Non-oil sector drives Bahrain to 2.9% growth in Q1

Bahrain’s economy grew 2.9 per cent in the first quarter of the year following an uptick in non-oil sector growth, according to Bahrain Economic Development Board (BEDB)

The organisation said non-oil growth increased 4.4 per cent from 3.7 per cent during 2016 thanks to expansion in a number of sectors.

These included the hotel and restaurant industry, which grew 12.3 per cent year-on-year, financial services (8.3 per cent) and transportation and communications (8.2 per cent).

Overall growth was down slightly from 3 per cent seen in 2016 as a whole.

“The Q1 growth figures are very encouraging and underscore the impact both of the government’s reform agenda and the powerful countercyclical impact of the unprecedented infrastructure project pipeline.”

Bahrain has been among the hardest hit of the Gulf economies in the current period of low oil prices, with a June report by Bank of America (BoFA) Merrill Lynch describing the country as one of the world’s most vulnerable oil exporters due to the size of its fiscal deficit.

Read: Bahrain, Oman among most ‘vulnerable’ oil exporters – report

However, the small island kingdom is pressing ahead with a number of infrastructure projects designed to diversify its economy including the $3bn Line 6 project at aluminium producer Alba, a $1.1bn airport modernisation and $335m for a new Banagas plant.

Read: Bahrain allows GCC citizens to obtain IDs in investment push