The Ministry of Finance and National Economy has released the Bahrain Economic Quarterly Report for the second quarter of 2023, which is available on their website at www.mofne.gov.bh.
According to preliminary data from the Information and eGovernment Authority (iGA), the Kingdom of Bahrain achieved a year-on-year (YoY) real gross domestic product (GDP) growth rate of 2.0% in the second quarter of 2023. This growth was supported by a 2.0% increase in the non-oil sector and a 2.2% increase in the oil sector.
The report highlights the crucial role played by non-oil sectors in driving economic growth in Bahrain. The continued growth and diversification of the economy resulted in the non-oil sector contributing 82.9% to real GDP in Q2 2023.
Several non-oil sectors demonstrated notable growth:
- Transport and Telecommunications: This sector experienced the fastest growth at 13.3%, driven by increased cross-border mobility. Key indicators included a 52.4% YoY growth in container vessel traffic, a 20.2% YoY increase in passengers at Bahrain International Airport, and a 12.8% YoY rise in mobile subscribers.
- Hotels and Restaurants: This sector saw growth of 9.6%, with a 29.3% YoY increase in guests at four and five-star hotels, leading to an 8% boost in occupancy rates.
- Real Estate and Business Activities: This sector recorded growth of 4.9%, primarily due to a significant 19.0% YoY increase in the value of real estate trading.
- Financial Corporations: This sector contributed 17.3% to GDP and achieved YoY growth of 4.7%. Indicators, such as the total value of the Electronic Funds Transfer System (Fawri+, Fawri, and Fawateer), increased by 12.4% YoY.
- Trade: The trade sector experienced a real-term growth rate of 4.7% in Q2 2023. Key metrics included a 20.7% increase in total mall footfall and a 5.2% growth in the value of point-of-sale (POS) and e-commerce transactions.
- Manufacturing: Although the manufacturing sector saw a slight decline of 0.9% during Q2 2023, this was attributed to a drop in global aluminum prices.
Additionally, the report noted a significant influx of foreign direct investment (FDI) during the quarter, surpassing BHD 1.3 billion. This brought the total investment balance to BHD 14.7 billion, marking a YoY growth of 13.9% from BHD 13.0 billion in Q2 2022. The financial and insurance services sector received the highest increase in FDI inflows, with BHD 982.9 million, while the real estate activities sector recorded BHD 129.2 million in FDI.
These indicators collectively reflect Bahrain’s positive economic performance and the ongoing diversification and growth in various sectors of the economy.
