Cover of The Report: Bahrain 2020

The Report: Bahrain 2020

Bahrain pioneered oil production in the Middle East beginning in the 1930s, establishing the region’s initial framework for the petroleum industry. Some 90 years later oil and gas operations comprise 18% of GDP, with the economy well diversified to host established financial services and industrial sectors, as well as unique tourism offerings.

Although it is one of the most diversified economies in the GCC, Bahrain did not emerge unscathed from the 2014 oil price crash. Since then, the country has worked to broaden state revenue streams, implementing new fiscal measures to balance the budget, such as the introduction of a 5% value-added tax in January 2019 and the lowering of state subsidies. Nevertheless, large-scale infrastructure projects and Bahrain’s liberal business environment bode well for future job and investment growth. Steps in the right fiscal direction have been acknowledged. For example, global credit ratings agency Standard & Poor’s upgraded Bahrain’s outlook from stable to positive in November. While expansion of the non-oil economy is expected to slow from 2.5% to 2.2%, the oil sector is due to move back into the black (0.2%). More broadly, well-developed ICT infrastructure, high technology penetration rates and a business-friendly ecosystem continue to prove Bahrain’s value offering to investors.  

OBG & Bahrain

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