Diversification Drives Q1 Growth

TDT | Manama

Email: mail@newsofbahrain.com

Bahrain’s economy strengthened in the first quarter of 2025 as non-oil sectors took centre stage, contributing 84.8 percent to real GDP and reinforcing the Kingdom’s diversification drive, according to the Ministry of Finance and National Economy’s latest quarterly report.

Non-oil momentum

Preliminary national accounts data from the Information and eGovernment Authority showed GDP expanding 2.7 percent yearon-year in real terms, driven by a 2.2 percent rise in non-oil activity and a 5.3 percent increase in oil activity. In nominal terms, GDP was up 3.0 percent, with non-oil output climbing 2.8 percent and oil activity advancing 4.6 percent.

Accommodation and Food Services led the growth tables with a 10.3 percent jump, reflecting strong performance in tourism and hospitality. Financial and Insurance Activities, the single largest contributor to GDP, posted a 7.5 percent gain in real terms. Construction grew by 5.4 percent, followed by Education at 2.5 percent, while Professional, Scientific and Technical Activities rose 2.2 percent.

Wholesale and Retail Trade and Real Estate Activities each expanded 2.0 percent, Transportation and Storage grew by 1.9 percent, and Information and Communication Activities edged up 1.4 percent. Manufacturing was the only sector to contract, dipping 0.4 percent. The report also highlighted a 3.5 percent year-on-year increase in Inward Foreign Direct Investment stock, which reached BHD 17.1 billion in Q1 2025.

Strategic progress

Officials noted that Bahrain continues to advance in several international economic and development benchmarks, citing the adoption of ambitious strategies and initiatives aimed at strengthening economic diversification, aligning with global standards, and enhancing the business environment.

The Q1 results signal that Bahrain’s non-oil sectors are sustaining growth while shaping the country’s long-term economic trajectory.