Bahrain’s economy demonstrated robust resilience in 2025, with gross domestic product (GDP) growing by 3.5 per cent at constant prices, fuelled by a surging non-oil sector.
According to the Bahrain Economic Report 2025, released by the Finance and National Economy Ministry, non-oil activities now account for a record 85.8pc of the kingdom’s GDP at constant prices.
Preliminary data from the Information and eGovernment Authority (iGA) highlights a clear shift toward diversification.
The non-oil GDP saw a significant expansion of 4.1pc year-on-year, while performance in the oil sector saw a marginal decline of 0.3pc during the same period.
At current prices, the overall GDP rose by 3.7pc, bolstered by a 5.3pc jump in non-oil activities which helped offset a decline in the oil sector.
The report identified several high-performing sectors that spearheaded the year’s growth.
Professional, scientific, and technical activities recorded an annual growth rate of 6.4pc, a figure matched by the accommodation and food service sector.
Financial and insurance activities followed closely with a growth of 5.6pc, while the construction sector expanded by 5pc.
Additionally, the transportation and logistics sector grew by 4.7pc, real estate activities increased by 4.3pc, wholesale and retail trade grew by 4.2pc, and the manufacturing sector rose by 3.7pc.
Bahrain’s attractiveness to international investors remained strong, with total inward foreign direct investment (FDI) stock reaching BD17.7 billion by the end of 2025 following a 1.8pc increase in the final quarter.
The kingdom’s business-friendly environment was further validated by high rankings in international indices.
Bahrain ranked first globally in e-commerce legislation within the Network Readiness Index 2025 and secured the third spot globally in the Business Incentives pillar according to the Innovators Business Environment Index 2026.
Furthermore, the World Bank Group maintained Bahrain’s Group A classification in the GovTech Maturity Index 2025, placing it 15th globally out of 197 countries.
avinash@gdnmedia.bh
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