The United States is Kuwait's largest supplier of goods and services, and Kuwait is one of the United States’ largest markets in the Middle East.
Kuwait is currently our 50th largest goods trading partner with $8.1 billion in total (two way) goods trade during 2017. Goods exports totaled $5.1 billion; goods imports totaled $2.9 billion. The U.S. goods trade surplus with Kuwait was $2.2 billion in 2017.
According to the Department of Commerce, U.S. exports of goods to Kuwait supported an estimated 14 thousand jobs in 2015 (latest data available).
With oil the main natural resource, oil refining and downstream petrochemical processing are the dominant industries. Non-petroleum-related manufacturing and agriculture sectors are limited, consisting of a switch-gear manufacturer for power sub-stations, and factories for building materials, furniture, and food packaging.
Kuwait imports most of its capital equipment, processed foods, manufacturing equipment, and consumer goods. Two-way trade is limited to a few international partners. Almost half of the country’s imports originate from China, the United States, the UAE, Japan, and Germany, while over 50% of Kuwait’s export earnings are attributable to South Korea, China, India, Japan, and the United States. The United States remains a leading and strategic trade partner. Imports from the United States in 2016 were valued at $3.3 billion, a 22% increase from $2.7 billion in 2015.
Transportation equipment, including automobiles and automotive parts, accounted for 42 percent of non-military U.S. exports to Kuwait in 2016. Oil and gas field equipment, telecommunications and IT equipment, medical equipment, and electronics were also leading export sectors for U.S. firms.
Kuwait is undergoing significant expansion in the building and construction industry. The government has approved a USD 104 billion National Development Plan that includes construction of major roadways, a new airport, new hospitals, new residential developments, a new Kuwait University campus, a new oil refinery, oil exploration, new power projects, and a new railway and metro. Private construction and project development, as in other GCC urban centers, is moving forward.
The traditional import sectors of automotive, oil and gas, computers/ICT, telecommunications equipment, and construction equipment remain strong. The Ministry of Education is revising curriculum for primary and secondary schools. There is a shortage of high quality health care facilities, and most building materials are imported. All these factors bode well for high-end exports that already have GCC exposure.
The Commercial Service in Kuwait has identified other opportunities for projects coming on board over an extended period of time. These projects include a multi-billion dollar investment in homeland security infrastructure, a proposed $10 billion expansion in needed electricity generation capacity (B.O.T projects), investment in environment cleanup projects, and continued expansion in the lucrative logistics market serving U.S. military forces in the Middle East.
Transportation equipment (including automobiles, auto parts and accessories) accounts for 42 percent of U.S. exports. U.S. high-end medical equipment has great promise, as clinics and hospitals are being upgraded. Oil and gas field equipment, electric generator sets, building materials and supplies, and information technology are also leading American export sectors. The Kuwait Petroleum Company and its subsidiaries are actively pursuing new U.S. sources for equipment and service products. The Commercial Service organizes Kuwaiti delegations to U.S. trade shows in these key sectors. It also supports medical, aviation, defense, and oil and gas trade shows in the GCC region, in addition to organizing inbound U.S. supplier delegations and outbound foreign buyer delegations to U.S. trade shows.
Provided their prices are reasonable, U.S. firms have a competitive advantage in many areas requiring advanced technology, such as oil field equipment and services, electric power generation and distribution equipment, telecommunications gear, consumer goods, and military equipment.
Treaties & Agreements
Kuwait and the United States belong to a number of the same international organizations, including the United Nations, International Monetary Fund, World Bank, and World Trade Organization. Kuwait is a participant in the North Atlantic Treaty Organization’s Istanbul Cooperation Initiative. From January 2018 through December 2019, Kuwait has a seat on the United Nations Security Council.
The U.S. and Kuwaiti governments have signed a trade and investment framework agreement, providing a forum to address mutual trade concerns and needed economic reforms.