Kuwait Defence and Security Report Q3 2011
Includes 3 FREE quarterly updates
While the Arab League’s decision to hold its annual summit in the Iraqi capital Baghdad in March 2012 was intended to demonstrate Iraq’s political rehabilitation, its main significance from a Kuwaiti standpoint was the opening of a new chapter in Kuwait-Iraq relations. Despite security concerns and widespread insurgent attacks across Iraq in the lead-up to the summit, Kuwaiti Emir Sheikh Sabah al-Ahmad al-Sabah personally attended the meeting of Arab leaders. In doing so, he became the first Kuwaiti head of state to visit Iraq since Saddam Hussein invaded Kuwait in 1990.
Earlier that month, Iraqi Prime Minister Nouri al-Maliki had visited Kuwait, and he sought to draw a line under one of the outstanding controversies of the 1990 invasion by agreeing to pay Kuwait US$500mn in compensation for 10 Kuwait Airways passenger jets that were stolen by Iraqi forces. Iraq also now pays 5% of its oil and gas revenues to Kuwait as reparation, and, though some bones of contention remain, relations between the two neighbours are finally regaining a stable footing.
Nonetheless, Kuwait’s regional security outlook remains harsh. Instability in Iraq and Syria, and the threat of war between Iran and Israel, all have the potential to spill over into nearby countries like Kuwait.
Kuwait’s status as a close ally of the US – which stations 23,000 troops in the country – offers protection on the one hand, while also potentially making Kuwait a target of anti-US forces in the region, be they state actors (eg, Iran) or non-state actors (eg, al-Qaeda in Mesopotamia).
Kuwait is also experiencing a period of internal political instability, which, though mild by the standards of the Arab Spring, has nonetheless made its leaders nervous. The storming of the Kuwaiti parliament by protesters in November 2011 led to a security crackdown and the sacking of the prime minister.
Parliamentary elections in February 2012 also took place amid protests, with riot police dispersing demonstrators after some stormed a Kuwaiti TV station that was in the process of interviewing one of the main pro-government candidates.
The election was a victory for the Islamist opposition, which secured 34 seats in the 50-seat parliament.
However, the country’s prime minister is handpicked by the emir, and following the poll the current incumbent, Sheikh Jaber Mubarak al-Sabah, appointed a distinctly familiar-looking cabinet comprising members of the ruling family (and not one Islamist). The prime minister did hold talks with the opposition during which he offered them three posts in the 16-member cabinet, but these discussions came to nothing. This is a matter of concern because it gives the impression that the ruling family has made little allowance for the February election results or the recent political protests. Thus, there is a risk of more political instability ensuing later in 2012. It seems likely that the Kuwait government will use largesse, rather than political reform, to co-opt the population, following record oil revenues for the fiscal year ending March 31, which were expected to top U$100bn for the first time. BMI expects this programme to include significant wage increases. However, the policy could also foster instability further down the line if oil prices fall and the government finds itself fiscally overstretched.
Nonetheless, in the short term, the main challenges to Kuwaiti security are external, with the crisis surrounding Iran’s nuclear programme still of particular concern.
While the Arab League’s decision to hold its annual summit in the Iraqi capital Baghdad in March 2012 was intended to demonstrate Iraq’s political rehabilitation, its main significance from a Kuwaiti standpoint was the opening of a new chapter in Kuwait-Iraq relations. Despite security concerns and widespread insurgent attacks across Iraq in the lead-up to the summit, Kuwaiti Emir Sheikh Sabah al-Ahmad al-Sabah personally attended the meeting of Arab leaders. In doing so, he became the first Kuwaiti head of state to visit Iraq since Saddam Hussein invaded Kuwait in 1990.
Earlier that month, Iraqi Prime Minister Nouri al-Maliki had visited Kuwait, and he sought to draw a line under one of the outstanding controversies of the 1990 invasion by agreeing to pay Kuwait US$500mn in compensation for 10 Kuwait Airways passenger jets that were stolen by Iraqi forces. Iraq also now pays 5% of its oil and gas revenues to Kuwait as reparation, and, though some bones of contention remain, relations between the two neighbours are finally regaining a stable footing.
Nonetheless, Kuwait’s regional security outlook remains harsh. Instability in Iraq and Syria, and the threat of war between Iran and Israel, all have the potential to spill over into nearby countries like Kuwait.
