The construction sector in Bahrain is set to experience significant growth over the next few years, with a projected increase from $3.04 billion in 2024 to $3.73 billion by 2029. This growth is attributed to the government’s substantial investments in large-scale projects and recent labour market reforms that aim to enhance productivity in the sector. Despite facing challenges in 2020 due to the impacts of COVID-19 and declining oil prices, Bahrain’s construction industry remains attractive to investors due to its relatively low project costs compared to other Gulf Cooperation Council (GCC) countries and its “free zone” status that allows for full foreign ownership and unrestricted movement of profits and capital.
The Bahraini government has prioritized the construction sector in its 2021-2022 budget, allocating 600 million dinars ($1.6 billion) for infrastructure, housing, and other essential areas. Furthermore, the country’s economic recovery plan includes more than 22 major infrastructure projects valued at over $30 billion, with the development of five artificial islands being a notable feature. To advance these projects, public-private partnerships are expected to play a vital role, in line with the Vision 2030 policy that advocates for economic diversification, privatization, and workforce development to stimulate growth in infrastructure and industry.
In an effort to bolster the construction sector and drive economic growth, Bahrain has implemented various initiatives and reforms. These include the introduction of the Real Estate Regulatory Authority (RERA) to regulate the real estate market, as well as the establishment of the Construction Institute within the Ministry of Housing to enhance industry standards and practices. Additionally, the government has launched the “Build Bahrain” program, which aims to streamline construction permit processes and facilitate public-private partnerships to accelerate project implementation.
One of the key factors contributing to the growth of Bahrain’s construction sector is the country’s strategic location and well-established infrastructure, which provides easy access to regional markets. Bahrain’s status as a regional financial and commercial hub further enhances its appeal to investors looking to capitalize on the country’s business-friendly environment and diverse economic opportunities. With a focus on sustainable development and innovation, Bahrain is poised to attract new investments and partnerships that will drive the continued expansion of its construction industry.
As Bahrain continues to position itself as a hub for construction and infrastructure development in the region, the government remains committed to fostering a conducive business environment that supports industry growth and investment. By leveraging its strategic advantages and implementing targeted reforms, Bahrain is well-positioned to capitalize on emerging opportunities in the construction sector and drive sustainable economic development. With a clear vision for the future and a commitment to driving innovation and progress, Bahrain is poised to become a key player in the global construction industry in the years to come.
