Bahrain’s growth plan faces regional challengers

Significance

Manama exceeded its own fiscal and economic expectations in 2022, as the budget came close to balance one year earlier than targeted and real non-oil GDP surged by 6.2%, driving the fastest overall growth for almost a decade.

Impacts

• Reduced tensions with Iran will limit the perceived political risk for potential foreign investors.
• Fiscal outcomes will remain heavily dependent on volatile oil prices despite revenue diversification.
• Efforts to localise the workforce will increase as fiscal pressures curb the public-sector payroll.