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Insights

11 August 2020

The Kingdom of Bahrain & Covid-19 – Bahrain’s reaction to the global pandemic

August 2020 update

The world remains in unfamiliar territory with Covid-19 still affecting the daily lives of people around the globe with the wearing of facemasks and other protective equipment in public and working remotely becoming the new ‘normal’. The reimplementation of lock-down procedures in cities across the globe, the increase in active cases in countries such as USA and the recent sudden closure of the air-bridge between the UK and Spain has shown that Covid-19 is still very much a present issue.

Following on from the steps detailed in our previous articles, the Government of Bahrain, led by the National Taskforce for Combating the Coronavirus, has recently announced various additional and/or extended measures aimed at supporting the economy, businesses, citizens and residents of Bahrain, with Bahrain again receiving praise from the Director General of WHO for its efforts.

Extension of stimulus package:

It has been reported by the Bahrain News Agency that the Government of Bahrain will add approximately BHD177m ($470m) to its 2020 state budget in emergency spending on fighting Covid-19, which is to be taken as a one-time reduction from the Future Generations Fund, which was set up in 2006 to reinvest hydrocarbon revenue, with a temporary halt placed on the allocation of oil revenues to the Future Generations Fund until the end of 2020. The aforementioned are subject to the provisions of several royal decrees.

The stimulus package announced earlier in the year included a range of economic policies that have been successful in minimising the economic impact of precautionary health measures whilst protecting the health of individuals at the same time. The stimulus package has also bolstered economic activity and prepared the economy for recovery, with improvements in the volume of cash withdrawals, point of sale transactions and exports reported for May.

Some elements of the stimulus package announced earlier in the year were to cover the months of April, May and June, such as the payment of Electricity and Water Authority Utility bills for individuals and businesses. The Finance and National Economy Minister Shaikh Salman bin Khalifa Al Khalifa reported at the end of June that certain stimulus measures would be extended with an aim to reduce pressure on households and families whilst also supporting many jobs of those employed in the private sector, namely that:

  • For July, August and September the Government of Bahrain would:
    • support 50% of salaries for insured citizens employed in the private sector working for companies most affected by Covid-19, which would total approximately BHD70m ($185m);
    • pay Electricity and Water Authority utility bills for citizens’ primary residences, which would total between BHD12m ($32m) and BHD15m ($40m) approximately; and
  • Economic sectors most affected by Covid-19 will be supported by The Labour Fund (Tamkeen) with such sectors to be determined in accordance with the rules and conditions set by the Labour and Social Development Minister.

Following directives of His Royal Highness Prince Salman bin Hamad Al Khalifa, Crown Prince, Deputy Supreme Commander and First Deputy Prime Minister, Tamkeen has increased the financial assistance provided to businesses most affected by Covid-19. The scope of Tamkeen’s assistance has been expanded with eligible start-ups now receiving 200% of the amount they were previously receiving and by supplementing 50% of income for taxicab drivers, public transport and bus drivers, driving instructors and kindergarten and nursery workers. The companies that have been supported include salons, restaurants and cafes, travel offices and gyms. As well as financial support, Tamkeen has also been assisting companies with formulating recovery plans.

The Bahrain News Agency has reported that the Bahraini Minister of Works, Municipal Affairs and Urban Planning, Esam Abdullah Khalaf, has issued an edict to reduce and exempt fees for 234 Bahraini families living in rented accommodation in June, supporting the Government’s aim to reduce pressures of families and households.

Health and safety requirements:

The Ministry of Health continues to increase the number of daily Covid-19 tests carried out with over 900,000 tests completed at the time of writing. Those healthcare workers on the frontline combating Covid-19 who have been unable to renew their licenses since February 2020 have been exempted from any fines or financial dues usually payable in respect of such non-renewal.

There is still the requirement to wear facemasks in public with all aspects of social distancing still actively encouraged with the requisite enforcement action taken for non-compliance. It is recommended that only essential travel take place, although more airlines are announcing the recommencement of their services to and from Bahrain. However, visas are still not available on arrival and all arrivals are required to undertake a Covid-19 test at the airport, followed by a mandatory 10-day quarantine period, with a further Covid-19 test at the end of such quarantine period. All individuals are now required to cover the cost of such tests, being BHD30 ($80) per test. The King Fahd causeway connecting Bahrain and Saudi Arabia remains closed to non-commercial traffic.

Immigration and employment:

The Nationality, Passports and Resident Affairs of the Ministry of Interior has announced the automatic extension of the validity of all valid and expired visas for an additional three months, until 21 October 2020. For those wishing to remain in Bahrain beyond this date, they can apply through the eVisa portal to do so, meaning that such individuals may correct their immigration status free of charge.

The Labour Market Regulatory Authority (“LMRA”) has recently announced that it will start accepting requests for new work permits from 9 August, following the temporary suspension of the same in March. This will allow private employers to apply for visas for overseas employees. The LMRA has altered the hiring process for the private sector for a duration of two weeks, during which time vacancies are to be advertised in local newspapers to allow Bahrainis and expatriates currently residing in Bahrain to apply for the positions.

The Ministry of Health has issued a number of guidelines that are to be followed by restaurants and coffee shops during their phased reopening, with outdoor dining to be permitted from 3 September 2020 and all dining services to be permitted from 24 September 2020. The guidelines are in respect of occupancy and distance between diners and are aimed at maintaining social distancing requirements.

Closing thought:

With gyms, outdoor playgrounds and swimming pools due to reopen on 6 August things are slowly moving towards how they were, to some extent, prior to Covid-19. However, with Eid Al Adha only last week, traditionally a time for friends and family to exchange visits, a strong focus will be on the daily Covid-19 cases, with the likelihood of the reintroduction of lock-down measures should there be a spike in such cases.


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