Al-Hajraf opens 10th Euromoney Conference Kuwait

KUWAIT: Finance Minister Dr Nayef Al-Hajraf addresses the Euromoney Kuwait Conference

KUWAIT: Kuwait Finance Minister Nayef Al-Hajraf yesterday underlined the importance of a planned economic reforms to activate the role of the private sector and "reduce government intervention in the economy."

Al-Hajraf made his remarks in his opening speech at the 10th session of the Euromoney Conference - Kuwait 2018. Kuwait has great potential in its institutions, human and financial resources, he said. He said that article 20 of Kuwait Constitution affirms that the national economy is based on social justice and fair cooperation between public activity and private activity, to achieve economic development, increase production, and promote living standards.

The minister spoke of certain amendments to legislations, in addition to changes made to the state budget, taking into account the latest economic and financial developments. He revealed that the new legislation has been referred to parliament and will come under close scrutiny by lawmakers during the National Assembly's forthcoming session. The key objective is to preserve Kuwait's financial resources, which in turn, gains the trust of the state audit bureau and simplifies the process of putting together the state budget, Al-Hajraf explained. As per the new legislation, he said that all government bodies are required to provide the finance ministry with an annual report detailing such intricacies as the gap between expenses and revenues.

This law draft will replace existing law No 31/1978. "We reformed the 40-year-old law to apply modern developments on public budget principles to make it more accurate. We have sent this draft law to the Cabinet to be listed among the priorities during the next term of the parliament," added Hajraf. "We are resetting the role of the ministry of finance in the governmental system to transfer from 'an accountant of public institutions' to 'chief financial officer', to direct the financial policies of the country," he said.

Similarly, he said that the "government is also required to inform parliament of current financial conditions" on a regular basis, citing the finance ministry's official website for further details over the new legislation.

The "Euromoney 2018 Conference" brings together several economic and financial experts to discuss how integral the financial sector is to Kuwait's national development plans.

The 10th edition of the Euromoney Kuwait Conference held at the Four Seasons Hotel is titled 'New Kuwait - the financial sector's response.' Kuwait unveils plan to attract direct investment

More FDI inflows

The Kuwait government has devised a strategy to lure direct investment as part of efforts to buoy the national development plan, director general of Kuwait's Direct Investment Promotion Authority (KDIPA) Dr. Sheikh Mishal Al-Jaber Al-Sabah told the 'Euromoney 2018 Conference.'

He said that the privatization of Kuwait's stock exchange, among other measures taken to create a more business-friendly environment, served as the catalyst for local market growth.

"These direct investments will serve the national vision 2035 - New Kuwait - which will ensure economic diversification, in addition to developing human resources and improving Kuwait's international position. We aim to achieve sustainable development goals based on our youth to build a bright future," Sheikh Mishal said.

The official said these measures go a long way in gaining the trust of investors and encouraging them to foray into the Kuwaiti market, citing "ample investment opportunities" the Gulf state has to offer. He pinpointed the growing cooperation between the private and government sectors as another factor that contributed towards increased foreign investment.

Sheikh Mishal said the Euromoney Conference is an important platform to showcase the model international development of finance and banking and its impact on the national economy. "This conference is a great opportunity for networking and gathering decision makers, officials, investors, bankers, executive directors, businessmen and experts at one event to exchange experiences and discuss important economic issues," he pointed out.

"The Kuwaiti market has become attractive, even more especially after reclassifying the Boursa Kuwait as an emerging market and continuing the privatization process of the market. Also, issuing modern economic laws and regulations boosted the business environment in the country, in addition to increasing transparency," explained Sheikh Mishal.

According to him, these achievements will increase investor trust. "These achievements reflect positive messages to the business community to encourage them to enter the Kuwaiti market and benefit from the investment opportunities. This is supported by encouraging partnership between the private and public sectors, protecting competition and using electronic transactions," he added.

New projects

Mazin Al-Nahedh, CEO and General Manager of Kuwait Finance House, said there are many upcoming projects in different sectors including health, oil, education and other vital sectors. "What we most care for is the execution of these projects. We hope the oil price hike in the present time won't negatively affect these developing projects or plans. I hope to see more of these projects in 2019," he told Kuwait Times.

Manaf Al-Hajeri, Chief Executive Officer of Kuwait Finance Center (Markaz), said the most important target for Kuwait is to diversify sources of income. "We coordinate with the oil sector to diversify income resources. The foreign investment in the stock exchange is great, but we haven't noticed local investments by public institutions in the stock exchange - they give priority to invest in the oil sector," he noted.

Privatization will have an impact. "I think privatization should be executed by a strong auditing institution. The Kuwait Stock Exchange is a good example. Also, I think that developing the public sector and providing work opportunities in the private sector through giving the private sector a bigger role is also very important for developing our economy," added Hajeri.

He feels optimistic about the financial sector in 2019. "At the same time, I'm not very optimistic about the economic sector as all, as it includes many sectors such as education, health and public administration, which need more efforts. The current price of oil is good for Kuwait, but we should focus more on adjusting expenses, as we can live at a very good level even with lower oil prices," he concluded.

By Nawara Fattahova