Bahrain is set to invest £1bn ($1.3bn) in the UK following an agreement between British Prime Minister Rishi Sunak and Bahraini Crown Prince Salman Bin Hamad Al Khalifa on 3 July
Both leaders signed a strategic investment and collaboration partnership during a meeting at Downing Street. The agreement seeks to facilitate investment of more than £1bn into the UK, support the diversification of Bahrain’s economy and drive greater cooperation in clean technology, business services and manufacturing.
Bahrain will make the investments through its sovereign wealth fund Mumtalakat, and entities Investcorp, GFH Financial Group and Osool Asset Management.
Separately, on 4 July, both countries agreed a new digital economy partnership to boost each other’s technology and service sectors. The pact aims to ensure trade between the UK and Bahrain continues to be modernised and streamlined to boost growth in sectors such as fintech, medtech, agritech, cyber and space.
Total trade in goods and services between the UK and Bahrain reached £3.1bn in 2022 (an increase of 93.5%, or £1.5bn, compared with 2021), according to figures from the UK’s Department for Trade & Business.
Bahrain was the UK’s 60th-largest trading partner in 2022, accounting for 0.2% of total trade. UK exports to Bahrain amounted to £763m in 2022 (up 40.5% year on year). UK imports from Bahrain reached £2.3bn in 2022 (an increase of 121% compared with 2021).
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In 2021, inward stock of foreign direct investment (FDI) in the UK from Bahrain was £1bn, making up 0.1% of total UK inward FDI stock, according to the UK’s Office for National Statistics.
The increase in ties with Bahrain comes as the UK is negotiating a free-trade agreement with the Gulf Cooperation Council, the six-country political and economic trade bloc. The bloc’s members are Saudi Arabia, the United Arab Emirates, Oman, Kuwait, Qatar and Bahrain. Talks are expected to enter a fourth round later in July, following a third round in March.