Bahrain non-oil revenue to soar

Bahrain is on course to more than triple its non-oil revenue by the end of this year when compared with 2018, Finance and National Economy Minister Shaikh Salman bin Khalifa Al Khalifa has said.

Speaking at the World Economic Forum in Davos, Switzerland yesterday, Shaikh Salman said the kingdom had put in a significant amount of work on increasing non-oil revenues, particularly since the announcement of the Fiscal Balance Programme (FBP) in 2018.

“We have diversified economy in Bahrain and in Q4 of last year, 81 per cent of national GDP was from non-oil sectors,” he said in response to a question on the impact of high oil prices on the country’s economic plans.

“High oil prices have the benefit of reducing funding needs and the diversified broad-bases growth that we’re seeing coming out of Covid-19 has served us well.”

According to him, the government has seen high oil prices reduce the deficit substantially.

“Our projected deficits for 2022 in our plan were based on oil price of $60 a barrel, it’s also important to note that our state budget estimated the price at $50 a barrel and now we’re achieving triple digit oil sales prices so we will see a significantly lower deficit in the first half of this year and we’ll be well on our way to achieving our targets before the year-end.”

Despite the higher oil revenue, Shaikh Salman said the target of achieving fiscal balance by 2024 remains.

“We focus on that $60 number because that is the basis that underpins our plans and we have shown absolute discipline in moving forward.”

The minister further said strong economic growth across all sectors towards the end of 2021 has picked up pace in 2022.

The Finance and National Economy Ministry has forecast real GDP growth of 4.1pc this year, whereas the World Bank has a slightly more conservative estimate of 3.5pc.

Shaikh Salman said the government remains focused on delivering sustainable growth, which it would not compromise on while managing inflationary pressures.

“What we’re doing in Bahrain now is correlating the fiscal position to economic growth, this is something that was overlooked in many previous cycles,” he said.

The minister was also emphatic in stating that Bahrain was not running any austerity programmes.

“The FBP is a programme to readjust the balance of revenues and expenditures while maintaining the growth trajectory,” he said.

Shaikh Salman was speaking during a session titled ‘Middle East and North Africa Economic Outlook’, which included Saudi Arabia’s Finance Minister Mohammed Al Jadaan, Majid Al Futtaim Holding chief executive Alain Bejjani and Investcorp executive chairman Mohammed Alardhi as panellists.

The discussion was moderated by Al Arabiya News Channel senior presenter Nadine Hani.

Shaikh Salman is part of a high-profile delegation taking part in the annual gathering of political and business leaders in the Alpine resort in Switzerland.

It also includes His Majesty King Hamad’s adviser for diplomatic affairs Shaikh Khalid bin Ahmed Al Khalifa, Industry, Commerce and Tourism Minister Zayed Alzayani, Youth and Sports Affairs Minister Aymen Almoayed, Economic Development Board adviser Ian Lindsay, under-secretary for research and projects in the Office of the Prime Minister Hamad Yaqoub Al Mahmeed and Almoayyed International Group deputy chairperson Hala Almoayyed.




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