Bahrain has historically had the smallest projects market in the GCC, which is not surprising given it has the smallest economy and population of all the GCC states. However, with only limited oil and gas reserves of its own, its projects market has grown to be less dependent on the crude price, and therefore more capable of withstanding the bearish market.
It has also benefited from external funding. In 2018, the cash-strapped government turned to its neighbours for help, and received a commitment of $10bn from the UAE, Saudi Arabia and Kuwait. A number of infrastructure projects in the kingdom have been financed directly by the three allies over the past three years, and the renewed monetary assistance will also be used to help pay for key infrastructure schemes, providing some stability to the market.
The COVID-19 pandemic threatens to disrupt the Bahraini economy more than any other GCC state. Without and major oil output to fall back on, and with tourism – particularly from Saudi Arabia – collapsing, the economy will not survive without government intervention. In late March, the government did just that by announcing a $11.3bn stimulus, equivalent to almost 30% of the kingdom’s total GDP.
However, even with this financial support, it is hard to see how the projects market in Bahrain won’t be affected severely by the coronavirus. This is reflected by the revised forecast which predicts that just $1.6bn worth of contracts will be awarded this year as a result of the pandemic, which would push the kingdom into a 10-year low.
Bahrain Projects H1 2020 is the update to last year’s H1 report. Focused on data, it is aimed at helping companies create strategies for targeting and growing the market. It uses almost exclusively data from MEED Projects, the region’s leading online projects tracking service. With 15,000 active projects tracked and more than 35,000 in total in the database, MEED Projects makes it possible to quantify current, historical and future trends in the projects market in the region.
All the MEED Insight reports are delivered via email in digital version.