Special Supplement: GCC - Kuwait In The Comfort Zone - Huge Oil Revenues Place Kuwait In An Economic Comfort Zone That Helps To Diminish Political Tensions, While Kuwaiti Banks Are Looking Across The Region For Opportunities, Writes Eleanor Gillespie, Wit.

Banker, The, August, 2006 by Gillespie, Eleanor; Marks, Jon

Byline: ELEANOR GILLESPIE WITH JON MARKS

Kuwaiti financial institutions face an enviable problem: where to invest the fruits of an oil boom in which, according to National Bank of Kuwait's (NBK) July economic brief, gross domestic product (GDP) rose by 35% to reach $81bn in 2005, following two strong years of 23% annual average growth. On a per capita basis, GDP reached $34,482 in Kuwait for 2005, compared with $52,896 in Qatar and $12,897 in Saudi Arabia.

The figures are exceptional: according to NBK chief economist Randa Azar- Khoury, oil revenues rose by 60% to Kd11.8bn ($40.8bn) in the April 2005/February 2006 period, constituting 95% of total budget revenues.

This economic cushion places Kuwait in a comfort zone, where huge revenues and...