Looking for the Ministry’s latest goals, projections, and developments—and how they’ll affect entrepreneurs over the long term? Go straight to the source. There may be a few pleasant surprises in store.
Thank you for this opportunity. In your opinion, what is the single most important role of the Ministry of Industry and Commerce today?
I would say changing the mindset of the business community in Bahrain in the broader sense. Everything we’re trying to do really revolves around that, whether it’s reforming laws, regulations, and operating systems to make them more business-friendly, accessible, and efficient; encouraging entrepreneurship and development of SMEs; promoting industry, tourism, and commerce; or cultivating the private sector to represent a greater share of the economy. The long-term idea is to have government withdraw from the front lines and take more of a regulatory, legislative role.
I have noticed, in many of your speeches, that you mention the idea of liberalization of the market. What does that mean, in a technical sense?
Liberalization involves relaxing the terms of doing business. It involves facilitating import of foreign investments, and using Bahrain as a platform for the Gulf, especially KSA and the northern Gulf.
We should utilize and capitalize also FTA agreements with the U.S., Singapore, and certain European nations. This will allow us to take advantage of Bahrain’s friendly business environment and excellent human capital, which is our strongest, yet least-marketed asset.
Why would you want to continue operating in a market that’s 700 square kilometers and less than a million & a half in population, when you have the opportunity to access a market of 300 million in the United States through the FTA.
Part of liberalizing is to help locals think globally: how to set up with as big a footprint as you can.
I WOULD SAY THAT PROBABLY 80% OF OUR VOLUME NO LONGER INVOLVES OTHER GOVERNMENT AGENCIES, MEANING YOU COULD GET YOUR RESPONSE RIGHT AWAY.
Excellent. As far as you can see, how long does it take for a Bahraini businessperson today to start their business in Bahrain? Can it be done fully online? How long would that take?
It varies according to the type of business. To register a business, it should take minutes. Inshallah, by next week we’ll have launched the last step in our company registration reform, and we will start issuing separate CRs. The aim is to make it quick and transparent.
I would say that probably 80% of our volume no longer involves other Government agencies, meaning you could get your response right away. That doesn’t mean we’ll approve it right away. We could decline it if it doesn’t comply for some reason, but at least you’ll have an answer and know where you stand.
We’re also in the final process of migrating from ISIC 3 to ISIC 4. ISIC is an international standard adopted by the United Nations to sub-classify activities. What ISIC 4 does is to shrink down the number of activities from 1,800 to 419.
For example, a restaurant is a restaurant. It’s good for you as an investor, and it’s also great for us, because it’s less work. Why should we get involved in whether you’re serving food, juice, or whatever? As long as you have the right hygiene and the right equipment,.
Perfect. On that same note, do you have any KPIs with other government entities who provide those approvals?
Yes, we do. All of them were set by the government agencies. Each took on a commitment unto themselves, and it’s being monitored on a weekly basis.
Access to funding is very limited in Bahrain, especially for small businesses and startups. Who is taking care of this? Is the MoIC looking after it?
It’s a core mandate of ours. This is why the stock exchange has been transferred from the Ministry of Finance to this Ministry: we want to create a conduit for SMEs to start from micro, then go through the cycles of venture capital and angel investors—and maybe, one day, public funding through the stock exchange.
We are also working to redraft our bankruptcy laws. Every business begins with a cheerful start, but unfortunately, some don’t turn out as well as anticipated. We need to create a safety net, because we feel the enthusiasm of entrepreneurs is being hit by a lack of certainty.
AROUND 2ND HALF OF THE YEAR, WE’LL BE LAUNCHING A VIRTUAL CR THAT IS GRANTED TO ONE PERSON, A BAHRAINI WHO OWNS AND OPERATES HIM OR HERSELF.
Is there a new law for Instagram businesses?
There is no new law. We’re not against people selling on Instagram; in fact, we encourage it. What we worry about is fake accounts, fake products, and poor-quality products, and customers being deceived or not getting their money’s worth. What we would like to encourage is to give these guys authenticity by having them registered, and displaying their registration number on their Instagram account.
You as a consumer would have more confidence in buying from this party, as well, because it would be legitimate, authenticated, and endorsed. We’ve had some cases in which people bought electrical items and ended up having fires at home, or food items that led to food poisoning or sickness. This can become a life-threatening risk, in some cases.
Around 2nd half of the year, we’ll be launching a Virtual CR that is granted to one person, a Bahraini who owns and operates him or herself. It’s not for companies, and they’re not allowed to employ others. Once the business grows, they can turn it into a company. An example could be professional photography. Somebody who has a camera gets a job, and he’s a freelancer. Again, you could do that on your own, but just to lend greater legitimacy and authenticity for people seeking their services, business owners like these would be backed up with official documents declaring they’re qualified for the job.
What, if I may ask, is the reasoning behind not allowing this for non-Bahrainis?
There’s no reason. We want to consider it a test-pilot project. This is why we’re doing it for only 12 activities at the beginning. We want to see how the market accepts it.
The objective is to create a conveyor-belt. You could start with a virtual CR, convert into a company with 3-5 employees, then go up to 20-30 then open branches abroad through raising capital by going public.. You achieve that, and it’s a success story that motivates others.
What were some of the challenges you faced as a businessman before becoming a minister?
My biggest frustration was not getting a clear answer in a timely manner. I think, generally speaking, all human beings like to have clarity. When I first came to this job, the message I tried to imprint upon the team was: you have to respond.
OUR GRANDPARENTS AND THEIR PARENTS TRADED WHEN THERE WAS NO INFRASTRUCTURE, FACILITIES, LOANS, GOVERNMENT, OR COMMUNICATION. THAT DIDN’T STOP THEM.
Which areas and industries do you encourage young entrepreneurs to get into? What do you think are the untapped markets?
As a ministry, we would like to encourage industry, especially export-based industry. We want to use that to create jobs and add value to the economy through the export of Bahraini products.
Tourism is a huge growth sector for us. Shortly, we’ll announce our new tourism strategy & identity for Bahrain which, Inshallah, will give us a new start. We believe tourism will be a huge employer of Bahrainis in the future, and you’ll see a lot of relevant employment created through tourism.
Any final messages for entrepreneurs?
In general, I’d say go back to your entrepreneurial roots. Our grandparents and their parents traded when there was no infrastructure, facilities, loans, government, or communication. That didn’t stop them.
Thank you for this opportunity.
This is also available in Arabic if you'd like.