Kuwait plans to amend its foreign direct investment law this year as the country embarks on a $111 billion plan to modernize its economy, Sheikh Meshaal Jaber Al-Ahmad Al-Sabah, Chairman of Kuwait Foreign Investment Bureau, said in an earlier interview. "Foreign investors coming to Kuwait find obtaining necessary licenses a very difficult and prolonged process, as well as getting land needed" for projects," he said. "The proposed amendment should overcome shortcomings of the law. We hope it will be passed this year." Kuwait expects private investors to contribute about half of the four-year development plan, which began in the 2010-2011 fiscal year, to diversify its oil-reliant economy. The country, which passed the foreign direct investment law in 2001 to ease foreign ownership limits, is seeking investments in projects including a $14 billion oil refinery. "The proposed amendment will shorten procedures to obtain licenses and land for investors who fulfill the criteria, he said. It will also stipulate the establishment of an independent authority to consolidate "all efforts to promote investment opportunities in Kuwait to the foreign market," he said. Kuwait's economy expanded 5.7 percent in 2011 and growth is expected to be "a little higher" this year, Finance Minister Mustafa al-Shimali said in March. National Bank of Kuwait, the country's biggest lender, last month raised its forecast for Kuwait's 2012 real gross domestic product to 4.4 percent on expectations of increased oil output. Foreign direct investments that come under the bureau's jurisdiction climbed 20 percent in 2011 from the previous year, Sheikh Meshaal said. "Since we started operations in 2003, about $5.4 billion in foreign investment was recorded to have come to Kuwait," he said. "The law's achievement may have been short of expectations, disappointing perhaps, but it is still progress." In 2007, Kuwait's parliament passed a law to reduce the tax burden on international companies for the first time in more than half a century, with corporate tax on foreign firms reduced to 15 percent from as much as 55 percent. Kuwait was the lowest recipient of foreign direct investment among the six Gulf Cooperation Council states in 2010 with $6.5 billion, according to data on the United Nations Conference on Trade and Development's website. Saudi Arabia, the biggest Arab economy, was the highest with $170.5 billion, followed by the United Arab Emirates with $76.2 billion. In contrast, Kuwait is estimated to own $300 billion of assets abroad through its sovereign-wealth fund. The Kuwait Investment Authority holds stakes in Daimler AG and BP Plc (BP/), and invested in the initial share sales of Agricultural Bank of China Ltd. and Citic Securities Co. "Some government agencies still don't understand the importance of international investors, and so take too long" to grant approvals required by the law, Sheikh Meshaal further said.
