Bahrain’s headline real growth rate increased sharply in the second quarter of 2018 to an annual rate of 2.4%, according to the Bahrain Economic Development Board (EDB).
Its Bahrain Economic Quarterly Report showed a significant acceleration of growth from the previous quarter, underpinned by both the normalisation of oil production and markedly faster non-oil growth.
The report also noted that the 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 below historical levels, it said.
The report added that business confidence has varied month to month while the growth of the non-oil sector has proved less pronounced that the expansion in the oil sector. This has prompted a number of governments to initiate economic stimulus programmes after a period of fiscal retrenchment.
The report also predicted that renewed regional spending power will drive growth in cross-border tourism as the Bahraini 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 total value of foreign direct investment is also continuing to increase with the total value of projects facilitated by the EDB in the first nine months of 2018 being 138% higher than a year earlier.