Business and operations
As a business-friendly hub for the GCC Market, Bahrain delivers a range of opportunities across various sectors including manufacturing, transportation and logistics, ICT & start-ups, financial services, and tourism.
Bahrain has a unique pipeline of US$32 billion in investment projects that will underpin long-term productivity growth. The SME sector is also sizeable, and plays a big role in the economy, contributing up to 35% of GDP by 2018. Bahrain offers investors access to a multi-trillion dollar economy by 2020, steadily closing the gap with the G-7 economies. Bahrain’s world-class business developments are home to some of the world’s leading companies such as Amazon, Mondelez, EY, IBM, BNP Paribas, DHL, Microsoft and Hewlett Packard.
Yes. In 2016, 40 new companies invested a total of $US281 million in Bahrain through the EDB. These companies are expected to generate 1,647 job opportunities over the next 3 years. This represents a two-fold increase over the $142 million in FDI attracted in 2015. The companies represent regional and international organisations, from India, China, the USA, and Germany among others.
17 companies specialise in manufacturing and logistics, 7 in financial services, 7 in leisure and tourism, 7 in professional services and 2 in information and communication technology. In terms of investments, the tourism sector attracted 75% of total investments whilst the manufacturing and logistics sector accounted for 15%, and the financial services sector a further 9%.
These opportunities are expected to increase in the coming years and Bahrain’s US$32 billion in mega projects will also spur economic growth.
Bahrain lies at the heart of the Arabian Gulf, with fast and efficient access to every market in the Middle East by air, sea and road. Major Gulf markets including Saudi Arabia, and the United Arab Emirates are all less than a one-hour flight away.
Saudi Arabia, the Gulf’s largest economy, is just one-hour away by road, which means Bahrain has the quickest access to KSA. Additionally, Bahrain’s cultural neutrality is unique in the Gulf. We have maintained warm relationships with our neighbours in the Middle East, from the UAE to Saudi Arabia, and, therefore, you will find doors are open to business and trade across the region.
Bahrain’s connectivity to the region is strengthened by the presence of prominent logistics providers, including DHL, Aramex, FedEx, among many others. Bahrain also offers investors the fastest time to market in the GCC due to our fast and efficient customs clearance procedures. Within the GCC, Bahrain has the shortest time and distance between the airport, seaport and causeway. All these factors render Bahrain as the GCC gateway hub to access key international markets.
Very competitive. Bahrain has one of the lowest business cost environments in the Middle East, with good value property, labour and the lowest taxes in the Gulf. Additionally, it has the lowest operational costs compared to other GCC hubs, and excellent value for money. The 2016 Cost of Doing Business Report by KPMG highlights Bahrain’s cost competitive standing across various indicators and sectors.
With the exception of trading, contracting and construction-related activities, and power generation, all sectors are open to 100% foreign ownership. This reduces set-up costs considerably since businesses do not have to use third parties to establish their businesses.
Bahrain has the following FTAs with their respective originating status requirements of value addition:
- Bahrain – GCC – 40% 2.
- Greater Arab States* – 40%
- GCC-Europe** – 40%
- GCC-Singapore – 40%
- United States – 35%
*Signatories of the Greater Arab FTA include: Bahrain, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, Palestine, Saudi Arabia, Sudan, Syria, Tunisia, UAE, and Yemen.
**Signatories of the Europe FTA include: Iceland, Liechtenstein, Norway, and Switzerland.
Communications infrastructure is world-class, fully developed and digitised.
The telecommunications sector was fully liberalised in 2004 and is among the freest ICT sectors in the region. The Telecommunications Regulatory Authority is mandated with promoting fair competition among established and newly licensed operators.
Bahrain has 6 cables, 4 of which are submarine fiber optic systems, and 2 of which are terrestrial dark fiber systems. Bahrain is connected to the rest of region by the Fibre Optic Gulf Cable and high-tech FLAG Falcon cable system. Bahrain’s fiber networks are still underutilised and will easily meet the growing demand for international connectivity by future investors for years to come.
Yes. Bahrain has excellent connectivity with the rest of the world. 34 passenger airlines and 15 cargo airlines fly from our world-class Bahrain International Airport. We boast 52 flight destinations worldwide and 2,095 flights a week. Gulf Air, Bahrain’s National Carrier offers the best regional connectivity with the highest number of flights within the region. There are daily flights to all GCC countries every day with flight times under an hour.
The $1.1 billion airport modernization program will be completed by 2020, with the new passenger terminal increasing air passenger capacity to 14 million passengers by 2019. Cargo volumes are also expected to increase from 219,000 tonnes (2015) to 1 million tonnes (2020), and consequently, to 2 million tonnes by 2027. The airport’s 2030 Air Cargo Development Strategy is focused on high-value cargo, value-added contractual logistics and distribution.
Bahrain is a multi-modal logistics hub with transport links that are among the best in the Middle East.
Bahrain has the infrastructure, with access to vital markets and advanced facilities such as Salman Industrial City, which includes Bahrain International Investment Park (BIIP) and Bahrain Logistics Zone (BLZ), the Middle East’s first multi-modal hub for value-added logistics and re-export.
