Market Trends of Bahrain Transportation Infrastructure Construction Industry
Government initiatives and huge investments driving the market
Bahrain announced over 22 strategic infrastructure projects worth more than USD 30 billion as part of its 2021 Economic Recovery Plan, including constructing five artificial islands.
These initiatives will be funded mainly through public-private partnerships. This emphasis on construction is consistent with the Kingdom's economic development strategy Vision 2030. The USD 1.1 billion Bahrain International Airport Modernization Program is one of the most significant projects in this pipeline.
The main contract was awarded to a consortium led by Arabtech Construction and TAV Construction from the United Arab Emirates. Several US firms have won smaller subcontracts as part of the overall expansion project. The first phase, completed in early 2021, nearly doubled the airport's passenger capacity to 14 million passengers annually.
Bahrain's Ministry of Transportation and Telecommunications has prequalified 11 international and local Bahraini companies for Phase One of the USD 2 billion Bahrain Metro Project, which will begin in May 2022. The project is expected to deliver a 109-kilometer light rail system capable of carrying over 43,000 passengers per hour and consisting of four separate lines with two interchanges and more than 20 passenger stations.
The King Hamad Causeway is also in the works, with construction set to begin in 2024. This new rail and road causeway project connecting Saudi Arabia and Bahrain overland will parallel the 25 km-long King Fahd Causeway. It will provide new lanes to support additional passenger and cargo traffic and a rail line connecting Bahrain to the central GCC railway and the existing Saudi rail network.
Vision 2030 and allied projects driving the market
- The Kingdom of Bahrain's government has given the development of the technical infrastructure a great deal of priority, reflecting its unwavering conviction that modern technology benefits and privileges are crucial for advancing the national economy and creating an environment conducive to the growth of both the private and public sectors. As a result, the Kingdom of Bahrain has steadily built over the past few years a strategic strategy for moving to Cloud Policy First, making Bahrain the first Middle Eastern nation and one of the top states in the world to adopt cloud computing.
- Bahrain has seen a paradigm shift with the other Gulf Cooperation Council (GCC) members. On the one hand, the economies of the GCC are changing course to become more competitive and sustainable by investing in future-defining and oil-proof industries like services, technology, and renewable energy. On the other hand, the global adoption of innovation and digitalization accelerated due to the COVID-19 pandemic. In response, GCC nations intensified their efforts to diversify their economies, emphasizing foreign direct investments. Bahrain may now want to think about the specific developing potential for FDI to carve a sustainable, specialized niche within an increasingly tech-oriented global economy in light of these trends and their unique configuration.
- With over USD 210 billion in total assets, Bahrain remains a significant player in the regional financial services industry. According to the Bahrain Economic Development Board, the largest non-oil sector in Bahrain's economy is financial services, contributing about 18% of GDP in 2020. Although the UAE and KSA's financial services industries are well-diversified and strong, there is room for improvement in the GCC's trade finance transparency. Bahrain might meet this requirement by setting up a business that offers ratings for trade finance deals and expanding these ratings internationally. Bahrain can build such a platform using cutting-edge technology like blockchain.
