Kuwait Times

Published Date: July 08, 2010

KUWAIT: the Prime Minister Sheikh Nasser Al-Mohammad Al-Sabah stressed the government is keen on accomplishing the state's set development plan and is stressing cooperation among all state bodies and diligent effort to work out difficulties as means towards that end. He was addressing a press conference he held with editors-in-chief of local papers, and stressed all due effort shall be exerted and all due cooperation shall be made within the framework of the constitution.

The government shall respect all supervisory tools used by MPs and would cooperate with them "and would not allow differences and conflicts stall development or cause tension in the relationship between the two authorities, and we have relentless determination to overcome all hurdles". Sheikh Nasser expressed thanks to the Almighty for blessing the state "with guidance and strength to utilize constitutional tools and coordinate their usage as well as coordinate efforts by the civil community institutions a
nd all groups within Kuwaiti society, and investing all that to serve the homeland and push forward development and bring about prosperity".

Sheikh Nasser also expressed appreciation to HH the Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah and HH the Crown Prince Sheikh Nawaf Al-Ahmad Al-Sabah for their great and continued support to all authorities and for their wise counsel that bolsters national action and protects it against shortcomings that could lead to deviation from the set path. The premier also expressed appreciation for the constructive effort of MPs and the time they put in "to enable as much achievement as possible". The judicial au
thority's efforts also merit appreciation, as it maintains law and order and justice even in the face of challenge.

As for the role of media, Sheikh Nasser hailed the achievement, performance and pioneering role of media in Kuwait. He specifically hailed media institutions' cooperation to support and maintain the political track. "I address you here today as we look back on a very sensitive stage, and the last few months saw great and most serious and keen effort to maintain the homeland's best interest in the long run. It is crucial now to look back and assess what has been achieved throughout last year before we all g
o on summer break; the achievements have been unique and of great weight if considered within the perspective of Kuwait's political history," Sheikh Nasser remarked.

For the first time, we have an agreed strategic vision that shall guide our policies till the year 2035, drafted in consultation with His Highness the Amir and by national and international experts. This shall serve as framework for the efforts of the current and coming governments as they seek to meet the expectations of the people," he said. "This is the first time in our legislative history for parliament to unanimously pass the development plan for the next four years," and "the process of realizing t
his blueprint is to go according to a clear methodology approved by the constitutional institutions and realized through cooperation and integration of initiatives by all economic and social sectors. The approved plan would put us on the right path towards economic development and help achieve our ambitions. And through the plan, we would determine and fund several hundred projects and initiatives, and the state treasury would spend great sums, and all would, God willing, lead to improvement in the state's
infrastructure and improve general services.

Sheikh Nasser pointed out several legislations passed to meet the demands of development and the challenge facing the state, including laws on the monetary authority, privatization, rights of those with special needs, and labor. Cooperation between the government and MPs was manifested when the government did not oppose several grilling requests, though some had crossed the lines set by the constitution and the constitutional court, and the government passed all grillings, which were both frequent and seri
ous.

The premier finally prayed the Almighty to bless all in the state with wisdom and continued resolve to best serve the homeland and the people's interests under the wise leadership of HH the Amir and the Crown Prince. The meeting was also attended by the Deputy Prime Minister for Economic Affairs, Minister of State for Development Affairs and Minister of State for Housing Sheikh Ahmad Fahd Al-Sabah, Minister of State for Cabinet Affairs Roudhan Al-Roudhan, Minister of Oil and Information Sheikh Ahmad Al-Abd
ullah Al-Sabah, Minister of Finance Mustafa Al-Shamali, Minister of Communication and Minister of State for National Assembly Affairs Mohammad Al-Busairi, Minister of Commerce and Industry Ahmad Al-Haroun, Minister of Public Works and Minister of State for Municipal Affairs Dr Fadhel Safar, Minister of Electricity and Water Dr Bader Al-Shuraian and Minister of Health Dr Helal Al-Sayer.

For his part, Sheikh Ahmad Al-Fahd said the meeting is a follow-up to previous meetings that have been regularly held by the HH the prime minister with "the media family and the fourth authority," indicating that it is intended for "consultations and relay of information regarding the government's recent activities". He affirmed that the talks dealt with the government "road map" for integrated development schemes aimed at restoring Kuwait's leading status in the region so "it might become a financial and
commercial hub".

