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China and Bahrain: Working in Unison for Mutual Benefit

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In the 33 years since the establishment of diplomatic relations between the Kingdom of Bahrain and the People’s Republic of China, bilateral relations have continued to develop and deepen with the signing of 27 bilateral agreements in trade and investment, economic and technical cooperation, and other related fields. Open service trade cooperation and inclusive cultural and friendly exchanges will continue to be the trend and theme of today’s world. China and Bahrain will give full play to their respective advantages in different fields to achieve complementary advantages and mutual benefits.

 

The advantages of investing in Bahrain are reflected in the following aspects.

  1. The business environment has improved to a high degree.According to the 2020 World Bank’s Business report, Bahrain is one of the top 10 economies in the world in terms of improving the business environment,Manama ranked fifth among all cities of its size in the Global Future Cities Index 2021. It is also ranked first among small and medium-sized cities in terms of FDI strategy.
  2. Cost-effective and business-friendly. Bahrain is ranked sixth in the world in terms of cost-effective and business-friendly, third in the MENA region.
  3. Emphasis on women’s business and legal indices.According to a report issued by the World Bank, Bahrain has made the highest progress in the Women’s Business and Law Index among Arab countries during 2021-2022, improving its ranking by 18 places in one year and ranking fifth in the Arab world.
  4. High levels of human development.The Kingdom of Bahrain scored 0.838 in the Human Development Report, placing Bahrain in the high human development category, ranking 45th out of 189 countries and territories.

Building the "Digital Silk Road"

The commercial relationship between Bahrain and China dates back thousands of years to the Maritime Silk Road era. China is currently Bahrain’s largest import market, with bilateral trade valued at $2.2 billion. Today, Bahrain’s focus has shifted to the Digital Silk Road, with agreements signed to facilitate cooperation and knowledge exchange with Chinese partners in emerging technologies such as fintech and artificial intelligence. In 2021, China’s Tencent Cloud officially signed a Memorandum of Understanding with the Kingdom of Bahrain’s Economic Development Board to deploy its first MENA data center hub in Bahrain, which will provide a huge opportunity to boost Bahrain’s digital economy and enable local organizations to accelerate their digital transformation journey.

To drive digital transformation, Bahrain has established a conducive environment that supports innovation, is cost-competitive, and has flexible laws and regulations in place. Huawei technology has helped Bahrain become one of the first countries in the region to launch commercial 5G nationwide. Bahrain has launched the region’s first national “Cloud First” policy to enhance government ICT and is actively promoting the cloud services among state entities, reducing IT costs by nearly 90 percent. Several leading Chinese companies have established offices in Bahrain, including Huawei, China max and Bank of China, leveraging the Kingdom’s competitive advantages such as cost-effective, strategic location, forward-looking laws, highly skilled bilingual workforce and 100% foreign ownership of most business sectors.

Today Bahrain has come a long way, and the country aims to keep reaching new heights. In October 2021, the Bahraini government launched an economic recovery plan that focuses on non-oil industries, such as agriculture, manufacturing, construction, finance, software, telecommunications and communications, wholesale and retail, and then includes all professional engineering services, non-profit pharmaceutical activities, and government services. Of these, the telecommunications ICT and digital economy sector is critical to the realization of the plan. The sector’s strategic goals focus on setting cybersecurity standards, attracting large technology companies, and becoming a regional hub for digital innovation. Its strategy will also pave the way for the development of digital payments, the expanded use of artificial intelligence, and increased cooperation between government and the private sector to improve the efficiency of government services.

It is also part of Bahrain’s plan to develop a world-class digital infrastructure that provides appropriate services for enterprises around the world, enabling them to cost-effectively expand their business operations, while benefiting from the convenience of Bahrain’s position as the gateway to the Middle East.

A subset of Bahraini companies is now actively engaging with potential Chinese partners in the hope of further strengthening Bahrain’s capabilities in key areas that will bring tangible business benefits to bilateral companies. For example, one stainless steel cold rolling mill, United Stainless Bahrain, is seeking a Chinese joint venture partner to expand its operations. Bahrain is encouraging Chinese aluminum fabrication enterprise to partner with Bahrain Aluminum, one of the world’s largest aluminum smeltery, to localize the production of its downstream products and further MENA market. In addition to manufacturing industries such as financial technology, modern logistics, e-commerce, and gaming are also emerging industries that the Bahraini government strongly supports.

The Kingdom of Bahrain sincerely welcomes cooperation with the People’s Republic of China for joint development.

H.E. Dr. Mohamed Ghassan Mohamed Adnan Shaikho 1
Dr. Mohamed Ghassan Mohamed Adnan Shaikho

Ambassador of the Kingdom of Bahrain to the People’s Republic of China

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