Bahrain will have to become more productive and competitive to achieve higher economic growth rates, according to a top buinessman.

The country should plan a growth rate rise of nine per cent a year effective from 2012 driven by productivity increases of 5pc a year and labour increases of 4pc a year, said Mashal Group chairman Dr Yousef Mashal.

'This means that by 2025 every Bahraini will have to produce 65pc more than he or she does now,' said Dr Mashal, who is also a National Dialogue participant.

'We have to become more productive and competitive. A simple salary increase which is not sustained by changes in the way we work will lead to a decline of our competitiveness and companies will go out of business.

'Companies will have to continuously think about how to produce their goods and deliver their services more efficiently using fewer people.

'One Bahraini and a machine will do what today takes several labourers to achieve.'

Dr Mashal said Bahrain must continue to diversify its imports and exports away from oil, targeting regional, US and European markets.

He said Bahrain had already begun to diversify its economy away from oil and last year non-oil exports stood at $2.4 billion and non-oil imports at $1.96 billion.

'Over the last two decades exports of manufactured products have become a major factor of economic growth and export expansion,' Dr Mashal told the Gulf Daily News, our sister newspaper.

'They have become a national priority where export promotion is perceived as the core of any successful policy in increasing competitiveness.

'The result is more output with fewer but high-tech resources, a labour force that is more productive, a stronger private sector and an economy that has higher rates of growth.'

Dr Mashal said increased productivity would translate directly into higher wages and greater wealth for Bahrainis. He said improved productivity was the long-term driver of increased wealth in all the advanced economies.

'Countries that are more productive are wealthier,' he said. 'Increased productivity leads to greater output, which gives rise to increased wages and greater profit. Increased wages and greater profits lead to higher spending and investments and thus create a healthy cycle of growth.'

Dr Mashal said Bahrain had already been successful in transforming itself from an impoverished state into a successful and progressive country and now it was faced with the next stage of change to create prosperity independent of oil wealth.

'Achieving Bahrain's aspirations will increase the size and wealth of Bahrain's middle class and increase its competitiveness,' he said.

'The results will not only bring all Bahrainis greater wealth but provide a strong foundation for our children, their children and future generations.' - TradeArabia News Service