Concluding remarks by the Chairperson

1. This first Trade Policy Review of the State of Kuwait has given us a much better understanding of recent developments in its trade and trade-related policies and practices together with the challenges it faces.  We are grateful for the active participation of the Kuwaiti delegation headed by H.E. Ambassador Dharar Razzooqi, Permanent Representative in Geneva.  I would also like to thank the discussant, Ambassador Shahid Bashir of Pakistan, and Members of the TPRB for contributing to our fruitful exchange of views.

2. Kuwait’s high oil export earnings and open trade regime, with a simple average MFN applied tariff of 4.8% in 2011, have enabled it to successfully weather the global crisis without backsliding on trade liberalization.  Kuwait is taking steps to diversify the economy away from oil and gas, and has been encouraged by Members to continue its structural reforms in order to achieve its goal of becoming the international trade, logistical, energy, and financial services hub in the region.  A key challenge of Kuwait’s development process is to increase the participation of the private sector (local and foreign) in the economy and scale-back reliance on the public sector to absorb domestic labour.

3. Members welcomed Kuwait’s commitment to the multilateral trading system as demonstrated by increasing its WTO notifications during the preparations for this Review, and encouraged it to further foster its participation given that it benefits from the open trading system and is relying on trade for its own goals of economic diversification.  Kuwait has also identified its technical assistance needs in the WTO. Kuwait participates in two overlapping regional trade agreements, the Gulf Cooperation Council (GCC) and the Greater-Arab Free Trade Area (GAFTA).  Several Members requested Kuwait to work with its GCC partners to ensure that the GCC customs union is reviewed under Article XXIV through the Transparency Mechanism as soon as possible.

4. From a close examination of the observations made by delegations during this Review, it appears to me that the Kuwaiti authorities might consider introducing further action or improvements in certain areas.  I note from Kuwait’s concluding statement that action is already being taken in several of these areas:

• Tariff, customs, and import licensing:  Despite Kuwait’s relatively low level of tariff protection, Members called for further action, including bringing its bound rates close to its applied tariff rates, and eliminating tariffs on all IT products.  Kuwait was also requested to remove its requirement for consular formalities on imports and revamp its import licensing system.
• SPS and TBT:  Kuwait was encouraged to improve transparency through prompt WTO notifications and allowing interested parties more time to review and comment on standards and SPS measures, while eliminating certain technical requirements to further reduce the cost of traders.
• Investment and business environment:  Members acknowledged Kuwait’s intention to promote more foreign investment.  They encouraged Kuwait to speed-up the promulgation of new laws to modernize the business environment; to tackle red tape and other obstacles to doing business; and to increase the transparency, accountability, and effectiveness of government administration.
• Government procurement:  Some Members requested Kuwait to amend its government procurement regime to remove the requirement to employ a Kuwaiti partner or agent in order to submit tenders, and review both its offset programme and tax retention scheme.  Kuwait was also invited to join the Government Procurement Agreement.
• Competition:  Questions were raised about the establishment of the Competition Protection Authority, and Kuwait was encouraged to consider broadening the scope of its competition legislation to cover facilities and projects owned and managed by the State given its heavy involvement in the economy.
• Intellectual property:  Several Members noted Kuwait’s plans to review its intellectual property legislation and the Kuwaiti delegation also emphasized the importance of a strong and efficient intellectual property system.  They encouraged Kuwait to further strengthen its implementation and enforcement actions.
• Energy:  Kuwait was encouraged to take further steps towards a more energy-efficient economy.
• Services:  Despite progress in the liberalization of trade in services, Members continued to be concerned by certain restrictions such as the need to use local agents.  They expressed hope that Kuwait might increase its GATS commitments and establish an independent ICT regulator.

5. In conclusion, I believe that this Review has given us a comprehensive update on the trade regime of the State of Kuwait.  The number of advance questions and the many interventions indicate the important role played by Kuwait in the WTO.  This Review has taken place at a very important time.  Following the global financial crisis that started in 2008 and current uncertainty in the global economy, the policy direction that Kuwait is going to take will be very important for its future development and for the stability of the world energy market.