43713
Bahrain Losing Appeal for Doing Business
World Economy

Bahrain Losing Appeal for Doing Business

On June 14, a court in Bahrain ordered the main opposition party Al Wefaq to be closed and its funds seized, following a request by the justice ministry. The surprise decision is likely to spell further trouble for the Persian Gulf island nation’s economy.
The country, home to the US Fifth Fleet, used to have a thriving business sector. Indeed, until the rise of Dubai, it was considered the pre-eminent financial hub for the region. Today it is a place that international businesses tend to avoid. In a report on the country issued on June 10, ratings agency Standard & Poor’s said there had been a net outflow of foreign direct investment of 6% of GDP last year and the banking system has shrunk by 25% since 2008, Forbes reported.
The economy has been struggling in the low oil price environment that took hold in late 2014 and the country has been repeatedly downgraded by the main ratings agencies over the past couple of years, taking it into junk status. With oil revenues sliding, but with high spending commitments to maintain, the government has had to resort to issuing debt and leaning on its richer Persian Gulf Arab neighbors for support.
Even before the latest clampdown, the outlook was already rather bleak. Earlier this month the World Bank cut its forecast for GDP growth this year to 2.2%, compared to the 2.7% it had predicted in January. The economy is set to slow further in the following years, with the World Bank forecasting growth of 2% in 2017 and 1.9% in 2018.
Further repression, and with it the likelihood of further protests, means the country will become even less appealing as a place to do business.
The country’s current political problems date back to 2011, when the region was in the grip of the Arab Spring protest movement. Pro-democracy activists took to the streets of the Bahrain capital Manama, but were forcefully suppressed with the help of troops from Saudi Arabia and the UAE.

Short URL : http://goo.gl/TYXRfE
  1. http://goo.gl/wxQNwB
  • http://goo.gl/rMw6EX
  • http://goo.gl/Xj1ltZ
  • http://goo.gl/va8KYp
  • http://goo.gl/o9tvDj

You can also read ...

Business confidence fell to its lowest level since August 2013 and around 7% of companies expected a contraction.
According to data from the International Monetary Fund in...
China Warned of Ballooning SOEs
Former chief of the World Bank Robert Zoellick cautioned China...
Shrinking unemployment in the US, Japan and the eurozone finally forces companies  to lift wages to retain and attract staff.
Workers in the world's richest countries are getting their...
New Zealand Q2 GDP Growth Picking Up
New Zealand’s economic growth is expected to have accelerated...
Saudi Sovereign Fund Secures $11 Billion Loan
Saudi Arabia's sovereign wealth fund said Monday it had...
Lira Eases Against Dollar
Turkey’s lira weakened against the dollar on Monday as...
By 2025 more than half of all current workplace tasks  will be performed by machines.
Robots will handle 52% of current work tasks by 2025, almost...
Myanmar Businesses Want Lower Taxes
Myanmar businesses are urging the government to lower the...

Trending

Googleplus