Bahrain’s economy is once again moving forward. Indeed it is performing so well that it is now the fastest growing economy in the GCC region, with the International Monetary Fund predicting that it will remain the best-performing economy through the remainder of this year and beyond.
This has been matched with substantive increases in foreign direct investment which grew by more than 160% in 2017, amounting to $733 million, and which the EDB estimated would allow for the creation of an additional 2,800 employment positions in three years.
Economic growth for last year was 3.2%, yet the non-oil economy grew by an impressive 5%. In consequence oil’s share of GDP has dropped sharply from 44% in 2000, to just 18.4%. This is a signal of how investment in infrastructure in support of the private sector is heavily paying off. For example, $10 billion of investment directed toward the hospitality sector includes ongoing work on 15 new hotels, along with a massive expansion project for Bahrain International Airport.
A significant factor boosting long term economic confidence in Bahrain is the discovery of large new oil reserves. According to independent analysts these discoveries amount to 80 billion barrels of oil and up to 20 trillion cubic feet of natural gas. Moody’s concluded that “the find… could stimulate private investment in the country’s energy sector in the near-term, and in the medium-term could increase government oil and gas related revenue, and reduce the country’s fiscal and current account deficit”.
Commerce Minister Zayed Alzayani, has stressed the need to use these large sources of new revenue to improve the country’s financial position and reduce debt levels: “We should act wisely to use the revenues generated by this find to develop our economy and diversify it even further, by reducing national debt, by investing in human capital, health services and education.
Along with recent increases in oil prices, these factors all add up to a promising period for Bahrain’s economy, acting as a vehicle for job creation and meaning that more funds are available for improving living standards and public services.