Cabinet Ministers outline Bahrain’s economic reforms on BTV

Manama, Jan. 19 (BNA): Government ministers have said that the financial challenges posed by the global decline in oil prices requires the Government of Bahrain to increase revenues and reduce expenditure. Adding that the objective can only be achieved through effective collaboration between public and private sectors, and constructive cooperation between the executive and legislative branches. And that the main priorities of the reforms are to deliver higher standards of living and ensure citizens’ aspirations are met. Whilst participating in a talk programme hosted by Bahrain TV on Tuesday evening, government ministers said that despite the difficult challenges ahead, they are confident their objectives can be achieved. The ministers noted that all oil-exporting nations are facing fiscal challenges, but that Bahrain’s investment environment will be boosted by the Gulf Development Programme and large-scale infrastructure investment worth over $32 billion. They agreed that Bahrain’s past diversification efforts have created a robust economy, noting that 80 per cent of GDP comes from non-oil sectors, and that in spite of the challenges faced, Bahrain is capable of maintaining its sustainable development. The ministers who took part in the BTV programme included: · Shaikh Ahmed bin Mohammed Al Khalifa, the Minister of Finance · Isam bin Abdullah Khalaf, the Minister of Works, Municipality Affairs and Urban Planning · Bassem bin Yagoob Al Hamer, the Minister of Housing; and · Zayed bin Rashed Al Zayani, the Minister of Industry, Commerce and Tourism · Isa bin Abdulrahman Al Hammadi, the Minister of Information and Parliamentary Affairs ‫ Finance Minister: Eliminating the deficit The Minister of Finance said that the government’s comprehensive economic and fiscal reform programme aims to create high-quality employment opportunities and maintain low unemployment throughout the Kingdom, whilst eliminating the deficit over the next three to four state budgets. In addition, the programme will reduce dependence on oil revenues, in line with the Kingdom’s past diversification efforts. The Minister said that the government would continue its implementation of the Government Action Plan and give priority to projects that directly improve citizens’ lives. He added that around $3.15 billion has been allocated to projects in the Northern City and Hidd East, and to a power grid project scheduled to start later this year. Shaikh Ahmed added that the Gulf Development Fund, which consists of $7.5 billion infrastructure investment, would contribute to the development of the energy, housing, health, and education sectors. The allocation of investment includes: 31.43% to housing projects; 17.17% to electricity and water infrastructure; 11.08% to roads and sanitation services; 2.81% to health; 1.13% to education services: 0.83% to social development and 0.43% to industry. He pointed out that combined public and private infrastructure investment due to take place in the Kingdom amounts to over $32 billion. In regards to reducing expenditure, Shaikh Ahmed noted that government task forces have submitted proposals to achieve 30% savings. He added that the government would continue to provide direct and indirect subsidy support worth approximately BD1 billion per year, for electricity, water, food, higher education and housing services. Minister of Information and Parliamentary Affairs: Cooperation with legislative branch vital component of reforms The Minister of Information said that addressing the Kingdom’s fiscal challenges requires strong cooperation between the government and the legislative branch. The minister pointed out that the government has continually worked with the legislative branch to implement economic and fiscal reforms, and that the government’s large-scale infrastructure investment will contribute to enhancing living standards and further diversify the economy. The minister also highlighted the role of the Labour Fund (Tamkeen) in enabling Bahrainis to improve their skillsets through training programmes, as well as Tamkeen’s grants to start-ups and small and medium-sized enterprises. Al Hammadi said that Tamkeen would disburse BD66 million during 2016, following grants of almost BD52 million in 2015. The minister also added that the government has developed a series of laws that will contribute to the strengthening of the Kingdom’s economic environment and stimulate investment. They include laws related to the recommencement of stalled property projects, the establishment of industrial areas and the streamlining of commercial registration processes. The minister added that the government was studying additional laws and projects that will be presented to Cabinet in the near future. Minister of Works: Allocation of $4.3 billion for roads and sanitation projects The Minister of Works, Municipal Affairs and Urban Planning set out the allocation of funds that will be directed to road and sanitation improvements within the Kingdom. With a total fund of $717 million for road improvements, the Minister stated that agreed allocations include: · $250 million for the second phase of the ring road in Muharraq · $250 million for land reclamation in Sitra West · $196 million for roads in Northern Town · $138 million for the development of Shaikh Jaber Al Ahmed Al Sabah Highway · $90 million for the expansion of the Shaikh Zayed Road · $34 million for Shaikh Khalifa bin Salman (in Hamad Town) · $9 million for the first phase of the ring road in Muharraq Sanitation projects have been allocated a total of $394 million, including: · $229 million for Phase Four of the Tubli project · $165 million for the Northern Town He added that the ministry was working on further stimulating economic activity by making it easier to issue permits for real estate development projects and power connection procedures. Minister of Labour: Government working to achieve balance between the needs of private sector and opportunities for citizens The Minister of Labour said that the Bahraini private sector workforce increased by more than 8% between 2011-2015, and that the unemployment rate in the Kingdom was less than 4%. He added that the government was working to achieve a balance between the needs of the private sector and opportunities for the Kingdom’s citizens. The minister pointed out that the government has continued to issue laws and launch projects that increase the number of Bahraini workers in private institutions. He also noted that women made up 40% of the Bahrainis in the workforce, which demonstrates the significant improvement in women's employment opportunities. The Minister also said that the government is committed to providing services that boost citizens’ skills and enable them to successfully compete in the labor market. Minister of Housing: BD2 billion allocated to housing projects The Minister of Housing said that housing was a key priority within the Government Action Plan and that housing continues to benefit from a large proportion of government expenditure. He added that BD2 billion had been allocated from the Gulf Development Fund to support housing projects, and that the ministry allocated more than 4,000 housing units last year. The minister also noted that work is underway to hand over the remaining housing units already built. Minister of Industry: Tourism sector will grow by 9% this year, with revenues up to BD 294 million The Minister of Industry said that the tourism sector would grow by 9% this year and that the ministry was currently preparing a comprehensive tourism plan for the Kingdom. The Minister said that tourism revenues reached BD 294 million increasing 9% from last year. He added that the Kingdom received over 11 million visitors last year reflecting an 11% increase from last year. The Minister highlighted that the tourism sector is one of the most important sectors in the Kingdom and that the Ministry is working on an integrated programme of events throughout the year, which includes the establishment of 13 new facilities and a specialised hospitality institute. Regarding industry and commerce, he said that a number of large-scale industry projects were underway in the Kingdom, including a new export centre. He added that the Bahraini economy is still growing with an increase of 9391 commercial registrations in 2015, totaling BD 257,434,231 in capital, which indicates the progress of economic development in the Kingdom despite the current economic conditions.