Faculty of Business Studies: National Competitive Advantage Report

This report analyzes the national competitive advantage of Kuwait, focusing on the application of Michael Porter's model. It examines various factors, including firm strategy, factor conditions, and supporting industries, within the context of Kuwait's economic policies and cultural aspects. The report discusses the importance of innovation, the role of government in promoting high-tech industries and R&D, and the impact of economic diversification and energy subsidies. It also explores policies related to labor market normalization, education, and international trade, specifically Kuwait's "look east" policy and its trade relations with Asian countries. The report highlights Kuwait's competitive advantages, such as its strategic location within the GCC and its plans for extensive investments outlined in the Kuwaiti Vision 2035 and National Development Plan, as well as the importance of vocational training and streamlining bureaucratic processes. The analysis draws on various academic sources to support its arguments and provides insights into how Kuwait can further enhance its competitive position in the global market.

Running head: NATIONAL COMPETITIVE ADVANTAGE AND EMPLOYABILITY
National Competitive Advantage and Employability
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Article Name: Almuslamani, H.A.I. and Daud, S., 2017. Strategic HR Practices and
Sustainable Competitive Advantage in Bahrain. Advanced Science Letters, 23(9),
pp.9009-9012.
Introduction
Michael Porter made use of a model that helped in the process of analyzing why some
of the nations were more competitive as compared to the others. National base of that of an
organization plays a crucial role in attaining competitive advantage (Ployhart, Weekley and
Dalzell 2018). The four determinants that can help in assessing national competitive
advantage are that of firm strategy, factor conditions, structure and rivalry and that of
supporting industries. This essay analyzes the policies in relation to determinants of national
competitive advantage within Kuwait.
Discussion
Conditions prevailing within Kuwait help in determining the characteristics of that of
domestic competition. Cultural aspects of Kuwait play a role in determining the strategies of
the organisation. Innovation is greatly valued by Kuwait and it is an important strategic
element in relation to competiveness. Kuwait makes use of a dynamic view pertaining to
competition. Integrated STI policy and formation of national innovation system can help in
the process of up gradation of the technologies of the firm. National innovation system can
help in connecting the different STI actors that can facilitate in the process of efficient co-
operation (Almuslamani and Daud 2017). Promotion of high-tech and R & D industry is
encouraged by the government in Kuwait that helps the companies in attaining competitive
advantage. The Kuwaiti agencies focus on the aspect of exploration that is well-motivated.
Economic diversification is carried on by the companies in Kuwait that can lead to economic
development. Another policy stressed is that of rationalization of spending and that of the

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subsidies. Subsidies help in targeting people who need them and that of tiered subsidization
in relation to the utilities can help in driving cost savings (Frija et al. 2017). Kuwait has
strengthened the “look east” policy for expanding the crude market share specially across that
of the Asian countries. In the year 2014, Kuwait exported around 10.62 million ton of that of
crude to China along with that of India. It was an increase of around 14 % from that of the
previous year.
The basic factors are that of land, climate and the advanced factors are more
sophisticated ones like that of stock of knowledge resources along with that of
communication infrastructure. Up gradation of that of the factor conditions can help in
providing the country with an advantage. The basic factors help in providing the country with
advantage that can be re-inforced with the help of advanced factors. Improvements can be
brought about in the four arenas of immigration policy, education, promotion of that of
private sector and that of economic diversification. The government acts as that of “employer
of last resort” for that of the nationals. The normalization of that of the labour market of
Kuwait can be attained by downsizing that of public sector employment (Fainshmidt, Smith
and Judge 2016). It can lead to an increase in the process of efficiency. Employment
opportunities have been created in the public sector and Kuwatis negative perceptions toward
that of public sector employment have been changed as an effective policy. Incentives are
provided to the students so that they choose the field of science and engineering. There are
some elements of that of vocational training that has been made compulsory within the scope
of secondary education that helps in providing basic level skills for that of the labour market.
Red-tapeism has been reduced by the stream-lining of bureaucratic process. Access to that of
credit has been facilitated that helps in financing the activities with the help of retained
efforts (Wu, Ma and Zhuo 2017). Kuwait focuses on the aspect of export and it has proved to
be successful for that of Asian development states. Energy subsidies have an impact on that

