Kuwait Overview

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Capital City: Kuwait

After an important increase in 2004, the activity slowdowned in 2005 : annual GDP growth rate was 6.3% in 2004 and 5.6% in 2005. It is estimated at 5.3% in 2006.

The Kuwaiti economy heavily relies on oil sector which contributed to 50% of the GDP and 95% of budget resources. Actually, Kuwait holds 10% of world-wide oil resources and is the world's thirteenth largest oil producer with a daily production of 2 million barrels. Besides oil, the country has two major sources of income, which are the payment of war damages by Iraq and overseas financial investments revenues.

Agriculture activity is very reduced in Kuwait, due to particularly harsh climatic conditions. Agriculture only amounts to 1% of the GDP. The industrial activity is dominated by hydrocarbons sector. The State holds monopoly over oil exploitation through the Kuwait Oil Company (KOC). The government wishes to stimulate foreign direct investments (FDI) : foreigners are allowed to hold 100% of a company's capital and can enjoy attractive tax benefits. The State particularly encourages FDIs in petrochemical, infrastructure, high technology and financial sectors.

The three main export partners are Japan, United-States and the Netherlands. Hydrocarbons represent 90% of the country's total exports. The Kuwaiti market offers numerous oportunities. 90% of consumer goods are imported, especially food products, capital and transport goods, and manufactured products.Kuwait's first three import countries are the United States, Germany and Japan.