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Discuss this article (0 Comments)Bahrain banking on more than banks
by Shaikh Mohammed Bin Essa Al-Khalifa on Monday, 04 December 2006
For many years, Bahrain has been a pioneering force in the Gulf as a key regional trade hub - and it remains so as a strategic business centre. As a result of a series of major investments in a range of new sectors - mainly shipping, industry, tourism, science and technology – there has been a notable increase in the level of debate and interest in Bahrain’s economic strategy of diversification.
It was announced last month that a new seaport and industrial zone on the island - the Bahrain Investment Wharf at Hidd - will see nine companies committing more than US$5.1 billion to develop the area. The Wharf is actively attracting new industrial players not only to Bahrain, but to the region as a whole.
This is just one among many recent developments in the Kingdom. At the Economic Development Board we have committed to international partnerships to develop a science and technology park; announced a beachfront tourism development; and improved access to the world’s largest single market with the ratification of the first free trade agreement between the US and a Gulf state. By working in tandem with public and private sector agencies, the Economic Development Board and its partners have been able to maximise the opportunities available, develop effective working practices, and foster significant sector growth.
For those people who view us simply as a financial centre, this type of diversification may be regarded as new, but this is certainly not the case. We are proud of our 30 year heritage as the financial capital of the Middle East. Following the old maxim of ‘invest in strength’, we have continued to focus on attracting and retaining financial institutions. Earlier this year, we formed the Bahrain Financial Services Development Bureau (BFSDB), a body which will reach out to the financial community across the globe, ensuring we remain the destination of choice for banks and other institutions and continue to develop as a global centre for both conventional and Islamic finance.
However, our diversification strategy and innovative investment in long-term economic growth and stability runs much deeper than financial services alone. Bahrain has been a regional pioneer for generations and was the first nation in the region to diversify, successfully, from oil. We were already investing in new sectors – including financial services – in the 1960s and 1970s. Today, this has resulted in the Kingdom having the region’s most diversified economy, with approximately a sixth of our revenues from oil.
The diversification strategy is a futuristic strategy. We prefer not to depend on natural resources alone, and to reinforce one of our key strengths - in this case, our people. Bahrain boasts the most educated, hard-working and innovative people in the region. Thanks to the early and wise investments in education and schooling, many of our indicators are at the higher end of the scale. Most importantly, we have a workforce that is skilled in many different areas, and we continue to invest in skills and training programmes to ensure we maintain our regional leadership in the field of human resources.
We see strong Bahraini presence in financial services, as well as in the ‘support’ sectors needed to service such institutions, such as legal, professional services, IT and telecoms. There is also a strong presence in other sectors, such as aluminium production. We have the largest modern production facility in the world. This is not only a recognition of the opportunities in Bahrain, but also the flexibility of our workforce and its ability to service many different sectors.
In tourism, we are seeing the development of a healthy conference and incentive travel sector – backed by local talent and investment. Our plans for tourism growth are organic and sustainable – and play to our strengths of hospitality, authenticity and heritage.
Our strategic position at the heart of the Gulf is also being recognised. The causeway to Saudi Arabia will be joined soon by a connection to Qatar, which will provide another boost to industrial development. We are committed to further diversification. We are honing our environment to make sure we foster an ever more innovative approach to doing business. We are identifying and bridging regional skills gaps through targeted local training programmes. And we are developing the right climate needed to foster home-grown entrepreneurs, and then help them reach out to the international market.
It means there is every reason to bank on the future growth of Bahrain.
Shaikh Mohammed Bin Essa Al-Khalifa is chief executive of the Bahrain Economic Development Board
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