Friday, December 21, 2007

Kuwait Inc.'s Special Influence In The UK Historically

Because the British Government’s British Petroleum [BP], the third-largest transnational oil company in the world in 1991, had a special interest in Kuwait, it was not surprising that British Conservative Party politicians in 1991 urged the Pentagon to use U.S. troops then to “liberate” the homeland of Kuwait Inc.. Another reason why the same British Conservative Party politicians who stubbornly supported the British military occupation of the North of Ireland were so against the 1990 Iraqi military occupation of Kuwait was, perhaps, because Kuwait Inc. also had a special influence on British politics. The value of Kuwait Inc. government investments in the UK in the early 1980s, for instance, exceeded $3 billion.

In 1952, the government of Kuwait Inc. opened an office in London that was called the Kuwait Investment Office [KIO] and in 1991 was located in a seven-story London building called St. Vedast House, near London’s St. Paul Cathedral. By the early 1970s, the government of Kuwait Inc. began to use its new wealth from the sale of Kuwaiti crude oil to play on the London real estate market. For $250 million, the Kuwait Investment Office purchased 100 percent of the St. Martin’s Property Corporation in 1974 to serve as Kuwait Inc.’s vehicle for its London real estate investments. By 1991, the value of the Kuwait Inc. government’s St. Martin Property Corporation was $1.5 billion. Among the London real estate properties owned by the government of Kuwait during the early 1990s was London Bridge City, a one-million-square-foot complex of offices, shops and restaurants along the Thames River of London.

The Kuwait Investment Office also began to play the London Stock Market with its new oil wealth in the 1970s; and by late 1982, according to the OPEC’s Investments And the International Financial System book by Richard Mattione, the government of Kuwait Inc. owned $2 billion worth of British corporate stock. The same book observed that the shares of British corporate stock owned by the Kuwait Inc. government “are concentrated in the areas of insurance, property and investment trusts” and in the early 1980s there were 53 British corporations in which the Kuwait Inc. government owned over 5 percent of all the stock.

Ten percent of Britain’s Midland Bank, worth $400 million, was also owned in 1991 by the Kuwait Inc. government. Sixty million dollars worth of another British bank, the Royal Bank of Scotland, also was owned in 1991 by the Kuwait Inc. government, as was $100 million worth of Britain’s Trusthouse Forte travel and catering firm. Until the early 1990s, the Kuwait Inc. government owned over 20 percent of the British Petroleum [BP] Corporation. But British popular opposition to having a foreign government control so much of Britain’s national oil company compelled the Kuwait Investment Office to reduce its ownership of BP to 9.9 percent.

(Downtown 1/23/91)

Next: Kuwait Inc.’s Historic Special Influence In Germany, Spain and Italy

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