Location and History of Kuwait
Kuwait is neighboring Saudi Arabia and Iraq, the country is smaller in size than all of its neighbors and sometimes smaller than one of their provinces, but its reputation around the world is complex. What are the characteristics of Kuwait that we hear its name from time to time? Residents of the southern cities of our country may know more about Kuwait.
Kuwait is a country in West Asia. Kuwait has land borders with Iraq and Saudi Arabia and water borders with Iran via the Persian Gulf. Its capital is the city of Kuwait. The official language of this country is Arabic and its currency is the Kuwaiti Dinar. Of all Kuwaitis, 60% are Arabs and about 38% of Kuwaitis are of Asian descent.
The people of Kuwait are white and of Semitic descent, and among them are other Arab races such as the Adnan's (the first nomadic group from Najd to this land belonged to the Anza tribe) and the Qahtanis.
The official language of Kuwait is Arabic. In addition, English is now of special importance due to the history of the British presence in this country and also the presence of the United States as a second language.
History of Kuwait:
The date of the founding of Kuwait goes back to Sheikh Barak ibn Gharir al-Hamid, the sheik of the Bani Khalid tribe and the ruler of the Emirate of Ehsa, who at the end of 1110 AH built a fort called Kut to store food and also store weapons, after which Kuwait took its name. And then this city was given to the Al-Sabah family during the time of Sheikh Sa'dun bin Muhammad Al-Hamid.
Kuwait in ancient times was mostly done by Iranians, especially the people of Bushehr and Khuzestan. At the beginning of the city's growth, several hundred Behbahani families from all walks of life settled in this port.
Kuwait has five provinces in terms of administrative division, each of which is governed by a governor appointed by the emir. These five provinces are Central Province (Al-Asma), Al-Houli Province, Al-Ahmadi Province, Al-Jahraa Province, and Al-Farwaniyah Province.
Kuwait is geographically a small country with an area of more than 17,000 square kilometers. It shares borders with Saudi Arabia and Iraq on land and with Iran by sea.
The climate of Kuwait is not unlike that of the scorching deserts of Saudi Arabia, and in most parts of the country, the climate is very hot and dry. It also has very little access to fresh water.
This has led Kuwait to import many of its food and agricultural products. Even in recent years, the country has supplied part of its drinking water through imports and desalination plants.
Of course, in recent decades, Kuwait has tried to slightly improve its agricultural situation by building greenhouses and changing farmland. Kuwait, despite its small size, is divided into six different provinces: Hooli, Jahra, Asma, Farwaniya, Ahmadi, and Mubarak al-Kabir.
Politically, Kuwait, like other countries in the Persian Gulf, is a sheikhdom. However, the political climate in this country is usually more open than in other Persian Gulf countries.
The country gained independence in 1961, and since then several members of the Al-Sabah family have come to power in Kuwait. There is also a parliament in the country that oversees the activities of the government alongside the judiciary.
Historically, the first steps in the establishment of Kuwait were taken by the Al-Hamid and Al-Sabah families. However, Iraq has always made claims to its territory that led to the second Persian Gulf War. Currently, Kuwait is one of the safest countries in the region and has good relations with many countries in the world.
Religion, Currency and economy of Kuwait
This is most of the citizens of Kuwait Islam. There are no official statistics on followers of Islamic religions in Kuwait, but it is estimated that 70% of Kuwaiti citizens are Sunni and 30% Shiite.
If you have noticed, the Arabs prefer to wear clothes that completely cover their arms and legs, and their wives often cover their faces with veils, but in Kuwait, due to a large number of immigrants, there is a special style of clothing for the people this country.
Kuwait is very suitable for anthropological researchers interested in learning about the culture of nations, if you are one of these people, do not miss a trip to Kuwait.
Currency of Kuwait:
The Kuwaiti currency is the dinar, the Kuwaiti dinar, like other currencies of oil-exporting countries, is directly dependent on the dollar. The Kuwaiti Dinar is freely convertible and its exchange rate is announced daily.
Kuwait is the fifth richest country in terms of oil reserves and has so much capital that it has been able to cope well with the expenses and expenses of immigrants. Although Kuwait is in a good economic situation, it can still be said that it is completely dependent on its oil exports and about 85% of its income comes from this way. These issues have made gas prices cheaper than water in Kuwait.
