Virus’ economic impact

TDT | Manama

The real growth of Bahrain’s oil sector had contributed to mitigating the repercussions of the coronavirus (COVID-19) crisis during the first quarter of this year, according to the Kingdom’s quarterly economic report.

The report was reviewed yesterday during the regular weekly Cabinet session, chaired by His Royal Highness the Prime Minister Prince Khalifa bin Salman Al Khalifa and attended by His Royal Highness Prince Salman bin Hamad Al Khalifa, Crown Prince, Deputy Supreme Commander and First Deputy Premier.

The report, presented by the Minister of Finance and National Economy, reflected the local economy’s performance and the main economic indicators of vital sectors, in the midst of the spread of the coronavirus since the beginning of this year.

It stated that the oil sector grew by 1.8 per cent at constant prices, while the non-oil sector, where the repercussions of the pandemic were more evident, recorded a decline in annual growth of 1.7 per cent at constant prices. Bahrain’s economy recorded a year-on-year real gross domestic product (GDP) decline rate of 1.7 per cent in Q1, the report added.

The performance of the nonoil sectors varied during Q1 of this year, with the manufacturing sector achieving positive real growth of 4.8 per cent, followed by the social and personal services sector which went up by 1.3 per cent, then the construction sector which posted a growth of 0.3 per cent.

Regarding the financial projects sector, which is the largest non-oil sector contributing to Bahrain’s GDP, figures showed that it had contributed by only 16.7 per cent, marking a decrease of 1.6 per cent. The hotel and restaurants sector recorded the largest decline of 36 per cent at constant prices, and the transportation and telecommunications sector also declined by 6.3 per cent.

The tourism and aviation sector was also affected by the restrictions imposed on travel, and the government services sector also recorded a decline by 2.9 per cent. The same was true about the real estate activities sector, as well as the business services and trade sectors, with both posting a decline by 0.4 per cent and 0.1 per cent, respectively.

Bahrain-US agreements, initiatives approved The Cabinet approved a letter of agreement between the Kingdom and the US, within the framework of training programmes between the two friendly countries in the field of combatting terrorism and the cooperation between competent authorities in this regard.

The session also approved the joint statement between Bahrain’s Interior Ministry and both the US Department of Homeland Security and the US Customs and Border Protection, to develop the International Expedited Traveller Initiative. The Ministerial Committee for Legal and Legislative Affairs recommended the approval of the initiative.

The session further approved a memorandum of cooperation between the Interior Ministry and the US Customs and Border Protection, which aimed to enhance cooperation between the two sides in the exchange of information and data on travellers.

School re-opening plan should take students’ health, interests into account HRH the Prime Minister gave directives to ensure that the plan to re-open public and private educational institutions should be based on the expected situation of COVID-19 spread, while taking into account students’ interests, safety and the right to continue their education.

The Supreme Council for the Development of Education and Training, chaired by Deputy Prime Minister HH Shaikh Mohammed bin Mubarak Al Khalifa, was requested to take the necessary procedures to achieve that goal.

Directives to study situation of overseas Bahraini workers HRH the Premier gave directives to the Ministry of Works and Social Development to coordinate with the relevant authorities and study the situation of laid-off Bahrainis who had been working overseas and have returned home, and those who cannot return to their work abroad because of the current circumstances.

Some LMRA fees to be reduced Based on a recommendation by the Government Executive Committee, led by HRH the Crown Prince, the Cabinet approved a decision to reduce some fees imposed by the Labour Market Regulatory Authority on all kinds of work permits for one year, and all monthly fees related to them by 50 per month for three months, starting from this month.

Meanwhile, business owners who are involved in commercial activities that have been most affected by the impacts of COVID-19, as will be determined by an edict by the Deputy Premier and Ministerial Committee for Financial and Economic Affairs and Fiscal Balance chairman, will be exempted from those fees for the same three-month period.

The measures aim to maintain sustainable growth, in general, and achieve the stability of the labour market for Bahrain’s small and medium-sized enterprises, in particular. Future Generations Reserve Fund’s report, financial statements approved The Cabinet approved the Future Generations Reserve Fund’s annual report and audited financial statements for the fiscal year ending December 31, 2019, ahead of its referral to the Representatives Council.

The report, presented by the Finance Minister, showed the fund’s returns have increased by 17.3 per cent over the past year, its assets have amounted to $918million, and investment revenues have reached $79million, marking an annual growth of about 10 per cent.