Tuesday 23 July 2024

Bahrain real GDP grows 3.9pc in 2012

Manama, May 20, 2013

Bahrain's real gross domestic product (GDP) is estimated to have expanded 3.9 per cent last year from the 1.9 per cent growth seen in 2011, according to a new report.

Even as the oil sector shrank by around 8.5 per cent in 2012 due to a temporary technical disruption at the country's main Abu Sa'afa oilfield - expected to return to full capacity this year - strong growth in the non-oil sector drove economic momentum, said the research report by Global Investment House.

Bahrain's economy is expected to grow by 4.2 per cent this year, the Gulf Daily News quoted the report.

In the first three quarters of last year, Bahrain's economy grew at an annual pace of 3.7 per cent, while headline growth rate slowed steadily from 4.8 per cent year-on-year in the first quarter to 2.9 per cent in the second, and 3.3 per cent in the third.

Moderate expansion in oil production and a recovery in the services sector will maintain the economic growth at around 3.7 per cent during 2013-15, the report said, and added that last year saw a rapid growth in non-oil sector.

Non-oil GDP rose to an expected 6.7 per cent in 2012 compared to 1.4 per cent in 2011.

The national accounts data for 2012 point to a relatively consistent increase in production virtually across the non-oil economy of Bahrain.

According to the report, the fastest growing sectors have been hotels and restaurants, followed by social and personal services and manufacturing.

In 2011, Bahrain recorded a trade surplus of $7.5 billion, the highest in last seven years, it said. The impetus for a high trade surplus was an increase in oil production, coupled with high oil prices.

In December 2011, Bahrain achieved the highest ever crude oil production of 45,900 barrels per day. As a result, oil exports which constitute 78.8 per cent of the total exports witnessed a growth of 52.2 per cent in 2011 over 2010.

Bahrain reported a fiscal deficit for the third consecutive year in 2011. However, fiscal deficit has reduced by more than half to reach 3.2 per cent of GDP in 2011 against 9.4 per cent of GDP a year earlier.

The fiscal deficit narrowed due to a surge in revenues, primarily oil revenues, which constituted 87.9 per cent of the total revenues in 2011.

Inflation in Bahrain dropped in the second half of 2012 after it surged in the first half of the year. The increase in the first half was primarily due to base effect of low or negative prices witnessed in 2011.

Average inflation in Bahrain accelerated to 2.8 per cent in 2012 compared to a 0.4 per cent fall in 2011. Inflation is expected to remain at 2 per cent to 2.6 per cent in 2013-14, supported by easing prices of commodities, particularly food items.

Thereafter, inflation is expected to remain stable despite prices for global industrial raw materials rise, as maintenance of subsidies will keep the increases in check. – TradeArabia News Service

Tags: Bahrain | economy | Oil | GDP | non-oil | 2012 | trade surplus |

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