Business Level Strategy Assignment (Doc)

Business Level Strategy 1
BUSINESS LEVEL STRATEGY
By (Student Name)
(Name of the Class) - Course
Tutor: Insert Name of tutor here
University
Department of
27/04/2018

Business Level Strategy 2
Policies enabling national competitive advantage in Kuwait
Introduction
This paper focuses on the enabling policies that elevate Kuwait’s national competitive
advantage. To begin with, it first explores the policies that stimulate the factor conditions that would
attract multinational corporations. Secondly, policies that promote firm strategy, structure and rivalry
are discussed. Thirdly, it inquires the enabling policies under the demand conditions in Kuwait. Lastly,
the paper delves into Kuwait’s policies encouraging related or support industries as antecedents for
national competitive advantage (Fainshmidt, Smith & Judge 2016).
Policies that stimulate the factor conditions in Kuwait
The first policy is the national science, technology, and innovation policy. Under this policy,
Kuwait has invested heavily in the progress of science and technology disciplines. The policy
encourages responsive innovations to the local population. Already over 80 percent of Kuwaitis use
internet technology and 97 percent use credit cards for e-commerce this is an attraction to
multinationals. There are e-commerce laws to protect local businesses (International Business
Publications [IBP] 2008).
Kuwait has a competitive labour policy enshrined in the Labour Laws, the critical human
resource necessary to spur development into the country has been made possible. Over 60 percent of
the population consists of expatriates who offer specialized skilled labour. The ministerial decree of
2006 allows expatriates’ invitation documents to be turned into work permits. However, immigration
laws restrict work that can be performed by local firms (Elkhafif, Taghdisi-Rad & Elagraa 2016).
A responsive infrastructure policy is a huge attraction to multinationals. The government of
Kuwait through the short-term to the mid-term development plan for the year 2016 to 2020 has set

Business Level Strategy 3
aside 2.3 billion Dinars for development of infrastructure suitable to attract multinationals in the fields
of human resource, renewable energy, and other related infrastructure. Already Doha and Kuwait City
are very urbanized and populated hence a huge market for potential foreign multinationals (Vought
2018).
Lastly, Kuwait has a reformed land ownership policy. Currently, over 95 percent of the land is
owned by the Kuwait Government. The land ownership policy seeks to explore public-private
partnerships to fully utilize this critical factor of production. The Government seeks to for instance
lease the land to multinationals companies to spur growth (Barakat & Batwala 2014).
Policies that promote firm strategy, structure, and rivalry
To begin with, Kuwait has a vibrant fiscal policy. Under this policy, Kuwait has set aside over
51 billion dinars to targeting the attraction of multinationals to diversify the economy of the country by
among other things streamlining the ease of doing business to promote competition in select sectors
necessary to spur innovation and product improvement(Organization for Economic Co-operation and
Development [OECD] 2012).
The government through the taxation policy encourages small and medium enterprise start-ups
and protects local firms by not taxing them on income tax to increase their competitiveness. However,
the taxation policy from the year 2016 has been amended to tax foreign companies to the tune of 15
percent on all income earned within the country (Arabian Business 2017).
According to Vought (2018), Kuwait has hatched an ambitious foreign direct investment policy.
The government ascended to Law number 8 that allows full ownership of foreign firms in certain
sectors of the economy. Previously, all foreign firms had to include a Kuwait National in order to
establish businesses (Hamdi & Sbia 2013)