Mumtalakat is a key pillar

Manama 

Mumtalakat, the investment arm of Bahrain, has assets worth BD7 billion, but its contribution to the economy is meager, senior parliamentarian, Ahmed Qarata said. 

“Mumtalakat has the capacity to contribute to the Bahraini economy in a big way. Even if it contributes 10 per cent of its assets, Bahrain can earn about BD700 millions per annum. This can help the Bahraini economy to a great extent,” Qarata, who is also heading a committee, formed to probe the financial affairs of Mumtalakat, said. 

He added Mumtalakat has a vital role to play in strengthening the economy of the Kingdom.

Since its inception in 2006, the company said it would make a profit. But so far, nothing has happened. But this situation cannot be prolonged for a longer period, Qarata, who is also heading a committee formed to probe the financial affairs of Mumtalakat, added.

Mumtalakat holds stakes in 38 commercial enterprises spanning a variety of sectors, including industrial manufacturing and services, financial services, tourism, telecommunications, real estate, transportation and food production.

Meanwhile, he said the MPs last year sent questions to Mumtalakat for almost five times. This year also more than 35 questions were sent by the MPs. But the company has not given clear answers, he said.

Last April, MPs launched a probe into the financial affairs of Mumtalakat.

Currently, about 80pc of the revenue comes from oil sources. Since oil prices are falling, the government is trying to cut down expenses, including various subsidies. But cutting down of subsidy is not a right way to balance the economy. Instead, the government should look at alternative sources of income. Therefore, the Kingdom needs a clear strategy on raising non-oil income, he said. 

Currently, the non-oil income reaches just BD400 million per annum. Serious efforts should be put to raise this income to BD 2bn. In this regard, the contribution of Mumtalakat is very important, Ahmed Qarata said.

The total debt of the government stands at BD6.8bn. By the end of 2016, it is expected to reach BD9bn. To reduce this debt, diversification of economy is the only way left, the parliamentarian suggested.