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OECD Reviews of Innovation Policy: Kuwait 2021

image of 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.

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Macroeconomic and framework conditions and innovation performance in Kuwait

This chapter first discusses Kuwait’s macroeconomic performance, and in particular, the benefits and long-term risks caused by Kuwait’s exceptional resource endowment, the diversification challenge, and its labour market and social contract. The second section discusses Kuwait’s framework conditions, especially those related to the business environment and entrepreneurship. The last section reviews Kuwait’s aggregate innovation performance. It starts by examining input indicators: R&D expenditure across sectors, education input and outcomes, and the availability of human resources for innovation. It then reviews indicators of innovation output to highlight qualitative and quantitative characteristics of Kuwait’s innovation system, in particular the quantity and quality of research outcomes, the number of patents, and the share of high R&D-intensive activities in its total exports.

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