develop medical tourism sector in Kuwait. The plan is expected to generate external revenue from worldwide patients and reduce foreign visits of Kuwait locals for specialized treatment.
The country’s 2035 vision emphasizes the importance of developing tourism sector and the role in supporting Kuwait’s economy by creating employment opportunities. To support this vision, Kuwait has started to build many modern tourist attractions and facilities through the state’s Touristic Enterprises Company,
Redevelopment strategy for 2035 vision are mostly centred around developing free zones and tourist havens. The development of five islands---Boubyan, Warbah, Failaka, Maskan and Oaha---into economic zones that worth USD 160 billion investment would also double up as tourist areas.
World Travel and Tourism Council forecast the direct contribution of Travel and Tourism industry to the country’s GDP will rise by 4.8% pa from 2018-2028, accounting for KWD 1,668.2 million and 3% of total GDP in 2028. In 2017, travel and tourism directly supported 54,000 jobs, which accounted for 2.6% of total employment, and expected to rise by 10% pa to 63,000 jobs in 2028. The investment in Kuwait is also set to rise 1.5% pa to USD 445 million annually in 2027.
Source: World Travel & Tourism Council
Leisure travel spending generated 70.9% of direct travel and tourism GDP in 2017, accounting for KWD 1,247.2 million, compared to 29,1% for business travel spending, reaching KWD 512.1 million. The council predicted leisure travel to rise by 4.5% pa to KWD 2,048.2 million in 2028. WHile business travel spending is expected to rise by 5.5% pa to KWD 965 million in 2028.
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