-  Promoting investment and strengthening economic cooperation between the two countries -

1. Ambassador of the Republic of Korea to Bahrain Koo Heon Sang and Minister of Finance and National Economy Shaikh Salman bin Khalifa Al Khalifa of the Kingdom of Bahrain signed the Agreement between the Government of the Republic of Korea and the Government of the Kingdom of Bahrain for the Promotion and Protection of Investments (hereinafter the "Agreement") on December 26, 2024, in Manama, Bahrain.

2. Korean companies have entered Bahrain, especially in the areas of energy, petrochemistry and infrastructure. Bahrain has an attractive business environment with a strategic role as a gateway to the Gulf Cooperation Council (GCC) region and a Middle Eastern hub for financial services. Expecting a wider presence of Korean companies in Bahrain, the Korean government concluded the Agreement to provide enhanced legal protections for investment and thereby to support Korean companies doing business in Bahrain.

  ※ Korea-Bahrain economic relations

   ㅇ Two-way trade volume : 650 million U.S. dollars (2023, Korea International Trade Association)

     - Korea’s export to Bahrain : 150 million U.S. dollars (automobiles, power equipment, etc.)

     - Korea’s import from Bahrain : 490 million U.S. dollars (naphtha, aluminium, etc.)  

   ㅇ Investment (cumulative total, 2023)

     - Korea’s investment in Bahrain : 280 million U.S. dollars / Bahrain’s investment in Korea : 160 million U.S. dollars

   ㅇ Nine Korean companies including Samsung E&A are doing business in Bahrain.

3. The main elements of the Agreement are as follows.

a. First, each Contracting Party shall provide fair and equitable treatment, national treatment, or most-favoured-nation treatment to an investment or investor of the other Contracting Party.

b. Second, each Contracting Party shall pay prompt, adequate, and effective compensation when it expropriates or nationalizes an investment of the other Contracting Party either directly or indirectly.  

c. Third, each Contracting Party shall guarantee the free transfer of all payments relating to an investment including the initial capital, profits, or proceeds from the liquidation of the investment.

d. Fourth, an investor who suffers loss or damage concerning an alleged breach of an obligation of the host country may submit the dispute to domestic courts of the host country or international arbitration.

e. Fifth, a Contracting Party may deny the benefits of this Agreement to an investor of the other Contracting Party that is a juridical person who has no substantial business activities in the territory of that other Contracting Party.

4. The Agreement will enter into force after both countries sign it and complete their domestic procedures including obtaining a parliamentary consent to ratification. The Agreement is expected to contribute to promoting investment and strengthening economic cooperation between the two countries as a legal foundation for protecting investments from non-commercial risks.

5. As of today, the Republic of Korea has concluded investment promotion and protection agreements with 101 countries (with 83 of them in force.) The Korean government will continue to conclude or modify those agreements in a way that reflects developments in the international investment environment and investment regulations, with an aim to protect Korean businesses' overseas investment as well as to secure its rights to promote the soundness of the Korean investment climate.