Following the 2014 rout in oil prices, GCC economies have been struggling to adapt to the new oil reality. GCC countries experienced a direct hit on their fiscal balances as government expenditure had not been adequately controlled following years of abundant spend.
With future deficits looming, Kuwait has followed the regional trend of pursuing economic and fiscal reform programs. These programs are comprised of multiple initiatives that seek to support economic diversification, strengthen private sector contribution to the economy and help maintain the deficit under control.
The country's economy is largely based on oil and fossil fuels. However, the share of the tourism sector in the Kuwaiti economy cannot be ignored. Kuwait has been a destination for many Iranian and foreign tourists since ancient times.
This trend has continued so far with an almost positive slope. Kuwait's agriculture accounts for a very small share of its economy. In many cases, agriculture accounts for less than one percent of GDP.
This has made the Persian Gulf country one of the main importers of food, especially from the United States. Stability and tranquility are the hallmarks of Kuwait's economy.
This stability has led many economic actors around the world to choose Kuwait as their center of activity. The table below provides relevant information on the state of the Kuwaiti economy based on data from international organizations.
The above information shows that Kuwait's economy is in very good condition and economic actors can safely do business with this country. This information also helps us to have a good perspective on the economic situation of this country on the Persian Gulf.
Ports of Kuwait
Al-Ahmadi Port: Al-Ahmadi Port is the largest oil port in Kuwait with four anchorages. The northern wharf of Bandar al-Ahmadi can be used for both the export of crude oil and refined products.
Shoaib Port: The second largest port in Kuwait is Shoaib. It has special anchorages for commercial goods, containers, and special anchorages for petroleum products, which are managed by the Kuwait National Oil Organization.
Shoaikh Port: This port is the oldest commercial port of Kuwait, which can accept various ships with a water intake of 7.5 meters at any time and with a water intake of 9.5 meters only in the maximum water condition.
Al-Zour Port: Al-Zour Port (Mina Al-Massoud) is the fourth oil port in Kuwait that exports oil to the neutral or subdivided region.
Doha Port: A small port built-in 1981 for boats and coastal cargo ships moving light goods between the countries of the Persian Gulf region. The water depth reaches 3.4 meters.
Abdullah Port: Bandar Abdullah was built in 1954 to export petroleum products to the Mina Abdullah refinery, which has two berths at a depth of two miles off the coast.
What we need to know before exporting to Kuwait
Geographical proximity, the existence of different ports on both sides, peace, and stability in the Kuwaiti economy, and the connection with global traders through this country are among the factors that make exports to Kuwait attractive for traders. mporters apply for import licenses from the Ministry of Commerce and Industry and must be registered with the Kuwait Chamber of Commerce and Industry (KCCI). The import licenses are valid for one year, are renewable, and allow for multiple shipments.
Import licenses for industrial machinery and spare parts are also required, which are issued by the Public Authority for Industry. Various ministries and agencies also issue licenses for specific products, including firearms, explosives, pharmaceuticals, and wild or exotic animals.
Only the local agent is authorized to clear items at Kuwait Customs by showing an official letter of representation as well as a letter by the end-user.
Kuwait Public Information; what do we know about our southern neighbor?
Exports to Kuwait have always been attracted to our country's businessmen, but in many cases, even novices enter the country without knowing and understanding it accurately.
Kuwait has been one of the countries in which the Iranians have had a strong presence for a long time. Usually, economic activists in the port and southern regions of the country such as Khuzestan, Bushehr, and Bandar Abbas have economic relations with the countries bordering the Persian Gulf, including Kuwait.
Kuwait, like other countries in the Persian Gulf, is a sparsely populated and small country. But it has become a center for the presence of important economic and commercial actors in the region and even in the world.
Access to international open waters and a privileged geographical location make Kuwait a very important center for business and commerce.
Iran is one of Kuwait's neighbors and has a sea border with this country. The presence of important ports on both sides has led to the exchange of a significant amount of goods between them each year.
Accurate knowledge of Kuwait will help you to take better steps to export to this country. Therefore, it is not bad to get acquainted with the general situation of this country first.
