Economic diversification and liberalisation and private sector expansion are creating a robust environment for investment in the GCC and wider Middle East region, said Khalid Abdulla Al Bassam, Deputy Governor of the Bahrain Monetary Agency (BMA).
And, as the region’s economy gains greater momentum, the need for new infrastructure facilities, funded through project finance transactions, is providing a valuable opportunity for foreign and regional investors, he said.
Mr. Al Bassam was delivering the welcome address at the Middle East Project Finance 2004 conference, which opened in Bahrain Tuesday.
The two-day event, taking place at the Ritz-Carlton Bahrain Hotel, has been organised by MEED Conferences, under the patronage of the BMA. Borrowers, lenders, investors and government officials are attending the event, which spotlights the financing opportunities arising from major projects across the energy and other infrastructure sectors.
“Changes are taking place that would have been almost unimaginable a few decades ago,” said Al Bassam.
“These changes are transforming the practice of business across the Middle East, and more specifically they are transforming the economies of the Gulf region.”
The changing landscape has put the countries of the region among the most attractive investment destinations, with Bahrain ranked 29 out of 140 countries in the United Nations report on global investment.
“One of the most important of the changes that is happening is the growing importance of the private sector in the diversification strategy of the countries in the Gulf region and, indeed, in the wider Middle East as well,” said Al Bassam.
In Bahrain, the telecommunications sector has been liberalised, and the involvement of the private sector is increasing in the power and water sector.
Bahrain has also recently concluded a Free Trade Agreement (FTA) with the US, which aims at achieving extensive liberalisation across a wide spectrum of trade issues, both in terms of goods and services.
In the regional arena, GCC states enjoy free trade arrangements among member states, while a monetary union is expected to be completed by 2010.
These developments are creating massive project opportunities in a number of sectors, most notably oil and gas, power generation, tourism, telecommunications, transportation and information technology.
Investors should also benefit from a strong and mature financial services industry, said Al Bassam.
“One of our priorities has been to develop a strong financial sector,” he said. “There is now the financial capacity and expertise that allows firms investing in the region, and undertaking projects in the region, to be confident that they are dealing with strong and reputable financial institutions.”
Bahrain, in particular, has been active in developing a broad-based, profitable and well-connected financial sector. BMA has also ensured that the financial sector is well managed and well regulated.
“The opportunities are here and the economic environment is extremely favourable. The financial sectors in Bahrain and the Gulf countries are well up to the challenges of meeting the financial needs of the region,” said Al Bassam. (menareport.com)
© 2004 Mena Report (www.menareport.com)
