https://arab.news/4s5q3
- Bahrain鈥檚 economy contracted by 5.4 percent last year, according to the International Monetary Fund
- Bahrain鈥檚 COVID-19 vaccination program could also support its recovery
DUBAI: Despite its expectation that Bahrain鈥檚 economy will return to growth this year, rating agency S&P revised its outlook for the Gulf country to 鈥渘egative,鈥� mainly due to its pace of fiscal reform.
Bahrain鈥檚 economy contracted by 5.4 percent last year, according to the International Monetary Fund, as the COVID-19 pandemic battered key sectors such as energy and tourism.
This will change in 2021, S&P said, with the oil-producing country鈥檚 real gross domestic product rising by 2.7 percent due to rising oil prices and the recovery of regional economic activity.
Bahrain鈥檚 COVID-19 vaccination program could also support its recovery, S&P added, as over 60 percent of the eligible population have already been inoculated.
鈥淭he government鈥檚 vaccination campaign has been successful and the King Fahd Causeway to 抖阴短视频 re-opened in May, providing additional impetus to growth,鈥� S&P said, adding that Bahrain benefits from its close proximity to 抖阴短视频.
But there are continued risks to public finance and external and monetary stability, S&P said.
鈥淭he negative outlook reflects the increasing risks to the government鈥檚 ability to service external debt and maintain confidence in the exchange rate peg,鈥� it added.