The government has succeeded, in coordination with the parliament, in thrashing out various legislative issues related to infrastructure, he said. "We hope that we have taken the first step on the path of the one-thousand-mile journey," he added. The minister indicated at the adoption of the government's long-term and medium term plans, the 2010-2011 development scheme, backed with the necessary legislations, as well several laws related to privatization, the cases of special needs and housing during the l
atest legislative term of the National Assembly.

The ministers have worked collectively dividing the 2010-2011 strategy into three sub-plans, topped by the strategic projects, Sheikh Ahmad said. Dealing with the implementation of the development plan, he said: "Before talking about the advantages, let's talk about the obstacles lying ahead. Bureaucracy always constitutes a real bottleneck for carrying out any development project. Yet, we have adopted a new approach which, God willing will help overcome these obstacles and facilitate the implementation of
a range of key projects in the areas of housing, healthcare, transport and ports. The government has finalized the building of four housing cities, namely Sheikh Saad, Sheikh Sabah, Sheikh Jaber, and West Sulaibkhat.

Sheikh Ahmad highly appreciated the efforts made by the Ministry of Public Works in carrying out the major projects in the transport and ports domains. "Today, in the presence of HH the prime minister, we celebrate the signing of contracts on launching the Mubarak Al-Kabir and the Boubyan ports," he said. "We also inspected the expansion of Sheikh Jaber Hospital where the developer is striving to finalize the project at an early date. The Minister of Health instructed the senior leaders of his ministry to
step up the launching of 11 hospitals which will be put up for tendering late this year. The Ministry of Public Works and global consultancy firms signed contracts on launching four other hospitals, the first of which, with a bed capacity ranging between 350 and 400, will be cast for tendering in October".

The four hospitals and the Police Hospital will relieve the burdens on the country's current 11 hospitals, Sheikh Ahmad revealed. As for the transport projects, he said a contract has been signed on building the United Nations Road. The upgrading of Jamal Abdul-Nasser Road, the First and Fifth Ring Roads and Al-Subiyah Road is in the offing.

The capacity of the air and sea ports has been expanded through ambitious projects involving Kuwait International Airport and Boubyan Seaport. The Ministry of Communication scaled up efforts to finalize the draft bill on the launching of a transport authority," Sheikh Ahmad disclosed.

Regarding industry, he said: "It is an essential part of the development plan. The country will depend on the manufacturing industry as one of the most important sources of non-oil income in the period ahead. The government is building the infrastructure of new industrial zones. The development plan envisages launching 14 major construction projects. We expect that contracts of the development of such projects to take place by next February. The plan also envisages setting up five public shareholding compa
nies and a shareholding company for low-cost housing projects. We are studying the funding for these projects.

Dealing with the issue of power supplies, Sheikh Ahmad said: "The construction of Al-Subiya power station has been completed. We will get the first 1,000 megawatts from the station in early 2011. We are poised to put up for tendering a public shareholding company for launching Al-Zour station. This could take place by the end of 2010. There are other medium-size projects which will add 6,300 megawatts to the country's power generating capacity and 300 million gallons to water supplies daily.

As for tourist and leisure facilities, Sheikh Ahmad said they constituted an integral part of the development plan. "We coordinated with the Touristic Enterprises Company (TEC) for launching 14 touristic projects in the coming three years after raising the capital of TEC from KD 15 million to KD 50 million," the minister pointed out. "Coordination is also underway with Kuwait International Fair Company and the Public Utilities Co for launching the fairground project and other key projects under the BOT sys
tem. Kuwait is competing with other sisterly GCC countries to become an international commercial and financial hub as per the instructions of His Highness the Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah ," he added.

Commenting on the law to restructure state departments, Sheikh Ahmad said the process will start only after finalizing the semi-annual report as per the provisions of the law. "We are about to finalize the quarterly report which will be turned over to the Cabinet in mid-July. When complete, the report will be made public in a transparent way according to the instructions of HH the Prime Minister Sheikh Nasser Al-Mohammad Al-Ahmad Al-Sabah. The report, to serve as nucleus for the semi-annual report, will th
en be referred to brother MPs who will debate it before developing the necessary administrative and legislative measures," he noted.

