Bahrain ranks first in Middle East for cost competitiveness and FDI strategy


Bahrain’s capital Manama has been named as fifth amongst all-sized cities globally and first amongst small and mid-sized cities for FDI strategy in the 2021 ‘Global Cities of the Future’ index published by the Financial Times’ fDi Magazine. Both Abu Dhabi and Dubai similarly ranked in the top 10, with Abu Dhabi placing sixth and Dubai placing eighth.

Bahrain Economic Development Board chief executive Khalid Humaidan said: “In 2019, FDI stock made up 80% of our nominal GDP, which is double the world average. We are very proud of this achievement and for being recognised for our FDI strategy. What is more promising, is that three GCC cities have ranked in the top ten, highlighting the clear attraction for FDI in the region.”

Bahrain also enjoys an open and attractive economic and regulatory environment for international companies looking for a gateway to Gulf and Middle East markets. It has the lowest corporate and personal taxes in the Gulf, without any restrictions for free trade zones. 100% foreign business ownership is also permitted across more than 95% of all economic activities, eliminating the need to resort to a local partner in most cases.

The excellence of the country’s infrastructure is a further attraction. Bahrain offers a large, highly skilled pool of financial workers, a regulatory structure that is both advanced and well-regarded, and a physical connection to Saudi Arabia – by far the largest economy in the Gulf.

Despite increased competition from other trade centres in the Gulf, Bahrain rose 19 places on the World Bank’s ‘Ease of Doing Business index in 2020, ranking 43 out of 190 countries. There were a number of significant investments in 2020, by GCC, European and Asian companies across a number of important sectors – financial services, manufacturing, logistics and retail services, education, healthcare services, real estates, tourism and ICT.

On top of all this, Bahrain has just been ranked as the third happiest Arab country and 40th in the world, according to a United Nations’ ‘World Happiness Report’, produced by the Sustainable Development Solutions Network, with a point score of 6.227 – up 0.8 from last year.
The report asks a sample of people living in each country to rank their country out of 10 in six categories – levels of GDP, life expectancy, generosity, social support, freedom and corruption.

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