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“International contractors and consultants are free to bid for our work”

Interview - November 26, 2013
Head of the construction arm of Bahrain's Government, Minister of Works Essam Bin Abdulla Khalaf discusses the raft of opportunities for the private sector to partner with the Government and the lengths it is going to in creating infrastructure that encourages private enterprise. He also points out the 'communication network, the good workforce, the legal framework, and the fact that we are a banking centre and a liberal society helps' Westerners settle easily into the kingdom
The King has a very ambitious agenda in terms of creating a knowledge-based economy and infrastructure is a major catalyst in this regard. How does the Ministry of Works fit into Vision 2030 and what has changed in order to put forward this very ambitious agenda over the coming years?
Vision 2030 was set by the Bahrain Economic Development Board (EDB). They set a vision as to where they want to see Bahrain by 2030. It is focused on upgrading standards of living and diversifying the economy, as well as transferring it from an oil-based economy to a diversified economy with services in the economy, increasing opportunities for job creation.

That vision is for the entire Government. Each ministry has to develop its own, which cascades from the overall vision for the country.

The Ministry of Works is the construction arm of the Government. We are one of the main infrastructure ministries, which is responsible for major services to the community. We are responsible for the road network, from design to construction, maintenance and the traffic engineering side of the road network. We are also responsible for sanitary engineering and, again, the entire services. Our major goal in that sector is reusing sewerage water and retreating and reusing it for agriculture, landscaping and industrial uses. We have sewerage treatment plants, mainly for this aim. We are also responsible for constructing public buildings on behalf of the other ministries.

For example, we build schools on behalf of the Ministry of Education, health centres on behalf of the Ministry of Health and so on. We are also responsible for the main infrastructure projects. For instance, we built the Sheikh Khalid Airport and the Formula 1 circuit. We built the Bahrain Airport as well, a long time ago, and now we are about to start upgrading the airport. 

In addition to these three main services (road, sanitary and buildings), we extend technical services to other ministries as well as the private sector. We make sure that building standards are met. We go to asphalt factories to make sure the asphalt that is used and produced is up to our standards. Whatever is imported or used in Government projects complies with the approved standards in Bahrain, which is mainly based on European and American standards. We deal with these projects every day – that is the bread and butter for us. 
We use local contractors for simple projects. However, for projects that require expertise we encourage them to engage in joint ventures with international companies, contractors and consultants. Also, since Bahrain has a free economy, international contractors and consultants are free to bid for our work on their own as well. We have that freedom. If the local contractors can do the work, they are most welcome to do so but, if not, they can complete it through a joint venture. We have carried out a number of projects under these categories.
For example, an Indian company has completed one of the interchanges. We just completed another flyover here via a joint venture with a Bahraini, Italian and Belgian company. We have just started a project in Formula 1. It is going to be a night race so there will be a lighting project. We are working to engage in a joint venture with a Bahraini company and a German consultancy firm. 
I remember, when I first started working here, our own labourers did most of the work. They used to build roads. Then, the ministry started hiring local contractors rather using its own employees to build the roads and maintain them. We are about to complete an engineering project with a British company to treat sewerage water. 
Talking about the historical ties between Bahrain and the UK, when I first started, most of the engineers here were from England. British and Scottish engineers trained me, as they were either employees of the ministry, or consultants working for us. I had the opportunity in my own training to work for these engineers and consultants full time. I remember they made me work really hard and much longer hours, but I benefited from it. I worked for Hyder, which is one of the prominent consultants that has done a lot of work for us in regards to the road network. They are working for us now on the sanitary engineering side as well.
In terms of infrastructure and cultural changes that need to take place in the near future, one of the things that is very interesting to see in the Vision 2030 is the use of public transportation. Bahrain has one of the highest rates of car ownership in the world. Please tell us about the strategies as well as the challenges of putting forward an ambitious plan for public transportation.
Car ownership in Bahrain is probably one of the highest in the world. The population right now stands at about 1.1 to 1.2 million and the number of registered vehicles has exceeded half a million. Bahrain has a small land area so the density is one of the highest in the world. Bahrain is a modern society and we depend on our cars.