Sheikh Ahmad added that the government was working out new tools for financing the projects involving shareholding companies, noting that five out of the 14 such companies envisaged in the development plan would come to existence soon. "Due to funding strains brought about by the global financial crisis, we are trying to leverage the returns of all the new projects to 16 percent. As the public would own up to 50 percent of the stocks of these projects, the projects would be of great benefit for both the co
untry and citizen investors. This is why we try to find out new tools to support the banks funding the projects. The issue is being discussed by the members of the parliamentary committee on financial and economic affairs," he explained.

Meanwhile, Minister of Public Works Safar said the implementation of the infrastructure and development projects is going very well as per schedule. "The Ministry of Public Works is receiving bids to develop and run a range of new projects under the BOT system in the domain of services, complexes, drainage and waste recycling. These projects are expected to have positive impacts on the state revenues," the minister pointed out.

On his part, Minister of State for National Assembly Affairs Roudhan said the government sticks to the principle of separation between jurisdiction of the legislative, executive and judiciary authorities according to Article 50 of the Constitution. "Despite the emergence of some disagreements, the executive authority is keen on pursuing cooperation with the legislative authority while exercising its mandate," Al-Roudhan affirmed.

Asked about the purported overlap between the mandates of the Ministry of Finance and the Central Bank of Kuwait, Minister of Finance Al-Shamali said: "There is close coordination between the two sides regarding the fiscal policy of the country." Admitting that some of the planned projects are too huge to be developed by small firms or contractors, the minister said the government was mulling involving large-size firms instead of launching new shareholding companies. "The projects, to be developed under th
e BOT system, will not be open for the developers listed on Kuwait Stock Exchange only as they could require the involvement of a strategic partner from inside or outside Kuwait," he noted. Al-Shamali added that the projects would have high financial returns, particularly the planned power company to be cast for tendering in the coming four or five years.

Minister of Electricity and Water Al-Shuraiaan said his ministry has an old study pertinent to the category system as regards the estimation of power and water consumption cost. He said the study in question would "see light shortly", noting that the said system is put in place in all other Gulf nations. The study, in its final shape, would be taken to the Cabinet soon as a prelude to sending it to the Assembly for further deliberations and then approval in the form of a law, he said. But, he said the prem
ier had instructed that the category system, once put in place, should not touch low-income groups. "The citizens will continue paying just a couple of fils for electricity and water consumption, while the second category will apply to some investment and trade facilities," he said.

Asked about the use of public shareholding companies in running power plans, the minister said most world countries, together with all other Gulf countries, allow their public sector to manage their power plants, or ask the private sector to do the job under the ITT or IWTT systems. The first project to be subject to Law 39/2010 on public shareholding companies for power and water production is the northern Al-Zour electricity station, which will be carried out through four stages, he said.

The plant will generate 1,500 megawatts in the first and second stages, 1,800 megawatts in the third stage and 4,800 megawatts in the fourth stage, the minister said. The plant, once operational, will produce 200 million water gallons, up 50 percent over the country's current 400 million megawatt production, he pointed out.

Meanwhile, Minister of Commerce and Industry Al-Haroun, elaborating on the position of the Kuwait Stock Exchange (KSE), believed that an injection of funds, even by 10 percent, into the market would be fruitless, given that some companies have lost roughly 75 percent of their capital. But, he said the government would seek to find a set of solutions to corporate bankruptcies through the Capital Market Authority.

Although we are convinced that the market will improve by one way or another through our legal and legislative tools, in addition to other diverse market instruments, a package of edicts is still to be made in an effort to shore up those companies which have positive cash sufficiency," Sheikh Ahmad Al-Fahd said. A congenial atmosphere should be provided for real estate, service, banking and productive sectors in order to be able to recover immediately, he requested.

Asked about national unity, he said: "It is the main concern of the government, HH the Amir and HH the Prime Minister." He quoted the country's high-level leadership as calling for, on several occasions, maintaining and safeguarding national unity. He said national unity can be protected by taking adequate legal measures against anybody that seeks to jeopardize the country's national fabric. A relevant committee involving competent figures is to be set up, Sheikh Ahmad revealed.

A joint action involving the government, fourth authority (media) and the legislative as well as the Kuwaiti citizen is required for keeping national unity intact," he argued. Acknowledging that national unity is now apparently in jeopardy, the minister vowed that relevant fears would be squelched soon. On Kuwait's national development drive, he said the government has spent a lot of money on planned development projects by signing multimillion contracts with executors, adding that the government is going
to spend a total of KD five billion on development enterprises.

