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Bahraini Chamber sounds alert over crisis

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Points of Essence:

  • Key industry leaders urged Bahraini Government to disseminate crucial information of the measures taken by the Government to cushion the impact of the US financial crisis to the Bahraini banking and financial sector. This will spur confidence  to businessmen and investors alike.


A LACK of transparency about the impact of the global credit crunch in Bahrain could have disastrous consequences for the country’s economy, business leaders warned yesterday. The Bahrain Chamber of Commerce and Industry (BCCI) says the government must provide more information about its readiness to deal with the international crisis, which has slashed share values worldwide.

It also wants “precautionary measures” to prevent global turmoil from affecting Bahrain’s financial stability and economic growth, as well as an emergency investigation into the possible consequences.

“Since Bahrain is considered as the region’s financial services hub, primarily in the Islamic and offshore banking sectors, great attention has been given by leading international monitoring agencies on the possible impact of such huge proportion on the kingdom’s financial institutions and national economy,” the BCCI said in a statement.

“Even though measures were taken by the relevant government agencies in Bahrain to control and minimise the effect of this economic crisis, the BCCI believes that the official information released on this matter is not sufficient to reflect a clear picture on Bahrain’s current position and readiness in terms of precautionary measures taken to battle such financial turmoil and reduce its effect as much as possible on Bahrain and its financial institutions.”

The statement called for the introduction of precautionary measures to protect businessmen and investor confidence, as well as minimise the effect of rumours that could “harm the stability of Bahrain’s financial institutions”.

“To ensure that the interest of the financial and investment sectors in Bahrain are protected and consumer confidence is not affected, the BCCI calls upon all government agencies, primarily the Finance Ministry, Central Bank of Bahrain and all related parties to take further steps to provide a more transparent financial picture of Bahrain’s current financial situation,” it said.

“The BCCI would like to stress the importance of introducing additional planned precautionary measures to avoid Bahrain suffering any possible negative impact, first and foremost on its financial stability and economic growth.”

The BCCI is planning a conference to discuss the effect of the global credit crunch on Bahrain’s economy to better understand the crisis and how to minimise its effects.

BCCI board member Samir Nass, who is also head of the contractors’ committee, does not believe Bahraini companies will go under.

But he told the GDN that failure to organise precautionary measures could cause long-term damage to Bahrain’s economy.

“No country is going to be immune from this,” said Mr Nass.

“On different levels there will be some kind of effect. If there is going to be an effect we have to know what will be the situation and what are the things we can do to avoid any effect from the global situation.”

Mr Nass said it was too early for Bahrain’s business community to have been affected, but said more information was vital.

“Generally conditions are okay, but there maybe an effect in the long-term,” he said.

Bahrain’s stock market value has dropped by more than 15 per cent so far this year, while the MSCI GCC Index – a benchmark that measures the performance of the GCC equity markets – has fallen by 33 per cent since peaking in January.


Note: Why no news on tackling crisis? also highlighted a similar concern in Malaysia. Also read here on a mixed response of the other middleeasterners on the financial crisis.


Written by Suapi Shaffaii

October 13, 2008 at 2:29 pm

Posted in General Issue

Tagged with ,

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