Made in #Bahrain

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In one of my travels to America during my last few months of completing my Ph.D., I thought long and hard about the type of simple gift I should bring back home with me. I don’t feel quite comfortable walking in empty handed, and tend to like to paint a picture of myself as creative and unordinary, in this specific department. One of my favorite places in America to walk around and search for the latest homey stuff and gadgets is Macy’s department store.

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So walking in Macy’s, I decided to get a nice top quality brand bed sheets. I’ve always walked pass those isles, the bed in a bag, gazillion thread-counts, and the softest and most medically induced pillows, but never really fell into their marketing stunt, except during this desperate times. I thought that would show a bit of my softer side since I was always told that The Citadel, my military college, has caused permanent damage to the thickness of my skin.

I came back with it to Bahrain and got it out of my suitcase to show my better half what I have bought, in pride. While holding the package to showcase the brand, the backside of it was facing me, and that’s where I shockingly read what it had said. “Made in Bahrain”. Huh?!

Around 4 years later, I received an invitation to visit a ‘garment’ factory located behind Alba (Aluminum Bahrain) while working at the Economic Development Board. Taking a tour in this massive garment factory, which is called WestPoint Home, I found out that this is where that bed sheet was actually made. I felt proud and full of hope because I saw things first hand on how successful we can be.

Sometimes I do feel that there is a master-plan for Bahrain, one that would make us one of the best countries in the future, completely independent and living off of selling the best manufactured products to the rest of the world. But honestly, most of the time I feel that we are walking into a dark future, one that is uncertain with barely any developmental plans to be the best we can be. When I open the newspapers and read what our parliament discusses and requests from the government, I feel hopeless and sad. In general, our members of the parliament continue to demand free things for the population without anything in return. When asked why, they say God has given us natural resources and we need to spend it on the people. What a plan!

But the people have kids, and those kids will grow up, have you thought of them, I ask? Of course not, they won’t be sitting in office by then, they’ll be enjoying their retirement benefits, of which they have orchestrated and voted for. But future problems, well, let’s leave it for future generations to figure it up for themselves.

The thing is, you see, is that Bahrain already lags behind, while industrial lands almost no longer exists. The ex-minister of industry, for example, proposed creating an industrial island somewhere in the sea, a relatively unnecessarily large one under his command. But I should give it him; it is an idea in the right path, not quite rational though because, well let’s just say there is no ROI (return on investment) plan.

So what to do? The answer is easy, but requires some steal sensitivity. It is called ISI, (Not ISIS) and it refers to Import Substitute Industrialization. This is something that countries like China have done, very successfully. At one time they were importing toys, so they decided to ban the importation of such products and force their economy to purchase locally made toys, even McDonald’s. With time, Chinese made toys rose to become very well and demanded even internationally, and when the market was open again, they remained very competitive. In fact, the world began purchasing those toys, cheaper and better.

For us in Bahrain, we need to understand that free market, open to the whole wide world, with barely any protectionism, is actually good, but not right now, not at a time where local companies are unable to compete with anything foreign. We need to first strengthen our local products. True, we barely have anything local, but what needs to be done is the following: Choose a foreign product, create an industry that manufactures this product, ban or restrict the foreign product, and then local demand would be created almost immediately. With time, the local product would strengthen, which will allow us to go to step 2, EOI.

Once a local product is supported to become competitive due to the local advantages it has received, the policy would then shift to allow this product become internationally sought. Of course nothing is for certain, but these methodologies are not theories, they have been done and tested by a number of countries very successfully, and others not very much so. It is all about doing this at the right time, every product needs to have its own plan, and one size does not fit all.

Where are our ISI and EOI plans? Free trade is good, but what about our national economic plan, does it include an industrial revolution, because that’s what made the West, and Asia had their own as well. Come on now, I doubt that I’m the only one in Bahrain that knows the alphabet!



Categories: Economics, Politics

Tags: , , , ,

3 replies

  1. Sir i like your thoughts! And i became really happy to see your scientific apporch toward problems and your FAR VISION.
    but i have some doubt about your sloutions. Like suppose if we creat TOY FACTORY as you mentioned and then you also gonna recruit and prefered bahraini nationals and labours for this work. And export our bahraini products to other countries, as you know these type of setups or factories dont have enough net profit margins.
    So what do you thinks A BHARAINI labour gonna go for such a small amount of salary and what do you think he gona be satisfied by 300BD or 250BD?
    Sir these problems you mentioned in your article are not gonna solve only by ecnomics or bussines strategies. These problem are gona solved by SOCIO-POLITICAL, SOCIO-ECNOMIC and SOCIO-PHYSCOLOGICAL approces.
    Im really glad by your positive thinking but not agree with you solutions.
    Thanks
    Hisham Mohammad Ali

    • Thank you for your comment Hisham. ISI is not about establishing a toy factory and selling it abroad. The first step is to first identify a product that we import, for example, Pepsi. The next step is to get the government to support the establishment of a similar product, almost the same taste, say we called it ISPEP. Once this product is up and running and is very similar to Pepsi, then the government would impose tariffs or even ban Pepsi. This way locally ISPEP would be in high demand and the factory would increase production and wages within the factory would rise. This will also, with time, allow the product to get better through better funding and research, and of course, marketing. After a calculated period of time, the product would enter the phase where it will be competitively sold internationally and exported to where demand exists. Imagine, it is a substitute to Pepsi, but costs less. Of course it is not as easy as it sounds, but that’s the general concept.

  2. I’ve found this blog while I was thinking of starting a pillow factory in Bahrain, but after reading these article I guess I need to start another factory LOL.
    Anyways, in my opinion, starting factories and producing stuff (rather than just working on trading) can jump Bahrain to a very higher level. We have many nice supportive programs like Tamkeen, BDB ect. Yes with slight changes they could be more useful, but what mostly we miss is the WILL

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