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Bahrain to pay private sector salaries with $570m Covid-19 relief package

Bahrain to pay private sector salaries with $570m Covid-19 relief package

The government will pay the salaries from April to June of approximately 100,000 citizens employed in the private sector

Bahrain has said that it will pay the salaries of approximately 100,000 citizens working in the private sector for the months of April-June, as a means to help firms offset the economic impact of the Covid-19 virus on their businesses.

On April 8, the country’s labour and social development minister Jameel bin Mohammed Ali Humaidan announced the launch of an online service on its Social Insurance Organisation (SIO) portal, which would allow employers to register to avail the benefit for their employees, reported Bahrain News Agency.

The minister added that this step would “provide the necessary liquidity to the private sector to deal with the effects of the current conditions preserving private sector growth and enhancing its vital role in supporting the national economy.”

Humaidan said that the payment of salaries would be made according to what is registered with the SIO until the end of February.

These salaries will be paid through savings from the unemployment insurance fund, and the overall cost to cover the salaries from April-June 2020 would be approximately $570m.

On March 17, Bahrain rolled out an $11.4bn economic stimulus package – equivalent to 29.6 per cent of its annual GDP – to support citizens, residents and businesses in the kingdom.

The measures included exempting all tourism-related industries from tourism levies for three months from April 2020, doubling the liquidity support fund to $530.4m, and also increasing the central bank’s loan facilities to $9.8bn to allow debt instalments to be deferred and extra credit to be extended.

The kingdom has also decided to halt the collection of rents and usufruct from traders leasing municipal properties for three months starting from April.

Bahrain has reported a total of 823 cases of Covid-19 infections until now, including five deaths.

Other GCC countries have also announced massive stimulus packages in the wake of the Covid-19 pandemic and plunging oil prices. The UAE has announced a $34bn economic relief package, while Saudi Arabia pledged an $18.6bn package to support the corporate sector and a $13.2bn programme for banks and financial institutions.

Read: UAE boosts stimulus to $34bn to fend off virus impact

On April 2, Kuwait’s central bank also announced measures to support smaller businesses as it reduced liquidity and capital adequacy requirements for banks, thereby boosting their lending capacity by $16bn.

Read: Saudi tells banks to support businesses to avoid job cuts

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