Regarding the state of the stock market, Al-Haroun said the government attached great importance to the KSE which "is reflective of many things". "The KSE does not operate remotely of the world's stock markets. The entire world has been suffering from the impacts of the economic downturn since mid-2008. The 220 KSE-listed investors made excellent results in 2008 but the results of the following year reflected the challenging conditions undergone by the firms," Al-Haroun recalled.

The KSE suspended trading in stocks of 66 firms which failed to announce their financial results," he said, noting that the stock market pinned hopes on a range of regulatory measures including the launching of the Capital Market Authority (CMA). "The planned authority will be equipped with legal tools to solve the numerous problems of the market. The law establishing CMA consists of 45 penal articles which will enable the authority exercise its regulatory and legislative mandate and bring to book the law
-violating traders. The authority will have a positive impact on the stock market," Al-Haroun said.

Asked about the impacts of industry on environment, he said: "Under the instructions of HH the Amir and HH the Prime Minister, the government licensed the launching of 110 new environment-friendly industrial firms with investments amounting to KD 600 million." He added the development plan envisaged raising the percentage of industry in the GDP from 5.6 to 12 percent in the coming four years. "Planning is underway for launching an industrial zone in Subhan Area housing some 112 firms by the end of this yea
r in addition to 1,062 firms in Al-Shaddadiya Area," Al-Haroun said, noting that Kuwait has 875 such firms at present.

Asked about a power network expansion and control center, the minister of electricity said a contract was signed on Dec 24 to link new power plants together through three phases. Concerning the control center, Al-Shuraiaan said: "It is a screen that shows main points of high voltage." Responding to a question about BOT projects to be set up according to five-year, 10-year and long-term plans, the minister of finance said the projects are suggested upon initiatives or proposals from businessmen in Kuwait. B
ut he emphasized that only serious investors would be given the opportunity to join such projects.

Al-Shamali said projects put up by the state, including northern Al-Zour electricity station, "have a priority and clear-cut plans". All relevant procedures have been taken for carrying out development projects, he said, noting that only a special law is yet to be passed for the purpose. The Higher Committee for Development Project is reflecting on a large number of such projects, mostly suggested by electricity, municipal and communication agencies, he noted.

On the economic situation in the country and alleged governmental failure to shore up the market, like the US and French governments did, the minister said: "It unacceptable to say today after all this time that the government has done nothing." He added that other countries which tackled the problems by the global financial crisis "didn't do so through the bourse or shares, rather through their financial institutions". "They tried to create a catalyst for these institutions to work to avoidance stoppage,
Al-Shamali said. In this context, he called for approving the financial stability bill, which he said would lead to an appropriate solution to the turbulent situation of the KSE. The minister also stressed the necessity of corporate amalgamation involving small-sized companies that deal in the bourse in order to help them become stronger financially.

Minister of Public Works Safar said there are six projects, including six labor cities, Sulaibikhat and Jahra beaches, a central slaughterhouse at Shuwaikh and three waste treatment sites for electricity generation, in addition to several other entertainment parks in the works. He said Al-Jahra road will link Al-Jahra roundabout with the UN roundabout and goes across Shuwaikh.

As for the role of the private sector in the development plan, Sheikh Ahmad Al-Fahd said the private sector would be a major player in the economic process. "There are three ways to bring into full play the role of the private sector - firstly, to launch public shareholding companies; secondly, to step up the privatization drive; and thirdly to expand the adoption of the BOT system. The financing tools include government funding, the banking sector in which Kuwait is one of the pioneering countries, and th
e issuance of bonds and stocks," he said, noting that the government turned over to the Assembly a host of draft legislations on bond and stock issuance.

Sheikh Ahmad added that the planned launching of an electricity company would not be based on the BOT system unlike the Failaka Island restructuring project. He highlighted the prospects of success of the private sector in areas such as landline phones and post, saying that the Ministry of Communication was probing privatization initiatives in these areas. He categorically refuted speculation about privatization of vital projects such as power generating stations, healthcare and education, saying "we will
start with medium-size projects".

