Bahrain’s economy is expected to grow 3.5% in 2025 and 3% in 2026, according to the World Bank’s latest Global Economic Prospects report, as the broader Gulf Cooperation Council (GCC) region benefits from a gradual recovery in oil output.
The World Bank forecasts economic growth in GCC countries will reach 3.2% in 2025, rising to 4.5% in 2026 and 4.8% in 2027. The acceleration is tied to the anticipated phase-out of oil production limits previously agreed under OPEC+ supply arrangements. This recovery in volume is projected to support output despite expectations of declining global oil prices.
Across the wider Middle East and North Africa (MENA) region, growth is expected to recover to 2.7% in 2025 and continue strengthening to 3.7% in 2026 and 4.1% in 2027. These projections assume improving domestic demand conditions and the easing of geopolitical tensions.
Bahrain’s projected performance is broadly aligned with the region, although it is slightly below the GCC average for 2026 and 2027. According to the World Bank, growth will depend on a combination of oil sector recovery and continued structural reform, including fiscal consolidation measures and diversification programmes.
GCC economies are expected to continue benefiting from non-oil investments and sovereign spending, particularly in Saudi Arabia and the UAE, where government-backed infrastructure and tourism initiatives remain a driver of capital flows.
The World Bank also noted that, while near-term risks remain, including global interest rates and commodity price volatility, GCC countries have greater fiscal space and reserve buffers than they did during previous downturns.
