Bahrain's decision to stick to the dollar peg has helped make it a beacon of economic stability amidst the global meltdown, according to a key minister.

Sticking to the dollar peg when the tide was against it, was the best decision the country could have made, said Industry and Commerce Minister Dr Hassan Fakhro.

"The dollar is now extremely strong and in the light of the falling currencies all over the world, Bahrain now finds itself in a much better position to handle the global financial crisis," he said after touring the Abraj Al Lulu (Pearl Tower) project in Sanabis.

"We are a robust economy and will not be affected as much as some other nations will be, but we have to be on our guard and take appropriate measures."

Dr Fakhro also declared Bahrain a "beacon of stability" as he opened the First Bahrain World Economic Summit on Monday.

"As the world is struggling with the prospects of recession and global financial, some would say meltdown, Bahrain remains as a relative beacon of stability in a region which continues to demonstrate solid growth rates."

The two-day summit has attracted business leaders from as far afield as the US, Europe and the former Soviet Union, the UK and Asia.

"The timing of this event could not be more opportune," he said. "Most of you here today are businessmen, some will no doubt be positioned to succeed even in falling markets."

"But by and large a contraction in developed country markets, particularly the US and Europe, will have a negative effect on the turnover of most businesses, and it is at times such as this, when it is important to look to non-traditional markets for growth.

"The Middle East in general is a huge market. Sitting as it does on at least two-thirds of the world's proven oil reserves, this translates into a big spending power."

"Here in Bahrain we have not had the luxury of large oil reserves, but what little we have, has been used well by a wise government committed to diversification, and to investment in its main resource - its human capital."

"Bahrain was the first country in the region, and only the second in the Middle East to have signed a Free Trade Agreement (FTA) with the US.

"This says a lot for the legitimacy of Bahrain as a global trading and investment partner, embedded in the rule of law but it also says a lot about the potential of investing in Bahrain for the wider market across the Atlantic," he said.

"Whether your business is involved in banking, services or industry, you cannot afford not to look at the Middle East markets, and there is no better place to put a toe in these waters than the kingdom of Bahrain, which offers a tax and exchange free regime, and a cosmopolitan, relaxed living and friendly environment for families," he added.

"We are if you will, an oasis of tranquillity, yet with a vibrant and business-driven underbelly."

Housing Minister Shaikh Ibrahim bin Khalifa bin Ali Al Khalifa said that while GCC countries had been experiencing sustained economic growth it remained to be seen what the impact of the global crisis would be on the region.

"Will this undermine out development," he asked. "The answers will not be easy to find because this is a really complex and unprecedented problem."

"It is now clear that this problem is global and no one is immune but I remain positive about the outcome for the region."

He said that even if the price of oil remained at $60 this would still result in revenues to the region between now and 2020 of $5.3 trillion, two-and-a-half times the earnings from oil for the GCC in the past 14 years.

"The GCC will continue to be a major supplier of investment capital, not only locally but globally and this will provide a solid basis for riding out the economic storm."

Bahrain Chamber of Commerce and Industry chairman Dr Essam Fakhro said the conference coincided with the launching of Bahrain's Economic Vision 2030.-TradeArabia News Service