What we need to know about the people of Kuwait
Kuwait is a Muslim country where the majority speak Arabic. However, some ethnic and religious minorities are also present in the country. The point that we have to pay attention to in terms of demographics and culture of Kuwait is that a significant part of its population is not native.
Because since ancient times, people from many other Asian countries have migrated to Kuwait. The reason for their migration was usually to gain better economic opportunities. Even a significant percentage of Iranians have immigrated to Kuwait. These people have usually been residents of cities and southern provinces of our country.
Although exact and official statistics are not available in this regard, according to some statistics, it is said that about 40% of the inhabitants of this country are non-natives.
Therefore, the diversity of ethnicities and nationalities in this country, along with the strong presence of the Iranian population, can be a positive point for Iranian businessmen who intend to export to Kuwait.
How is Kuwait's trade with the world and Iran?
Kuwait does not have a large volume of non-oil exports. Most of the country's exports are based on exports of oil and fossil fuels. Most of Kuwait's exports go to countries such as India, the United Arab Emirates, Iraq, Pakistan, Oman, and China.
According to the latest global data, Kuwait exported $ 66 billion worth of goods to various countries in 2018, which is a jump of about 20% compared to the previous year.
This year, oil and fossil fuels account for about 92 percent of Kuwait's exports. Organic chemicals, fertilizers, plastics, minerals, aluminum, and precious stones are each next with a small percentage. These figures show that oil and fossil fuels are the mainstays of Kuwait's economy and that the country needs to import many goods.
Which countries import the most Kuwait?
Because the Persian Gulf economy is a single product, it meets many of its needs, including products and foodstuffs, through imports. Statistics show that China and the United States are Kuwait's main partners in the import debate. Among Kuwait's neighbors, Saudi Arabia and the United Arab Emirates also export a significant portion of their goods to Kuwait.
Meanwhile, the emptiness of Iranian goods in Kuwait is quite felt. The map below shows Kuwait's main partners in the import debate. World Trade Organization (WTO) data for 2018 show that Iran does not have a large share of Kuwait's imports.
According to the same data, among the imported goods of Kuwait, the names of some goods are more prominent, which indicates the import needs of Kuwait. In the following, we will refer to the main import groups of this country.
What are the most important imported items of Kuwait?
Kuwait imports goods in many fields. However, this list may change slightly over the years. But on average, some products are often part of Kuwait's regular import needs.
Iranian traders can meet many of Kuwait's import needs.
Other import needs of Kuwait include plastic products, medical equipment, construction materials, and many other products. However, usually, each country exports certain goods to Kuwait.
The United States, for example, plays a major role in supplying food to Kuwait. While other countries may focus more on exporting other products to this Persian Gulf country.
What are the statistics of Iran's exports to Kuwait?
Statistics show that in recent years, the amount of Iranian goods exported to Kuwait has always fluctuated slightly. But this statistic has suddenly jumped significantly in 2018.
This year, $ 358 million worth of goods were exported from Iran to Kuwait. Although this amount of goods is not much compared to the total imports of Kuwait from other countries, it shows a very significant growth compared to previous years. In 2017, the export of Iranian goods to Kuwait was less than $ 200 million. The chart below shows the number of Iranian goods exported to Kuwait in recent years.
In 2018, Iran exported more than $ 350 million worth of goods to Kuwait. The chart above shows that there have been two significant jumps in the export of Iranian goods to Kuwait, the first being in 2013 and the second in 2018. It should be noted that statistics for 2009 and 2012 were not available.
What are the goods exported to Kuwait?
In the previous section, we mentioned the most important import needs of Kuwait, which is imported by this country every year. Here we are going to list the goods exported to Kuwait by Iran.
Examining it will help Iranian businessmen and traders to better analyze and study trade with this country. According to statistics, the most important goods exported by Iran to Kuwait in 2018 are as follows:
- Mineral products: gypsum, lime, cement, sulfur, salt, and stone
- Iron and steel
- Sheep and other live animals
- Food products such as flour, cereals, dairy products
- Types of vegetables and agricultural products
- Fish and other marine fish
- Fruits and citrus fruits, watermelon
- Works of art and culture
- Building materials
In addition to the above products, various other goods are exported to Kuwait. Although the list of goods to be exported to Kuwait may change each year, many of the products exported are often the same each year.
