Bahrain – an Arab state located on the southwestern coast of the Gulf, is an archipelago comprising of Bahrain Island and around 30 smaller islands. The kingdom is located in one of the world’s highest oil-producing regions. Given that it only has small reserves of hydrocarbons, the kingdom and its economy has long relied on processing crude oil from its regional neighbors.
In the recent past, other sectors such as financial, communication and tourism have grown noticeably. The country’s capital city, and port – Manama is located on the northeastern tip of Bahrain Island. During the 1970 - 1980, several regional and international institutions searching for a stable environment relocated themselves to Bahrain. This afforded Bahrain among the first Gulf Cooperation Council (GCC) states to divert its economy beyond the tradition dependence on hydrocarbon exports. Despite the neighboring GCC countries making headlines with their economic models, Bahrain has long been a strong base to build businesses with the aim of attracting regional opportunities. Economic growth in Bahrain accelerated robustly in 2017. The positive momentum was mainly attributed to unprecedented spending on infrastructure, as well as a collection of strong and positive non-oil growth drivers.
The Abu Dhabi Fund for Development’s (ADFD) efforts towards social and economic development for Bahrain began in 1974. The Kingdom of Bahrain has been a strong focus of the ADFD, having received about AED 10.6 billion in total grants and loans. The fund has provided financial assistance for 26 projects in various segments of sectors; Agriculture, Electricity & Water, Social & Health services, Housing, Industrial and Transportation. Among these projects is the expansion of the Bahrain International Airport, which is of national importance.
Revamping the gateway
ADFD aims to help strengthen Bahrain’s push for growth in the non-oil segment, to continue bolstering its economic standing. It is with this initiative that came the decision to finance the expansion of the airport, providing the bulk of the funding - $918 million of the $1.1 billion, as part of a GCC development program originally conceived in 2013. After many reviews of development schemes, this project remains the landmark of a series of development program projects.
Having the distinction of being the first international airport in the region, built in the early 1920s, the Bahrain International Airport (BIA) is a critical component of the kingdom’s fast growing aerospace sector. Not only has the airport been a regional hub for commercial and cargo airlines but has increasingly gained recognition as a world class facility, having climbed to the 55th position in the latest Skytrax ranking of the world’s top airports. As a result of its strategic location in the GCC, BIA has been an attractive hub for regional and international airlines, which in turn has increased its connectivity to the region’s largest economies and to Europe, Asia and the Far East. Cargo volumes have been on a steady rise at BIA, with 2017 witnessing a 10% surge. As the GCC economic block continues to grow, demand for air traffic and regional aviation prospects continue to drive future investments in air transport infrastructure to support future growth.
Upon its completion in 2019, the expansion of Bahrain International Airport will increase the facility’s existing capacity to 14 million passengers , 130,000 air traffic movements annually and 4700 bags per peak hour, further cementing the Kingdom’s attractiveness of a regional hub for travelers and cargo. The new terminal will cover a built-up area of 20.7 hectares that will include a 4,600m² departure hall, 104 check-in counters, 36 passport control booths, 24 security checkpoints, five E-gates, eight baggage reclaim belts and a 1,000m² duty-free shop. In addition, the expansion will also have 108 check-in desks, 24 passport control booths, 28 security lanes, a 9,000m² duty-free retail space, premium-class lounges, food and beverage zones, and 24 jetty-served departure gates all of which are slated to be ready by the scheduled opening in 2019.
Other enhancements to the airport include a new cargo area, maintenance hangars and Bahrain’s first general aviation terminal, to be housed in the original 1950s-built airport building. Furthermore, Bahrain International Airport’s (BIA) new fuel farm complex will cement the Kingdom’s status as a major regional aviation fuel services hub when it launches in the third quarter of 2019. Bahrain Jet Fuel Company (BJFCO) is currently developing the facility, which will streamline the aviation fuel supply and operation processes at BIA and increase its fuel storage capacity to 30,000 cubic meters. The health and wellbeing of passengers is also a top priority. Operated by Bahrain Specialist Hospital’s team of highly trained medical professionals, the new terminal’s state-of-the-art airport clinic will offer medical services to passengers and airport staff 24/7. The project is being positioned to support the Bahraini aviation sector and catalyze the growth of related sectors including tourism, trade and transportation. Germany-based airport developer and operator, Fraport AG, is responsible with providing operational readiness and airport transfer services for the new passenger terminal as part of a 32-month deal with the Bahraini government signed in 2017. Likewise, the contractor working on the construction of the new terminal building, the main services building and aircraft bay constitutes a joint venture between the UAE's Arabtec and Turkey's TAV Construction.
