BMI View: Overall little has changed in the Bahrain water sector; however, we have upgraded our forecastsfollowing the release of new historical data. We anticipate that the need for greater water security and moreefficient distribution infrastructure will continue to be the key issues facing the water services sector, yet thesubdued project pipeline and the difficulties in obtaining financing will offer minimal opportunities forwater infrastructure groups.
The privatisation of the water sector has been on the agenda in Bahrain for several years. This privatisationtakes place in the context of an improvement of the overall investment climate in Bahrain, with domesticeconomic conditions gradually showing signs of improvement after little growth in the last two years. Thecountry's Electricity and Water ministry is actively seeking bilateral partnerships with counties includingFrance and the UAE as part of the wider strategy to improve the quantity and quality of its water suppliesover the longer term. If these meetings develop into full-blown partnerships we anticipate a possibleupswing in joint ventures in Bahrain's water sector (particularly water infrastructure) between French,Bahrain and UAE companies.