Trapped at the Top: Kuwait's Resource-Rich Paradox and the Economic Diversification Imperative

This policy paper answers a question Kuwait's prosperity makes easy to overlook: why a high-income country still decisively needs the United Nations. Once richer than the United States, Kuwait today earns roughly a third of the US level, caught in what we call the resource-rich high-income trap, constrained not by a shortage of capital but of capability. The way out is within reach and its small scale is an advantage: redeploying the sovereign wealth fund, building high-value tradables, and rewiring the labor market so skills rather than rents drive reward. Because the binding constraint is institutional and human, not financial, this is exactly where the United Nations, working as one Country Team, adds value that capital alone cannot.