That is why congestion is rising even though we are trying to combat this congestion by building more roads and flyovers, but we cannot sustain this strategy. This ministry has conducted a study with consultants and we have focused the Vision 2030 on encouraging public transport. Currently, public transport usage is at 5%, compared to total transport needs. The goal for 2030 is 30%, which is a big challenge. We have identified the routes for public transport and through the Ministry of Transportation we are starting to recreate routes. We are starting by expanding the bus network. 
Currently, a private company operates the bus network. The idea is to expand the bus service and the routes to cover the whole of Bahrain, increase the number of buses and encourage the use of public transport.

This is the first step, but we realise that there is a lot of work ahead of us. We know that we cannot sustain the existing situation that depends on private vehicles. I must say that even Government policies need to be reviewed. I think Bahrain is one of the cheapest countries in the world to own a car: customs is as low as 5%, petrol is cheap, parking is almost free (we have parking meters) and the registration fee is very low. In other countries such as Spain, the UK and the US it is very expensive. 
Would you say that it is a supply problem, and that there is no infrastructure in terms of buses, light rail etc. and that is why people are not encouraged to use it, or is it more of a demand side problem, and that people are not culturally accustomed to using public transport?
Quite frankly, when I started working, I used to take the bus from about six or seven miles from here. So, it is not unusual for Bahrainis to use public transport. The good thing about our society, which I am really proud of, is that Bahrainis adapt to their realities. The fact that we depend on private vehicles is only because they are available and petrol is cheap. However, if the situation changes and we need public transport, I do not think there is a cultural hindrance. When my mother was alive, even though we lived in the same house and we used to have our own cars, if she wanted to go to the shopping mall or souk area she used the bus rather than asking us to take her. 
In terms of culture and transportation we are different compared to our neighbours. I do not see it being a cultural issue. At the end of the day, whatever mode of transport you use is an economic issue, like anywhere else in the world. If something is available and you can afford it, you will use it. But if it is not, then you will not use it.
Going back to the public-private partnerships (PPPs) that this ministry has with international and national companies, what relationship does the ministry establish with the private stakeholders in order to provide the best infrastructure whilst having a sustainable action framework?
We want to encourage such projects. Encouragement is not just through words – it is through providing factors for success. In order to do so, as Government we provide the infrastructure up to their plot boundary. For example, we built the highway to reach Durrat Al Bahrain to have the free, safe access and high capacity. It coincided with our plan and also provided them with the main issue, which is access. Along with that, our colleagues in electricity and water provided them with the infrastructure for electricity and water.

The road is already there and we are going to upgrade it very soon and change it from a single carriageway to a dual carriageway. We have just completed the flyover and the King Faisal Highway. The flyover is part of the overall plan, in order to provide access to the whole of the north of Manama and encourage business there.  Without accessibility, things will be very difficult. 
In regards to the Financial Harbour, we have done a lot of work on widening the King Faisal Highway in order to improve accessibility. That is what we are doing. We provide infrastructure for almost all these investment projects. For the Reef Island project, we did a bridge almost exclusively for them. That is how we are encouraging them. We are providing accessibility through bridges and highways and sanitary engineering services. Our colleagues in electricity and water services are also responsible for whatever is inside. We make sure that whatever they build is up to the standards we work with.
What is the current state of the Qatar-Bahrain Causeway?
That is a project that is very close to my heart. I started the project at its inception. I remember visiting the former Emir of Qatar, with the now Deputy Prime Minister, when the agreement was first made between the two governments. I worked with consultants that had been appointed to define the route between Bahrain and Qatar for four or five years and we went through the environmental and traffic studies, and many other technical meetings, which used to be held in Doha and Manama, until the route had been set and an authority had been established. We are very optimistic because Qatar has to be ready for the World Cup 2022. We have a vision to accommodate the fixed track, which is for the rail. That is the information that I have at present.
In the same regard, Bahrain has a technological edge, because it has the experience of the causeway with Saudi Arabia.  
Yes, it is using the same structure. From a technical point of view, it is not something unusual, as you mentioned. The King Fahad Causeway is 25km long and Bahrain-Qatar Causeway will be 40km. The King Fahad Causeway is 50% bridges and 50% embankments, and we agreed on 55% bridges and 45% embankments for the Bahrain-Qatar Causeway. All the details have been similar.