The Kingdom invests heavily to meet growing demand and facilitate supply-chain throughput, with a pipeline of infrastructure projects worth USD $32 billion under way. These will help grow annual cargo capacity at Bahrain International Airport to 1 million tonnes by 2020, reduce import costs by up to 50% via the new King Hamad Causeway and shift 36% of freight traffic to the proposed GCC Railway.
Bahrain’s logistics sector has recently undergone significant reforms that have substantially improved the business environment. Established in 2015, the Bahrain Logistics Board has spearheaded efforts to enhance Bahrain’s regional competitiveness. Among its implemented and in the pipeline initiatives are the following:
- Known shipper status: Fast lane access to strategic export-oriented companies in Bahrain over the King Fahad Causeway on the Known Shipper Lane via the adjustment of border infrastructure/lanes & integrated IT solutionsFirst point of entry concept: Custom duties and lab testing at the first entry point only implemented across all GCC, to limit checking for exports and speed up movement of goods on internal borders
- First point of entry concept: Custom duties and lab testing at the first entry point only implemented across all GCC, to limit checking for exports and speed up movement of goods on internal borders
- Single window customs clearance system: New software interface to facilitate and streamline processes, allowing for e-payment, pre-clearance, authority approvals etc. and reduce overall lead times. Deployment expected by Q3 2017
- Road feeder service: Transportation of cargo from Bahrain Int’l Airport to Saudi Airport (Dammam) on a bonded transit system and sealed under guarantee for further distribution into KSA
- GCC fast lane: New GCC initiative underway with a 24 hours customs clearance fast lane for all perishable goods across internal borders within GCC
Businesses in Bahrain can set up wherever is most convenient for them. There are no ring-fenced free zones, meaning the entirety of Bahrain is a free zone.
Bahrain has excellent business infrastructure, including locations such as the Bahrain Financial Habour, Bahrain World Trade Centre, Bahrain International Investment Park, Bahrain Logistics Zone, and Bahrain Investment Wharf.
The Bahrain International Investment Park (BIIP) is a popular location for manufacturing facilities. It is a high quality 247-hectare business park developed by the Ministry of Industry, Commerce & Tourism (MOICT). It is situated in a location with excellent connectivity, private industrial zoned land, and access to both the Bahrain International Airport and the new Shaikh Khalifa Sea Port in Hidd. The BIIP also enjoys direct motorway access to Saudi Arabia, via the 25km Saudi-Bahrain King Fahad Causeway. The Khalifa Bin Salman Port, operated by one of the largest port operators in the world, APM Terminals, is a 5-minute drive from the BIIP They have an average clearance time of 7 hours per container and a total capacity of 1,000,000TEU.
In addition, the Bahrain Logistics Zone (BLZ) offers prime real estate close to KBSP. It is the region’s first boutique logistics area offering a high quality environment to companies that meet its tenancy requirements. It offers a range of benefits including 100% foreign ownership, multimodal access, flexible plot options, road network infrastructure, 24-hour customs services, one-stop-shop services with licensing and registration, end-to-end services, and basic services such as facilities and special waste management.
Another option for manufacturing facilities is to set up in Bahrain Investment Wharf (BIW). BIW focuses on light manufacturing. It offers both private land and leased prebuilt industrial units. The government also owns plots around the country that are available for lease by potential investors.
Education and skills
Three generations of modern higher education have given Bahrain’s men and women the opportunity to develop advanced skills and expertise. There are many international schools offering curricula from Europe, the US, Japan and India. In addition, Bahrain is reforming post-secondary education to support the needs of the economy and give Bahrainis more choice over the skills they want to develop. Bahrain has a tech-savvy population, highly qualified ICT workforce, strong entrepreneurial community that is of great value to investors looking to hire.
Life in Bahrain
Yes. According to the 2017 HSBC Expat Explorer Survey, Bahrain is ranked 9th globally for expat satisfaction, the only country in the MENA region to feature among the top 10 best places to live, work, and raise a family.
Bahrain has a distinctive island culture that both locals and expats find relaxing and fulfilling. From its beautiful coastline offering great water sports, to the vibrant restaurant scene, to the warmth of the traditional cultural events, to the café culture, art and music scene and spacious housing, Bahrain offers an excellent lifestyle proposition, especially for families.
The cost of living in Bahrain is highly competitive when compared to other GCC countries and this will continue with the proposals of the 2030 strategy to build Bahrain as an attractive business center. In fact, Bahrain ranks 9th on wage growth in the 2017 HSBC Expat Explorer Survey. Bahrain offers excellent value for money, coupled with a balanced lifestyle.
The EDB is an investment promotion agency, chaired by His Royal Highness the Crown Prince of Bahrain, with the overall responsibility for attracting investment into Bahrain and supporting initiatives that enhance the investment climate. EDB is the first point of contact for investors, delivering a world class, seamless experience and holistic support across the investor lifecycle.
We offer business case support, facilitation, and aftercare services. This entails identifying and connecting potential joint venture partners, providing information on sector-specific opportunities, as well as offering aftercare and expansion support. This ensures long-term satisfaction and project success.
Have additional questions? Our team is on hand to help answer them.