On the formation of the CMA, HH the Prime Minister Sheikh Nasser said, "we'll not push this matter through because the authority should be made up of highly-qualified experts in legal, financial and administrative affairs. No favoritism will be followed in the formation of the authority." Noting that some of the candidates for the CMA's membership apologized to take part, he voiced appreciation for them and understood the reasons which prevented the nominees from coming forward.

On national unity, Minister of Information Sheikh Ahmad Al-Abdullah said the government is all for raising the ceiling of freedoms within law, stressing that the government told the parliamentary committee on negative phenomena "that the media shall not be utilized to tarnish others, as such a matter is unacceptable to begin with". "I'm abiding by and implementing the law endorsed by the parliament itself and what proves it is more than 450 detailed cases I followed since the law was put in action." The mi
nister's remarks were referring to the audio-visual and publications code.

We showed seriousness in implementing the law despite the fact that the ministry of information is not solely concerned with the matter, but other bodies also have responsibilities to shoulder in this regard," Sheikh Ahmad pointed out. He added that the government is irritated by some material some satellite TV channels are putting on air, which puts down Kuwaiti society, "and that is why the ministry is seeking to add a few amendments to the code without limiting freedoms, but rather expand them even fur
ther". Meanwhile, HH Sheikh Nasser said, "we are a country of constitution and laws, as we consider them our 'safety pins'.

On the development plan, Sheikh Ahmad Al-Fahd said "as the country expands in terms of democratic practices, political movement grows along with it, and we cannot keep on delaying development". "One of the government's developmental approaches is having infrastructural and services' mechanisms work parallel with political movement. We shall not wait for things to calm down, yet we build our country left and right and we keep on practicing democracy in a sound manner," he said.

He explained that despite the eight interpellations tabled during the last legislative term, the government managed to sign as many contracts for development projects as it could, which proves maturity and development of the country's economic sector. As for corruption in governmental bodies, Sheikh Ahmad said the government is dealing with it without going into quarrels or pointing fingers at anyone as it presented the financial liability and corruption laws to legal committees and the fatwa and legislati
on department before forwarding it to the parliament.

Commenting on the just-ended legislative term, Minister of Communication Al-Busairi said MPs and the government reached agreement on prioritizing 49 draft bills. "Out of these, 46 bills were passed but not in the priority order of the draft legislations due to the mechanism of operation of the legislature," he pointed out. "The percentage of the bills which were passed to the ones agreed upon tops 75, which is high," the minister said. "There are some very important bills that have yet to be cleared; these
include draft laws on financial liability, the anti-corruption authority, consumer protection, military service, the communication authority, the transport authority, e-commerce, tenders and the judiciary," he disclosed.

Al-Busairi voiced hope that the parliamentary committee on priorities would reconvene during summer to arrange for the coming legislative term with the government being represented. Concerning the key projects of his ministry, Al-Busairi said: "The government mall, started at the Liberation Tower four years ago, helped to relieve the burdens of up to 20 state departments. The government is expanding this idea to other governorates starting with a second government mall at Al-Ahmadi Governorate in January a
nd a third branch in Al-Jahra Governorate in April," he noted.

As for the planned launching of a transport authority, Al-Busairi said the Ministry of Communication studied the experiments of countries in the Gulf region and other parts of the world in this regard. "The ministry developed a draft bill on the authority which is being probed by the Cabinet's legal advice and legislation committee. The legislation will be ready for parliamentary debate in the coming legislative term," he affirmed.

The underground metro and the railway and monorail projects, costing up to KD 4.5 billion, are among the gigantic projects in the development plan. Theie implementation will pass through stages ending in 2017. The ceremony of opening the envelopes of the consultancy firms vying for these projects took place last week," Al-Busairi revealed. "The planned railways will be underground in some parts of the country and overpasses in others to cover all areas of the country as a prelude to hooking up with the ra
ilway networks of the Gulf Cooperation Council (GCC) countries and subsequently with the Arab network. The GCC countries are working with the World Bank for developing the joint railway system and consultancy firms are expected to produce studies and designs on the project this summer," he added.

Regarding the privatization of Kuwait Airways Corporation, the minister said the process was going on as per the provisions of Act No 6 for 2008. The law provides for the metamorphosing of KAC into a shareholding company with the public owning 40 percent stake, a strategic investor 35 percent, Kuwaiti employees 5 percent and the government the remaining 20 percent. - KUNA