Kuwait city: Kuwait's recent upgrade by Standard and Poor's (S and P) to a sovereign credit rating of AA- with a stable outlook marks a pivotal moment in the country's economic trajectory, reflecting the cumulative impact of wide-ranging reforms and structural transformation carried out over the past year.
According to Kuwait News Agency, S and P's decision represents a strong vote of confidence in Kuwait's economic direction. The agency highlighted that the reforms undertaken by the government have strengthened the fiscal framework, enhanced liquidity management, and created a more predictable environment for long-term financial planning.
The improved rating is expected to support greater foreign investment inflows, boost investor confidence, and enhance the competitiveness of Kuwait's development projects regionally and globally.
During its weekly meeting on Tuesday, chaired by Sheikh Ahmad Abdullah Al-Ahmad Al-Sabah, the Cabinet affirmed its commitment to implementing the vision of Sheikh Meshal Al-Ahmad Al-Jaber Al-Sabah. The government is pushing ahead with reforms to attract foreign investment and improve the business climate, aiming to transform the country into a regional and global financial and commercial hub.
The Cabinet reiterated its support for ongoing financial reforms intended to raise Kuwait's sovereign credit rating on international indices and assured that it will meet current and future requirements to ensure fiscal sustainability. It assigned the tasks of reporting every six months on developments in Kuwait's sovereign credit rating to Minister of Electricity, Water and Renewable Energy and Acting Minister of Finance and Economic Affairs Dr. Sabeeh Al-Mukhaizeem.
S and P also pointed to Kuwait's substantial financial assets, managed by Kuwait Investment Authority, and ongoing reform momentum as key factors that strengthen Kuwait's fiscal resilience and reduce dependence on hydrocarbons. The agency highlighted major infrastructure and capital projects as evidence of the state's long-term economic transformation.
The momentum behind Kuwait's reform agenda accelerated significantly since mid-2024. A synchronized program covering economic, financial, legislative, and structural areas seeks to build a modern, flexible, and sustainable economic model aligned with Kuwait Vision 2035.
A central milestone in this process was the enactment of Law No. 60 of 2025, known as the Liquidity and Financing Law, which provides a comprehensive framework for managing liquidity needs and supporting public finances. The law enables the state to adopt diversified financing tools and ensures smoother fiscal operations.
In parallel, Kuwait implemented the global minimum tax on multinational corporations earlier this year, making it one of the first regional economies to adopt the international tax framework endorsed by the G20 and OECD. This move strengthens Kuwait's commitment to transparency and enhances integration with global markets.
Complementing these legislative reforms is the anticipated approval of the Sukuk Law, which will provide Kuwait with an additional sovereign financing instrument. These measures aim to build a robust fiscal foundation that supports long-term stability and growth.
The government has also advanced several structural initiatives aimed at optimizing national resources and improving efficiency across key sectors. Efforts include repricing state land assets, rationalizing subsidies, and enhancing performance standards within the public sector.
To strengthen the investment climate, the government introduced the real-estate brokerage system to improve transparency and launched the smart licensing project. Kuwait recorded its highest quarterly development spending in five years during the first quarter of the 2025-2026 development plan.
The Cabinet recently directed ministries and state agencies to expedite procedures for signing major project agreements with several partner governments.
Kuwait also intensified high-level economic and technical engagements in recent months, resulting in accelerated legal and technical reviews for major projects.
In the monetary sector, the Central Bank of Kuwait continues to anchor the Kuwaiti dinar to a basket of currencies, providing a strong foundation for price stability.
Reforms in the investment and tourism sectors have strengthened Kuwait's attractiveness as a destination for global companies. Major international firms have expanded operations in Kuwait, reflecting confidence in the country's economic transformation.
The government also launched the Government Performance Management System to promote accountability and strengthen governance.
Kuwait's economic performance has already shown positive indicators, with the national economy recording 1.3 percent growth in the first half of 2025.
Minister of Electricity, Water and Renewable Energy and Acting Minister of Finance and Economic Affairs Dr. Sabeeh Al-Mukhaizeem said the upgraded sovereign rating reflects the positive impact of Kuwait's structural and fiscal reforms. He affirmed that the government remains committed to advancing economic diversification.