Bahrain’s Real GDP records 2.4% growth in second quarter
Bahrain’s GDP increased sharply in the second quarter of 2018 to an annual rate of 2.4%. The data published in the Bahrain Economic Quarterly Report (BEQ), produced by the Bahrain Economic Development Board (EDB), shows a significant acceleration of growth from the previous quarter.
This rebound was underpinned by both the normalisation of oil production and markedly faster non-oil growth.
In spite of the improvement, the BEQ noted the ongoing regional economic recovery is progressing somewhat more slowly than initially expected. While GCC growth is expected to accelerate to 2.5% this year and 3% in 2019, this is clearly below historical levels.
Dr Jarmo Kotilaine, Chief Economist, Bahrain EDB, commented: “Bahrain’s impressive improvement in the second quarter was thanks to a broad-based recovery across the whole economy. In particular, the expansion of Bahrain’s non-oil GDP stands out in the regional context. With the oil industry now only accounting for less than 20% of Bahrain’s GDP, growth dynamics are critically linked to non-oil drivers. This compares to the situation in much of the rest of the region where the stronger growth has been led by higher oil prices and production.”
As regional growth picks up, the BEQ also predicted that renewed regional spending power will drive growth in cross-border tourism. Bahrain’s tourism industry continues to grow across a broad range of metrics. Visitor numbers are up 5.8% year-on-year and the average number of nights spent in Bahrain per visitor jumped by 16%
According to the quarterly report, Bahrain’s non-oil GDP expanded by an annual 2.8% in the second quarter, driven by the construction (up 6.7%) and manufacturing sectors (up 4.5%). The ongoing expansion in the construction sector is illustrated by the total sum of infrastructure projects in Bahrain reaching US$87.3 billion in mid-September according to MEED Projects, a 3.8% year-on-year growth.