A government survey has revealed that 94.01% of investors expressed stability in Bahrain’s investment climate during Q1 of 2023.
The Business Confidence Environment Survey, conducted by Bahrain’s Information and eGovernment Authority, showed that the Business Confidence Index (BCI) rose by 1.85 points or 1.81% to 103.84 points in Q1 of 2023 compared to Q4 of 2022.
The survey measures business confidence by company size, industry, and investment type, and the overall business confidence increased to 28.35 points in Q1 of 2023.
The highest business confidence was observed in the category of administrative and support service activities, and medium-sized companies had the highest business confidence in terms of turnover.
Additionally, the highest business confidence of 42.38 points was observed in the administrative and support service activities industry, followed by accommodation and food service activities at 36.47 points.
Medium-sized establishments that have 51-100 employees reported the highest business confidence of 39.75 points, with small businesses having 5-50 employees in second place at 30.42 points, from the perspective of size.
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In terms of turnover, medium-sized companies with BD1m to favorable BD3 m have the highest business confidence of 33.25, closely followed by large firms with +BD3m at 32.84 points. Establishments with both inward and outward foreign investments have topped the business confidence index with 38.8 points in terms of investment type.
The paper further showed that during Q4 of 2022, nearly nine out of 10 establishments experienced stable/normal to favorable business performance, with 87.81% of them reporting such performance.
Diversified economy
Relatedly, the industry and commerce minister of Bahrain Abdullah Adel Fakhro recently emphasized the importance of diversification to the future of Bahrain’s economy during a trip to Japan. The minister stated that Bahrain’s economy cannot survive as a single-property economy and that the country has been seeking to become diversified, including in the financial services sector which has exceeded the oil sector in GDP for the first time.
The purpose of the minister’s visit was to grow Bahrain’s presence in non-oil sectors such as industry, ICT, medicine, aluminum, petrochemicals, food security, and tourism.
According to the minister, “Today, the economy has become highly diversified. In the past, 40 percent of Bahrain’s GDP was from the oil sector, whereas today it makes up almost 20 percent.”
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