Bahrain - Growth between the Period of 2005 and 2011 - Case Study Example

Micro Table of Contents Table of Contents 2 0. Introduction 3 2.0. Growth between the period of 2005 and 3 2 GDP at Current Prices 3 Year 42005 4 2006 4 Percent Change 4 2007 4 Percent 4 2008 4 Percent Change 4 2009 4 Percent Change 4 2010 4 Percent Change 4 2011 4 GDP at Current Prices 4 7.9% 4 6.7% 4 -1.2% 4 8.4% 4 1.7% 4 6.3% 4 -2.1% 4 3.1% 4 -3.2% 4 4.5% 4 1.4% 4 4.6% 4 2.2. GDP at Constant Price 4 Year 5 2005 5 2006 5 Percent Change 5 2007 5 Percent 5 2008 5 Percent Change 5 2009 5 Percent Change 5 2010 5 Percent Change 5 GDP at Constant Prices 5 3853 5 7855 5 %51 5 8506 5 .07% 5 9036 5 .05% 5 9266 5 .02% 5 9668 5 .04% 5 2.3. Per Capita GDP at Current Prices for Bahrain 5 3.0. Major Eight Production Items of the Country that has contributed to the GDP Growth In Between 2005 and 2011 6 4.0. The National Savings and its Growth 7 5.0. Major 8 Items of Export between 2005 and 2011 8 6.0. Major 8 Items of Import between 2005 and 2011 9 10 7.0. Conclusion and Findings 10 References 11 1.0. Introduction Bahrain is an island that is situated in the in the western shores of the Persian Gulf and east of Saudi Arabia. It is known as the first state in the gulf to have made the discovery of oil and established refinery. The country has a diversified economy dependent on numerous domains for its operations. The country has a total area of 717 sq. km (277 sq. miles) which has reduced a little in the past years due to land reclamation. Comparatively, the nation is 3.5 times the size of United States (US) capital, Washington, DC (CIA, 2014). The population of the country is around 1.4 million as per the census result of 2012. The country is quite specific and heavily dependent on its natural resources such as oil, natural gas and fish of the offshore waters. As per the figurers acquired in 2011, the number of local residents of the nation was 584,688 while the number of expatriate was around 610,332. The per capita income of the nations is around USD15,920 measured in the year 2010 by the World Bank. The national savings rate of Bahrain stands at 47% of the total GDP. The rate of inflation in the country stands at 1.9% as per the latest report accumulated in 2014. Some of the major industries in the nation primarily deal with the domain of oil, aluminum and financial service industries among others. As far as production is concerned, the country is widely known for its oil and petroleum products (Central Informatics Organization, 2012). 2.0. Growth between the period of 2005 and 2011 2.1. GDP at Current Prices The country i.e. Bahrain has seen growth strengthening its economic position particularly due to the high oil prices and resilient regional and global economic growth. Nonetheless, the figures fluctuated from time to time further depicting both incline and decline trend. This can be better comprehended from the GDP growth of the nation in between the period of 2005 to 2011. In 2005 the annual GDP growth percent of the nation was around 6.8% which increased to 8.3% in the year 2007. However, during the year 2009, the GDP of the nation declined heavily and reached the figure 2.5%. Though the figure improved in the 2010 and reached 4.3% but once again the figure fall to 2.1% reflecting volatility in the years 2011. This aspect reveals the fluctuating trend of GDP growth between the period of 2005 to 2011 (The World Bank, 2014). Year 2005 2006 Percent Change 2007 Percent Change 2008 Percent Change 2009 Percent Change 2010 Percent Change 2011 GDP at Current Prices 7.9% 6.7% -1.2% 8.4% 1.7% 6.3% -2.1% 3.1% -3.2% 4.5% 1.4% 4.6% Fig: GDP at Current Prices 2.2. GDP at Constant Price The GDP growth at constant price in Bahrain showed an inclining trend over the years. This aspect was also relevant between the periods of 2005 to 2011. Notably, the GDP growth at constant price of the nation in 2006 was around 7855 BHD million. Subsequently, the figure climbed to 8506 BHD million in 2007, 9036 BHD million in 2008, 9266 BHD million in 2009, 9668 BHD million in 2010 and 9871 BHD million in 2011 respectively. This shows that the country has seen a steady growth in the domain of GDP at Constant Price further reflecting an increasing trend in between the period of 2005 to 2011 (1Trading Economics, 2014). Year 2005 2006 Percent Change 2007 Percent Change 2008 Percent Change 2009 Percent Change 2010 Percent Change GDP at Constant Prices 3853 7855 %51 8506 .07% 9036 .05% 9266 .02% 9668 .04% Fig: GDP at Constant