Let's talk about Kuwait economy

17 Jan 2023

Kuwait is hot all year round and in such a dry, hot and water-deficient desert country, water and oil have become important resources to maintain Kuwait's survival.

The long age of several wells

Before 1925, the people living in this land of Kuwait depended on a few wells for drinking water. Water was carried home from the well in small buckets and was stored in yellow clay pots shipped from Persia. Traders and pilgrims passing by filled their sheepskin pockets with water from the wells and carried it on the backs of their animals to continue their journey. People cherish every drop of well water and guard the well like they care for their eyes. Therefore, if anyone finds a new well, it will be a great joy.

Later, Kuwait set up a special water-carrying fleet, which transported fresh water to Iraq every day and sold it back to the city. When the wind is favorable in summer, a round trip takes only 24 hours, and a round trip in winter generally takes 3-4 days. Water shipped remotely like this is expensive. In 1951, the Kuwait Oil Company's desalination plant was built, which can provide 320,000 liters of water per day to Kuwait City.

Since the 1970s, more than 30 mushroom-shaped conical water towers have been built in Kuwait City, each of which can store 3 million liters of water. Among them, the three highest cylindrical spherical water towers are both reservoirs and observation decks, gardens and restaurants.

Today, Kuwait's seawater desalination volume is as high as 300,000 cubic meters per day, which basically meets the needs of industrial and domestic water. However, the mineral water sold in supermarkets is still not cheap. An ordinary 500ml bottle of mineral water can be sold for more than USD 5, which is more expensive than gasoline.

Rich oil resources

Kuwait has been very poor since ancient times, and its residents lived in earthen houses and tents. But since the discovery of oil, the living standards of the local people have improved rapidly, and the earthen houses and tents have been demolished, leaving only dozens of them as cultural relics.

In the 1980s, the residential area of ​​Kuwait medium-sized families was over 400 square meters, and the low-income families also had more than 200 square meters. Most of them are built by the government for sale at low prices, or built by the government with interest-free loans and subsidies.

The Kuwaiti government has the confidence to solve the housing problem, which is naturally closely related to its oil revenue. Kuwait has huge oil reserves, nearly 100 billion barrels. At its peak, its annual oil production reached 150 million tons. In the 1980s, Kuwait's annual oil sales revenue exceeded 15 billion US dollars, and its per capita GDP once ranked among the top ten in the world, even surpassing developed countries in Europe and the Big Asian economies, creating a myth of riches.

In the past few years, the international oil price has been soaring, and Kuwait's oil exports have repeatedly hit new highs, exceeding 100 billion US dollars, accounting for more than 90% of the total exports. Kuwait has accumulated massive wealth from oil exports, and its national financial reserve exceeds 550 billion US dollars, which is nearly four times its GDP.

In 2018, Kuwait's population was close to 4.5 million, the total GDP was about 140 billion US dollars, and the per capita was 35,000 US dollars. It seems that as long as oil is still the main energy source used by human beings, Kuwait will continue to be a rich country!

Write & Read to Earn with BULB

Learn More


Population growth has always been a key performance indicator for the future growth of a country in the long term (Think 30 - 50 years). Although this might just be a short term trend, Kuwait' population has declined by 2.5% over the past 3 years. It will be interesting to see how Kuwait's government combats this population decline.