Describes how major projects are secured and financed. Explains activities of the multilateral development banks in and other aid-funded projects.
Selling to the Government
In October 2002, Bahrain implemented a government procurement law to establish the basic framework for a transparent, rules-based government procurement system. The law requires certain procurements to be conducted as international public tenders open to foreign suppliers. The law established a tender board to oversee all government tenders and purchases.
All major civilian projects and government acquisitions valued at BD 10,000 ($26,667) or more are posted on the website of Bahrain’s Tender Board, https://www.tenderboard.gov.bh/ . The Tender Board determines the terms of bidding, invitations for bids and selection of firms for awards. The Tender Board advertises its tender openings and decisions on its website, and in local media. Tender opportunities are published in English and Arabic. Contracts are generally, but not necessarily, awarded to the lowest bidder.
Bahraini government procurement contracts are subject to the requirements of the U.S.-Bahrain FTA. The FTA, however, does not govern military procurement and other procurements deemed a matter of Bahrain’s national security. For government sales, except where an agent is not permitted (e.g., sales to the Bahrain Defence Force or Ministry of Interior), it is generally advisable to have a local agent serve as a point-of-contact, provide advice on tender preparation, and act as “eyes and ears” on the ground. Bidders must meet the specifications set out in the tender and offer a competitive price to be successful. A local agent can provide valuable advice on pricing, timing, and key contacts.
The Bahraini government is not a signatory to the OECD Convention on Combating Bribery.
For GCC Development Plan-funded projects, Bahrain must honor financial agreements with the GCC country funding the project. Although tenders for these programs often are issued by the Bahrain Tender Board, they may be subject to tendering rules of the GCC country funding the project. U.S. companies should carefully research tenders they pursue to determine whether the project is subject to GCC Development Plan funding requirements.
In addition to several key oil and gas projects the Bahraini government offers a variety of business opportunities, mainly in real estate and housing, power and renewable energy, transport and public works and manufacturing. In 2018, the Bahraini government hosted its first Gateway Gulf Investor Forum to showcase major projects open for investment. Due to the COVID-19 pandemic, the Bahraini government postponed indefinitely the 2020 Gateway Gulf Investor Forum.
U.S. companies bidding on Government tenders may also qualify for U.S. Government advocacy. A unit of the U.S. Commerce Department’s International Trade Administration, the Advocacy Center coordinates U.S. Government interagency advocacy efforts on behalf of U.S. exporters bidding on public sector contracts with international governments and government agencies. The Advocacy Center works closely with our network of the U.S. Commercial Service worldwide and inter-agency partners to ensure that exporters of U.S. products and services have the best possible chance of winning government contracts. Advocacy assistance can take many forms but often involves the U.S. Embassy or other U.S. Government agencies expressing support for the U.S. bidders directly to the foreign government. Consult Advocacy for Foreign Government Contracts for additional information.
Financing of Projects
Bahrain’s onshore and offshore banks have extensive experience providing syndicated loans for larger risk projects, including major infrastructure investments. The Bahrain Development Bank (BDB) promotes industrial development in Bahrain. The BDB also lends funds for local projects it deems to be priorities. BDB funding is not restricted to Bahraini-owned companies. BDB funds are allocated on market terms and available to foreign investors. Credit terms are variable, but usually limited to ten years with a maximum grace period of two years.