Page 258 - The Persian Gulf Historical Summaries (1907-1953) Vol II

243
APPENDIX C
Documents relating to the investment of Kuwait Surplus Revenue—1953

(i)
(Paragraph 20)
Letter, dated February 23 1953, from the Ruler of Kuwait to the Political Agent,
Kuwait
We have given careful consideration to the recommendations made to Us by
Her Majesty’s Government in February 1952 concerning the investment of that
part of Our sterling revenues which is not required for current expenditure. We
have discussed these recommendations with Our officials and with Mr. Loombe
of the Bank of England. The purpose of this letter is to inform you of the
arrangements which, in the light of these recommendations, We have now decided
to make.
We are instructing Our Finance Department to inform Us from time to time
how much of Our expected sterling revenues is likely to be required to meet the
needs of the State, as far as can be foreseen, for administration and other general
expenses and for development. After the provision of such sums as We may
approve for these purposes there is likely to remain a Surplus from Our sterling
revenues.
We have decided that this surplus State revenue should be set aside for
investment and therefore propose to make the arrangements set out in the following
documents, copies of which We enclose: —
(a) a document providing for the establishment of a Kuwait Investment Board,
and
ib) Our general directive to the Board on the manner in which it should
exercise its functions.
In connexion with the establishment of the Kuwait Investment Board We propose
that the first members should be: —
The Right Honourable Lord Piercy, C.B.E.
The Right Honourable Lord Kennet of the Dene, P.C., G.B.E., D.S.O.
Mr. H. T. Kemp.
Mr. C. P. L. Whishaw.
We should be glad if you would convey to the Governor of the Bank of England
Our thanks for his nomination of Lord Piercy as a member of the Board and Our
acceptance of the Governor’s offer to place at Our disposal special facilities in
the form of an account at the Bank of England. We confirm that We are
instructing the Investment Board that investment and disinvestment should be
conducted in such a way as to avoid as far as possible any unwelcome effects on
the London Stock Exchange.
We should be grateful for your confirmation:'—
(i) that Her Majesty’s Government consider that the arrangements described
in this letter and the enclosed documents are satisfactory for the purpose
for which they are intended; and
(ii) that the income which will arise from sterling investments made by the
Investment Board on Our behalf will not be liable to United Kingdom
Income Tax, and that Death duty in Great Britain will not be charged
on funds and investments held in Great Britain which are the property
of Our State.
(ii)
(Paragraph 20)
Decree by the Ruler constituting the Kuwait Investment Board, dated
February 23 1953
Know all men that We His Highness Shaikh Sir Abdulla Al-Salem Al-Sabah,
K.C.M.G., C.I.E., Ruler of Kuwait on behalf of Ourself and Our successors as
Ruler of Kuwait do hereby constitute and establish the Kuwait Investment Board
(hereinafter called “ the Board ”). The Board shall have the under-mentioned
duties, authorities and powers which it shall perform and exercise subject to the
provisions regarding termination hereinafter contained.