Price 2.3. Per Capita GDP at Current Prices for Bahrain The GDP per capita of Bahrain at current prices in between the period of 2005 to 2011 has depicted a constantly increasing trend. In 2005 the figure for this particular indicator was 18,156 USD for Bahrain. This further increased in the year 2006 where the figure climbed to 19,460 USD. Again the figure soared to 21,050 USD and 23,038 USD in the subsequent years i.e. 2007 and 2008 respectively. This rising trend in the growth of GDP per capita for current prices continued for the subsequent years of 2009, 2010 and 2011 respectively as the figures upsurge to 19,251 USD, 20,546 USD and 22,467 USD in the respective years of operations of the nation. This further affirms that the country has experienced considerable growth in its various domains which further impacted it overall economy positively especially i between the period of 2005 to 2011 (2The World Bank, 2014). Fig: Per Capita GDP at Current Prices 3.0. Major Eight Production Items of the Country that has contributed to the GDP Growth In Between 2005 and 2011 Some of the major products that are being produce by the nation include aluminum, fertilizer, building materials, furniture, petroleum, iron ores, aluminum bars, raw aluminum, aluminum plating and refined petroleum among others. The share of refined petroleum on the GDP of the nation is 64% while for iron ore is 8.1%. The production of aluminum bars and raw aluminum has 3.6% share each on the overall economy of the nation. The production share of aluminum plating is around 2.6% in Bahrain. These products have major contributions on the GDP growth of the nation. The contribution of the products mentioned above in the GDP of the nation was around 68.5% in the year 2009 while in the subsequent years i.e. 2010 and 2011 the figures increased marginally to 69.5% and 79.0% respectively. Hence, it can be affirmed that in between the period of 2002 to 2011 the figure generally depicted an increasing trend (Central Informatics Organization, 2012). Fig: Major Eight Production Items of the Country 4.0. The National Savings and its Growth The net national savings of the nation has shown a fluctuating trend over the years. Reports suggested that in between the period of 2000 to 2008 the figures have shown both decline and incline periodically. For example in the year 2000 the net savings of the nation was 12.4% while in the 2001 it dropped to 6.26%. Again in 2002, the figure of net savings of the nation was around 13.08% while in 2003 the figure soared to 17.03%. Notably, the change in figure can be seen in diverse domains. For example in the industrial sector, the national savings of the country was around 4.7% in the year 1990. While with the initiation of the year 2000, the figures dropped and settled at 3.8%. This trend continued till the year 2010 where the figure declined by 3.0%. Likewise, in the government domain, the savings has shown an inclining trend. For example, the savings of the government sector in the year 2010 was around 34.54%. The figure was around 30.15% in 2009 and 37.2% in 2011. The percentage share of the government sector in the national savings was around 41.97% while for the industrial sector the figure was around 3.0% during the year 2012-2013. This aspect depicts about how the national figures in terms of the aspect of savings was influenced by various other sectors of the nation (Economy Watch, 2013). Over the years, there has been changing trend in the figure of the contribution with respect to government and the industrial sector to the national savings. Notably in the year 1999-00 the contribution of the industrial sector to the overall national savings was around 3.8 % which further dropped to 3.0% in the year 2012-13. Again there has also been a major change in the contribution made by government sector to national savings. Notably, the contribution of the government sector to the overall national savings of Bahrain was around 20.06% in the year 1999-00 which further increase severely to 34.54 in the year 2009-10. The rate of savings of Bahrain has also shown a fluctuating trend over the years. Observably, the national savings of Bahrain was around 45.29% which further declined to 26.01% as of 2009. This depicts a major change in the form of decline in the national savings rate of the country (2Trading Economics, 2014). 