Bahrain is committed to streamlining business setup processes and fostering a more efficient investment environment, Minister of Finance and National Economy HE Shaikh Salman bin Khalifa Al Khalifa said at the Fintech Forward summit on Wednesday. His remarks highlighted the government’s focus on improving the ease of doing business as part of the country’s broader economic reforms.
The minister pointed out that since the launch of Bahrain’s economic growth plan in 2021, the government has worked closely with the private sector to enhance infrastructure access and reduce delays in essential processes. “What we ask ourselves in government is, what is the slowest part of the machine? What’s taking the longest to get done, and what do we need to do to shorten that time?” he stated, underscoring the focus on efficiency as a key to attracting investment and capital to the Kingdom.
Al Khalifa also emphasised the importance of facilitating business creation, noting that simplifying and speeding up processes is central to the government’s agenda. “We need to make it easy for people to set up a business,” he said, reflecting Bahrain’s commitment to fostering a more business-friendly environment.
Economic growth plan
Bahrain’s national economic growth and fiscal balance plan, introduced in 2021, is one of the country’s most comprehensive reform programmes. It is designed to enhance the Kingdom’s competitiveness and support post-pandemic recovery efforts. The plan aligns with Bahrain’s Economic Vision 2030, which includes the long-term goal of achieving net zero by 2060.
The five-pillar strategy includes a Labour Market Reform Plan to create 20,000 jobs for Bahraini nationals and train 10,000 individuals annually until 2024. Complementing this is a Regulatory Reform Package focused on simplifying business license approvals, launching a Government Land Bank, and digitising urban planning services. These reforms are expected to attract $2.5 billion in foreign direct investment by 2023.
In addition to regulatory reforms, the plan centres on large-scale investments through a Strategic Projects Plan, which aims to channel over $30 billion into key sectors such as tourism, logistics, and financial services. The Priority Sectors Plan outlines strategies to grow non-oil industries by 5% annually, further supporting Bahrain’s efforts to reduce reliance on oil revenue.
The minister also highlighted fiscal reforms, noting that the updated Fiscal Balance Program targets budget equilibrium by 2024. This is being pursued through expenditure cuts, subsidy reforms, and new revenue measures, including an increase in VAT to 10%.
The growing role of fintech
The financial sector is the biggest contributor to Bahrain’s GDP, with fintech emerging as a critical area of focus. The pandemic accelerated the importance of fintech as global financial institutions reevaluated their supply chains and human capital strategies. This has driven demand for decentralised operations, leading to the creation of more tech hubs.
Al Khalifa noted that Bahrain has positioned itself as an attractive hub for fintech, supported by three key factors: strong digital infrastructure, a robust regulatory framework, and a skilled workforce. “These are the three main ingredients we need to ensure that we are well-positioned in the Kingdom of Bahrain to serve the service industry and ensure growth,” he explained.
Significant investment in digital infrastructure has come from companies in the telecom and data centre sectors. Al Khalifa cited services like Benefit, the country’s real-time settlement system, and telecom-based payment solutions such as STC Pay, as examples of fintech’s role in advancing financial services.
“We need to make it easy for people to set up a business”
HE Shaikh Salman bin Khalifa Al Khalifa
Beyond traditional banking, Bahrain aims to become a hub for investment services, family offices, and the insurance industry. High technology adoption rates across these industries are driving transformation and enabling businesses to operate seamlessly. Digitalisation has also strengthened regulatory oversight, improving transparency and stability in the financial sector. “The ability to see a real-time picture means that we can push for higher compliance and more stability in the financial system,” the minister said.
The Central Bank of Bahrain (CBB) has created a supportive regulatory environment, with regulations covering areas like crypto-assets and fintech services. Bahrain has also pioneered international regulations around data sovereignty, making it the only country in the world offering this legal framework.
Looking ahead
Looking to the future, Al Khalifa expressed confidence in Bahrain’s ability to continue strengthening its position as a global fintech leader. He attributed this to the country’s adaptability, its skilled workforce, and its focus on innovation.
“When people make a decision to invest in Bahrain, it comes down to the fact that they’ve seen one of the most talented workforces in the world,” he said. He added that many international companies have expanded their operations in Bahrain after experiencing the benefits of the Kingdom’s business-friendly environment.