Preliminary data from Bahrain’s Information and eGovernment Authority (iGA) revealed that Bahrain achieved a two percent year-on-year (YoY) growth in real gross domestic product (GDP).
According to the report, the growth in Bahrain’s GDP was driven by a 2 percent increase in the non-oil sector and a 2.2 percent increase in the oil sector. Additionally, the report highlighted the significant role played by non-oil sectors in supporting economic growth. As the economy continued to grow and diversify, the non-oil sector’s contribution to real GDP reached 82.9 percent in the second quarter of 2023, as stated in the report.
Read more: Bahrain reports $1.01 bn budget deficit in H1 2023
The transport and telecommunications sector experienced the highest growth rate, reaching 13.3 percent, driven by increased cross-border mobility. Additionally, the hotels and restaurants sector grew by 9.6 percent.
In a related development, Bahrain witnessed a significant increase in the volume of foreign direct investment (FDI), recording a year-over-year growth of 13.9 percent. The FDI reached approximately 14.75 billion dinars (equivalent to around $40 billion), marking the highest level in the history of the Kingdom.
Budget deficit
In September, Bahrain reported a budget deficit of 381 million Bahraini dinars ($1.01 billion) in the first half (H1) of 2023.
Total revenues in Bahrain reached 1.44 billion dinars by June 30, while spending amounted to 1.82 billion dinars, which was 2 percent lower than the estimated amount. As a result, a fiscal deficit was incurred.
Furthermore, in June 2023, Bahrain’s Ministry of Finance announced that its overall budget deficit in 2024 is expected to narrow down to 161.4 million Bahraini dinars ($428.16 million) from a deficit of 520 million dinars in 2023. The latest budget statement shows that while total spending will remain at around 3.6 billion dinars for both years, total revenues are forecast to increase to 3.47 billion dinars in 2024 from 3.1 billion dinars in 2023, mainly due to an increase in oil and gas revenues.
For more news on the economy, click here.
