Bahrain's economy shrank 0.3 percent from the previous quarter in the April-June period, its first quarterly drop in a year, largely because of weakness in the financial sector, official data showed.
Gross domestic product, adjusted for inflation, had expanded 2.5 percent quarter-on-quarter in the first three months of 2013. The small non-OPEC oil producer last experienced a quarter-on-quarter contraction in April-June 2012.
On a year-on-year basis, however, GDP growth quickened to 5.3 percent in the second quarter of 2013, the highest rate since the final quarter of 2010, from 4.2 percent in January-March, the data from the Central Informatics Organisation showed.
Limited oil resources have forced the island kingdom of 1.3 million people to rely on other forms of business, particularly finance. But political unrest since 2011, in which the government has clashed with mainly Shi'ite-led pro-democracy protesters, has hurt Bahrain's status as a regional financial hub while increasing pressure on the state budget.
Output in the hydrocarbons sector, which accounts for a quarter of Bahrain's $30 billion economy, grew 1.2 percent in April-June from the previous quarter, after a 1.3 percent rise in the first three months.
On a year-on-year basis, hydrocarbon output jumped 18.6 percent in the second quarter, as last year's drop in crude oil output from Bahrain's key Abu Safa field, which it shares with Saudi Arabia, was corrected.
Meanwhile the financial industry, which accounts for roughly 16 percent of GDP, shrank 1.0 percent quarter-on-quarter in April-June, the first contraction since the second quarter of 2012.
In the hospitality sector, which nosedived during the 2011 turmoil, output climbed 1.7 percent quarter-on-quarter in April-June, accelerating from a 0.5 percent rise in the previous three months.
Analysts polled by Reuters in September forecast that Bahrain's GDP growth would accelerate to 4.0 percent in 2013 from 3.4 percent in 2012, before slowing again to 3.5 percent next year.
Bahrain’s Arcapita eyes new investments after first Gulf Chapter 11Bahrain-based Arcapita is aiming to build a new asset management firm with a debut local deal in the logistics, education or healthcare sector as the ... Banking & Finance
Bahrain's three mobile operators receive spectrum for LTEBahrain's telecoms industry regulator has awarded radio spectrum for next-generation networks to the kingdom's three mobile operators after scrapping ... Telecoms
Bahrain’s Al Salam Bank to buy BMI Bank in stock dealBahrain’s Al Salam Bank has agreed to acquire fellow Bahraini lender BMI Bank, an affiliate of Oman’s Bank Muscat, through a share-swap ... Banking & Finance
Bahrain in talks over possible Eurofighter jet deal, says BAEBritish defense firm BAE Systems said the Gulf state of Bahrain was in talks about the possibility of buying an unspecified number of Eurofighter ... Aviation & Transport
Bahrain Investcorp annual profits surge 56 percentBahraini provider of alternative investment products, Investcorp, reported a 56 percent increase in its full year income, Reuters news agency reported ... Banking & Finance
Bahrain to study restrictions on VoIP telecoms servicesBahrain is to study whether to restrict Internet-based telecom services, the communications minister of the Arab state told Reuters, although no final ... Telecoms
Moody’s puts Bahrain debt on watch, warns on oil priceMoody's credit rating agency put debt issued by Bahrain on watch on Friday, warning of a possible downgrade because the country could face strains ... Economy