July 22, 2015

Report: Bahrain’s non-oil sector quarterly growth reaches 5 %

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Wednesday 22 Jul 2015 - 15:12 Makkah mean time-6-10-1436

Chief Executive of EDB Khalid Al Rumaihi (Image from BNA)

Manama, (IINA) - Bahrain’s non-oil growth came in noticeably above projections in the first quarter of 2015 according to the latest Economic Quarterly (BEQ) issued by the Economic Development Board (EDB).
The report also highlighted broad-based real GDP growth of 2.9 percent on an annual basis, and strong labour market activity, with employment increasing by 5 percent compared with the same period last year, BNA reported.
The report found that growth in the non-oil economy, which constitutes more than 80 percent of Bahrain’s GDP, saw strong growth in a number of sectors, reaching 5.0 percent. The social and personal services sector grew by 8.3 percent year-on-year, overtaking the hotels and restaurants sector as the fastest-growing sector. The social and personal services sector is primarily made up of private sector healthcare and education activities. The manufacturing sector also saw 5.9 percent year-on-year growth.
Despite global economic challenges, the report finds that forward-looking indicators point to a high degree of continuity in the regional non-oil economy, reflecting the strength of key structural growth drivers and the commitment of regional governments and investors to long-term projects.
Strong growth of 7.5 percent year on year was reported in the construction sector, which is in line with the sector’s momentum that became apparent in the second half of last year and reflects continued infrastructure activity. Growth in the transport and communications sector followed closely with a 7.3 percent year on year expansion.
The report also found that infrastructure activity had a marked effect on the labour market. The increase in total employment occurred at its quickest pace since Q2 2013, and was driven by the private sector, which represented 89 percent of the annual growth in total job creation during Q1. A fall in the unemployment rate was also reported in the first quarter of 2015, reaching 3.5 percent in March – a level last seen during Q3 2012.
In spite of oil price volatility in the second half of last year, the country’s fiscal performance also improved. The report found that according to the 2014 consolidated final accounts, government revenues rose by 11 percent in 2014, and expenditures declined by the same percentage.
Khalid Al Rumaihi, chief executive of the EDB said: "The report highlights the strong performance of Bahrain’s non-oil sector, with growth coming in above our projections. This reflects Bahrain’s diversification efforts over the past decade and the general resilience of the GCC economies at a time of doubts about the global recovery. Even as Bahrain’s hydrocarbons sector experiences a decline due to seasonal maintenance headline real GDP expanded by 2.9 percent and we continue to project robust growth throughout 2015 and 2016."
Bahrain is set to invest over US$22 billion in key infrastructure projects over the coming years, which aims to spur public and private sector participation across the manufacturing, energy, healthcare and education sectors. This includes a commitment to build 25,000 housing units over the coming four-year period.
SM/IINA

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