Kuwait Infrastructure Report Q4 2011

BMI View: Kuwait continues to be an underperformer in the region this quarter, as the rewards for investors remain low. Although the political situation is stable there is little sparkle in the Kuwaiti infrastructure sector. The construction industry is forecast to post growth of 2.5% in 2011, taking the industry value to US$2.4bn. The remainder of the forecast period is likely to be slow but steady with industry value rising marginally to US$3.2bn by 2015. Browse All: Infrastructure Market Research Reports Key developments in the last quarter included: In June 2011, Kuwait's Supreme Petroleum Council approved the development of the Al-Zour refinery, according to oil minister Mohammad al-Busairy. The 615,000 barrels per day (b/d) facility will be the country's largest refinery and requires investment of at least KWD4bn (US$14.5bn). The first phase of the Mubarak Al-Kabir Seaport project at Boubyan Island was launched on April 6 2011 and is scheduled to be completed in four phases. The first phase involves the building of expressways and railways linking all parts of the island, as well as construction of bridges for cars and trains. The port is likely to have 60 berths with each to have a depth of 20m in order to accommodate large vessels. The ground-breaking ceremony was attended by His Highness Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah.rnDelays to projects in Kuwait are likely to continue over the short term with plans to invest in infrastructure obstructed by the transient and overly bureaucratic government. This has resulted in significant delays to the procurement and execution of projects. Plans to invest much needed funds into the utilities sector are likely to come up against the same problems. The recent government reshuffle will have limited implications for both the country’s political risk profile and the business environment. We expect the outgoing prime minister to be reappointed as the head of a new cabinet, while tensions between the government and the parliament - although dissipating in the near term - are likely to return over the medium term. Similarly, expansionary oil sector policies will remain unaltered, while non-hydrocarbon sector reforms will continue to be delayed because of disagreements between rival political factions. Related Reports: Tanzania Infrastructure Report Q4 2011African Fixed-line and Fibre Telecoms Markets and Infrastructure