GCC Insights: Bahrain sends mixed signals on tourism

The authorities in Bahrain keep sending mixed signals about their commitment to the tourism sector.

Ironically, new tourism facilities are being developed while the authorities place restrictions on entertainment activities inside hotels.

The stakes are high in the tourism sector. More than three million people visit Bahrain annually, the majority from Saudi Arabia crossing King Fahd causeway connecting the two countries, altogether generating around $500 million for the economy.

The tourism sector, through direct spending and indirect spill over into the economy, accounts for up to 10 per cent of the GDP.

Bahrain boasts some 83 hotels including seven five-star, and plans are underway to start two hotels in the next few months. The sector could provide work opportunities for thousands of job seekers.

Over the last few months, tourism officials put pressures on hotel administrators as part of efforts to clean up the image of Bahrain's tourism industry.

In October, tourism authorities closed nightspots inside 22 hotels for three months on charges of violating Bahrain's tourism regulations. A government statement said the nightclubs were ordered shut down for "sullying Bahrain's tourism image".

Restrictive measures partly reflect a government determination to heed popular calls to clean up entertainment scenes, which falls in line with the socio-political reforms programme initiated in 2001 by His Majesty the King of Bahrain Sheikh Hamad bin Isa Al Khalifa.

Not surprisingly, plans are underway to develop a 1,540,000-square-metre Iceberg Tower involving a ski-track and ice-skating rinks at a cost of $175 million.

More recently, immigration officials have taken measures against hotels accused of breaking rules regarding visitors. Some 500 people sponsored by these hotels had failed to leave or to renew their visit visas, rendering their stay illegal.

Several mega tourism projects are being envisaged notwithstanding restrictions being imposed on hotels.

The ambitious Amwaj Islands project is being developed off the northern coast of Bahrain. The $1 billion project aims at developing commercial, leisure and residential properties.

The first phase of the project, which is almost complete, involves reclamation of 2.79 million square metres of land. The second phase concerns infrastructure development such as utilities and roads, which is being rapidly assembled.

The third phase calls for the development of residential and commercial structures involving a range of villas, apartments and condominiums as well as hotels.

Private sector investors own the project through Ossis Property Developers. Besides GCC citizens, expatriates are permitted to own property at Amwaj.

Another grand project, known as Durrat al Bahrain, is poised to be developed in the south-eastern region of Bahrain covering an area of about 20 square kilometres. The government of Bahrain and Dallah Al Baraka Group of Saudi Arabia jointly own the overtly ambitious project.

The authorities need to streamline regulations concerning tourism activities before next April. This is the date when Bahrain stages its first Grand Prix, which is expected to entice many visitors. The formula one race track complex is being constructed south of Manama at a cost of $200 million.

The writer is assistant professor, College of Business Administration, University of Bahrain