Democracy May Be on the Way in Kuwait

Many stores may still be burnt out here, but on Kuwait Beach a new market is flourishing as boats from Iran bring in fish and watermelons, and Kuwaiti drivers display fruits and vegetables and other merchandise acquired on quick runs down to Saudi Arabia.

Across town at the main produce market there are potatoes from Lebanon and apples from Washington state. And a big mall and supermarket called Sultan Center is crowded with shoppers for food, clothing and bicycles for the children.

In one sense, commercial vitality is returning to Kuwait.

But in another sense, business is stalled and so is the nation. Minimal repairs have been made--electricity is on, water is running, but phone service is uncertain. And car dealers and other retailers who suffered massive losses from theft or fire during the Iraqi occupation--acts of war not covered by insurance--are waiting for government reimbursement or low-interest loans to restock and get started again.

Neither loans nor reimbursement are forthcoming. And that only adds to the frustration and criticism of their government that is now so widespread among the educated and well-off citizens of this tiny, wounded country. In the wake of the worst crisis in its history, Kuwait is questioning its past policies and future prospects.

Much of the anger for the vicious Iraqi occupation is directed less against Saddam Hussein than against the Kuwaiti government. “This government is incompetent,” says Khalid Sultan, a young merchant who was tortured by the Iraqis.

Remarkably, such harsh criticism is coming from leading merchants and from top employees in state companies. “Opposition is usually in the minority,” says Ali al-Ghanim, head of one of the largest trading companies, “but here it is in the majority. That is why the government is weak.”

The government, a monarchy of the al-Sabah family that has ruled the country for about 200 years, was blamed for leaving Kuwait’s troops without ammunition or orders when Iraq invaded. Now it is being blamed for having no policy to help the nation recover, save for its avowed intention to send foreign workers out of the country--particularly Palestinians suspected of having collaborated with Iraq.

Yet that policy is one that business people oppose as counterproductive.

Population is a sensitive matter. Kuwait is a tiny nation of about 2 million people, only 550,000, or 27.5%, of whom are citizens.

In the last four decades, as oil revenues enriched Kuwait, Palestinians and other foreigners came to provide essential services--as doctors, engineers, accountants and business managers.

The number of Palestinians, once at 450,000, is said to be below 200,000, many having fled the country.

Kuwait’s economy is stumbling without them. “You cannot cash a check,” an incredulous company manager says.

But that is not all. The departure of Palestinians threatens real estate values, which in Kuwait is serious business indeed. Kuwaitis own the buildings, Palestinians rent the apartments. “If you cut the population to 1.3 million, as is being talked of, who rents all those apartments?” asks Faisal al-Jasem, a young businessman. “Who buys from all the stores?”

Real estate has particular resonance to Kuwaitis because that is how their families got rich. Forty-five years ago this once-lovely and now-pockmarked modern city consisted mainly of adobe houses, homes of seagoing merchants and traders. When oil came along in the early 1950s, the government spread the wealth by paying property owners handsomely for their adobe houses--giving them capital to open a business or buy more property.

So for the preservation of property values, as well as the smooth functioning of the economy, a compromise is likely on the expulsion of foreigners.

But the larger question of Kuwait’s recovery remains. In their cautious mood today, many in Kuwait are saying that they would rather invest abroad than in their homeland, a caution that could result in a slow and strained recovery. Bankers estimate that $3 billion will flow out of the country June 24, when the government gives Kuwaitis permission to transfer money abroad.

That’s glum news for the U.S. government, which is looking to a thriving Kuwait economy to be a good customer for U.S. goods and services. Officials of Overseas Private Investment Corp., the government’s insurance agency for business abroad, were in Kuwait this week trying to help deals along.

But the Kuwaitis these days are more thoughtful than enthusiastic. “Money is not the whole of life,” says Ali al-Ghanim, who is listed by Forbes as one of the world’s richest men. “The answer to the economy lies in politics. It is democracy.”

Al-Ghanim was once a member of the Kuwait Parliament, which the emir of Kuwait dissolved in 1986. He and other leading citizens are pushing for a reconvening of Parliament and for elections as soon as possible. Their position is that only with representative government can decisions be made to revive Kuwait and set policy for its future.

Their democracy would not be universal suffrage but a parliament, of men only, that would pass laws and hold the royal family to account. But it would be a start toward broader democracy, says Meshari al-Osaimi, a leading Kuwaiti lawyer--and the first representative government in the Gulf area.

“We hope the U.S. government will back our efforts for democracy,” al-Ghanim says.

An American might think that having sent 500,000 troops to free Kuwait, the U.S. government already had backed such efforts to the hilt. But it just may be that real change is only beginning in Kuwait and the rest of the Middle East.