During the Financing Projects in the New Oil Era conference, Anas al-Saleh, Kuwait’s Deputy Prime Minister, has announced plans to continue supporting the KD6 billion (US$20 billion) public-private partnership (PPP) program, which is improving the private sector implication on local projects.

The Kuwait government has plans to increase the number of PPP projects in the country, to achieve this objective, Kuwait Authority for Partnership Projects (KAPP) has developed the PPP program as well as the additional PPP laws to the executive bylaw of the PPP law number 116 of 2014. Under the country’s PPP law, project companies should hold an initial public offering (IPO) after their selection on a PPP project.

According to Meed Projects, Kuwait awarded US$31 billion in all type of contracts in 2015. We reported about several PPP projects in Kuwait during the last year:

• Kuwait Schools Development Program
• Umm Al Hayman Wastewater PPP Project
• Labor City (south Al-Jahra city) PPP Project
• Az-Zour North IWPP Phase II
• Kabd Municipal Solid Waste PPP Project
• Al-Khairan IWPP PPP project
• Services and Entertainment Center in Egaila PPP Project

Additionally, in October 2015 we reported that the KAPP had plans to establish public joint stock companies to carry out two mega projects, the Kuwait National Rail Road (KNRR) and Kuwait Metropolitan Rapid Transit System (KMRT).

According to sources, Anas al-Saleh, Deputy Prime Minister, Minister of Finance and acting Minister of Oil, said during the conference:

“We will continue to spend on our infrastructure projects, as planned. We have never seen such high levels of capital expenditure. We are focusing on infrastructure projects that work best and avoiding falling into the trap of economic stagnation because Kuwait’s economy depends on government expenditure. We are on full throttle and not holding back. We are building our debt management strategy, and we have everything on the table. We can use financial reserves from the good years mixed with issuing some sovereign bonds in the local and international markets.”

Cynthia Corby, audit partner and DME Construction Industry Leader, Deloitte Middle East, added:

‘’It is encouraging to hear the commitment from His Excellency on investment in Capital projects and diversification of the funding options for these capital programs. When considering the capital programs across the GCC and the diversification agenda for all the GCC countries it is key to note that the liquidity issues currently being experienced can be addressed through alternative funding arrangements and PPP type structure which will also drive operational efficiency and better return on investments as all stakeholder will be incentivized to maximize returns if the PPP’s are structured effectively.’’