x Abu Dhabi, UAEMonday 24 July 2017

Kuwait sales law advances

The country's parliament yesterday approved the first draft of a law to allow the government to privatise state-owned assets, excluding those in oil production, health and education.

KUWAIT CITY // Kuwait's parliament yesterday approved the first draft of a law to allow the government to privatise state-owned assets, excluding those in oil production, health and education. The proposed law was passed on a vote of 33 to 10 after a fiery debate in the national assembly. It will be amended by politicians before facing another vote in at least two weeks. The bill outlines a procedure for turning state-owned assets into private entities, with half of the shares to be owned by Kuwaitis. Abdulrahman al Anjari, an MP who supported the bill, described it as "the most important law in Kuwait's modern history".

Mr al Anjari said the rights of Kuwaiti workers in the privatised companies would be protected by clauses that would ensure they received their current salaries and benefits for four years. He said the companies would be required to keep the same number of Kuwaiti staff that they employed before privatisation and the government would be responsible for retraining employees who have to find other jobs.

A privatisation council would be created to oversee the privatisations. The government would reserve the right to intervene in cases where privatised companies had "irregular financial activities", Mr al Anjari said. He said the law would help to create jobs for 8,000 Kuwaiti university graduates every year and reduce the strain public wages put on the government's budget, which was "89 per cent of our oil revenue".

Mr al Anjari said oil production "will never be privatised" but refineries, petrochemical industries and oil logistics companies could be moved into the private sector with the new law. Communications, water, ports, some petrol stations and the postal service are among the first assets the government would like to privatise, he said. Trade unionists made their opposition to the new legislation known with a demonstration near the parliament yesterday morning and furious protests from the chamber's public gallery when it became apparent the bill had received the majority of votes.

Much of the opposition to the bill is from Kuwait's tribal MPs, who hold about half of the assembly's 50 elected seats. jcalderwood@thenational.ae