Kuwait will see the lowest growth rate among its GCC peers in 2023

Recent elections may not ease political tensions in Kuwait

MNCs operating in Kuwait must use targeted strategies to capture the narrow set of opportunities the country has to offer. 

Key actions for B2Bs and B2Gs:

  • Align with corporate on likely slow payment timelines.
  • Maintain high engagement with local partners to get more realistic updates on project status and possible reimbursement delays. In addition, understand government spending plans ahead of the 2023/2024 budgetary release and the launch of new tenders.
  • Ensure that you are adjusting your offering to current government priorities (mainly infrastructure), which will make you more likely to win the limited spending.

Key actions for B2Cs:

  • Update market size assumptions to account for the limited growth in the addressable market size, as expat numbers continue to decrease. 
  • Expect to see continued price sensitivity among lower- and middle-income segments in Kuwait. Consider updating your product portfolio to justify price changes and better target specific customer segments .
  • Help distributors better market to a more price-sensitive customer base via targeted marketing investments.
  • Expect resilient demand from the higher-income local/expat population and focus on that customer segment to drive profitability.


The first half of 2023 has been plagued by political uncertainty. The government resigned in January over a dispute with parliament over a debt relief bill. Following this, September’s parliamentary election was annulled, and the 2020 parliament reinstated. A new government was appointed in April, headed by Prime Minister Sheikh Ahmad Nawaf Al-Ahmad Al-Sabah. Finally, parliament was dissolved, and legislative elections were set for June 6, 2023. Opposition lawmakers have won the majority in the elections, with 29/50 elected seats amid record-low voter turnout.

Projects under Kuwait’s diversification strategy continue to face delays and extended deadlines. This includes projects such as the Al-Zour refinery, whose construction remains incomplete despite an initial completion timeline of 2020. Political gridlock has continued to delay the passing of a budget for FY 2023/2024, which is limiting public spending on projects. Alongside this, MNCs operating in Kuwait continue to face bureaucratic delays including in the procurement of labor and raw material. 

On the consumer side, the government has accelerated workforce localization efforts in the public sector and begun to incentivize locals to enter the private sector. Estimates show that more than 1 million expats left Kuwait in the past three years. Overall expatriate employment in several labor-intensive sectors, such as real estate & construction, manufacturing and trade, continues to range below pre-pandemic levels. Expats in Kuwait continue to face tighter living conditions, including higher utility bills, restricted access to healthcare services, and increased difficulties in obtaining driving licenses. 

Despite this, opportunities remain. The government has approved 239 projects worth US$ 3.15 billion for FY 2023–2024, covering sectors such as construction, development, and energy. Infrastructure emerges as a main priority for the government, in line with Vision 2035, with a pipeline of infrastructure projects with an estimated value of US$ 27.6 billion in the bidding stage. Alongside this, the underlying drivers of consumer activity in Kuwait remain solid, including wage growth and the resilience of higher-income consumer segments.

Our View

Political gridlock will persist into H2 2023, with tensions between government and parliament continuing to limit the passing of a timely 2023/2024 budget and vital economic reform to stimulate the country’s private sector, including the long-awaited debt law. Additionally, the government will push forward with workforce localization this year and beyond, targeting expats in the private sector alongside efforts to reach Kuwaitization quotas in the public sector. This will continue to limit the growth potential of the addressable market size.

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