Bahrain: Foreign investment at $1B for second year running

Published June 25th, 2015 - 11:32 GMT

Inward foreign direct investment (FDI) in Bahrain was nearly $1 billion at the end of last year, a report has found.

The United Nations Conference of Trade and Development’s (UNCTAD) World Investment Report 2015, launched regionally at the Ramee Grand Hotel in Seef yesterday, shows that FDI remained at a similar level in 2014 as in 2013, (2014: $957 million; 2013: $989 million), said a report in the Gulf Daily News (GDN), our sister publication.

As a percentage of GDP (55.4 per cent), Bahrain’s inward FDI stocks, which reached $18.8 billion last year, remained the highest in the GCC and well above the global average, emphasising Bahrain’s position as one of the region’s most open economies, Economic Development Board (EDB) chief executive Khalid Al Rumaihi said at the launch.

He was joined by UNCTAD division of investment and enterprise head Mohamed Chiraz Baly, who presented the findings of the report to representatives from the private and public sectors, as well as the media along with Mena Centre for Investment chairman Dr Zakaria Ahmed Hejres.

The event was hosted in co-operation with the EDB and the Mena Centre for Investment.

“There is no doubt that the region, and wider world, still faces a challenging economic climate, as businesses and governments continue to recover from the economic shock of 2008 as well as the current oil price environment, as illustrated by the investment flows outlined in this year’s World Investment Report,” Al Rumaihi said.

“However there are a number of structural drivers which give cause for a more optimistic long-term outlook in the region, including connectivity, increasing economic integration, and the demographic dynamics.”

Al Rumaihi also thanked UNCTAD for their efforts in preparing the global report, and highlighted that it has become an invaluable tool for policy makers.

The report says that global foreign direct investment fell by 16 per cent to $1.23 trillion last year, due to the fragility of the global economy, policy uncertainty for investors and geopolitical risks, as well as new investments being offset by some large divestments.

China became the largest recipient of FDI, and nine of the largest 20 investor countries were from developing or transition economies.

The shift towards FDI in services related sectors continued, due to increasing liberalisation and tradability of services, as well as the growth of global value chains in which services play an important role.

FDI into West Asia, which covers a number of countries in the Mena region including the GCC members, Turkey, Jordan and Iraq, also fell by four per cent to $43 billion, reflecting the global economic issues and ongoing security risks.

Turkey remained the largest FDI recipient in the West Asia region, whilst investment into the GCC remained “sluggish” despite continuing robust economic growth.

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