ECONOMIC
PROBLEM
DESCRIPTION
GOVERNMENT/
STAKEHOLDER
SOLUTIONS
OUTCOMES/
EFFECTIVENESS
Volatile Oil Prices
Dependence on oil exports
makes the economy
vulnerable to global oil price
fluctuations.
Kuwait Vision 2035,
diversification of the
economy, development of
non-oil sectors.
Progress in diversification,
but oil remains dominant;
ongoing initiatives to
strengthen other sectors.
Fiscal Deficit
High government spending
and reduced oil revenues led
to substantial fiscal deficits.
Fiscal reforms, introduction
of VAT, subsidy
rationalization, and public
finance management
reforms.
Gradual reduction in fiscal
deficit, improved efficiency in
public spending, increased
non-oil revenues.
Economic
Diversification
Heavy reliance on oil with
an underdeveloped
private sector.
Incentives for private sector
growth, regulatory reforms,
investment in other sectors.
Incremental growth in non-
oil sectors, but significant
challenges remain.
ECONOMIC
PROBLEM
DESCRIPTION
GOVERNMENT/
STAKEHOLDER
SOLUTIONS
OUTCOMES/
EFFECTIVENESS
Unemployment
and Labor Market
Issues
Mismatch between skills of
nationals and private sector
needs, high public sector
employment.
Nationalization policies,
training programs, education
reforms to align skills with
market demands.
Increased employment of
nationals in the private
sector, improved skill
alignment, but the public
sector still preferred.
Inflation
Fluctuating inflation rates
due to global economic
conditions and supply chain
disruptions.
Monetary policy adjustments
by the Central Bank,
stabilization measures.
Inflation rate managed and
stabilized around 4.0
percent.