Macroeconomic Study

Of
Bahrain




Submitted To: Submitted By:
Prof. Surta Mehta Krunalkumar Deshmukh











About Bahrain:
Bahrain, which two seas, is an archipelago in the Persian Gulf off the coast of Saudi Arabia.
The islands for the most part are level expanses of sand and rock. A causeway connects Bahrain
to Saudi Arabia. Known in ancient times as Dilmun, Bahrain was an important center of trade by
the 3
rd
millennium B.C. The islands were ruled by the Persians in the 4
th
century A.D. and then
by Arabs until 1541, when the Portuguese invaded them. Persia again claimed Bahrain in 1602.
In 1783 Ahmad ibn al-Khalifah took over, and the al-Khalifahs remain the ruling family today.
Bahrain became a British protectorate in 1820. It did not gain full independence until Aug. 14,
1971.
Although oil was discovered in Bahrain in the 1930s, it was relatively little compared to other
Gulf states, and the wells are expected to be the first in the region to dry up. Sheik Isa ibn
Sulman al-Khalifah, who became emir in 1961, was determined to diversify his country's
economy, and he set about establishing Bahrain as a major financial center. The country provides
its people with free medical care, education, and old-age pensions.
Conflicts between the Shiite and Sunni Muslims are a recurring problem in Bahrain. The Sunni
minority, to which the ruling al-Khalifah family belongs, controls nearly all the power and
wealth in the country. the Shiites continue to agitate for more representation in government, and
minor violent clashes have led to about two dozen deaths since 1994.
Bahrain has been an important Western ally, serving as a Western air base during the Persian
Gulf War in 1991 and the Iraq War in 2003. It continues to serve as the base of the United States'
Fifth Fleet, which patrols the Gulf.
The emir, Sheik Isa ibn Sulman al-Khalifah, died in 1999 after four decades of rule. He was
succeeded by his son, Sheik Hamad ibn Isa al-Khalifah, who gave himself the title of king but
also began a sweeping democratization of the country: censorship has been relaxed and
draconian laws repealed, exiles have been repatriated, and the stateless Bidoons have been
granted citizenship. In a Feb. 2001 referendum, which permitted women to vote for the first time,
Bahrainis overwhelmingly supported the transformation of the traditional monarchy into a
constitutional one. In Oct. 2002, Bahrain had its first parliamentary election since 1973. In 2006,
the U.S. and Bahrain signed a free-trade agreement.
Anti-government demonstrations gripped several countries in the Middle East in early 2011, and
Bahrain experienced some of the most violent confrontations between protesters and government
forces and police. The protesters, inspired by recent events in Egypt and Tunisia, began their
protests on Feb. 14. There has long been simmering tension between the populace, which is 70%
Shiite, and the Sunni monarchy and ruling class. Shiites complain that they are excluded from
top positions in the military and government and claim that the government encourages
immigration of Sunnis and then gives Sunnis preference in hiring. In response to the protests,
King Hamad offered each Bahraini a payment of about $2,700 and promised to increase jobs,
which only emboldened the opposition. On Feb. 17, police fired on the demonstrators in
Manama's Pearl Square, killing at least two people, and during the funeral the next day,
government forces attacked mourners. The attacks drew a strong rebuke from the U.S., which
bases the navy's Fifth Fleet in Bahrain and stations troops in the country.
The government withdrew troops on Feb. 18, and for the next several days thousands of
triumphant protesters poured into Pearl Square. Crowds reached their peak on Feb. 22, with more
than 100,000 protesters gathered in the square. The enormous pro-democracy protests continued
for three weeks, but the euphoria was short lived. On March 14, at the request of King Hamad,
Saudi Arabia and the United Arab Emirates dispatched 2,000 troops to help break up the
protests. The presence of neighboring Sunni troops in a country populated by a majority of
Shiites further inflamed sectarian strife. The Shiites labeled the deployment an "invasion." When
violence broke out between protesters and troops, King Hamad declaredmartial law and resumed
implementing repressive tactics against the opposition, including using force to remove
protesters from Pearl Square, warrantless searches, mass arrests, and there were allegations of
