Bahrain's economy has bounced back registering a significant growth of 19.8 per cent during the second quarter of this year due to the government reform efforts, said senior officials, citing data.

The growth rate at constant price registered an increase of 0.8 per cent during the second quarter, compared to the same period last year and about 1 per cent compared to 2009, according to preliminary figures released by Central Informatics Organisation (CIO).

'Bold decisions taken by Gulf governments during the recent incidents, particularly Saudi Arabia and the UAE, have helped boost business sentiment in the country and improved the investment climate for the private sector,' CIO president Dr Mohammed Al Amer stated.

'This positive impact will encourage foreign and institutional investors to return to Bahrain,' he added

The country's economy grew 19.8 per cent at current prices during the second quarter compared to the same period last year, due to an increase in international oil prices, the CIO data showed.

The oil sector contributed 1.9 per cent to the growth, while non-oil sector 0.6 per cent. Retail banks registered a growth rate of 3.7 per cent at constant prices, the data said.

Services sector also showed stable growth with goods producing industries surging 2.9 per cent, transportation and communications 8.6 per cent, government services 4.9 per cent, social and personal services 12.9 per cent, electricity and water 17.3 per cent, wholesale and retail trade one per cent and agriculture and fishing 8.3 per cent, while building, construction and real estate activities, business services and hotels and restaurants dropped by 1.8 per cent, 3.8 per cent and 17.4 per cent respectively.