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of the overall economy and it can help in increasing the competitive capabilities in relation to
export-oriented sector.
The harsh weather condition of Kuwait is the reason for the high rate of energy
consumption. The subsidised energy tariff can help in driving the consumption of electricity
within Kuwait. The International Monetary Fund has stated that proposal for that of tariff
structure on the basis of usage can help in the process of generation of additional revenue
(Gholami and Shahroodi 2016). A construction contract was signed for developing
renewable energy power station at the region of Al Shagaya. It can help in supporting the
energy requirements of the place and at the same time helps it in remaining self-sufficient
that can help it in gaining competitive advantage. Kuwait applies ‘source approach’ to that of
taxation. The enactment of that of new Investment Law has the potential in changing the
structure of business (Matherly and Al Nahyan 2015). The foreign corporate bodies act as
shareholder or with the help of an agent. The capital gains on that of the sale of asset is
treated like that of normal business profit in Kuwait. The foreign corporate bodies can engage
in business in Kuwait with the help of commercial agent or with the help of a service agent in
Kuwait.
Kuwait has many competitive advantages as the manufacturing centre. The easy
access to that of the other GCC member states gives it national competitive advantage. The
policy of lifting of the international trade sanction after the deal in the year 2015 helped in
boosting trade between that of GCC and Iran. The Kuwaiti vision 2035 makes plans in
relation to extensive investments that can develop the role of the country as a facilitator of
trade. Development Plans have been put in place by the government that has investment
programme that can funnel the funds in relation to key projects. The National Development
Plan was launched in the year 2010 and the investment package was worth $ 108 bn. It acted
as a stimulus package for the economy of Kuwait and for the non-oil sectors. These are the

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projects that helped Kuwait in attaining competitive advantage and helped in directly
benefitting manufacturing sector. In the year 2015, NDP was supplemented by that of KDP
2015-20 that helped in delivering more than that of 500 projects in different sectors like
transport and energy. The refinery projects of Kuwait like that of “Clean Fuels Project” can
help in expanding the refinery complex. Kuwait National Petroleum has been awarded with
Clean Fuel engineering to that of three international consortiums.
Conclusion
Vocational training in the arena of secondary education can help the people of Kuwait
in sharpening the skills that can help them in the arena of labour market. The streamlining
pertaining to the bureaucratic process has helped in curbing red-tapeism that can help Kuwait
in achieving competitive advantage.

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References:
Almuslamani, H.A.I. and Daud, S., 2017. Strategic HR Practices and Sustainable
Competitive Advantage in Bahrain. Advanced Science Letters, 23(9), pp.9009-9012.
Fainshmidt, S., Smith, A. and Judge, W.Q., 2016. National Competitiveness and Porter's
Diamond Model: The Role of MNE Penetration and Governance Quality. Global Strategy
Journal, 6(2), pp.81-104.
Frija, A., Dhehibi, B., Salah, M.B. and Aw-Hassan, A., 2017. Competitive Advantage of
GCC Date Palm Sector in the International Market: Market Shares, Revealed Comparative
Advantages, and Trade Balance Indexes. International Journal of Marketing Studies, 9(6),
p.1.
Gholami, S. and Shahroodi, K., 2016. Studying the Relationship between the Empowerment
of Information Technology, Supply Chain Flexibility and Competitive Advantage. Arabian
Journal of Business and Management Review (Oman Chapter), 5(12), p.43.
Matherly, L.L. and Al Nahyan, S.S., 2015. Workplace quotas: Building competitiveness
through effective governance of national-expatriate knowledge transfer and development of
sustainable human capital. International Journal of Organizational Analysis, 23(3), pp.456-
471.
Ployhart, R.E., Weekley, J.A. and Dalzell, J., 2018. Talent Without Borders: Global Talent
Acquisition for Competitive Advantage. Oxford University Press.
Wu, J., Ma, Z. and Zhuo, S., 2017. Enhancing national innovative capacity: The impact of
high-tech international trade and inward foreign direct investment. International Business
Review, 26(3), pp.502-514.