And truth be told that Saudi and UAE’s accelerated implementations of their visions are helping fuel Bahrain’s high spirits and own ambitions.
Bahrain is well positioned to benefit from an expected trade boost brought about by the liberalization and economic growth of Saudi Arabia, Zayed Al Zayani, the country’s minister for industry, commerce and tourism told CNBC recently.
“By having a more liberal and accessible Saudi Arabia we all stand to benefit from that,” said Al Zayani.
“We already have a large industrial base in Bahrain that’s predominantly orientated to Saudi Arabia and the rest of the region.”
Bahrain’s National Oil and Gas Authority (NOGA) announced last week the launch of an energy fund that looks to raise $1 billion from institutional, domestic and international investors to develop the country’s energy assets, Kallanish Energy, an industry site, reported.
The fund will be open to investors in Bahrain, the Gulf Cooperation Council (GCC) and internationally, according to Kallanish Energy.
Bahrain announced last month an oil discovery off its west coast, estimated to contain some 80 billion barrels of tight oil.
Good news for Bahrain’s budget deficit which reached as high as 17.8% of GDP in 2016 and would be no less than 12% of GDP in 2018 as predicted by the International Monetary Fund (IMF).
Bahrain’s hydrocarbon-related revenue accounted for 75% of government revenues in 2017 and 55% of exports, figures sure to increase when exploration concludes.
Rating agency Moody’s reported that Bahrain has an oil output of around 198,000 bpd of which around 150,000 bpd comes from an offshore field that it shares with Saudi Arabia, a country that produces just around 10 million bpd.
Bahrain’s current account swung from surpluses averaging 8% of GDP in 2012-13, to deficits averaging 3.7 percent of GDP in 2015-17,” analysts told CNBC.
“The reserves have since recovered somewhat on the back of large sovereign external bond issuances, including $3 billion in international bonds in September 2017 and $1 billion in international sukuk (Islamic bonds) in April 2018.”
Bahrain’s dwindling foreign reserves stood at $2.8 billion at the end of November covering only 1.4 months of imports of goods and services and less than 10 percent of Bahrain’s short-term external debt, according to CNBC.