torture. King Hamad lifted the state of emergency on June 1, but the country remained tense and
on the brink of violence.
In June King Hamad appointed an independent commission to investigate the crackdown by his
security forces on protesters. The report released in November found widespread human-rights
abuses, saying prisonersmostly Shiawere hooded, whipped, beaten, and given electric-shock
treatment. Five prisoners died in custody. While the report was an embarrassment to the
government and highly critical, it proved that the king followed up on his promise to fairly and
fully investigate the allegations of abuse. Hamad said the perpetrators will be fired.
Protesters returning to Pearl Square in Manama in February 2012 to mark the one-year
anniversary of the uprising were pushed back by police who fired tear gas and stun grenades at
them. The protests continued through the year, and the government continued to stifle dissent
and crack down on the movement. Several protesters and police were killed in the fighting, and
in October the interior minister banned demonstrations and forms of protest, saying protesters
had taken advantage of the freedom of speech the government had granted them.
Anti-government demonstrations gripped several countries in the Middle East in early 2011, and
Bahrain experienced some of the most violent confrontations between protesters and government
forces and police. The protesters, inspired by recent events in Egypt and Tunisia, began their
protests on Feb. 14. There has long been simmering tension between the populace, which is 70%
Shiite, and the Sunni monarchy and ruling class. Shiites complain that they are excluded from
top positions in the military and government and claim that the government encourages
immigration of Sunnis and then gives Sunnis preference in hiring. In response to the protests,
King Hamad offered each Bahraini a payment of about $2,700 and promised to increase jobs,
which only emboldened the opposition. On Feb. 17, police fired on the demonstrators in
Manama's Pearl Square, killing at least two people, and during the funeral the next day,
government forces attacked mourners. The attacks drew a strong rebuke from the U.S., which
bases the navy's Fifth Fleet in Bahrain and stations troops in the country.
The government withdrew troops on Feb. 18, and for the next several days thousands of
triumphant protesters poured into Pearl Square. Crowds reached their peak on Feb. 22, with more
than 100,000 protesters gathered in the square. The enormous pro-democracy protests continued
for three weeks, but the euphoria was short lived. On March 14, at the request of King Hamad,
Saudi Arabia and the United Arab Emirates dispatched 2,000 troops to help break up the
protests. The presence of neighboring Sunni troops in a country populated by a majority of
Shiites further inflamed sectarian strife. The Shiites labeled the deployment an "invasion." When
violence broke out between protesters and troops, King Hamad declaredmartial law and resumed
implementing repressive tactics against the opposition, including using force to remove
protesters from Pearl Square, warrantless searches, mass arrests, and there were allegations of
torture. King Hamad lifted the state of emergency on June 1, but the country remained tense and
on the brink of violence.
In June King Hamad appointed an independent commission to investigate the crackdown by his
security forces on protesters. The report released in November found widespread human-rights
abuses, saying prisonersmostly Shiawere hooded, whipped, beaten, and given electric-shock
treatment. Five prisoners died in custody. While the report was an embarrassment to the
government and highly critical, it proved that the king followed up on his promise to fairly and
fully investigate the allegations of abuse. Hamad said the perpetrators will be fired.
Protesters returning to Pearl Square in Manama in February 2012 to mark the one-year
anniversary of the uprising were pushed back by police who fired tear gas and stun grenades at
them. The protests continued through the year, and the government continued to stifle dissent
and crack down on the movement. Several protesters and police were killed in the fighting, and
in October the interior minister banned demonstrations and forms of protest, saying protesters
had taken advantage of the freedom of speech the government had granted them.