Maximizing potential
The sole purpose of the fund is to help developing countries achieve sustainable economic growth by providing financial resources and forging partnerships in the public and private sectors, the aforementioned project has started a chain reaction with the pivotal assistance provided in this project. Not only will the expansion project create new jobs, substantially improving the standards of living of several people, it will also enhance the skill level of new and existing entrants into the work force. One of the ripple effects of the project is the launch of the “Tahleeq” programs – the first “Tahleeq” program – produced 20 graduates who now work full-time at the airport and was designed to shape the future leaders of the Bahraini aviation industry. “Tahleeq 2” attracted an additional 20 Bahraini graduates with a growing number of applicants. To meet the increased interest into these programs, the number of applicants for recently launched “Tahleeq 3” has doubled to 40. Apart from recruiting 80 Tahleeq Trainees, and 20 employees for Level 1 & Level 2 ICT helpdesk support, there is potential for recruiting more staff to support ICT maintenance. Eighteen young Bahraini recruits are currently being trained at the recently established
Baggage Handling Services department. These programs will aim to provide young Bahraini with a development platform by exposing them to different skill sets required to work in various disciplines. This platform will focus on providing skilled personnel to cater to the ongoing Airport Modernization Program (AMP), a national project which aims to elevate BIA’s standards to an industry leader. In addition, the kingdom’s national carrier – Gulf Air, is being revitalized as the expansion of BIA has acted as an enabler for broader operations. Part of the strategy is to expand routes and frequencies as well as a brand refresh for the Middle East’s most distinguished airline, which will be celebrating its 70th anniversary in 2020. Another part of the strategy is to be able to offer hub connections for passengers transferring within the region and North Africa, which could only be achievable with a larger operating base – BIA. The national carrier has also signed a join co-operation agreement with “Tamkeen” (Government authority for economic growth and development in Bahrain) which is aimed at developing opportunities of training and employment of Bahraini within the aviation sector.
Recreational Utility
The expansion project will also cater to the kingdoms well-paced tourism sector - which has seen strong growth in recent years, the most recent figures dictate a growth rate of 6% y-o-y in visitors to the country in 2016 to a total of 12.3 million, a contribution of BHD 1.3 billion (USD 3.4 billion), 9.7% of GDP in 2017 and is expected to grow by 3% this year and 4.7% thereafter per year for a total contribution of 10.9% to GDP by 2028. This posed as an obstacle for the kingdom as the operational capacity for the airport as it stands pre-expansion is 9 million passengers (in a facility originally designed for 3.5 million) annually. Better aviation infrastructure to accommodate for a growing tourism sector will naturally result in permitting modernization in terms of hotels – a number of new 4 and 5 star hotels are in development slated to be completed in the short-medium term, restaurants, parks and other recreational real estate – shopping and entertainment developments such as the Mall of Dilmunia and Marassi Galleria, thereby adding value for the Bahraini community as well. The project also proves to be socially beneficial, as stated under the United Nations sustainable development goals (SDG), the project ties into decent work and economic growth (SDG 8) industry, innovation and infrastructure (SDG 9) and sustainable cities and communities (SDG 11). The Abu Dhabi Fund for Development will continue to provide financial assistance for various projects. Projects including the ongoing aforementioned airport expansion will promote economic development and open the country to various regional and international economic and social development facets, in line with the goal of the fund. With the completion of the project will come the revamping of Bahrain’s national carrier – Gulf Air, this will lead to a shift in morale as well as pride for the Bahraini.