The Bahrain Economic Quarterly by the Bahrain Economic Development Board (EDB) forecasts that sunny days are ahead and predicts strong economic growth in the coming months. Despite suffering in the first quarter, due to a one-off maintenance-related reduction in oil production, the economic outlooks look favorable.
The construction sector has since accelerated remarkably after experiencing slow growth in 2017. As construction has been a prominent driver for growth in non-oil sectors, suggesting that manufacturing, trade, financial services and real estate sectors are to benefit from this within the coming year.
The year may not be over yet, and the country has yet to experience a surge in growth due to high lending activity. Retail banks have seen a considerable increase in activity over the past year, with the majority of new loans going to the private sector. Companies in the Kingdom can expect to benefit from the favorable regional backdrop with headline growth accelerating from last year.
Commenting on the report, Dr. Jarmo Kotilaine, Chief Economist, Bahrain Economic Development Board, said: “While growth in Q1 2018 reflected a one-off maintenance-related contraction in the oil sector, the broader economic data underpins our confidence in likely full-year growth. The stronger regional growth dynamics, a benign liquidity situation in the banking sector, the renewed expansion in the construction sector and implementation of a large infrastructure project pipeline suggest growth is likely to accelerate over the course of the year as a new phase of construction growth helps to support activity across the economy.”