Comparative Size of Bahrain Economy:

Fast Moving Consumer Goods (FMCG):
The FMCG sector in the MENA region continues to sail ahead and evolves rapidly, with more
than 400 million people and a growing and very young population. The size of the MENA region
economy is nearly 2 trillion dollars and there is huge headroom for growth in every industry
including FMCG. This includes facial tissues, toilet paper, kitchen towels, feminine napkins,
baby diapers, hair shampoos, hair coloring products, soaps, cleaning detergents, mouthwash,
toothpastes, pesticides, packaging products, household supplies, air fresheners, baby care
products, cosmetics, wipes, nail polish remover, shaving creams, and many others.

Changes in the competitive environment and operating models as well as shifting consumer
lifestyles and channel structures are creating opportunities for FMCG manufacturers,
distributors, and retailers. FMCG companies in the GCC and Middle East are spending millions
of dollars in building their brands, growing their products, changing consumer behavior, and
developing organizational capabilities. They are also expanding their capacities by having
several manufacturing facilities dotted across the MENA landscape in addition to de-
bottlenecking facilities and modernization.

Today, all the leading multi-national FMCG companies worldwide are present in the region
including Kimberly Clark, Unilever, P&G, Henkel, Reckitt Benckiser, L'Oreal, Sealed Air
Diversey, Biesdorf, Johnson & Johnson, Dabur, Godrej, Indevco, Fine, many others. These
companies have different strategies as to how they run their business in the region. Some of them
have their own offices and production plants, others have offices and outsources the production
to private label contract manufacturers in the region, some have distribution and retail centers
only, or a mix of different strategies for different product lines.

Private label and contract manufacturing are growing very quickly in the region as more
international FMCG companies works to outsource the production of their products or
complement their existing capacities to fulfill increasing demands. In addition, more local
retailers are working towards developing their own brand portfolio to compete with international
FMCG companies.

Food
The GCC countries form one of the worlds largest food importing groups. With most of its food
needs met through imports, the GCC region has ample opportunities for global producers and
local distributors. Saudi Arabia continues to be the largest food and beverages market in the
region.

Bahrain will always be a net good importer. Approximately only 20% of Bahrains Food and
Beverages are manufactured in Bahrain while the remaining 80% are traded, imported and
distributed.

In the past decade, there has been a surge in the manufacturing sector, where a number of major
food companies are looking to set up their manufacturing facility in Bahrain mainly due to the
accessibility to KSA which is the single largest consumer in the region. Currently,

Key facts

Annual imports of the GCC are over USD 12 billion

Over 90% of food requirement in the GCC are imported

Saudi Arabia accounts for 63% of the regions overall imports and is only a 40 minutes
causeway drive away from Bahrain

Total GCC food production is only 11.2 million metric tons serving a population of 40 million,
food security is a growing concern across the GCC

In 2006, Kraft Food established a state-of-the-art factory that produces 60,000 metric tons of
Kraft cheese and Tang products annually for the GCC region where more than 60% of this goes
to Saudi Arabia

Aluminum
Bahrain is home to one of the oldest and most developed aluminum industries in the GCC. In the
1960s, the Bahraini government decided to diversify away from its reliance on Oil & Gas
activities by establishing Aluminum Bahrain B.S.C. (ALBA), one of the worlds largest primary
aluminum smelters. Over the recent decades, Bahrain has continued to develop their downstream
capabilities with the introduction of numerous downstream industries. The EDB continues to
encourage and support the further development of the Kingdoms downstream capability as it
aids in stimulating high value addition manufacturing and competitively paid jobs for Bahrainis.

Key Facts:


The total investment in Bahrains aluminum industry amounts to over US$3 billion

28% of total Bahraini exports are Aluminum related products

12% of Bahrains GDP is directly attributed to Bahrains Aluminum industry

Bahrains Aluminum sector employs over 5,000 workers.

Steel:

Gulf Industrial Investment Company (GIIC), the GCCs first pelletizing plant, began operating in
Bahrain in 1984, and today has a capacity of 11million mtpa.