Kuwait’s status as a close ally of the US – which stations 23,000 troops in the country – offers protection on the one hand, while also potentially making Kuwait a target of anti-US forces in the region, be they state actors (eg, Iran) or non-state actors (eg, al-Qaeda in Mesopotamia).
Kuwait is also experiencing a period of internal political instability, which, though mild by the standards of the Arab Spring, has nonetheless made its leaders nervous. The storming of the Kuwaiti parliament by protesters in November 2011 led to a security crackdown and the sacking of the prime minister.
Parliamentary elections in February 2012 also took place amid protests, with riot police dispersing demonstrators after some stormed a Kuwaiti TV station that was in the process of interviewing one of the main pro-government candidates.
The election was a victory for the Islamist opposition, which secured 34 seats in the 50-seat parliament.
However, the country’s prime minister is handpicked by the emir, and following the poll the current incumbent, Sheikh Jaber Mubarak al-Sabah, appointed a distinctly familiar-looking cabinet comprising members of the ruling family (and not one Islamist). The prime minister did hold talks with the opposition during which he offered them three posts in the 16-member cabinet, but these discussions came to nothing. This is a matter of concern because it gives the impression that the ruling family has made little allowance for the February election results or the recent political protests. Thus, there is a risk of more political instability ensuing later in 2012. It seems likely that the Kuwait government will use largesse, rather than political reform, to co-opt the population, following record oil revenues for the fiscal year ending March 31, which were expected to top U$100bn for the first time. BMI expects this programme to include significant wage increases. However, the policy could also foster instability further down the line if oil prices fall and the government finds itself fiscally overstretched.
Nonetheless, in the short term, the main challenges to Kuwaiti security are external, with the crisis surrounding Iran’s nuclear programme still of particular concern.
Contents
Executive SummarySWOT Analysis
Kuwait Security SWOT
Kuwait Defence Industry SWOT
Kuwait Political SWOT
Kuwait Economic SWOT
Kuwait Business Environment SWOT
Global Political Outlook
Major Risks Looming In 2012-2013
Global Flashpoints: Eurozone, Iran, Syria, Afghanistan, Korean Peninsula
Table: Election Timetable, Q212-Q113
Wild Cards To Watch
Middle East Security Overview
The Strategic Outlook For The 2010s
The Middle East In A Global Context
Challenges And Threats To Stability And Security
Regional Power Dynamics
Nuclear Proliferation
External Powers
Scenarios For The Middle East
Security Risk Ratings
Table: Middle East And Africa Defence And Security Ratings
Table: Middle East And North Africa State Vulnerability To Terrorism Index
Political Overview
Domestic Politics
New Cabinet Suggests Political Gridlock Will Continue
Kuwait's Political System
Long-Term Political Outlook
Democracy: No Turning Back
Security Overview
Internal Security Situation
External Security Situation
Latest Developments
Armed Forces And Government Spending
Armed Forces
Weapons Of Mass Destruction
Market Overview
Arms Trade Overview
Industry Trends And Developments
Procurement Trends And Developments
Procurement Background
Latest Developments
Industry Forecast Scenario
Armed Forces
Table: Kuwait’s Armed Forces, 2000-2008 (’000 personnel, unless otherwise stated)
Table: Kuwait’s Available Manpower For Military Services, 2009-2016 (aged 16-49, unless otherwise stated)
Defence Expenditure
Table: Kuwait’s Government Defence Expenditure, 2009-2016
Table: Kuwait’s Defence Expenditure Scenario – Changing % Of GDP, 2009-2016 (US$mn)
Defence Trade
Table: Kuwait’s Defence Exports, 2009-2016 (US$mn)
Table: Kuwait’s Defence Imports, 2009-2016 (US$mn)
Table: Kuwait’s Defence Trade Balance, 2009-2016 (US$mn)
Key Risks To BMI’s Forecast Scenario
Macroeconomic Outlook
A Robust Consumption-Led Growth Story
Table: Kuwait – Economic Activity, 2011-2016
Country Snapshot: Kuwait Demographic Data
Section 1: Population
Table: Demographic Indicators, 2005-2030
Table: Rural/Urban Breakdown, 2005-2030
Section 2: Education And Healthcare
Table: Education, 2002-2005
Table: Vital Statistics, 2005-2030
Section 3: Labour Market And Spending Power
Table: Employment Indicators, 1997-2006
Table: Consumer Expenditure, 2000-2012
BMI Methodology
How We Generate Our Industry Forecasts
Defence Industry
Sources Skip to top