Amid long-running speculation that Kuwait’s Ministry of Commerce and Industry could privatise retail co-ops, sector apex leader Mariam Al-Awad recently shared details on the critical role co-ops play in the Kuwaiti economy.
The apex – the Union of Consumer Co-operative Societies – has previously spoken out against privatisation, and has now released figures which suggest co-ops make up between 60-70% of all retail trade, and are accountable to residents and members in their local areas of operation.
Calling them the “backbone of the national economy”, Al-Awad highlighted that sales figures from Kuwaiti co-operatives now reportedly exceed one billion dinars (£2.4bn / US$3.2bn), with one co-op alone recording sales of 30 million dinars (£73.5m / $97.7m). Al-Awad also cited the fact that 90% of co-operative goods are produced locally, with profit margins capped at 12% and net proceeds reinvested in social services, public facilities, landscaping, national events and Umrah trips to Mecca.
All of this takes place under strict rules; the Union’s member co-ops must price their products within a framework set by its Pricing and Inspection Department, while the resale of co-operative products is prohibited outside co-ops or abroad.
Al-Awad has now announced that the Union is extending a tender for new goods bearing the ‘Cooperative’ logo. Today, this includes six product categories, such as paper products, detergents, aluminium foil, detergent, and Cooperative Tissues, which have been available under the brand for over 50 years. After an initial tender only received bids from 10 companies, the Union has now extended the deadline to December 11 – giving co-operatives a greater window of opportunity to sign up to the scheme.
Since 2023, there have been widespread fears that Kuwait’s co-op sector could face drastic government reform. A plan published by the Ministry of Commerce and Industry proposed a full reshaping of the role of co-ops in Kuwaiti society. This would have involved re-examining the laws around co-operatives to “enhance oversight of the board of directors’ practices in co-operative societies and strengthen governance”, under the oversight of the Ministry of Labor Affairs and the Federation of Associations. One recommendation in particular examines “adopting models for the privatisation of co-operative societies to reduce administrative costs and bolster the role of the private sector in the economy”.
In the face of widespread opposition to the proposals by figures in the co-operative sector, the Kuwaiti government has now denied that it plans to privatise co-operatives. Kuwait’s director general for co-operative affairs at the Ministry of Social Affairs, Athari Al-Matrouk, reportedly said “co-operatives play a key role in ensuring food security, and the ministry continues to support and supervise them”.
