Endorsing the Kingdom's reputation of driving economic openness within the Gulf Cooperation Council region, the World Economic Forum's Enabling Trade Index ranked Bahrain's economy the second most open in the Gulf.

The index, which rates a total of 118 countries worldwide on how well they facilitate the free flow of goods across borders, rated Bahrain's economy above fellow GCC States of Qatar, Oman, Saudi Arabia and Kuwait confirming Bahrain's position as a regional leader in international free trade.

The report placed the Kingdom 37th in the worldwide rankings.

Shaikh Mohammed bin Essa Al Khalifa, CEO of the Economic Development BoardEconomic Development Board of Bahrain said: "I am proud that the World Economic Forum has recognised the Bahraini economy's leadership's commitment to free trade. The Government of Bahrain is strongly committed to promoting free trade while simultaneously maintaining a strong regulatory system that is attractive to corporations from across the world. Together this will see Bahrain increasingly becoming the location of choice in the Gulf."

Crucial to Bahrain's recent success in this sphere has been the Free Trade Agreement (FTA) with the USA, which was signed in 2006 and resulted from long established commercial and diplomatic relations with the United States. This was the first of its kind trade pact between Washington and any GCC State. The deal was fast-tracked in record time only taking two and a half years from start to finish.

The FTA not only reaffirms Bahrain's open market policies by liberalising trade in goods and services, it also gives companies investing in Bahrain a competitive advantage. This is shown by the 46.5 per cent increase in Bahrain's exports to the USA in 2006 following the agreement coming into effect. Under the FTA the Bahraini economy exports a vast range for products to the US - the top five being methanol, aluminium, garments, textiles and clothing. Major corporations such as the Bahrain Petroleum Company, Alba Aluminium Bahrain and Manama Textile Mills are already feeling the benefits of the agreement. He said the Free Trade Agreement with the United States was vital to Bahrain's future economic growth. "US corporations are recognising Bahrain as a gateway to the Gulf region while companies seeking to trade with the United States can see the benefits of locating in the Kingdom."

In addition to the FTA with the USA, Bahrain, as part of the GCC, has signed FTAs with Singapore, Switzerland, Norway and Iceland this year and was currently in negotiations with major economic players including the European Union, China, Japan, India, Brazil and Australia.

Underpinning Bahrain's free economy as a well developed regulation system, the Central Bank of Bahrain recognised as the region's foremost regulator offers business-friendly regulations to international standards. Corporate accounting also follows International Accounting Standards and all the major international firms are represented in the Kingdom.

The Bahrain Economic Development BoardEconomic Development Board formulates and oversees the economic development strategy of Bahrain, creating the right climate to attract direct investment into the Kingdom.

The Board is also responsible for attracting inward investment into Bahrain, and is focusing on six target economic sectors in which the Kingdom offers significant strengths financial services, downstream industries, tourism, business services, logistics and health, education and training.

By K.V.S. Madhav

© Bahrain Tribune 2008

 

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