Finance in Kuwait
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Financing Your Business in Kuwait
Foreign Direct Investment Law
With the Kuwaiti government keen to reinvest its oil wealth in other parts of its economy, in 2001 it passed the FDI Law No. 8 with various incentives for foreign enterprises, including UK operations, looking to expand or open in the country. The main concession passed was the allowance for businesses that are 100% foreign owned. The key areas the government are trying to stimulate investment are as follows:
- Infrastructure projects such as water, electricity, sewage and communications.
- Finance Banks, investment and exchange companies. These are subject to approval from the Central Bank of Kuwait www.cbk.gov.kw
- Insurance companies subject to approval from the Ministry of Commerce and Industry or MCI.
- Information technology and software Development
- Healthcare hospitals and medicine
- Tourism hotels and entertainment
- Media and culture The law exempts foreign involvement in publishing houses, newspapers and magazines.
- Housing development Foreign investors are forbidden however from speculating on real estate.
The tax incentives and finance incentives for UK businesses include the following:
- No taxation for 10 years
- Exemption from or reductions from import duties
- Government allocation of land or real estate
Kuwait Free Trade Zone
Located in Shuwaikh, Kuwaits main industrial area and near a number of ports, the trade zone offers the following incentives and resources for businesses looking to operate in the zone: www.kuwaitfreezone.com
- 100% foreign owned businesses
- No import duties for foreign businesses
- No corporate income tax
- The allocation of industrial and service licenses without a local sponsor and
- Human Resources facilities for recruiting and accommodating foreign workers
- On site consulting and financial services
Credit from financial institutions is available from a variety of private financial institutions that have branches in the country. As with all commercial loans, a strong business plan and an understanding of the local business conventions and etiquette are important if pursuing this form of finance. It is also recommended that you consult an accountant before making a formal approach to a bank.