Kuwait After Desert Storm

Kuwait After Desert Storm

The reconstruction of Kuwait has generated enormous interest on the part of American businesses and individuals. Just after the liberation of Kuwait, the Department of Commerce's Gulf Reconstruction Center was receiving some 14,000 inquiries a day, and it continues to receive hundreds of calls a day. These inquiries tend to focus on the following sorts of questions: What kind of market is Kuwait? Just how much damage was done to Kuwait as a result of the Iraqi invasion? What plans have been made for the reconstruction process? Where have some of the major contracts been awarded? Where might U.S. companies still profit? This article answers some of these questions about Kuwaiti reconstruction.

Other sectors of the pre-war economy were dwarfed by the oil sector. Services including financial, transportation, communications, and social services accounted for about 35 percent of GDP in 1989. Manufacturing, concentrated in the production of building materials, food items, and light manufactures, represented a meager 3 percent of GDP in 1989. Construction and agriculture accounted for another 3 percent.

Although vulnerability to certain external factors (most notably the price of oil) makes the common perception of Kuwait as a fabulously wealthy Gulf emirate less than completely accurate, Kuwait's huge oil exports have led to large and consistent trade surpluses. Furthermore, considerable amounts of Kuwait's oil earnings have been invested abroad as part of the Fund for Future Generations, reported to be worth over $80 billion at the time of the invasion, and oil income has been increasingly supplemented by income from this fund. Large foreign exchange reserves, minimal trade barriers, and low tariffs, made pre-war Kuwait an attractive, if highly competitive, export market.

The United States has traditionally been a major supplier to the Kuwaiti market. Although Japan maintained a larger market share throughout the first half of the 1980s, U.S. exports soared after 1987 as the dollar declined against competitor currencies. By 1989, the United States had taken the lead position, with exports of $855 million, or 15 percent of the Kuwaiti market. Major U.S. exports to Kuwait included: automobiles and parts, commercial aircraft, oilfield equipment, air conditioning and refrigeration equipment, industrial machinery, tobacco products, and consumer goods.

Saddam Hussein's August 2, 1990 invasion of Kuwait is but one of the many large scale crimes he committed during the course of his bloody reign as President of Iraq. While Saddam murdered thousands upon thousands in alternatively creative and disturbingly efficient ways, and even used chemical weapons against combatants and civilians alike in Iran and inside Iraq itself, much of the world did not know him for what he was until this very event. Even among the despots of the Middle East, Saddam distinguished himself time and time again with his brutality and total control over Iraq's people, turning the cradle of civilization into a heavily monitored, sprawling prison in which a parent could face death for cursing Saddam in his own home if his son or daughter innocently repeated the parent's statement in school the next ...