chapter  8
18 Pages

The State of Bahrain

ByJ.S. Birks, C.A. Sinclair

Bahrain is a state composed of thirty islands to the north-west of Qatar, most of which are small and uninhabited. Bahrain’s income from oil is only a small fraction of that enjoyed by a Saudi Arabia, Kuwait or even Qatar. Bahrain’s development strategy aims to utilise domestic factor endowments which centre on the limited amount of oil, substantial reserves of natural gas, substantial work-force by Gulf standards, and a central position in the Arabian Gulf. Banking activities have expanded and the Bahrain Monetary Authority has created an ‘offshore banking centre’ which has more than 30 licensed operators. An increasingly complex ‘productive’ service industry has been developed, which includes the Bahrain Ship Repairing and Engineering Company. The Bahraini economy is passing through a period of transition, during which time the government is attempting to create the basis for a non-oil-supported future.