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MANAMA: Inflows of foreign direct investment (FDI) to Bahrain rose six per cent in 2018 to $1.515 billion taking a 4pc share of the national GDP, according to new data from the United Nations Conference on Trade and Development (UNCTAD).
The UN agency’s 2019 World Investment Report, an annual report that provides the latest data and projections on the state of global FDI, released yesterday shows that Bahrain was ranked sixth among 18 countries in West Asia in terms of volume of FDI inflows last year.
The growth of FDI in Bahrain came even as global FDI fell 13pc to $1.3 trillion.
UNCTAD noted that the growth of investment in Bahrain was bolstered by a number of economic reforms.
The $1.5bn is mainly due to growing interest in the manufacturing sector.
In 2018, both Mondelez International (the US) and Ariston Thermo Group (Italy) set up manufacturing facilities in Bahrain International Investment Park, a Special Economic Zone (SEZ).
The two companies were amongst 32 new or expanding businesses choosing Bahrain for their manufacturing, transport or logistics hub last year.
Bahrain is continuously developing the air, sea and road networks to facilitate the entry of imports, as well as reducing complexity of procedures, and the speed of the customs process means businesses can clear their goods in less than 24 hours.
The kingdom’s rich heritage as a trading nation, superior infrastructure connectivity and de facto status as the gateway to Mena are all qualities highly prized by overseas investors.
SEZs are the theme of WIR 2019, and their successful application by Bahrain is reflective of the kingdom’s use of innovative regulation more broadly. This includes the introduction of the region’s largest fintech hub, Bahrain FinTech Bay; its first regulatory sandbox that allows start-ups and entrepreneurs to test new products and services; and a commitment to encourage new ways of working such as cryptocurrencies, for which the Central Bank of Bahrain issued comprehensive regulations earlier this year.
This year investment promotion agency, the Economic Development Board (EDB) hosted the launch of the report, which charts global investment flows, analyses trade trends and examines government policies that seek to expand world trade.
“Foreign direct investment creates jobs, diversifies the economy and fuels growth, so we are delighted to see such strong momentum, even against a challenging global backdrop,” said EDB chief executive Khalid Al Rumaihi during the launch.
“The UN report is yet another affirmation of Bahrain’s growing attractiveness to investors from around the world. We are increasingly becoming an attractive investment destination in the Middle East, thanks to our ability to offer a flexible, agile and highly competitive economy, that is not only diversified, but also sustainable in the long-term,
“As overseas investment into Bahrain continues to grow, we must remain focused on what is attracting investors to the kingdom. Our ability to work collaboratively across public and private sectors to build a business-friendly environment is the foundation to our economic success, and will continue to be the number one draw for entrepreneurs, start-ups and multinationals alike.”
Mr Al Rumaihi added that Bahrain has “undertaken a number of significant initiatives in the first half of this year to build on this success and we expect to announce a number of further measures in the coming months, helping investors to access the GCC opportunity.”
Among prominent developments in 2018 has been the establishment of a $100 million Fund of Funds to help fund start-ups across the Middle East; and a growing number of companies using the Central Bank of Bahrain’s regulatory sandbox to develop new products and services.
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