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Bahrain’s public debt rises by 11.7%

October 31, 2018 at 2:20 am

Bahrain’s public debt rose by an annual rate of 11.7 per cent in September, the Central Bank of Bahrain (CBB) announced yesterday.

According to the CBB’s official data, the country’s public debt reached 11.74 billion Bahraini dinars ($31.34 billion) last month, compared to 10.51 billion Bahraini dinars ($28 billion) during the same month in 2017.

The country’s debt, CBB pointed out, rose by 1.6 per cent on a monthly basis last month, adding that it reached 11.551 billion Bahraini dinars ($30.8 billion) in August.

The bank explained that total amount of the public debt had stemmed from a 9.07 billion dinars ($24.2 billion) worth of government bonds and treasury bills and 2.66 billion dinars ($ 7.1 billion) of Islamic Sukuk certificates.

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The kingdom’s economy has been hit hard by a drop in oil prices in recent years, with its dinar sliding to its lowest in more than a decade. Saudi Arabia, the United Arab Emirates and Kuwait have offered a $10 billion aid package to avoid Bahrain’s risk of a debt crisis, which was also tied to fiscal reforms.

On 5 October, the government released a fiscal plan to fix its debt-burdened finances and essentially abolish its budget deficit by 2022. The plan, which promises further cuts in public spending, comes at a sensitive time as the kingdom prepares to hold an election next month, the second ballot since 2011 when protesters took to the streets demanding democratic change.