October 28, 2015: Kuwait Direct Investment Promotion Authority (KDIPA) announced that Kuwait has witnessed marginal improvement in its position in the Ease of Doing Business Indicator issued in recent Doing Business Report 2016 (DB2016), released annually by the World Bank. The direction of improvement reflected in terms of Kuwait’s position in the Distance to Frontier (DTF), which recorded a slight increase to 60.17 in DB 2016 as compared to 59.77 in DB2015. The report has attributed this to a positive reform, which affected the minimum capital requirement within the Starting a Business component, whereby the cost dropped marked from 74% to 8.2%, and Kuwait rank in this component dropped to 148 from 150, amongst 189 countries in this report, with DTF recording a rise from 71.28 to 75.37, in the same period.
Despite this improvement, Kuwait overall rank in the Ease of Doing Index dropped to 101 in DB2016 from 100 in DB2015.
KDIPA noted several developments in the new repot, after a thorough review of the details, and in accordance with the task entailed to it by its establishing Law No. 116 of 2013, and the fact that it heads the Permanent Committee for Streamlining Business Environment, including introducing several new indices as sub-components:
• Within Dealing with Construction Permits Component, Building Quality Control Index (0-15), where Kuwait recorded a good position at 11.
• Within Getting Electricity Component, Reliability of supply and transparency of tariff index (0-8), where Kuwait recorded a fair position at 3.
• Within Registering Property Component: Quality of the land administration index (0-30), where Kuwait recorded a fair position at 17.5.
• Within Enforcing Contracts Component: Quality of judicial processes index (0-18), where Kuwait recorded a fair position at 8.
On another hand, there were other developments affected the methodology and resulted the following:
• Within the Getting Electricity Component, cost (% of income per capita) increased from 47.3% in DB2015 to 52.2% in DB2016.
• Within the Getting Credit Component, the Credit bureau coverage (% of adults) increased from 32% to 34.2%, and the Credit registry coverage (% of adults) increased from 10.9% to 15.3%, in the same period respectively.
KDIPA have indicated that the areas that witnessed some improvement based on the efforts by the concerned government entities has made Kuwait closer to the DTF. KDIPA further reiterated that this positive direction will continue as KDIPA will exert more concerted efforts with all concerted parties to advance the doing business reform agenda, and achieve a better understanding of the change of methodology introduced in the DB 2016 report.
KDIPA would like to take this opportunity to express its gratitude and thanks to everyone who contributed to improve Kuwait position in the DTF, hoping that all government entities will further cooperate and work closely to enhance Kuwait overall rank in the Ease of Doing Business,. This is a target that is close to attain with increased governance, approaching the opening of the national “one stop shop”, and near approval of the bankruptcy draft law.