Major Bahrain road projects face delays - Minister

At least eight major road projects in Bahrain are facing delays because of the impact of the global economic crisis, it was reported on Sunday.

Bahrain's government is looking for private money to pump into massive infrastructure projects costing up to BD400 million, said Works Minister Fahmi Al Jowder in comments published by Gulf Daily News.

But he added that the ministry was committed to pushing the projects ahead, because infrastructure developments were vital to the country's economic growth.

It is exploring an array of finance options such as sukuks (Islamic bonds), private partnership and full privatisation, such as of the sewerage network, the paper reported.

He told the paper the ministry was seeking contributions from private developers, similar to those in the cases of Bahrain City Centre, where developers contributed around 25 percent of the total road projects in the area and the Bahrain Bay developer's financing of the flyover into the development.

The ministry is also discussing with the Finance Ministry the option of creating a specific fund for infrastructure projects, he added.

"I believe that even in crisis situations you need to spend on infrastructure," Mr Al Jowder told the paper.

"First, it will stimulate the economy so that you avoid getting into recession and you will probably get it done cheaper than you anticipate (since contracts and materials may cost less)."

Al Jowder said the financial crisis was a major factor in delays to eight projects, but it was premature to say how far they would be set back.

"For most of the projects we are trying to see how we can fund with private money. There is an appetite in the market, finance institutions are more willing to fund governments than individuals nowadays and this is probably an advantage we are trying to use to approach financial institutions," he said.

Projects facing delays because of the cash crunch include the King Faisal Highway upgrade, Mina Salman junction upgrade, Alba Roundabout/Nuwaidrat upgrade, Juffair Ringroad, Muharraq Ringroad, Northern Manama Causeway (to the planned Northern Town), the Shaikh Khalifa bin Salman Highway Interchange and the approach road to Al Salam Resort.

The total cost between them is BD350m-BD400m, said Al Jowder.

Most of the projects facing delays were scheduled to be completed before 2011.