|18 March, 2020

Bahrain annouces $11.3bln package to back economy

The majority of these initiatives will be funded through the CBB initiatives

Image for illustrative purposes. Central Bank of Bahrain official shows new BD$10 on first day of its release in Manama.

Image for illustrative purposes. Central Bank of Bahrain official shows new BD$10 on first day of its release in Manama.

REUTERS/Hamad I Mohammed

An economic package worth BD4.3 billion under eight initiatives has been announced by the government to offset the impact of the Coronavirus Disease (Covid-19).

The eight financial initiatives include a waiver on electricity and water bills for all accounts – including individuals and commercial – for three months and a delay of bank loan instalments for six months for those impacted by the virus.

The other initiatives include doubling the Liquidity Fund to BD200 million, withdrawing excess from the Unemployment Fund to support the wages of Bahrainis in the private sector, and exempting tourism facilities from tourism fees for three months among others.

Details of the unprecedented economic package were announced last night at a Press briefing chaired by Finance and National Economy Minister Shaikh Salman bin Khalifa Al Khalifa, Industry, Commerce and Tourism Minister Zayed Alzayani, Central Bank of Bahrain (CBB) Governor Rasheed Al Maraj, Labour and Social Development Minister Jameel Humaidan, and Electricity and Water Affairs Minister Wael Al Mubarak.

CHALLENGES

“These are extraordinary times that require extraordinary measures and as one team we can get through all the challenges,” said Shaikh Salman as he opened the conference, which was held at the Finance Ministry complex in Manama.

“The majority of these initiatives will be funded through the CBB initiatives and following approval from the legislative authority, also from funds – therefore they will not impact the deficit in the national budget.”

“These comprehensive financial and economic initiatives were launched to provide the necessary liquidity for the private sector in light of the current situation to combat Covid-19 and maintain sustainable growth.

“The Covid-19 outbreak is impacting world economies and the aim of these initiatives is to ensure Bahraini citizens are secure in their jobs and continue the economic wheel.

“The entire size of these programmes and initiatives to support the economy and the private sector is BD4.3billion that will steer the economy in the right direction.”

Shaikh Salman added that the eight initiatives will be further explained in the coming days.

Explaining the reprieve on utility bills, Mr Al Mubarak said that the package was worth BD150 million.

“The government will pay electricity and water bills for all accounts for the coming three months,” he said.

“This package is worth BD150m.

“The government will also pay municipality fees worth BD25m.”

Mr Humaidan, meanwhile, said that an urgent proposal will be sent to the National Assembly in a bid to withdraw money from the unemployment insurance fund in support of over 100,000 citizens in the private sector.

He explained that this will come at a cost of BD215 million as part of the economic package.

“An urgent proposal will also be submitted to the legislative authority to take excess from the unemployment insurance to support wages for the next three months,” said Mr Humaidan.

PACKAGES

“It will be used to support wages for the next three months and it will be worth around BD215m.

“More than 100,000 to 105,000 citizens working in the private sector will come under this package to support their wages and ensure job security.

“This will help us in this situation which requires extraordinary measures.”

Meanwhile, Mr Alzayani reassured the government’s full support towards the Small and Medium Enterprises (SMEs), stressing that the initiatives will directly target this segment.

He explained that the segment was progressing under the national initiative of the SME Development Board, which was being impacted by Covid-19.

“Now in the given Covid-19 situation, all of these financial initiatives will have a direct impact on SMEs, mainly on expenses of their payroll, utility, delay of loans and training from Tamkeen,” Mr Alzayani told the GDN on the sidelines.

“Some of them will also have an impact on industrial land if they happen to have a small plot of land, but that is not significant compared with the others.”

raji@gdn.com.bh

reem@gdn.com.bh

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