Bahrain’s real GDP growth reached 4.5% in 2014 according to the Bahrain Economic Quarterly (BEQ) issued by the Bahrain Economic Development Board (EDB) issued at the end of the first quarter, 2015.
The report examines the major economic indicators, and highlights Bahrain’s performance, indicating that the non-oil sectors rose markedly from the 3.0% rate recorded in 2013 to 4.9% in 2014.
Strong growth of 12.5% year on year was reported in the construction sector following the initiation of a number of major infrastructure projects in areas such as road transportation.
The hotels and restaurants sector has been a strong performer throughout 2014 having seen an overall expansion rate of 9.9% year on year. The sector benefited from a continued increase in visitor numbers to unprecedented levels. Partly in response, it has also seen significant expansion in capacity, with several new establishments opening in 2014.
Growth in the financial services sector reached 3.4% year on year in 2014 in a marked acceleration from the 2.3% pace recorded in 2013. The report further suggested that the retail-banking sector is in a position to accelerate lending due to high liquidity as loan-to-deposit ratios are less than 50%.
Even as the pick-up in growth was above all due to the clear acceleration in the non-oil space, the hydrocarbons sector also saw stronger growth than originally expected, expanding by 3.0% during the year.
The report projected that real GDP growth will be around the 4.0% mark over the coming two years, despite the challenging macroeconomic environment.