Bahrain posts highest Q2 economic growth in 11 years at 6.9%

Bahrain’s economy grew 6.9 percent in the second quarter of 2022, posting the highest growth rate in the past 11 years, driven by strong performance in the country’s non-oil sectors, which have been targeted under the country’s economic reform plan.

Data from the Ministry of Finance and National Economy shows that non-oil growth was led by the Gulf state’s hotel and restaurant sector, which grew 18.1 percent compared to the second quarter of 2021, the state-run Bahrain News Agency reported on Sunday.

The transportation and communications sector rose 15.1 percent and manufacturing rose 7.6 percent, boosted by increases in overall output from Bahrain Petroleum Company, Bahrain Natural Gas Company and Aluminum Bahrain, the agency said.

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“The report showed positive economic growth, driven by the strong performance of the non-oil sectors, in line with the positive results in all sectors affected by the stimulus plan,” the ministry said on its website.

Bahrain’s economy, the smallest in the six-strong GCC bloc, has been looking for ways to cut spending and reach a balanced budget by 2024.

Last year, she unveiled an economic reform plan that aims to invest about $30 billion by 2023 in projects to spur post-pandemic growth, boost jobs for citizens, and attract 2.5% foreign direct investment to attract billions of dollars.

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The government has also taken cost rationalization measures, including raising VAT to 10 per cent, to help the kingdom balance its budget by 2024.

In August, Bahrain posted a first-half surplus of US$88 million and posted a 52 percent annual increase in sales, the Ministry of Finance and National Economy said.

Revenue for the January-June period totaled nearly 1.7 billion Bahraini dinars ($4.5 billion), up from 1.1 billion dinars in the same period last year.

With Bahrain’s economy posting strong growth of 5.5 percent in the first quarter of the year, the mid-year financial report is another indication of the kingdom’s post-Covid-19 financial recovery, the ministry said at the time.

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Meanwhile, Bahrain’s commerce sector grew 7.5 percent in the second quarter of this year, reflecting an increase in the value of point-of-sale and e-commerce transactions, the ministry said.

“The government services sector grew by 7.1 percent in real terms, while real estate and business activities increased by 4.5 percent annually, helped by the increase in the number of real estate transactions registered with the Survey and Land Registry,” it said.

Updated September 25, 2022 at 4:10 p.m

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