Efforts to make Bahrain and its economy more business friendly has attracted growing interest from the Gulf and beyond, Rasheed Al-Maraj, the Governor of the Central Bank of Bahrain (CBB), told CNBC Europe’s “Closing Bell” programme in an interview from the World Economic Forum (WEF) Annual Meeting in Davos, Switzerland.
“We try to make our economy and our country more business friendly by putting in the right legal and regulatory (measures) to ensure that there is an environment conducive for doing business. Over the years, we have seen growing interest not only from the region itself but also from outside looking into Bahrain, because we have been doing this for the last four decades.”
Rasheed Al-Maraj noted that there has been growing interest in insurance and Islamic Finance in particular. The Kingdom is a pioneer in Islamic Finance having been the first in the Middle East to nurture its concepts. Bahrain now has by far the largest number of Islamic banking entities in the world and more than 30 countries have sought the country’s support to develop their own Shari’a compliant banking.
Asked if the example of Dubai had cast some caution around the whole question of sukuk, Rasheed Al-Maraj replied: “Each individual product and borrower will have its own characteristics. Bahrain borrowed last year in terms of sukuk and we did not face any problems. I am sure that people, when they re-examine some of the problems that happened through the defaulted sukuk, will understand better what sukuk stands for.”
The Central Bank of Bahrain (CBB) consults with practitioners in Islamic Finance to ensure the regulations make practical sense before applying them firmly with no exceptions. To raise professional standards, Bahrain continues to devise and run numerous courses and training programs to develop the skills of Islamic banking.
The interview explored the healthy investment community in Bahrain – and a relatively healthy banking industry throughout the Middle East – against the backdrop of the issues facing the western world.
“I think the financial institutions in the region have weathered the storm in a very effective way. The focus of these institutions over the last few years has been in the region as a result of a growing economy and arising investment opportunities. This, to a large extent, has protected most of the financial institutions from getting exposed to toxic assets and problematic debts.”
Rasheed Al-Maraj is part of a Bahrain delegation at Davos led by His Royal Highness Prince Salman Bin Hamad Al Khalifa, the Crown Prince of Bahrain and Chairman of the Kingdom’s Economic Development Board (EDB). Themed “Improve the State of the World: Rethink, Redesign, Rebuild”, the summit is a gathering of the foremost leaders and seeks to encourage cooperation in an effort to shape the global agenda for 2010.
