Bahrain economy expands 4.3pct in first nine months

Bahrain’s economy is on target to meet expectations of 4 per cent year on year growth for the full year, according to the Bahrain Economic Quarterly, Q4 2010. The quarterly reports, first published in December 2009, have been developed by the Bahrain Economic Development Board (EDB), to provide regular assessments and key information on the Bahrain economy, in the context of the regional and global outlook. GDP growth in Bahrain was 4.3 per cent through the first nine months of 2010.

There was particularly strong growth in hotels and restaurants (up 15 per cent year on year in Q3 2010), manufacturing (up 8 per cent) and financial services (up 6 per cent).

Bahrain’s economic progress has also been supported by two recent independent reports, following visits by the IMF and Standard & Poor’s.

The IMF noted that: “The near-term outlook is favorable. Buoyed by the rebound in oil prices, the continuing recovery in the global economy, and fiscal stimulus, growth is expected to accelerate from the 3 per cent recorded in 2009 to 4 per cent in 2010 and further to 5 per cent in 2011.”

They also noted that: “The CBB’s existing macroprudential tools have worked well in preventing excesses from building up in the domestic financial system and will continue to play a key role in insulating the economy from fluctuations in global capital markets.”

Standard & Poor’s also recently reaffirmed its ‘A’ rating for Bahrain’s sovereign debt, with a stable outlook. In reaffirming its rating, it stated that: “The ratings on the Kingdom of Bahrain reflect the government's net financial asset position, renewed development of its hydrocarbon resources, and strong international alliances.”

Shaikh Mohammed bin Essa Al Khalifa, Chief Executive of the Bahrain EDB, said “We are delighted to see that economic growth continues to match our expectations, which illustrates the benefits of our tried and tested single regulator and the strength of our prudent, business-friendly economic policies that have meant Bahrain is well placed to achieve long-term, sustainable growth.

The fact that our strategy and vision continue to be supported by key international organisations such as the IMF and Standard & Poor’s is also important.”

Sustainable economic expansion is an important part of Economic Vision 2030, the blueprint for the development of Bahrain’s economy, government and wider society over the coming decades. Bahrain is two years into the process, which the EDB is leading under the guidance of His Royal Highness Prince Salman Bin Hamad Al Khalifa, the Crown Prince of Bahrain and Chairman of the EDB.

The report also highlights that Bahrain remains on track to achieve the key aim of Economic Vision 2030, of doubling Bahraini real household income by 2030.