A look into the performance of the country in the eighteenth and nineteenth century shows that Kuwait was a key link between trading partners of the Mediterranean region and India. The location of the country in the Middle East allowed effective access to seaports and desert land, where merchants engaged in successful trade activities.
With trade taking place all around Kuwait, mercantilism best defines Kuwait in the period prior to oil discovery and subsequent exploration. The economic condition of this city-state was subject to the influence of massive trade activities both within and outside Kuwaiti borders. Following trade developments and increase in the number of merchants in Kuwait, social and political practices became evident in the country. This realization would eventually set developmental pace for an oil rich nation.
In the social context, merchants were influential people in Kuwait until after oil was commercialized. The primary social organizations in Kuwait comprised of Mariners and Bedouin. These groups closely related with the merchants and rulers of the nation. Politically, Kuwait was ruled under traditional practices until the post oil period, which saw the promulgation of the state’s constitution. Politically, Sheikhs worked closely with merchants in governing Kuwait before the oil era.
Following oil discovery and subsequent exploration, Kuwait joined the richest producers of oil in the world. The commercialization of oil meant economic transformation through oil revenues and social organization in terms of the positive impacts of oil wealth. In the post oil era, Kuwait significantly shifted from trade to oil exploration in the 1950s. Government revenues, under the Sheikh-based rule, increased significantly. Political activities further heightened, thereby depicting reduced leadership collaboration between rulers and merchants/trade partners.