By Azlan Othman in Kuwait City
Brunei Darussalam and Kuwait have underlined the need to promote cooperation and widen their trade and investment linkages. His Majesty the Sultan and Yang Di-Pertuan of Brunei Darussalam is currently on a three-day State Visit to the Gulf state and on the second day yesterday, His Majesty visited the 35th Al-Shaheed (Martyrs) Armour Brigade facilities.
Both nations have the same intention of branching out of their petroleum-based economy, from being dependent on oil exports into a much more diversified economy.
Brunei's Minister of Energy, Pehin Orang Kaya Seri Dewa Major Gen (Rtd) Dato Seri Pahlawan Hj Mohammad bin Hj Daud held talks on Monday with Kuwait's Oil Minister Sheikh Ahmad Al-Abdullah Al-Sabah on ways to enhance oil cooperation after the two countries signed (MoU) on oil and gas cooperation.
Speaking to KUNA (Kuwait's official news agency) after the meeting, held at Bayan Palace, Sheikh Ahmad said Brunei intended to build an oil refinery and use Kuwait crude oil.
The meeting, he added, touched upon the refinery, which would be co-financed by the private sector in Kuwait and Brunei.
The refinery project is being studied and private sector companies to take part in the venture were not specified yet, said Sheikh Ahmad.
The Kuwaiti senior official said they have also discussed the agenda of a round table of oil ministers of producing and consuming countries, slated for April 25-26 in Japan.
Earlier on Monday, His Majesty was briefed on the economic development and investment in Kuwait by Bader Mohammad Al-Saad, Managing Director of Kuwait Investment Authority.
Figures obtained from the Brunei side stated that trade between the two countries is small, with statistics in 2007 showing Brunei's export contributing to $85,904 and import $18,899.
Meanwhile, during the briefing to His Majesty on economic development and investment, Bader Mohammad Al-Saad highlighted that Kuwait's economy is dominated by the petroleum sector which accounts for 52 per cent of nominal GDP and 95 per cent of export earnings, while 31 per cent constitute other sectors and 12 per cent service sector, which is much larger and expanding rapidly with community, social and personal services and financial institutions.
Manufacturing accounts for five per cent of nominal GDP and dominated by hydrocarbons-based downstream industries, chiefly refining and petrochemicals.
Over 95 per cent of export revenues are generated by the oil sector, which rose by almost 40 per cent last year on the back of an increase in oil output and rising international oil prices. Import spending grew by 26 per cent last year on the back of a spike in international non-oil commodity prices.
His Majesty was told that Kuwait, like other Gulf countries, has been affected by the current global financial crisis. The crisis has impacted Kuwait with drop in oil prices and lack of liquidity, exposure of local investments and real estate companies especially in Dubai and Qatar, and flow of non-resident and foreign bank deposits. However, Kuwait is well placed with low levels of public debt providing room to borrow if the need arises.
Kuwait is the fourth richest country in the world in terms of GDP per capita, which is $60,800. It also has the third largest oil reserves amounting to 98.8 billion barrels.
- Borneo Bulletin
(15th Apr 2009)