Bahrain - Country Commercial Guide
Construction and Infrastructure
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The International Trade Administration identifies construction as a leading sector for opportunities for U.S. firms.  According to Bahrain’s Information and E-Government Authority (IGA), Bahrain’s construction sector grew by 1.4 percent in 2022.  The sector remained resilient in the face of macroeconomic shocks, including the COVID-19 pandemic and the collapse of world oil prices, and is gradually reverting to steady growth levels as the global economy continues to recover from the ramifications of the pandemic.  As part of Bahrain’s 2021 Economic Recovery Plan, Bahrain announced over 22 strategic infrastructure projects worth over $30 billion, including the construction of five man-made islands.  These projects will be largely funded via public-private partnerships. This emphasis on construction is consistent with the Kingdom’s Vision 2030 economic development strategy The strategy seeks to improve infrastructure, industry, housing, and connectivity and this calls for a more diverse economic base, with broader privatization, industrialization, training, and education of Bahrain’s national workforce.

Large-scale government infrastructure projects continue to stimulate the sector and have positive spillover effects in supply industries.  The government’s major projects include:

  • The $7 billion Bahrain Petroleum Company (BAPCO) modernization & expansion project
  • The $3.5 billion King Hamad Causeway transportation infrastructure project
  • The $2 billion Bahrain Metro Project
  • A new $355 million gas processing plant
  • Major housing and resort projects estimated at $2.2 billion
  • Electricity and water delivery projects estimated at $1.1 billion
  • Road and sewerage infrastructure projects estimated at $900 million
  • The U.S. Trade Zone
  • The development of five offshore cities off Bahrain’s coastline

A number of other projects underway focus on education, health, social development, youth, sports, and industry, many of which will be funded by grants received from Bahrain’s wealthier neighbors via the GCC Development Fund.  In October 2021, the government also launched its Economic Recovery Plan which outlines Bahrain’s post-pandemic economic recovery trajectory, and includes key business initiatives across the infrastructure, tourism, financial services and logistics sectors, among others. 

Leading Sub-Sectors

The demand for small housing units for low and medium-income families has increased dramatically in recent years.  There are approximately 60,000 Bahraini families on the government’s waitlist for subsidized housing.  The government is pursuing an ambitious program of developing 40,000 housing units within the next decade.  Close to 20,000 units are under construction.  The major housing projects are East Hidd City, Diyyar Al Muharraq, Tubli Gardens, Argan, East Sitra, and the Naseej project in Northern City.  The Ministry of Housing has also launched a social housing financing program to support the home purchases of Bahraini nationals.

In the private sector, major new freehold real estate projects have been launched in Diyar al Muharraq, Dilmunia, and Durrat al Bahrain.  Among others, a 3,000-unit Deerat al Oyun project has commenced in Diyar al Muharraq.  Government-funded projects in the fields of energy, industry, and transportation have also been major drivers in the construction sector.


One of the largest projects within this pipeline is the $1.1 billion Bahrain International Airport Modernization Program.  The main contract was awarded to a consortium led by UAE’s Arabtech Construction and TAV Construction in early 2017.  A number of U.S. firms have won smaller sub-contracts as part of the overall expansion project.  Phase one was completed in early 2021 and nearly doubled the airport’s passenger capacity to 14 million passengers a year.  Follow-on phases and new project opportunities include the construction of a maintenance repair and overhaul hanger, the refurbishment of the VIP aviation terminal, and, as part of the Bahrain Metro Project, the installation of a passenger station connecting the airport to downtown Manama.

In May 2022, Bahrain’s Ministry of Transportation and Telecommunications prequalified 11 international and Bahraini companies for Phase One of the $2 billion Bahrain Metro Project.  The project is expected to deliver a 109 km light rail system which carries over 43,000 travelers per hour and includes four separate lines with two interchanges and more than 20 passenger stations.

The King Hamad Causeway is planned, with construction possibly starting in 2024.  This new rail and road causeway project connecting Saudi Arabia and Bahrain will run parallel to the existing 25km-long King Fahd Causeway and deliver new lanes to support additional passenger and cargo traffic, as well as a rail line to link Bahrain with the main GCC railway and existing Saudi rail network.

In January 2021, the U.S. Department of Commerce and Bahrain’s then Ministry of Industry, Commerce, and Tourism (MoICT) signed a Memorandum of Understanding (MOU) to establish a United States Trade Zone (USTZ) within Bahrain’s sovereign territory.  MoICT selected the USTZ location near Bahrain’s Khalifa bin Salman Port and other industrial and logistics facilities, and within a short distance to Saudi Arabia via the King Fahd Causeway.  The Bahraini government and U.S. Embassy laid the ceremonial cornerstone for this project in early 2022.  Design planning for the land reclamation and construction phases is underway and the current MOIC expects the USTZ to open within 2-3 years.

Despite the pandemic-induced global economic downturn which led to a contraction in Bahrain’s manufacturing sector, the sector is showing signs of recovery and state-owned companies are proceeding with building out critical economic infrastructure and landmark heavy industry projects in downstream hydrocarbons and aluminum, including the BAPCO modernization and expansion program.  In 2022, Bahrain’s manufacturing sector registered 4.9 percent growth.  In December 2022 Aluminium Bahrain B.S.C. (Alba) launched a feasibility study for its Line 7 expansion project.  The company estimates that the Line 7 Project will have a similar production capacity as the Line 6 expansion project, within the range of 540,000 metric tons per annum.

Bahrain’s tourism and real estate development strategy also extends to medical-tourism projects, such as the construction of the $300 million King Abdullah Medical City Hospital which is expected to open in in the near future, and the launch of mixed-use real estate projects at Bahrain Bay, Bahrain Marina, Diyar Al Muharraq, Water Garden City, Dilmunia, Thai Mart Bahrain, open-air El Balcon Mall, and Marassi Al Bahrain. In January 2023, the $66 million King Hamad American Mission Hospital was inaugurated.

 Other key tourism developments expected to be completed in the near-term include:

  • The $120 million Muharraq Water Front Project (Saada), consisting of retail establishments, a marina, entertainment facilities, a 4-star hotel, a multi-story car park, and a traditional souq.
  • The mixed-use Bahrain Marina in Manama, consisting of a five-star hotel and hotel suites, apartments, villas, a shopping mall, entertainment and educational facilities, retail space, and a yacht club with space for 250 boats.
  • The multi-million dollar seafront mixed-use tourism and recreational Bijlaj Al Jazair project in Zallaq, delivering public beach access, food and beverage outlets, entertainment facilities, and hospitality services, as well as a four-star hotel, branded boutique hotels, and residential apartment buildings planned for later phases.


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