ShareKUWAIT: Minister of Commerce and Industry Khalifa Al-Ajeel issued a ministerial decision which changes some regulations regarding the distribution of subsidized building materials in Kuwait. The goal is to reallocate subsidies to benefit citizens more effectively and use public funds more efficiently.
According to a statement from the ministry, the new decision addresses the need to unify the subsidy system, which was previously inconsistent with fixed and variable subsidies in place. The reorganization also adds materials that were previously excluded from the 2023 subsidy decision. The ministry is prioritizing national products, ensuring that they are supported within the new decision. The decision also includes anti-monopoly provisions, allowing imported products to be introduced if prices rise or if there are concerns about market manipulation. The decision aims to provide better prices and higher-quality materials for citizens, supporting the growth of the construction sector and contributing to residential and development projects in Kuwait. The new decision will take effect in one month. The Ministry has the authority to adjust material allocations and redistribute subsidies based on market price changes.
How housing assistance works
Kuwait’s housing program offers several options to assist citizens in securing housing. The first option provides a government-built house or apartment, with a minimum size of 375 square meters, offered by the Public Authority for Housing Welfare (PAHW) at a nominal cost. Additionally, a monthly rent allowance of KD 150 is provided during the waiting period. The second option includes a 375 square meter plot of land, also provided by PAHW at a nominal price, along with a long-term, interest-free loan of KWD 70,000 and building materials worth KD 30,000 at a subsidized rate, offered by the Kuwait Credit Bank (KCB) to help with the construction of a house.
A KD 150 monthly rent allowance is also provided during the waiting period. The third option offers a KD 70,000 long-term, interest-free loan from KCB to either purchase an apartment or house with a minimum area of 360 square meters or to build a house if the citizen already owns land. In this case, KCB also provides KD 30,000 worth of building materials for construction or renovation.
Key changesUnder the new decision, the subsidy remains fixed, but the construction material prices, which were previously capped, are variable, offering more flexibility to citizens and fostering healthy competition among suppliers.
In a statement released Thursday, the Ministry of Commerce explained that the new mechanism outlined in the decision allows all qualified suppliers to participate in providing building materials to beneficiaries, ensuring fairness in dealings with local suppliers. It also provides citizens with more flexibility to choose building materials based on their construction needs.
The statement also highlighted changes in the subsidy amounts for specific materials. For example, the subsidized price for air conditioning units increases from KD 5,000 to KD 6,000. The subsidy for ready-mix concrete rises KD 8,500 to KD 9,000. Aluminum for windows is now subsidized with a cap of KD 1,000.
