Manama-May-27(BNA) The robust growth witnessed in the Bahraini private sector in 2012 is set to continue this year, according to the latest Bahrain Economic Quarterly, issued today by the Economic Development Board (EDB).
Bahrain saw overall GDP growth of 3.4% in 2012, but the pace of the expansion in the non-oil sector reached 6.7%. According to EDB estimates, overall growth in 2013 is expected to exceed 5% on the back of a rebound in oil production and ongoing expansion in the non-oil sector.
All sectors of the Bahraini non-oil economy recorded growth in 2012. Among the largest sectors, manufacturing grew by more than 9% whilst financial services expanded by 3.5%. Strong performances were also seen in social and personal services, one of the most dynamic sectors of the economy in recent years, which grew more than 10%. Hotels and restaurants saw 26% growth as the sector rebounded from the 2011 slow-down. In general, the report found that “economic activity has now largely normalized across the non-oil economy.”
The Quarterly argues that this return to growth in the private sector has been underpinned by favourable credit conditions and a strong export performance. The increase in bank lending in Bahrain in 2012 peaked at 18% in April, before levelling out at approximately 6%, a growth level that has continued into the first quarter of 2013. This increased lending has also been aided by strong liquidity among Bahrain’s retail banks, which remain in robust health.
The report also noted that the dynamics for private sector recruitment “are looking increasingly promising” after more than 2,000 private sector jobs were created for Bahraini nationals in the last three months of 2012, in comparison to a slight contraction in the same period in 2011.
Kamal bin Ahmed, Minister of Transportation and Acting Chief Executive of EDB said: “The ongoing growth in Bahrain is encouraging and we are seeing signs that it has continued into 2013, underpinned by solid economic fundamentals. This sustainable growth is essential in maintaining the process of rebalancing and diversifying the Bahraini economy and in creating employment and opportunities for Bahrainis.
“As the Bahraini economy expands and the broader economic conditions continue to improve across the region, this will open more opportunities for international businesses that are looking to take advantage of the opportunities within the $1.4 trillion Gulf market.”