A MAJOR hydroponics project will be launched by summer next year with Bahrain’s sovereign wealth fund planning to make a substantial investment in it, it has emerged.
The idea gathered momentum during the current Covid-19 pandemic which has highlighted the need to localise food supply, said Mumtalakat chief executive Khalid Al Rumaihi.
“Over the last few months, the key concern that His Royal Highness Prince Salman bin Hamad Al Khalifa, Crown Prince, Deputy Supreme Commander and First Deputy Premier, had in his planning for Covid-19 was healthcare and ensuring that there were enough groceries in the country and the supermarkets were adequately stocked,” said Mr Al Rumaihi.
The pandemic has disrupted supply chains, and a secure supply of food and other essential goods has become a matter of grave concern to every country.
“We saw people all over the world lining up to buy groceries and essentials and it begins to hit home that ensuring you have food, and that people do not feel deprived is as much about security as anything else.”
According to Mr Al Rumaihi, the current crisis is a historic first as there has never been a complete disruption of supply and demand happening simultaneously, with demand for many products vanishing due to enforced containment at home globally along with a breakdown in supply as many factories depend on employees who cannot report to work.
Without revealing details about the project, Mr Al Rumaihi said hydroponics was an area where Mumtalakat is looking to invest substantially over the next six months to a year as supply chains come closer to home.
“We know what the market needs and I’m sure supermarkets will want to localise their supply chain as long as the price is right.”
Hydroponics is a type of horticulture and a subset of hydroculture, which is a method of growing plants without soil, by using mineral nutrient solutions in a water solvent.
It is also a perfect solution in countries or regions where the amount of arable land is very limited, apart from being an ideal solution in regions where there is ample light, even if it is also enhanced by artificial lighting.
The alternative farming technique is considered particularly suitable to arid countries like Bahrain where the amount of arable land is very limited.
According to the 2014 Arab Forum for Environment and Development (AFED) Annual Report, ‘Food Security in Arab Countries’, the total amount of arable land in Bahrain is only 11 per cent of the total land area.
Talking about the wider impact of Covid-19 on the economy of Bahrain, Mr Al Rumaini listed four key trends unfolding over the next few years.
“I see accelerated technology adoption, changing consumer habits in sectors like education and healthcare, localising of supply chain using hydroponics among other things and faster privatisation by the government.
“Therefore, finding opportunities where businesses can substitute for the government, I think is going to be timely,” he added.
Last month, Mumtalakat reported consolidated operating income of $332.4 million for 2019, a 211pc jump over the previous year on the back of a solid performance by portfolio companies.
Since its establishment in 2006, the sovereign wealth fund’s portfolio has grown from 29 companies mainly in Bahrain to more than 60 across various markets.
avinash@gdn.com.bh
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