After years of economic stagnation and political infighting, optimism in Kuwait is on the rise. Local economists expect an uptick in government spending — tied to a partial resolution of the political turmoil — and a pickup in the pace of mega-development project implementation. But behind the spending spree, royal infighting, fears about longer term budget constraints and an upcoming succession might derail Kuwait’s turnaround before it even gets started.
“The Kuwaiti economy, in our view, will witness a moderate acceleration in non-oil growth toward 4-4.5% in 2014 and 2015 … driven largely by a faster pace of project implementation, which is already taking place,” Nemr Kanafani, senior economist with National Bank of Kuwait, told Al-Monitor.