Saudi Arabia, UAE and Kuwait pledge to help Bahrain

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The three Gulf allies granted $ 10 billion in aid to Bahrain in 2018 to help it avoid a credit crunch

Saudi Arabia, the United Arab Emirates and Kuwait reiterated their support for Bahrain’s plans to balance its budget, a move that should help their neighbor in debt capital markets despite delays in its recovery plans. heavily indebted finances.

The three Gulf allies provided $ 10 billion in aid to Bahrain in 2018 to help it avoid a credit crunch.

Bahrain said last month that due to the coronavirus crisis last year it postponed the target year for a balanced budget to 2024 and announced plans to increase value added tax to increase state coffers.

The balanced budget program – a set of reforms aimed at balancing the budget – was tied to the $ 10 billion pledged.

The finance ministers of Saudi Arabia, the United Arab Emirates and Kuwait met with Bahrain’s finance minister on Tuesday to discuss Bahrain’s progress in improving its finances.

“The ministers commended the efforts of the government of Bahrain in implementing the balanced budget program and the progress made by the government despite the challenges posed by the Covid-19 pandemic,” the three countries said in a joint press release.

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“The ministers affirmed their support for the efforts of the Kingdom of Bahrain in pursuing further reforms to improve fiscal stability and strengthen sustainable economic growth,” the statement said.

Bahrain’s public debt reached 133% of gross domestic product (GDP) last year, up from 102% in 2019, according to the International Monetary Fund.