Shura Council to discuss Bahrain-Hungary investment deal

TDT | Manama

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A BD39 million trade relationship between Bahrain and Hungary could grow further as the Shura Council prepares to discuss a draft law on Sunday to ratify a bilateral investment agreement.

The deal, attached to Decree No. (84) of 2024, sets out legal safeguards for investors, offering assurances on fair treatment, asset protection, and dispute resolution.

The Foreign Affairs, Defence, and National Security Committee has examined the proposal and prepared a report outlining its findings.

Legal setting

The agreement, signed in Manama on 4 September 2024, is designed to ensure a predictable legal setting for businesses operating between the two countries. The Ministry of Finance and National Economy, the Ministry of Foreign Affairs, and the Legislation and Legal Opinion Commission have backed the agreement, viewing it as a step towards strengthening commercial links.

Trade between the two countries stood at BD39 million in 2023, with Hungarian investment in Bahrain amounting to BD106,000, according to figures from the Information & eGovernment Authority.

Cooperation

The Ministry of Finance and National Economy noted that Hungary had already entered into similar agreements with the UAE, Kuwait, and Oman, and that Bahrain’s inclusion could lead to further cooperation.

The agreement consists of 22 articles and an annex covering financial transactions, legal protections, and business conditions.

It commits each government to treating investors from the other fairly while retaining the right to regulate economic policies in the public interest.

Compensation

It also sets out terms for compensation in cases of asset seizure, outlines protections in the event of conflict or unrest, and guarantees that money can be moved freely in a widely accepted currency.

Bahrain has entered into similar arrangements with several of its key trading partners, including China, Japan, the UK, the US, France, Russia, Singapore, Germany, Turkey, and the UAE.

Officials say agreements of this kind provide legal certainty and help businesses make longterm decisions with greater confidence.

Sources of income

The committee has noted that the deal aligns with Bahrain’s Vision 2030 and the wider push to attract outside investment and diversify sources of income.

The committee has determined that the agreement does not clash with Bahrain’s legal framework and should be enacted.

It has recommended approval in principle of the draft law and endorsed its provisions in full.