Foulath's Steel Complex, the world's first fully integrated steel manufacturing facility, and home
to Foulath's subsidiaries:

Gulf Industrial Investment Company (GIIC), a world-class pelletizing company, which is one of
three merchant plants in the world and the only one located in the Middle East

United Stainless Steel Company (USCO), the region's first manufacturer of stainless steel

United Steel Company (SULB), which will be the region's only producer of beams and medium
and heavy structural steel sections. SULB will be a joint venture (US$1.4 billion) between
Bahrain's Gulf United Steel Holding Co (Foulath) and Japan's Yamato Kogyo Co. - completion
date in 2013
Aluminum Bahrain B.S.C. (ALBA):

Aluminum Bahrain (ALBA) is one of the worlds largest primary aluminum smelters with a
production capacity of 860,000 mtpa. (3.65 sq.km site)

Employs 2730 employee, as of 2011. 87% of which are Bahrain nationals

With approximately 99.84% metal purity, Alba produces 5 different types of finished products
(Standard and T-ingots, extrusion billets, rolling slab, properzi ingots, and molten aluminum)

Since 1971, ALBA expanded its capacity from 120,000 mtpa to a current capacity of 860,000
mtpa. ALBA is finalizing plans to introduce a 6th smelting line that is aimed at increasing
capacity through an additional 400,000 mtpa
Gulf Aluminum Rolling Mill (GARMCO):

The largest aluminum rolling mill in the Middle East, is located in close proximity to Alba. They
are a high quality one stop source for a wide range of aluminum sheets and coils produced in a
capacity of 165,000 tons annually.


Midal Cables Ltd:

Is the first company in the Gulf, and one of the world leaders, in manufacturing and exporting of
Aluminum and Aluminum Alloy Rods, Overhead Conductors, Wires and Conform Extrusion
Products. They are a known brand in the world market for their consistent quality and reliability
in the products. Average annual production is approximately 60,000 tons per annum.


Bahrain Aluminum Extrusion Co (BALEXCO):

Was the first aluminum extrusion plant in the Arabian Gulf with an annual production capacity
of approximately 25,000 tons. They produce high quality extrusions and systems, which meet
international standards, used mainly as aluminum doors, window frames, and other products that
are required in the construction industry.




Packaging:

Plastic is replacing paper in flexible packaging forms like display packs, combo pack because of
better quality attributes. In fact, plastics accounts for 70% of all packaging solutions in GCC
compared to a world average of 48%.For metal, packaging weight per unit weight of product is
high and also lacks in flexibility of size and operation unlike plastic packaging. Therefore in
some segment like fruit juices flexible plastic packaging will compete with metal cans.
Furthermore, the food industry is growing at 18% to 20% in Saudi Arabia annually and pre-
packaged processed food constitutes 50% of the total industry. The GCC retail market is also
growing substantially growing at 9.5% every year and thus creating immense opportunities for
flexible packaging. Overall, the flexible packaging market in the GCC region is at an emerging
stage.


The packaging sectors focus subsectors are mainly: Plastic films & chips, caps, closures,
containers, bottles, cups, industrial bags with applications mainly in various sectors: 60% Food,
25% FMCG, 10% Medical and 5% others.

Chemicals & Plastics:
High construction activity and cheap energy are the factors driving industrial growth in the GCC.
Oil revenues have enabled GCC countries to diversify their economies and strengthen their
positions in a variety of sectors. Due to abundant oil and gas reserves, the GCC States are also
producing a variety of chemical and plastic products. In 2005, the Middle East contributes to 4%
to the worlds production of chemicals and plastics and by 2015 it is expected to increase to
10%.

GCC chemical industry covers a group of sub-industries including: manufacturing of basic
chemicals, fertilizers, nitrogen compounds, plastics and synthetic rubber in primary forms and
industries of a variety of goods such as pesticides, paint, inks, soaps and cleaning products,
perfumes and cosmetics in addition to synthetic fibers.


