Macroeconomic Forecast Bahrain

Bahrain's public finances are set to deteriorate in 2011, as the government ramps up spending in a bid to shore up public support. Indeed, while revenue streams will undoubtedly benefit from the ongoing uptrend seen in global energy prices, cash handouts and promises to build thousands of new homes will keep expenditure growth elevated this year. We project the budget surplus falling to 0.9% of GDP in 2011 from 1.4% in 2010.

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