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Monday 17th of June 2019
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Arbitrary arrests escalate, says Human Rights Watch

Bahrain lost more of its appeal as a haven for offshore money during March after a period of social unrest came on top of stiff regional banking competition from Dubai. 

Assets held by Bahraini banks specializing in offshore assets fell 10 percent to their lowest level in six years, central bank data showed on Wednesday. 

Foreign assets held by these so-called offshore banks fell 10 percent to $134.9 billion in March, their lowest since 2005, while both domestic assets and assets of local retail banks remained stable throughout the unrest, Reuters reported. 

Paul Gamble, head of research at Jadwa Investment, told Arab News: “Financial institutions are naturally cautious and instability will encourage them to look elsewhere. Dubai and Qatar have been investing heavily in building their financial sectors and are attractive options for companies that are concerned about the events in Bahrain.” 

However, Jarmo T. Kotilaine, chief economist at the National Commercial Bank, said as offshore banking thrives on safety, security, and predictability, Bahrain has had only exceptional uncertainty to offer in recent weeks. Nonetheless, not too much should be read into the scale of the decline in offshore funds yet. 

Many of the factors that allowed Bahrain to emerge as a regional financial hub — above all good regulation — remain in place and by regrouping and redoubling their efforts, policymakers can shift the focus back on Bahrain’s strengths rather than the recent troubles, he said. 

“But it is doubtless true that the competitive landscape is far more challenging than it used to be. Bahrain must act quickly and likely reinvent its image so as to reverse the trend to its favor again,” Kotilaine said, adding any recovery is critically dependent on maintaining social peace and political stability. 

"Bahrain has a tall order ahead as its political climate has been impacted negatively and foreign investors will seriously begin to reassess their presence in Bahrain and consider other region options. Bahrain will have to show political stability and resolve to keep the investors as well as attracting new ones. Certainly it's not an easy task," John Sfakianakis, chief economist at Banque Saudi Fransi, said. 

Bahrain established itself as the Gulf’s regional financial hub when money handled by Lebanese banks left Beirut during that country’s civil war. 

This status has increasingly been challenged by the rise of Dubai in recent years, and assets of Bahraini banks had already started to fall after a regional property crash in late 2008. 

“In relative terms, Bahrain has been losing ground (before the unrest),” Reuters quoted Giyas Gokkent, chief economist at the National Bank of Abu Dhabi, as saying. 

At least 13 protesters and four policemen were killed and hundreds injured in clashes during protests that gripped the country for weeks in February and March. 

The protests dissipated after Bahrain’s government declared martial law to help quell the unrest in a crackdown on a protester camp near Manama’s financial district on March 16, Reuters reported. 


source : http://www.world-newspapers.com
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