The government has proposed a law to privatize most of Kuwait’s industries, except for the Army, Police, and the Oil industry. The law would entitle the government to a 20% stake in the newly established companies, while a strategic partner would own 35%, employees own 5%, and the public would retain the remaining 40% stake. The law is being discussed in the parliamentary Financial Committee.
This law, if it passes and sees the light of day, is a huge step for Kuwait in the right direction, in our opinion. The new entities will be more efficient, specialized, lacking corruption, with clear goals, and accountable for their actions. Let us look at the Ministry of Electricity and Water Power as an example. If they privatize electricity, people will start to own up to their responsibilities and pay their bills. If they don’t, then the company will cut their electricity, unlike what is happening nowadays. This change will make people more accountable for the responsibilities and will improve people’s morality and ethical standards.
When Kuwait’s industries are put for sale, it will lead to a huge influx of foreign capital into Kuwait because 35% of these companies will be owned by specialized partners. A foreign electricity company might collaborate with a Kuwaiti partner to establish a Kuwaiti electricity company. The foreign companies will bring their expertise in that area, as well as their capital.
The government clearance of these industries that require routine work and constant Parliamentary headaches will lead the government to focus on more meaningful ventures, and work on establishing long-term plans and actually implementing them.
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