5.0. Major 8 Items of Export between 2005 and 2011 It is known that the country is extensively involved in the production of aluminum and oil products which are exported to the other nations of the world. Some of the notable products that are being exported by the nation include refined petroleum, iron ore, aluminum bars, raw aluminum, aluminum plating, petroleum gas, iron reductions and aluminum wire among others. During the period of 2005 to 2011 the annual growth rate of the export items of the country has been around 1.2 % which is again deemed to be quite considerable and appreciative considering the large scale of export the country is involved in. The annual revenue collected by the country for these items stands at around USD5,773,032,937.02. Notably these items have major contribution towards the overall export value of the nation. These shares are refined petroleum (64%), iron ore (8.1%), aluminum bars (3.6%), raw aluminum (3.6%), aluminum plating (2.6%), petroleum gas (1.3%), iron reductions (1.2%) and aluminum wire (1.2%) (The Observatory, n.d.). Fig: Major 8 Items of Export 6.0. Major 8 Items of Import between 2005 and 2011 Observably, the country is also extensively involved in importing products from other nations of the world. Some of the notable products that the country is extensively involved in importing include Crude Petroleum, Cars, Iron Ore, Planes, Helicopters, and/or Spacecraft, aluminum oxide, computers, packaged medicaments and Petroleum Coke. It has been noted that during the period ranging between 2005 to 2011 the annual growth rate in terms of the overall import of the nation was around 39% annually in the products of crude petroleum and 5.3% in the products of iron ore annually to name a few. This aspect also shows the increasing population and increasing demands of the people in the nation. Furthermore, the annual revenue of the nation is around USD 2,963,371,885.65 which is quite less as compared to the import of other similar nations of the world. The contributions of the eight imported items to the nation includes Crude Petroleum (39%), Cars (5.3%), Iron Ore (5.3%), Planes, Helicopters, and/or Spacecraft (1.6%), aluminum oxides (1.3%), computers (1.0%), packaged medicaments (0.94%) and petroleum coke (1.5%) (The Observatory, n.d.). Fig: Major 8 Items of Import 7.0. Conclusion and Findings From the overall analysis it can be comprehended that the economy of the country i.e. Bahrain has seen a considerable change over the years which is accompanied with both positive and negative aspects. Changes has also been seen in various domain of the nations including the growth of the overall economy, the GDP of the nation, the import and export of the nation, the national savings of Bahrain and the overall production rate of the nation among others. Notably, for example the GDP at current prices of the nation has shown fluctuating trend while the overall national savings of the nation includes the government and the industry shown a commendable growth over the years. Hence, it can be concluded that all this aspects has impacted the overall economy of the nation i.e. Bahrain in an extensive manner altogether. References Central Informatics Organization, 2012. Bahrain in Figure. Home. [Online] Available at: http://www.cio.gov.bh/cio_eng/Stats_SubDetailed.aspx?subcatid=604 [Accessed 13 June, 2014]. CIA, 2014. The World Factbook. Middle East: Bahrain. [Online] Available at: https://www.cia.gov/library/publications/the-world-factbook/geos/ba.html [Accessed 13 June, 2014]. Economy Watch, 2013. Bahrain Gross National Savings (% of GDP) Statistics. Home. [Online] Available at: http://www.economywatch.com/economic-statistics/Bahrain/Gross_National_Savings_Percentage_of_GDP/ [Accessed 13 June, 2014]. The World Bank, 2014. GDP Growth (Annual %). Data. [Online] Available at: http://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG/countries/BH?display=default [Accessed 13 June, 2014]. 2The World Bank, 2014. GDP Per Capita (Current US$). Data. [Online] Available at: http://data.worldbank.org/indicator/NY.GDP.PCAP.CD [Accessed 13 June, 2014]. 1Trading Economics, 2014. Bahrain GDP Constant Prices. Data. [Online] Available at: http://www.tradingeconomics.com/bahrain/gdp-constant-prices [Accessed 13 June, 2014]. 2Trading Economics, 2014. Adjusted savings: education expenditure (US dollar) in Bahrain. Home. [Online] Available at: http://www.tradingeconomics.com/bahrain/adjusted-savings-education-expenditure-us-dollar-wb-data.html [Accessed 13 June, 2014]. The Observatory, No Date. Bahrain. Home. [Online] Available at: http://atlas.media.mit.edu/profile/country/bhr/ [Accessed 13 June, 2014]. Read More