MANAMA — Bahrain's non-oil sector, which constitutes more than 80 percent of Bahrain's GDP, saw strong growth at 5.0 percent in the first quarter of 2015, the latest Bahrain Economic Quarterly (BEQ) issued by the Bahrain Economic Development Board (EDB) revealed. Broad-based real GDP grew 2.9 percent on an annual basis, and strong labor market activity, with employment increasing by five percent compared with the same period last year. The social and personal services sector grew by 8.3 percent year-on-year, overtaking the hotels and restaurants sector as the fastest-growing sector. The social and personal services sector is primarily made up of private sector healthcare and education activities. The manufacturing sector also saw 5.9 percent year-on-year growth. Khalid Al Rumaihi, EDB chief executive, said “the report highlights the strong performance of Bahrain's non-oil sector, with growth coming in above our projections. This reflects Bahrain's diversification efforts over the past decade and the general resilience of the GCC economies at a time of doubts about the global recovery. Even as Bahrain's hydrocarbons sector experiences a decline due to seasonal maintenance, headline real GDP expanded by 2.9 percent and we continue to project robust growth throughout 2015 and 2016.” Despite global economic challenges, the report finds that forward-looking indicators point to a high degree of continuity in the regional non-oil economy, reflecting the strength of key structural growth drivers and the commitment of regional governments and investors to long-term projects. Strong growth of 7.5 percent year on year was reported in the construction sector, which is in line with the sector's momentum that became apparent in the second half of last year and reflects continued infrastructure activity. Growth in the transport and communications sector followed closely with a 7.3 percent year on year expansion. Moreover, infrastructure activity had a marked effect on the labor market, the report said. The increase in total employment occurred at its quickest pace since Q2 2013, and was driven by the private sector, which represented 89 per cent of the annual growth in total job creation during Q1. A fall in the unemployment rate was also reported in the first quarter of 2015, reaching 3.5 percent in March – a level last seen during Q3 2012. In spite of oil price volatility in the second half of last year, the country's fiscal performance also improved. Government revenues rose by 11 percent in 2014, and expenditures declined by 11 percent, the 2014 consolidated final accounts showed. — SG/Agencies
