Kuwait: the dangers of oil dependence

OPEC members crude oil production. Source: OPEC, 2013
OPEC members crude oil production. Source: OPEC, 2013

Kuwait, a small Gulf state, is one of the richest countries in the world. It sits on the world's sixth largest proven oil reserves. This oil dependent economy is enjoying a strong performance thanks to high oil prices. But analysts question whether the government’s generous social spending is sustainable especially in the light of two main challenges - a potential downward pressure on oil price and the desire of Kuwait to expand its production.

KUWAIT sits on 101.5 billion barrels of oil (6.1 per cent of world total) - the world’s sixth largest proven oil reserves after Venezuela, Saudi Arabia, Canada, Iran and Iraq. It is an oil dependent economy, enjoying the rewards of high global ...

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