New Entertainment City Will Cost 200 Million Dinars
Kuwait had the lowest contribution from the tourism sector to the GDP among Gulf Cooperation Council countries, according to a recent study, with an average contribution of 6.1% to the GDP, compared with 10.8% in the UAE, 9.8% in Bahrain, 9.7% in Qatar, 9.4% in Saudi Arabia, and 6.8% in Oman.
Kuwaitis spend more than 4 billion dinars ($14 billion) on foreign tourism each year, or about 11% of their gross domestic product. Al-Qabas daily reports that the country's tourism revenues do not exceed the level of 300 thousand dinars per year, according to the study, prepared by the Tourism Enterprises Company and recently reviewed by the Council of Ministers.
Tourism projects have finished drawing out the outline for the establishment of an entertainment city that would yield a viable economic return for the government. Approximately 200 million dinars will be required to implement the project, 120 million of which will be capital expenditures, and 80 million will be infrastructure expenditures, with an exploitation period of 50 years instead of 3 years needed for its implementation.
Approximately 85 million dinars will be contributed to GDP by the project in 2035, about 4 thousand new jobs will be created, and 900 thousand people will visit the entertainment city by 2030, assuming that the internal rate of return is between 11% and 13%, assuming a 50-year lease term is assumed.
According to the study, the government has two options for implementing the project:
- A legislative amendment to the State Property Law that the period of offering to exploit the site be 50 years or more, and then it is possible to achieve an internal return of 15%, so that it is attractive to investors in the private sector.
- Injecting the value of the capital required by the state (building and then contracting with an international operator), noting that Wafra Real Estate Company has expressed its desire to invest in the project.
The new entertainment city will include the following sections:
- Amusement parks
- Sports courts
- Water Park
- Sheikh Zayed Park
- Bird watching area
- Forest huts
- Retail and restaurant area
- Picnic area
- Electronic games hall