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Thursday, December 22, 2005

Research Director Comments On FDI in Bahrain

During a presentation on FDI policies in Syria, Farhat Hourshani, financial expert, said that "FDI flows, which reach $181.6 million on average annually since 1999, are relatively weak in Syria and focused on excavation and oil production." Hourshani added that reform policies needed to attract FDI, and should focus on governance, corporate steering and enhancing economic freedom.

Meanwhile, commenting on FDI in Bahrain, Imad Shehab, director of Research at the Arab Banks Union, said that "although Bahrain had a low FDI performance, it had a high unexploited potential." FDI reached $845 million in 2004 (in 2003 it was $517 million, 138 percent over 2002), according to the UNCTDA 2004 World Investment Report. Based on an official survey conducted lately over 233 companies falling into the FDI category, 80 percent of the FDI was linked to financial services, Hourshani said.

He added that there was clear evidence from the studies he carried that FDI had a positive impact on economic growth in Bahrain. Hourshani said Bahrain will soon issue a clear and transparent investment law to improve FDI. Hourshani blamed the weak flow of investments among Arab countries to the weak rate of trade among these countries. Calling for serious administrative reforms, he added that corruption is also "a major reason for crowding out investments from the region.


Source: The Daily Star


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