BMI View : Bahrain saw an uptick in construction over late 2014 and growth for the year came in higher than forecast , at a robust 7.3%. Growth prospects for 2015 and 2016 are more subdued, as government spending comes under increasing pressure from falling global oil prices and private investor interest remains hampered by ongoing political insecurity . The key focus remains on residential construction as Bahrain addresses the shortfall in social housing capacity, as well as transport infrastructure, particularly connections with neighbouring Saudi Arabia. These developments remain heavily reliant on external funding and as the GCC investment programme slows we expect growth in Bahrain's construction sector to stagnate over the latter half of the forecast period.
Latest Updates And Structural Trends
Bahrain's housing shortage means the government continues to focus on residential construction projects. In 2015 construction was ongoing on 3,895 houses in two housing projects in Northern City and East Hidd. The projects are part of the scheme that comprises construction of 25,000 units in the next four years under five housing projects throughout the country, including the East Sitra project, Southern Housing Project and Al Ramli Housing Project.
Air transport infrastructure, which has lagged behind other countries in the region, is attracting investment and the government has announced plans to build the country's second airport on a purpose-built island off the north coast. The country's existing airport, the Bahrain International Airport, is also undergoing expansion as a part of airport modernisation programme. The expansion plan, including construction of a passenger terminal, 24 airport bridges, arrival and departure lounges and loading bays, is scheduled to be completed in 2019.
Few energy or utilities projects are currently planned or under way, with the exception of some transmission extension and upgrade works. As such, growth in the overall construction sector will remain relatively subdued over much of the forecast period, rising from BHD0.82bn in 2015 to BHD1.30bn in 2024.
|e/f = BMI estimate/forecast. Source: Ministry of Finance, BMI|
|Construction industry value, BHDbn||0.78||0.82||0.87||0.93||1.00||1.04||1.09|
|Construction Industry Value, Real Growth, % y-o-y||7.30||2.23||3.01||4.26||4.31||1.36||1.41|
|Construction Industry Value, % of GDP||5.9||5.8||5.8||5.8||5.9||5.7||5.6|
Bahrain's Infrastructure RRI score has fallen from 53.6 out of 100 to 49.5 out of 100, resulting in the country falling in the Middle East and North Africa rankings.
The country's Industry Rewards profile has declined due to weakened economic growth prospects.
The country fares better for Industry Risks due to the maturity of the financial services sector and openness to foreign investment.
|Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
The Bahrain Infrastructure Report features BMI Research's market assessment and forecasts covering public procurement and spending on all major infrastructure and construction projects, including transportation and logistics by land, sea and air; power plants and utilities, and commercial construction and property development. The report analyses the impact of regulatory changes and the macroeconomic outlook and features competitive intelligence on contractors and suppliers.
BMI's Bahrain Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Bahraini infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Bahrain to test other views - a key input for successful budgetary and planning in the Bahraini infrastructure market.
- Target business opportunities and risks in the Bahraini infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Bahrain.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).
BMI Industry View
Summary of BMI’s key industry forecasts, views and trend analysis covering infrastructure and construction, regulatory changes, major investments and projects and significant national and multinational company developments. These are broken down into construction (social, commercial and residential), transport (roads, railways, ports, airports, etc), and energy & utilities (powerplants, pipelines and so on).
Industry SWOT Analysis
Analysis of the major strengths, weaknesses, opportunities and threats within the infrastructure and construction sectors and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (up to 2012) and forecasts to end-2024 for all key industry indicators, supported by explicit assumptions, plus analysis of key developments in the market and risks to the main forecasts. Indicators include:
Construction: Industry value (USDbn); contribution to GDP (%); total capital investment (USDbn); real growth (%).
Construction industry real growth forecasts (%) and industry value (USDbn) forecasts for industry sectors are split into Residential and Non-residential and Infrastructure sectors. Where the data is available for particular countries the infrastructure is further broken down into indicators for the transport subsectors of roads, railways, airports and ports and the energy and utilities sub-sectors of power plants and transmission grids, oil & gas pipelines and water infrastructure. This dataset is unique to the market.
The reports also include analysis of latest projects across the infrastructure sectors (transport, utilities, commercial construction).
BMI’s Infrastructure Risk Reward Index
BMI’s Risk Reward Index provides investors (construction companies, suppliers and partners) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points. These provide indices of highest to lowest appeal to investors, with each position explained.
An assessment of the competitive landscape and key challenges to entering the market. Details of the largest companies active in the sector across the sub-segments of the industry, including the key financial figures from some of the largest players in the sector.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Infrastructure reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.