Construction sector ‘set to lead growth’
THE construction industry in Bahrain is expected to play a leading role in the country’s economic growth in the future, according to a report.
The industry’s potential lies in its benefits from several major projects that are being rolled out in Bahrain, according to the report put together by global publishing, research and consultancy firm Oxford Business Group (OBG).
‘The Report: Bahrain 2020’ highlights Bahrain’s ongoing shift towards a knowledge-based economy against a backdrop of lower oil prices and fiscal reforms.
Marking 15 years of OBG’s operations in Bahrain, the document also elaborates the sectors of the economy that are expected to play a key role in driving new growth as part of broader diversification efforts.
“Key among those is the construction industry, which is benefiting from the roll-out of several mega projects for the energy, industry and transport sectors, alongside affordable housing and high-end commercial facilities,” said the report.
It also charts the performance of Bahrain’s manufacturing industry, which is now the second-largest contributor to non-oil gross domestic product (GDP), successfully attracting higher levels of foreign direct investments (FDI).
It maps out the growth underway in value-added production, with food and the fast-moving consumer goods (FMCG) segment both gaining momentum.
“Long a major driver of non-oil growth, Bahrain’s banking industry accounts for more than 16 per cent of the GDP and has carved a niche as a regional hub,” said the report.
The report said the oil and gas sector also continued to play a major role in driving Bahrain’s economy, despite its share of the GDP falling to 18.1pc in mid-2019.
The implications of the major oil and gas find in the Khaleej Al Bahrain basin, which could boost production four-fold, and the modernisation programme underway at the Sitra refinery are also considered in the report.
Featuring a viewpoint of His Majesty King Hamad, together with a detailed sector-by-sector guide for investors, the report also features a wide range of interviews with high-profile personalities, including Bahrain Economic Development Board chief executive Khalid Humaidan, National Bank of Bahrain chief executive Jean-Christophe Durand, Bapco chief executive Pete Bartlett, Alba chief executive Ali Al Baqali, Batelco chief executive Mikkel Vinter.
OBG editor-in-chief Oliver Cornock said that while the oil price crash of 2014 had heightened the need for fiscal reforms, Bahrain was well placed to tap investors for a range of initiatives across the sectors of its economy.
“Bahrain benefits from being one of the most diverse economies in the GCC, supported by a well-established financial services industry and robust industrial and manufacturing sectors,” said Mr Cornock.
“Having taken steps to balance the budget, the kingdom will now be looking to its big-ticket infrastructure projects and attractive investment climate to drive new growth.”
OBG Middle East managing director Jana Treeck added that Bahrain’s diversification drive had also led to a sharper focus on value-added and downstream activities.
The report has been produced with Zu’bi and Partners, attorneys and legal consultants, and the Bahrain Bourse.