The landing points have already been fixed and I know that our colleagues in Qatar have extended the road network up to the landing points. We have plans to upgrade our road network so, once the causeway is built, we will be ready to connect roads. We hope to see this starting as soon as possible. 
From our experience as a country, we know that the King Fahad Causeway has strengthened the ties between Bahrain and Saudi Arabia. Both economies are now linked. The average daily traffic has exceeded 14,000 vehicles per day. Our weekends are now the same. Saudi used to be Thursday and Friday and now they have switched to Friday and Saturday. It is good for Bahrain as well.
In the context of the 200 years celebrations of UK-Bahraini relations, what are the advantages, and the ease of doing business, in Bahrain for UK firms in particular?
Because of this historical relationship, the UK knows Bahrain best and we know them best. In fact, a British engineer working here with us told me that he finds that Bahrainis know more about the UK than he does. Because of this historical relationship, we know each other more than others. Bahrain has incentives here. I think the legal framework to safeguard investments we have here is one of the best in the area and in the Arab and Islamic world. Investors want to safeguard their investments and I think the legal framework we have is very well developed. 
Secondly, companies that come want locals to contribute and, because the level of education is high, we have a well-trained Bahraini workforce in all disciplines.

I think that is an advantage. Bahrain is a banking centre, which is another incentive. In Bahrain, it was recorded in the paper that there were 2.2 million subscriptions on social networks. For the size of Bahrain, that is amazing. You can tell that they are IT-oriented, especially the new generation. I think the communication network, the good workforce, the legal framework, and the fact that we are a banking centre and a liberal society helps. People can dress however they want and there are no social restrictions. We find that people from the West and Europe find it easier to live in Bahrain. The standards of living here and the freedom here give Bahrain an edge. 
How do you see all the changes that you are currently implementing in the country developing over the next five to 10 years?
I have a positive view for the Bahraini economy and our country in general. The leaders of the GCC have said that they have committed $10 billion over 10 years to spend on infrastructure in Bahrain. We have already started – contracts have already been signed in this ministry, because we build the projects on behalf of the other ministries. We started putting in tenders for schools and health facilities, as well as the projects that this ministry will implement: flyovers, main road expansion and the development of the major treatment plant. These are mega projects. Of course, they will be implemented over five or six years. We are hopeful that this will increase the GDP (gross domestic product) and create more jobs. 
As part of the state budget there are a number of projects planned, some of which are about to go to tender. In fact, many are already under construction. We see Bahrain changing. We want to see services in Bahrain continue to upgrade to international standards. For sanitary engineering, more than 90% of the population now has access to sanitary engineering services. From what we know, this is one of the highest worldwide. Roads and connectivity exceeded 94% but we want even more. We do not just want a road network – we want it to be more efficient and safer.
Our leadership wants the best for its citizens. I get my directives as minister from the leadership. We want the best for our citizens. We want higher standards of living, more jobs and better services. We have to use them efficiently in order to implement the leadership’s directives. We know it is a challenge because Bahrain has limited resources, especially oil, which is why we have to keep on diversifying our economy and get more income to use this for our people.
We have to involve the private sector. We have a project that we are about to complete that develops a treatment plant with a consortium led by a consultant. We are doing this through a PPP project. We are responsible for public buildings and we have green buildings, which means we have to save energy by using lighting that consumes less energy, controlling air conditioning and making sure that the buildings are sustainable and consume less energy and water. We have started with our own buildings in the ministry. We are changing the water taps to sensor taps so that we consume less water and we have started changing all our lights to LED lights.

A lot of our electricity consumption is used on cooling, just as in your countries it is used on heating.