A guide to economic zones in Bahrain
The island nation of Bahrain is diversifying its economy away from unsustainable hydrocarbons resources to sectors such as banking and finance, trade and industry, retail and tourism. Its physical link to Saudi Arabia via the King Fahd Causeway, constructed in 1986 has facilitated trade, tourism and retail. The causeway was crossed by more than 1.6 million travellers in June 2012 alone, according to the King Fahd Causeway Authority.
In 2013, Bahrain was ranked as the 12th most-free economy in the world by the US Heritage Foundation think tank, making it the only Middle East and North Africa country to appear in the top 20. Bahrain is home to three special economic zones, all of which were ranked in the top 20 locations for inward investment, economic development and business expansion in FDI Magazines Global Free Zones of the Future 2012/13 report.
The Bahrain Logistics Zone was established in 2008 next to Khalifa bin Salman port, the islands main harbour. Placed 16th in the FDI Magazine ranking, the port zone offers land plots of 3,000 square metres and more for lease. The 100-hectare zone focuses on third-party logistics, storage and distribution (for export and re-export), as well as other logistics services and activities. In the first quarter of 2013, container throughput stood at 95,828 20-foot equivalent units, with an average processing time of 32 minutes.
Bahrain International airport sits in 19th place in the free zones of the future list, and is ranked fifth-best airport zone in the world. Offering cargo facilities, offices and retail space, the foreign trade zone has no customs duties. It is governed by Mumtalakat, the government vehicle for Bahrains non-oil and gas investments, established in June 2006 by royal decree.
Bahrain International Investment Park (BIIP) offers 100 per cent foreign ownership of companies, duty-free access to GCC markets, exemption from import duties on both raw materials and equipment and 100 per cent repatriation of capital. Located 5 kilometres from Bahrain International airport, BIIP consists of 2.5 million sq m of leasable land, costing $1.33 a sq m a year to rent. GCC free zones are considered as being outside the country, so goods are taxed at 5 per cent when exported to Bahrain. BIIP is not treated as a free zone, so is not subject to the 5 per cent tax when shipping goods to Bahrain.
Fast facts
- All three Bahraini free zones appear in FDI Magazines top 20 free zones of the future 2012/13.
- Bahrain International airport is ranked 19th in the free zones of the future list and fifth-best airport zone in the world.
- Goods shipped to Bahrain from Bahrain International Investment Park are exempt from the standard 5 per cent import tax.
- In 2013, first quarter throughput at Bahrain Logistics Zone was 95,828 20-foot equivalent units.
Free zone list
Click on the free zone name for more details
Bahrain Logistics Zone (BLZ)
The BLZ is situated just 1km from Khalifa bin Salman port, 13km from Bahrain International airport and 40km from the Saudi border.
Facilities
Plots of land start at 3,000 sq m, while the zone itself covers 100 hectares. Expansion plans were announced in 2012, including the construction of a new 66kV power station.
Benefits
- Customs-free zone
- 100 per cent foreign company ownership
- Land, sea and air access
Industries
- Third-party logistics
- Storage and distribution
- Logistics services and value-added logistics services, including assembly, packaging and re-packaging
Bahrain Logistics Zone
PO Box 75315
Al-Hidd, Bahrain
Tel: (+973) 1 735 9608
Fax: (+973) 1 735 9564
Email: blz_inquiry@mot.gov.bh
Web: www.mot.gov.bh
Bahrain International Airport (BIA)
While BIA is not a free zone, infrastructure plans are in their final stages , including a possible free zone. Currently, as with most airports, BIA has a bonded cargo terminal, which allows importers to delay the payment of duty until products leave the facility.
Facilities
Cargo facilities at BIA are located in a 19,000-sq-m terminal providing export cargo sales, trans-shipment facilities, break-bulk cargo handling, dangerous goods provisions, customs clearance.
Benefits
- Bonded cargo terminal
Industries
- Cargo facilities
- Retail
- Advertising space
- Offices
Bahrain International airport
Tel: (+973) 1 735 3397
Fax: (+973) 1 733 1014
Email: marketing@bac.bh
Bahrain International Investment Park (BIIP)
The BIIP does not operate as a free zone as such, but allows products manufactured in Bahrain to be sold into the wider GCC without export duties, while avoiding the 5 per cent import tax.
Facilities
The BIIP comprises 2.5 million sq m of land, located 5km from Bahrain International airport and next to Khalifa bin Salman port.
Benefits
- 100 per cent foreign ownership
- Zero corporate tax, guaranteed for 10 years
- Exemption from import duties on raw materials and equipment
- Duty-free access to all GCC markets, including Bahrain
- Free-trade access to the US
- 100 per cent repatriation of capital
- No minimum capital requirements
- No recruitment restrictions for first five years
Industries
- Manufacturing
- International services
BIIP costs
- Rents: From $1.33/sq m a year
- Electricity: From $0.04/kWh
Bahrain International Investment Park
PO Box 50502
Al-Hidd, Bahrain
Tel: (+973) 1 746 7373
Fax: (+973) 1 746 7300
Email: admin@biip.com.bh
Web: www.biip.com.bh
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