By the end of 2010, the GCC region had 1,006 chemicals plants employing over 83,000 people,
contributing to over 9% of total GCC employment. Currently the most produced commodity
chemicals in the GCC region are Urea, Ethylene, Ammonia, Methanol and Polyethylene and are
exported to mainly to China, India and Europe.


The plastics industry, on the other hand, now accounts for around 11% of the total manufacturing
in GCC. In fact the GCC has the 3rd largest per capita plastic consumption in the world. Also,
the GCC global share of key plastic resins (polyethylene & polypropylene) stands at 13% and
11% respectively & is expected to increase to 18% and 15% respectively by 2015.

Construction:
The constructions sector in Bahrain currently contributes 5% to the local GDP, and is expected to
increase 3-5% annually. The growth is mainly attributed to the prioritization of infrastructure and
housing projects in the kingdom. The government has made it a priority to deal with the high
demand for social housing. There are currently 53,000 social housing applications with 4,000
new applications annually. The government has earmarked $3.2 billion to construct 30,000
homes by the year 2016. Several other major construction projects which are currently in the
works. Most notably:

Gulf rail line development

Public transport network (due in 2030)

Bahrain Airport Expansion

Investment in power and water projects

Construction of infrastructure for three planned cities

New state of the art Exhibition Centre


Healthcare:
Bahrain, for many years, has strived to become one of the best healthcare providers in the Gulf
region. The government of Bahrain sees healthcare as paramount to the Kingdoms evolution
into a service-oriented economy, a place where high skilled practitioners and comprehensive
facilities are the norm.

Furthermore, Bahrain boasts a modern, technologically-advanced and comprehensive healthcare
system with an adequate number of qualified Bahraini doctors many of whom have studied
aboard and returned home to practice. Bahrain has four medical universities: the Arab Gulf
University, the Royal College of Surgeons of Ireland, the College of Health Science, and AMA
International University.

Healthcare is available through both private and public systems. Public medical services are free
or subsidized. There is high demand for specialized medical services and while latest medical
surgical procedures, such as transplants, are already available.

Bahrain Total Population:

Source: http://databank.worldbank.org/data/views/reports/tableview.aspx

Gross Domestic Product:
The monetary value of all the finished goods and services produced within a countrys borders
in a specific time period, though GDP is usually calculated on an annual basis. It includes all of
private and public consumption, government outlays, investment and exports less imports that
occur within a defined territory.
Years Population
2007 1.03 million
2008 1.12 million
2009 1.19 million
2010 1.25 million
2011 1.29 million
2012 1.31 million

Years GDP (current
US$)
GDP Growth
%
2007 18.5 billion 8
2008 21.9 billion 6
2009 19.3 billion 3
2010 25.7 billion 4
2011 29.0 billion 2
2012 30.4 billion 3

Source: http://databank.worldbank.org/data/views/reports/tableview.aspx


Bahrain GDP:


Gross National Product:
Years GNP (US $)
2007 20.44 billion
2008 25.76 billion
2009 29.84 billion
2010 32.79 billion
2011 38.26 billion
2012 -

Source: http://bahrain.knoema.com/aewtuqe/gnp-and-gdp-by-country

Per capita Income:
Year Per Capita Income (US
$)
2007 17,894
2008 19,626
2009 16,213
2010 20,546
2011 22,467
2012 -

Source: http://data.worldbank.org/indicator/NY.GDP.PCAP.CD?page=1

Foreign Direct Investment:
Years FDI (US $)
2005 0.86 billion
2006 (19.34 billion)
2007 (0.87 billion)
2008 (1.73 billion)
2009 (20.48 billion)
2010 1.78 billion
2011 1.12 billion

Source: http://www.indexmundi.com/facts/bahrain/foreign-direct-investment


ECONOMIC INDICATORS:

