VZCZCXRO5617
RR RUEHDE RUEHDIR
DE RUEHKU #0118 0310520
ZNR UUUUU ZZH
R 310520Z JAN 08
FM AMEMBASSY KUWAIT
TO RUEHC/SECSTATE WASHDC 0685
INFO RUEHZM/GULF COOPERATION COUNCIL COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC

UNCLAS KUWAIT 000118 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR NEA/ARP, NEA/TPP, EEB; PASS TO USTR 
 
E.O. 12958: N/A 
TAGS: ECON ETRD PREL KU
SUBJECT: FOREIGN BUSINESS COUNCILS COORDINATE TO TACKLE 
TRADE OBSTACLES 
 
 
¶1. On January 28, Embassy Kuwait hosted the first-ever 
meeting of representatives from various foreign business 
councils in Kuwait to discuss common concerns and ways to 
collaborate on areas of common interest.  Organized in 
conjunction with the American Business Council, the 
roundtable was attended by members of the British Business 
Forum (BBF), British Embassy, American-Kuwaiti Alliance 
(AKA), Canadian Commercial Council (CCC), German Council, 
Dutch Embassy, Indian Business Council, and by a professor of 
Business Studies at the American University of Kuwait. 
 
¶2.  The Charge kicked-off the roundtable with brief remarks 
stressing the need for further economic reforms in Kuwait. 
He noted that although the GOK has made some progress 
recently, businesses in Kuwait have many more challenges to 
overcome.  Recently passed economic laws -- reducing the tax 
rate on foreign companies from 55 percent to 15 percent, 
privatizing Kuwait Airways, controlling investment in public 
properties especially under BOT contracts, and creating 
public-private partnerships to own and operate customs 
facilities and warehouses near the Iraqi border -- all 
reflect steps in the right direction, he noted.  However, the 
cumbersome bureaucracy involved in establishing a company in 
Kuwait, major problems in public procurement, weak 
enforcement of intellectual property rights, and inadequate 
protection of basic worker rights, are challenges that all 
foreign companies are facing in Kuwait. 
 
¶3.  The subsequent two-hour discussion focused on challenges 
faced by business associations in Kuwait, the role of 
embassies in furthering the business agenda, and avenues to 
identify and influence key GOK decision-makers.  There was 
strong consensus that a "safety in numbers" approach would 
enhance the impact of the work of the business councils, 
provided the group identified realistic and achievable goals. 
 Participants pointed to the need to identify key officials 
in government that business groups and embassies can target 
with a consistent message on reform.  Councils need to devise 
a collaborative strategy to use interactions with government 
officials as opportunities to "train" them to understand 
western and international ways of doing business. 
 
¶4.  Participants unanimously decided to create a working 
group with one representative from each council.  The group 
will meet in early March to devise a collective plan of 
action and identify Kuwaiti partners to join forces with. 
The group plans to meet on a bi-monthly basis.  The working 
group format will encourage active participation and 
facilitate technical discussions over common goals and 
strategies.  Participants noted the need for including 
Kuwaitis in the working group.  Kuwaiti participation would 
add internal knowledge and local perspective to doing 
business in Kuwait.  Also, Kuwaiti businesses face several of 
the same challenges faced by foreign companies.  KCCI, Kuwait 
Lawyers Society, and AKA members were mentioned as potential 
Kuwaiti partners in the new Working Group. 
 
Comment 
------- 
 
¶5.  This meeting, the first of its kind in Kuwait, was a 
great opportunity for the various foreign business councils 
to meet in a collective forum and exchange ideas on trying to 
reduce the impediments -- corruption, lack of transparency, 
legislative drift, weak political leadership -- that hinder 
bilateral trade relationships and act as a disincentive for 
foreign investment.  The enthusiastic response to this 
meeting revealed the need and the advantages of a more 
collaborative effort in dealing with the GOK on reform issues 
that are important to all business groups in Kuwait.  The 
decision to form an international working group is a first 
step towards greater cooperation between business groups from 
different countries.  Consensus on the utility of a combined 
approach in consultation with embassies is an encouraging 
first start. 
 
********************************************* * 
For more reporting from Embassy Kuwait, visit: 
http://www.state.sgov.gov/p/nea/kuwait/?cable s 
 
Visit Kuwait's Classified Website: 
http://www.state.sgov.gov/p/nea/kuwait/ 
********************************************* * 
MISENHEIMER