December 2016 71 www.bahrainthismonth.com construction, food and retail are also growing,” he says. “However, oil-related industries have been affected due to the changes in the oil prices. Moreover, the small- and medium-sized enterprises (SME) sector as a whole has been negatively affected. “SMEs provide a wide range of goods and services and account for a significant part of the economic activity of the citizens and the many expatriates, which has a direct bearing on the well-being of all who live and work in the Kingdom. “The reduction of oil prices in the past few years has affected the pace of economic growth in Bahrain and other GCC countries, resulting in challenges for most enterprises, especially so for the SMEs. Where there are areas regenerating new SMEs, there are, on the other hand, many SMEs struggling, reducing in size or vanishing from the market.” He says a main achievement this year has been a new agreement between the BCCI and the MOICT that has been approved for electronically joining the membership directorate of the BCCI with the Commercial Registration at the MOICT. This has come as part of the two parties’ efforts in applying the new law, under which all CRs must register their membership (with BCCI) as a condition for issuing and renewing their CRs. “The BCCI is also working on a new ‘Investment Law’ which has already been drafted and we are currently seeking feedback from the different concerned authorities and their reviews for the law.” The BCCI has organised various important events tackling vital issues and subjects including VAT, ‘Re-invest in Bahrain’, the second Turkey–GCC Business Forum and the Business Environment in Bahrain event, to name a few. There are 24 committees representing each economic sector, and eight shared committees between the BCCI and other main authorities (services, ministries, parliament, etc) in Bahrain. Additionally, a total of 11 shared business councils are responsible for growing investments and exchanging business between Bahrain and a number of other countries such as the most recent Filipino–Bahraini shared Business Council. The number of Bahrainis employed in the private sector (101,198) is greater than the public sector (57,130), with a total number of 158,328 local employees in both segments, according to LMRA data as of the fourth quarter of 2015. To further strengthen the private sector economy, Mr Almoayed believes the nation should focus on diversifying away from oil and gas, and grow areas such as tourism, logistics, financial services, manufacturing and ICT. “Bahrain can focus more on attracting investors by promoting the business-friendly environment and improving the legislation and regulations,” he says. “The private sector can become the main partner to the government, working hand in hand on making decisions and driving the economy. Bahrain can also focus on moving towards a knowledge-based economy and cultivating SMEs, entrepreneurship and innovation as drivers to growth and solving unemployment issues.” Private Sector’s Investment for 2016 and Projections for 2017 Despite a slight slowdown in the construction and real estate sectors, a large pipeline of projects provides a robust underpinning for near-to-medium-term growth in the Kingdom. • Around USD6 billion of the GCC Development Fund has already been allocated to date and some USD3.7 billion worth has been tendered. Funds secured by various sectors: Housing: 35 per cent. Electricity and water projects: 22 per cent. Airport expansion: 14 per cent. Roads: 12 per cent. • With work having started on USD1.3 billion worth of projects, according to the latest quarterly report from the Bahrain Economic Development Board, the Kingdom’s overall pipeline of projects stood at USD72.3 billion by mid-December 2015, up 17.2 per cent from a year earlier. • Funded through a USD266 million grant from the late King Abdulla bin Abdulaziz Al Saud, the King Abdulla Medical City is expected to break ground by the end of 2016. The project, located in the south of the island, is designed by SaudConsult and will be operated by the Arabian Gulf University. Phase one of the project will include a 300-bed hospital, staff housing and mini shopping mall and is expected to begin in 2017. The hospital is expected to open by 2019. • Kuwait Finance House and Mabanee Real Estate Company signed a memorandum of understanding in February which funds the USD94 million The Avenues Bahrain project over a one-year period. The new shopping complex, located in Bahrain Bay, is expected to open in the first quarter of 2017. • Diyar al Muharraq expects its USD3 billion Marassi al Bahrain development to have its first residents within two years. The project is being developed by Eagle Hills Diyar, a joint venture with UAE-based Eagle Hills. The first phase of the project is estimated to cost USD1.2 billion and will include 480 seafront apartments, a shopping complex and luxury hotels built by The Address Hotels and Resorts. • Gulf Finance House has begun the site preparation work at the Harbour Row Development. The USD150 million mixed-use landmark project, located within the Bahrain Financial Harbour area, is expected to comprise luxury residential units as well as a commercial promenade.
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