MARKETS LAST PREVIOUS AVERAGE UNIT REFERENCE FREQUENCY

STOCK MARKET 1382.19 1356.91 1679.46
INDEX
POINTS
2014-04-11 DAILY [+]
CURRENCY 0.38 0.38 0.38

2014-04-12 DAILY [+]
GDP LAST PREVIOUS AVERAGE UNIT REFERENCE FREQUENCY

GDP 27.03 25.86 9.08 USD BILLION 2012-12-31 YEARLY [+]
GDP ANNUAL GROWTH
RATE
5.40 5.70 4.66 PERCENT 2013-12-31 QUARTERLY [+]
GDP CONSTANT PRICES 10746.00 10203.00 7012.53 BHD MILLION 2013-06-29 YEARLY [+]
GDP GROWTH RATE 0.70 2.10 0.33 PERCENT 2013-12-31 QUARTERLY [+]
GDP PER CAPITA 14238.94 14311.61 13647.24 USD 2010-12-31 YEARLY [+]
GDP PER CAPITA PPP 21521.24 21631.07 20626.93 USD 2010-12-31 YEARLY [+]
GROSS FIXED CAPITAL
FORMATION
2109.10 1633.50 1748.95 BHD MILLION 2012-12-31 YEARLY [+]
LABOUR LAST PREVIOUS AVERAGE UNIT REFERENCE FREQUENCY

EMPLOYED PERSONS 569999.00 566730.00 428443.74

2013-11-15 QUARTERLY [+]
POPULATION 1.32 1.29 0.51 MILLION 2012-12-31 YEARLY [+]
UNEMPLOYMENT RATE 3.70 3.70 4.18 PERCENT 2012-12-31 MONTHLY [+]
PRICES LAST PREVIOUS AVERAGE UNIT REFERENCE FREQUENCY

CONSUMER PRICE INDEX
(CPI)
120.90 120.20 112.21
INDEX
POINTS
2014-02-15 MONTHLY [+]
GDP DEFLATOR 111.85 110.70 131.96
INDEX
POINTS
2012-06-29 YEARLY [+]
INFLATION RATE 3.70 3.30 2.25 PERCENT 2014-02-28 MONTHLY [+]
MONEY LAST PREVIOUS AVERAGE UNIT REFERENCE FREQUENCY

INTEREST RATE 2.25 2.25 3.06 PERCENT 2014-03-31 MONTHLY [+]
MONEY SUPPLY M0 453.50 453.30 225.52 BHD MILLION 2013-09-30 MONTHLY [+]
MONEY SUPPLY M2 9073.00 9095.00 4512.85 BHD MILLION 2013-09-30 MONTHLY [+]
TRADE LAST PREVIOUS AVERAGE UNIT REFERENCE FREQUENCY

BALANCE OF TRADE 3058.00 3407.00 644.18 BHD MILLION 2012-06-29 YEARLY [+]
CURRENT ACCOUNT 835.40 1220.90 439.70 BHD MILLION 2012-06-29 YEARLY [+]
CURRENT ACCOUNT TO
GDP
15.40 11.20 9.88 PERCENT 2012-12-31 YEARLY [+]
EXPORTS 8593.00 8628.00 2912.10 BHD MILLION 2012-06-29 YEARLY [+]
IMPORTS 5535.00 5221.00 2268.05 BHD MILLION 2012-06-29 YEARLY [+]
GOVERNMENT LAST PREVIOUS AVERAGE UNIT REFERENCE FREQUENCY

GOVERNMENT DEBT TO
GDP
33.90 28.90 18.39 PERCENT 2012-12-31 YEARLY [+]
GOVERNMENT SPENDING 1639.00 1480.00 1060.17 BHD MILLION 2012-06-29 YEARLY [+]
GOVERNMENT BUDGET -4.40 -3.00 -0.91
PERCENT OF
GDP
2012-12-31 YEARLY [+]
CREDIT RATING 61.25

MONTHLY [+]
BUSINESS LAST PREVIOUS AVERAGE UNIT REFERENCE FREQUENCY

CAR REGISTRATIONS 439.00 320.00 280.13 HUNDREDS 2012-06-29 YEARLY [+]
CHANGES IN
INVENTORIES
53.00 68.00 46.17 BHD MILLION 2012-06-29 YEARLY [+]
CONSUMER LAST PREVIOUS AVERAGE UNIT REFERENCE FREQUENCY

