Viewpoint: Sheikh Khaled bin Abdullah Al Khalifa
As countries around the world continue to recover from the economic challenges of Covid-19, it is paramount for government leaders to implement sound policies and develop strategies that will see a return to the level of stability we experienced before the pandemic.
The kingdom of Bahrain has been praised internationally for its comprehensive health care response, as we took decisive and early action in the initial stages and maintained vigilance throughout the pandemic. Although the crisis was challenging, it was also an opportunity to demonstrate the inherent resilience and unity of Bahrain’s government and its civil and private institutions in the face of unprecedented pressures.
Building on these successes, we realised the importance of focusing not only on restoration to repair the damage caused, but also on creating a more favourable environment for the economy and society to flourish. In October 2021 we launched our Economic Recovery Plan, a multi-year, five-pillar strategy that includes economic reform packages designed to enhance the kingdom’s competitiveness, based on Bahrain Economic Vision 2030.
The plan involves labour market reform initiatives. The goal is to develop a more skilled local workforce that is equipped to meet the demands of the future economy, and create exciting new career and employment opportunities.
By 2023 regulatory framework packages hope to bring in $2.5bn in foreign direct investment while also spurring more than $30bn in investment in multi-sector strategic projects around the kingdom to boost connectivity and productivity.
A series of new sector strategies are being implemented across tourism, logistics, financial services, telecommunications, IT and digital economy, oil and gas, and the manufacturing sector – with the aim of increasing non-oil sector revenue by 5% annually.
Bahrain is more than on the road to post-pandemic recovery. The kingdom has received positive ratings in global Covid-19 recovery indices, as well as post-pandemic tourism surveys. The IMF estimated a 2.2% GDP growth rate in 2021 and is forecasting steady 3% growth in 2022, in large part due to the government’s integrated approach to tackling challenges and paving the way for new opportunities.
Indeed, Bahrain reported a budget surplus of $88m in the first half of 2022, aided by increased oil revenue as well as the wider reform agenda. This marks the first budget surplus since 2008 and is equivalent to a 52% increase compared to the same period last year.
Mumtalakat, the sovereign wealth fund of the kingdom, also announced its highest net profit since its inception in 2006. Its stand-alone financial results revealed an annual profit of BD45.6m ($121m) at the end of 2021 compared to a loss of BD550.7m ($1.5bn) in 2020, when the pandemic weighed heavily on the global investment environment.
In June 2022 Bahrain’s government saw the most significant Cabinet reshuffle in its history, with 17 out of 22 ministers changed. This has created the kingdom’s youngest, most diverse and most representative Cabinet ever. Our new Cabinet of capable leaders brings with it fresh ideas and thinking that will stimulate innovation and progress.
Notwithstanding real change in many areas, Bahrain remains committed to the UN Sustainable Development Goals (SDGs). To this end, a new Ministry of Sustainable Development has been formed, with wide-ranging oversight of the SDGs across the government. The kingdom has pledged to reach net-zero carbon emissions by 2060, and this commitment will guide the future development of strategic industries.
Our recent performance has underlined why we have confidence in our reform agenda and its ability to reduce both the fiscal deficit and public debt. At the same time, we are continuing to provide the best services and opportunities for the citizens and residents of our nation.