MUHAMAD ALOTHMAN WRITES– Kuwait and China signed a Memorandum of Understanding in November of 2018, in Beijing. This non- binding agreement gives Kuwait the opportunity to expand and even become a leading global financial hub in the Gulf.
Oil prices, Kuwait’s main source of income, have been declining over the past few years and are set to fall even further. To fill the void created by dwindling supplies of oil money, Kuwait intends on creating a new city, called ‘Silk City,’ by fostering construction in uninhabited areas.
Located in the north of Kuwait, Silk City, a massive architectural project, is estimated to cost between 250 and 270 billion U.S dollars. Initial plans suggest the city be comprised of four sectors: financial, entertainment, environmental, and cultural. Expected to house 700,000 people, this location will also have its own airport. The project is set to be constructed in phases that are estimated to reach completion within 25 years.
The project expects to attract foreign investments, which in turn will strengthen Kuwait’s economy by making it a top tourist destination. And it is estimated to create 450,000 new jobs.
China, too, has much to gain from Silk City, as it will be an asset to the Belt and Road Initiative that will connect Asia with Europe and Africa. Additionally, China is contracted to collect a percentage of the project’s profit for its first 100 years.
Critics question the probability of this deal reaching completion. They remember all too well-failed agreements between Bangladesh and China as well as Sri Lanka and China, with many believing that China has been taking advantage of smaller countries. Additionally, the Silk City project has been delayed multiple times in the past by the Kuwaiti government, drawing concern regarding its legitimacy.
Despite the skepticism, this project could be of great benefit to both Kuwait and China. We hope that Silk City proceeds apace … as smooth as silk.