According to several sources, Kuwait Investment Authority (KIA) is cutting costs. This is not a bad thing in and of itself. Although this comes at a time when oil prices are at $75/barrel and the KIA sits on $202.8 billion* of assets under management, cost cuts are usually a good thing and point to a disciplined style of management. However, the alarming fact is that the KIA is cutting-costs across the board which is an easy yet very dangerous approach. The biggest victim of this approach? Kuwait.
The KIA website states that the authority aims to “contribute to the national development by investing in human resources.” This goal has been more than fulfilled during the previous years as KIA had trained highly qualified Kuwaitis and transformed them into business leaders capable of excelling at the highest levels in both private and public sectors. Moreover, KIA’s yearly MBA scholarship recipients have been steadily joining the workforce armed with unrivaled world-class education from leading universities such as Harvard, Stanford, MIT, London Business School, and Wharton Business school. Such an education enables the youth to emerge as future Kuwaiti leaders.
The shocking news is that KIA is cutting its training budget at a time of economic prosperity, massive multi-billion dollar development plans, and efforts to transform Kuwait into a regional financial hub. On the contrary, we would’ve expected prioritizing the investment in human capital as it is a perpetually beneficial investment considered a corner stone for the prosperity of any country. The training program and MBA scholarships cost KIA less than KD 1 million a year. Is it too much for an institution worth $200 billion? We doubt. Will Kuwait reap benefits from world-class educated and trained individuals? You bet!
In a previous post, we applauded KIA’s Managing Director (Bader Al-Saad) for his relentless reform efforts since the beginning of his tenure. Also, in the most recent parliamentary discussions of the KIA budget Minister of Finance Mr. Al-Shamali requested an increase in the training and MBA scholarships budget. We now call upon them and all parliament members to reinstate the renowned MBA scholarships program and the semi-annual version of the training program. Such an act will not only relieve the Kuwaiti youth, but also restore our hopes of a better future for Kuwait.
* According to the Sovereign Wealth Fund Institute.
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Loading ...Tags: KIA MBA, KIA Scholarships, KIA Training, Kuwait, Kuwait Investment Authority
are you saying the training and mba program have been canceled? or simply reduced?
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Keynesian Reply:
September 1st, 2010 at 5:29 pm
I tried to contact them with no avail. However, I heard that 7 students accepted to top MBA programs were told that there was no budget for this year and they wouldn’t send them! So MBA scholarships are off. As for the training, as far as I know it was semi-annual, but they switched it to 1 annual one.
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What a disappointment… there really isnt much to add to what you wrote.
I have known a handful of people who have amazed me with their knowledge and broad know-how participating in the investment world, who all shared a common background of being nourished under KIA’s training program.
Its a shame management prioritized other ‘probably’ luxury benefits over this life changing program… Let alone ditching funding for 7 Kuwaitis who have been granted acceptance in the worlds top Universities. I guess they don’t understand the true value and and added benefits of higher education, or just maybe Tareq Al-Sultan (Agility), Mohammed Al-Shaya (Al-Shaya Group) and Farooq Al-Sultan (NAS) are not good enough an example.
Bottom line; regarding this move by KIA management (or maybe MoF): Pathetic!
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“The KIA website states that the authority aims to “contribute to the national development by investing in human resources.” This goal has been more than fulfilled during the previous years as KIA had trained highly qualified Kuwaitis and transformed them into business leaders capable of excelling at the highest levels in both private and public sectors”
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Given the troubles and excesses of the recent past, I really wonder on the quality of the management we have here in Kuwait. Especially the ones that have entered into the now doomed Investment Sector (Banks are all in the act as well). Just look where this “oldest in the region” or “most educated in the region” mentality got us. No more trusts exists between the shareholders, the smaller ones at least, and the large shareholders.
We are light years away from advancement. Besides, there is not even political will on that matter……..and this Kuwait vision of becoming a “financial center” is nothing but a load of crap
As a holder of an MBA myself, I can tell you that the value of an MBA to the country itself, is zero if you have no industries to speak of!!!.. and for real now, how much of what you learn in MBA do you apply in Kuwaiti companies……. now or in the future!
what we have is good oil, and now we have more MBA’s and Finance people while Mechanical Engineering, Petroleum Engineering, Electrical Engineering are being shunned because everyone wants to enter the Investment Sector or the banking sector and be somehow involved in the next Real Estate bull market
So am w/ KIA on this one!!!
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@Bo6air: Although i greatly oppose your views on the 2 business leaders mentioned above the main issue were discussing should not be forgotten, knowledge and education enlightens its seekers and its seekers sometimes need funding.
We’ll discuss the good and bad sides on the management styles of Al-Shaya and Al-Sultan on a different thread (@admins)
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@Salbader: My comments are very relevant. I am questioning the very value of this education if it does not improve society –
since this is public money the KIA is spending, I personally think there are better uses for it then spending on supposedly “world class” education, whereby the leaders that have graduated from these top schools continue to show the least regards to basics such as excess greed and improving shareholders’ values.
I would rather have the money spent on sending Engineers and doctors to top schools than the hassle of going through the University of Kuwait or through your work place.
Bottom line: MBAs are way overvalued.
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Bo6air.. just one small comment on the Al Shaya group ( I am in no way related to them and I dont even know anyone from that family)
do the Al Shaya Starbucks stores in Turkey and Russia (which have succeeded where previous franchise owners failed) rent from mabanee buildings as well?
I don’t know if you are Kuwaiti or not, but if you are, we tend to not give credit where its due sometimes (notice i said the word we, as I admit to doing it as well)
Also, MBA’s maybe overvalued in your opinion and I respect that. However, the way I think of it, many great companies/inventions/products/ services have come into existence due to people sharing ideas and meeting up in their MBA classrooms. In addition, many MBAs studied fields other than business for their undergraduate concentrations.
They might have brilliant ideas relevant to their respective fields, but lack the necessary business acumen to transform this idea into a valid, business- ready product/service
Don’t blame greed on the MBAs these people have received. All people are greedy because of the system we are brought up in and the rules we live by. People just have varying degrees of greed
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@FAISAL:
MBAs are not half as valuable as higher degrees in the sciences/engineering. this is what builds society, this is what builds products. not some marketing schemes and some money shoveling knowledge. I think the only valuable part of the MBA is if you were to focus on HR – as this is so weak (look at the high employee turnover)
Simply I was saying that this money – if it was allocated to education – then I suggest it be spent on either have a world class university here (hopefully public)
Or give it to students of engineering, medicine, biology, etc.
and yes I am Kuwaiti
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Keynesian, can you verify that KIA has decided not to fund the five MBA scholarships this year? I’d like to follow this up as a news story. If true, a sign of the times. There’s an interesting similar announcement on the Mohammed bin Rashid Al Maktoum website that you might want to look at…
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Kit, i can confirm that this is the case, i’m one of the affected students.
Kenesian, thanks for writing about this !
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