CONSUMER SPENDING 4271.90 4243.20 2890.03 BHD MILLION 2012-06-29 YEARLY [+]
TAXES LAST PREVIOUS AVERAGE UNIT REFERENCE FREQUENCY

CORPORATE TAX RATE 0.00 0.00 0.00 PERCENT 2014-01-01 YEARLY [+]
PERSONAL INCOME TAX
RATE
0.00 0.00 0.00 PERCENT 2013-01-01 YEARLY [+]
HOUSING LAST PREVIOUS AVERAGE UNIT REFERENCE FREQUENCY

HOUSING INDEX 183.00 221.00 240.79 TENS 2013-05-15 QUARTERLY [+]


Advantages Of Investor (Why investors invest in Bahrain?):
Along with competitive costs, easy access to the rest of the Middle East, and a well-established
business infrastructure, you will find that we have a great deal of experience in understanding the
needs of foreign businesses and responding to them.
We regard foreign investment as key to our Economic Vision 2030 long-term plan for improving
the competitiveness of our economy, creating skilled jobs for Bahrainis and enhancing living
standards. For this reason, we are committed to building on our existing advantages, aiming to
build the Middle Easts most attractive centre for business.


We offer businesses operating in the region five important advantages:
Our position at the heart of the Gulf makes access to every market in the Middle East quick and
efficient by road, air and sea. By car, Saudi Arabia, the Gulfs largest economy, is less than an
hours drive away and Riyadh, its business hub, is a four hour drive. By plane, the United Arab
Emirates is an hour flight and Qatar just 25 minutes; further, Bahrain is the home of Gulf Air,
which has the largest regional network in the Gulf. In addition, following the opening of the
Khalifa Bin Salman Port in April 2009, Bahrain is becoming a major regional trans-shipment
centre.
We are committed to maintaining the regions most liberal business environment, with zero
taxation for private companies, few indirect taxes for private enterprises and individuals, and free
repatriation of capital. We are also the only country in the region offering 100% foreign
ownership of business assets and real estate in most sectors. Finally, unlike any other Gulf
country, Bahrain has a fully liberalized telecommunications sector. As a result, Bahrain is ranked
the 12th most open economy worldwide by the Heritage Foundation and Wall Street Journals
2013 Index of Economic Freedom.
Bahrain has a track record as a modern international business economy stretching back several
decades. Our financial services sector has been thriving for 40 years and was recently judged the
Gulfs most sophisticated financial market.
Our low costs are another important advantage. Basic costs such as rents for offices and
industrial land are lower than elsewhere in the region. The combination of subsidies and
privatisation in the utilities sectors, mean that electricity, gas and water costs are highly
competitive. And with low living costs, wages are also highly competitive.
Finally, our workforce is the most educated and skilled in the Gulf. This means you can
minimise spending on expatriate packages and build a long-term, sustainable local workforce.
For example, Bahrainis comprise two thirds (66%) of the financial services workforce, according
to the Central Bank of Bahrain (2010).


Reference:
Chemicals & Plastics: http://www.bahrain.com/en/bi/key-investment-
sectors/Pages/Chemicals%20and%20Plastics.aspx#.U0diXj-Sx-w
Construction: http://www.bahrain.com/en/bi/key-investment-
sectors/Pages/Construction.aspx#.U0dkSD-Sx-w
Healthcare: http://www.bahrain.com/en/bi/key-investment-
sectors/Pages/Healthcare.aspx#.U0dlBT-Sx-w
OECD Statistics Portal: http://www.keepeek.com/Digital-Asset-
Management/oecd/social-issues-migration-health/connecting-with-
emigrants/key-statistics-on-diaspora-from-bahrain_9789264177949-graph125-
en#page2

GDP Graph: http://www.tradingeconomics.com/bahrain/gdp