Growth in the non-oil sector of Bahrain?s economy reached 4.4 per cent in Q1 2017, up from 3.7 per cent during 2016, according to Bahrain Economic Quarterly published by the Bahrain Economic Development Board (EDB)
This growth was driven by strong performance across the non-oil private sector, with momentum continuing to be supported by large-scale infrastructure projects. Overall, during the first three months of 2017, the Bahraini economy expanded by 2.9 per cent, in line with the three per cent pace seen in 2016 as a whole.
The first three months of 2017 saw particularly strong growth in the hotels and restaurants, financial services and transportation and communications industries.
Hotels and restaurants emerged as the fastest growing single sector during Q1, posting a 12.3 per cent year-on-year real rate of expansion. Financial services continued along its strong growth trajectory reported last year, posting an annual expansion of 8.3 per cent at the end of Q1 compared to 5.2 per cent in 2016. The transportation and communications sector also performed strongly, with an annual real growth rate of 8.2 per cent in Q1.
Underpinning the near-term momentum in Bahrain?s non-oil economy is the large amount of investment in infrastructure that the country is experiencing. This includes the US$3bn Alba Line 6 project, which is set to create the world?s largest single-site aluminum smelter. US$1.1bn is being invested in the airport modernisation programme and a further US$335mn has been earmarked for a new Banagas gas plant.
Expressions of interest have been generated for the construction of King Hamad Causeway, which will add to the existing King Fahd Causeway, connecting Bahrain to Saudi Arabia and serving as a platform for the GCC railway.
Jarmo Kotilaine, chief economic adviser of the Bahrain EDB, said, ?As the region continues its transition in a low oil price environment, Bahrain offers further encouraging indications both of its resilience and the progress of diversification. 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.?