The second Gulf War and the occupation of Kuwait in 1990 dealt a fatal blow to Kuwait's economy, squandering more than $ 100 billion in foreign reserves and investments. The total damage to Kuwait as a result of its occupation by Iraq is estimated at more than $ 109.44 billion. The structure of Kuwait's economy did not change after the Persian Gulf War. The country's GDP increased after 1993 after a decline due to the occupation.
Kuwait is a small but restricted economy that is heavily dependent on crude oil exports. The sale of crude oil accounts for 90% of GDP and 75% of the government budget. The global oil crisis of late 1998 and early 1999 reduced the country's budget from $ 5.5 billion to $ 3 billion, creating widespread problems for Kuwait's economy.
Of course, much of Kuwait's economic woes over the past 10 years are due to the devastating effects of Iraq's 1990 invasion of the country's oil facilities. Funding for the reconstruction of cities and economic units on the one hand, and the cost of sending US troops to defend Kuwait against Iraq's ambitious threats, has prompted the Kuwaiti government to attract foreign investment in recent years.
Kuwait has a good per capita income due to its small population and relatively high GDP. The average per capita income of the Kuwaiti people, which was about $ 12,500 in 1999, rose to about $ 14,000 in 2000. Few people live below the poverty line in this country and most of the families have a relatively prosperous life. The tendency for luxuries and rituals, which is a subculture in Kuwaiti families, stems from this relative social well-being.
The economic inflation rate in Kuwait is estimated at less than 2%, which is a reasonable rate (it was about 8.7% in 1997). Kuwait has a workforce of one million, most of whom are immigrants from neighboring countries. Fifty percent of Kuwait's workforce is employed in government and social services, 40 percent in services, and 10 percent in industry and agriculture.
Kuwait is a good buyer of food, building materials, vegetables, and clothing from neighboring countries. The official currency of Kuwait is the dinar, which is divided into one thousand scales. Each US dollar is currently equal to 0.28073 Kuwaiti dinars (December 18, 2011) Kuwait is one of the 20 most expensive cities in the world in terms of the high cost of living.
After 1991, Kuwait's former economic problems were linked to the devastating consequences of the second Gulf War, and there was an urgent need to change the country's economic structure. The Kuwaiti government enlisted the advice of the World Bank and the International Monetary Fund to follow this path and solve its fundamental economic problems. In 1993, expert delegations from the two organizations visited Kuwait and recommended the implementation of an economic reform program, the main focus of which is:
- Elimination of subsidies and free services, increase of taxes
Kuwait has invested directly and indirectly in European, American, and Asian countries. The largest of these investments are in seven industrialized countries.
Kuwait's trade balance in 1997 and 1998 was $ 7.1 billion and $ 641 million, respectively. Also, the current account balance of this country in the above years reached 7.9 billion and 2.9 billion dollars, respectively. Crude oil, petrochemicals, food products, construction metals, and salt are the main industrial and mineral products of Kuwait.
Kuwait also can generate 27 billion kilowatt-hours of electricity, all of which are supplied by thermal power plants and consumed by domestic units. Kuwait has little agriculture and its fishing activities are limited to fishing and shrimp. The United States, Japan, South Korea, India, Singapore, the United Kingdom, Germany, and Italy are Kuwait's largest trading partners.
Important economic, social and political characteristics of Kuwait
The Emirate of Kuwait with an area of 17.818 square kilometers and a population of about two million people is located in the north of the Arabian Peninsula and northwest of the Persian Gulf between 8 and 30 degrees latitude 46 and 48 degrees east longitude and from north to Iraq, from south to Saudi Arabia is bounded on the east by the Persian Gulf.
Kuwait is flat and desert land with a sandy surface and no natural features such as mountains and rivers. Since political, economic, social, etc. activities revolve around the city (Kuwait), in terms of area and population, the concept of city-state can be applied to Kuwait.
The country has several islands on the shores of the Persian Gulf, the most important and largest of which are: Bobian, Filke, Varya, Meskan, Awah, Umm al-Niml, Qarawara, Umm al-Muradam, and Kabar. Due to its geographical location, Kuwait has always been an important center for shipping and maritime activities.