Skepticism toward the private sector remains resilient

KUWAIT CITY, Sept 9: The absence of clear mechanisms for gauging public sentiment poses a challenge in Kuwait, notably shows the prevailing skepticism among most Kuwaitis towards the private sector remains resilient, irrespective of whether it could effectively address specific issues within its domain, reports Al-Jarida daily. This skepticism persists even with the presence of state-regulated controls since over the past month, discussions in the local economic arena, be it in parliamentary or union settings or through various communication channels, have centered around government ownership and management of various sectors.

These discussions often contrast with inquiries into the efficiency of the private sector and its capacity to potentially manage these sectors more effectively or otherwise enhance service provision. Three key topics have dominated these conversations such as the concerns of several National Assembly representatives regarding the privatization of Kuwait Airways Company; the Oil Minister Saad Al-Barrak’s acknowledgment of the challenges associated with involving the private sector as a strategic partner in the petrochemical refining project at the Al-Zour complex and the establishment of the Kuwait Warehousing Company by the state (through the Public Authority for Investment) as a competitor to privately-owned and managed warehouse and logistics services companies specializing in the same areas of business.

The reasons for this distrust in the private sector cannot be attributed to an analysis of each individual project or deal mentioned above, as determining the preference for private sector ownership or management varies depending on the sector. Instead, this skepticism serves as a starting point to analyze why most Kuwaitis lack confidence in the private sector and resist privatizing government-owned entities, despite ongoing complaints about government administration. This is particularly noteworthy since successful models worldwide often involve private, non-governmental companies and projects.

Lack of confidence
This lack of confidence in the private sector can be attributed to two primary factors. Dominance of the Public Sector since the official data from the Central Bureau of Statistics reveals that the public sector employs 83.9 percent of Kuwaiti workers, while Kuwaitis in the private sector make up only 16.1 percent and second the lack of Positive Private Sector Models -- successful models of private sector involvement have been scarce, and this absence contributes to public skepticism.