Bahrain

The GCCBahrainKuwaitOmanQatarSaudi ArabiaThe United Arab Emirates

Bahrain is one of the most diversified economies in the Arabian Gulf. Highly developed communication and transport facilities make Bahrain home to numerous multinational firms with business in the Gulf.

As part of its economic diversification strategy, Bahrain implemented a Free Trade Agreement (FTA) with the US in August 2006, the first FTA between the US and a Gulf state. Bahrain’s economy, however, continues to depend heavily on oil. Petroleum production and refining account for more than 60% of Bahrain’s export receipts, 70% of government revenues, and 11% of GDP (exclusive of allied industries).

Other major economic activities are production of aluminum – Bahrain’s second biggest export after oil – finance, and construction. Bahrain competes with Malaysia as a worldwide center for Islamic banking and continues to seek new natural gas supplies as feedstock to support its expanding petrochemical and aluminum industries.

In 2011, Bahrain experienced economic setbacks as a result of domestic unrest. Bahrain’s reputation as a financial hub of the Gulf has been damaged, and the country now risks losing financial institutions to other regional centers such as Dubai or Doha. Economic policies aimed at restoring confidence in Bahrain’s economy, such as the suspension of an expatriate labor tax, will make Bahrain’s foremost long-term economic challenges – youth unemployment and the growth of government debt – more difficult to address

Flag and national emblem

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Key facts
Population 000,000,000
Population 000,000,000
Population 000,000,000