The International Monetary Fund called on Bahrain to speed up addressing the financial imbalances caused by the restrictions of the economic closure, despite its praise of the government measures that contributed to mitigating the effects of the pandemic. Noting that Bahrain needs an urgent financial adjustment after the health crisis ends.
According to IMF experts, the Bahraini government should do more to reset its financial positions, even if it manages to gather additional regional support.
As for the GDP forecasts for 2021, it is expected that the recovery of Bahrain’s economy after the pandemic will be gradual, as economic growth will reach about 3.3 percent during the current year. These expectations reflect a rebound in the growth of the non-oil sector to 3.9 percent in 2021, as the widespread distribution of the vaccine boosts activity towards pre-crisis levels. The Bahraini Ministry of Finance expects to record a deficit in the current year's budget of 1.2 billion dinars (3.2 billion dollars), after it reached about 4.3 billion dollars in the previous budget.
Bahrain has accumulated debts very quickly since the decline in oil prices, while a financial aid program worth ten billion dollars from Saudi Arabia, the United Arab Emirates and Kuwait contributed to averting the credit crisis in 2018. The Bahraini economy was also affected by the outbreak of the Coronavirus, which prompted the government to approve a 4.3 financial stimulus package of 4.3 billion dinars ($11.4 billion) as a top priority to support the economy to face the repercussions of the pandemic.
Source (London-based Al-Arab Newspaper, Edited)
