OECD Reviews of Innovation Policy: Kuwait 2021
The slowdown in market demand for oil is putting increasing pressure on Kuwait's current economic and social model. This model is based on the distribution of petroleum export proceeds to Kuwaiti citizens, with relatively limited long-term investment in knowledge production and the upgrading of the national innovation capacity.
The transition towards a knowledge-based society – where value creation, the resolution of societal challenges and the well-being of society at large will be based on the production, diffusion and implementation of knowledge – is becoming an imperative. This is recognised within the national development strategy which formulates the objective of attaining 'Smart Kuwait' by 2035.
Such a transition is challenging and can only be achieved through the build-up of appropriate governance of the STI system with adequate institutions such as a Ministry and a professional agency with a mandate for research and innovation. This set-up should help raise awareness and reduce barriers to innovation, reinforce the scientific research base, develop the support for business innovation, foster knowledge diffusion and co‑creation between science and industry, build up the human capital needed, and establish the role of science, technology and innovation in tackling Kuwait's societal challenges.
Innovation in the business sector in Kuwait
This chapter presents the business innovation activity in Kuwait. It starts with some background concerning the diversification issue and the imperative for Kuwait to develop into a knowledge-based economy and society. It then gives a brief overview of the characteristics of an efficient business innovation system, based on international experience, discussing the role of research and development in enterprises, innovative entrepreneurship, knowledge diffusion, and business-academia linkages. The chapter then analyses the structure of the Kuwaiti business sector, which is dominated by state-owned enterprises in oil and other strategic sectors, with a relatively underdeveloped small and medium-sized enterprise sector. The chapter moves on to discuss the innovation and R&D performance in enterprises, followed by an analysis of business-academia co‑operation and linkages. The final section discusses Kuwaiti policies in favour of innovation and R&D in the business sector, which has many opportunities for improvement.