Bahrain is one of the freest and developed economies in the Middle East. The country’s economy is mainly dependent on the oil sector but also greatly developed in other sectors such as manufacturing and finance.

In 2009, Bahrain’s GDP was BHD 7.263 billion. The oil sector contributed BHD 1.677 billion to GDP. Other contributions were from manufacturing, offshore financial services, trade, transport, communication, real estate, etc.

(Source: CIO: File)

(Source: CIO: File)

Income Tax Rate

The country does not impose any income tax and capital gain tax on individuals. It only levies corporate tax and social insurance taxes.

The corporate tax rate is 46%, which are levied only on companies engaged in exploration, production or refining of oil in the country.

The social insurance tax rate is levied at the rate of 15% for every employee. Of this contribution, the employee is liable to pay 6% and employers pay 9% on the employee’s behalf.

(Source: Economic Development Board, Ernst & Young Corporate Taxation: File)

Inflation Rate

In 2009, inflation rate was recorded at 2.8%. Inflation was highest for food products, beverages and tobacco, whereas it was lowest in the communication sector.

 

(Source: Ministry of Finance: File, Central Bank: File)

Foreign Direct Investment (FDI)

At the end of 2009, FDI inflow of the country remained at BHD 5,639.30 million and FDI outflow at BHD 2,838.30 million. However in 2009, International Investment Position (IIP) of direct investment was BHD 2,801 million.

(Source: Central bank: File)

Foreign Portfolio Investment (FPI)

At the end of 2009, FPI inflow of Bahrain remained at BHD 15,323.70 million and FPI outflow at BHD 4,730.20 million. However in 2009, IIP of portfolio investment was BHD 10,593.50 million. 

 

(Source: Central bank: File)

Central Bank Assets

As of November 2010, total assets of the Central Bank of Bahrain stood at BHD 2,416.6 million, of which 76.65% were foreign assets and 23.35% were assets held in the country. The central bank has foreign gold reserves of BHD 2.5 million.

 

Central Bank Assets (BHD million)
Month	Assets
2010
January	2,223.7
February	2,313.7
March	2,511.7
April	2,432.9
May	2,475.4
June	2,437.5
July	2,461.4
August	2,445.2
September	2,412.8
October	2,450.3
November	2,416.6
2009
November	2,034.6
December	2,065.4

 

(Source: Central Bank – PDF file)

Non-Performing Loan Ratio (NPLR)

As of March 2010, NPLR of conventional retail banks in the country was 5.9%. Local retail banks reported a NPLR of 6.3%, while overseas retail banks reported the lowest – 4.6%.

(Source: Central Bank – PDF file)

Consumer Price Index (CPI)

In Q2 of 2010, Bahrain’s CPI is recorded at 112.1 points. The index was the highest for food, tobacco, alcoholic and non-alcoholic beverages.

(Source: Ministry of Finance: File, Central Bank: File)

Interest Rates

As of November 2010, interest rate on saving deposits was 0.26% and for time deposits for 3-12 months period was 1.15%. During the same period, interest rates on loans showed a decline of about 1% from 2009.

(Source: Ministry of Finance: File, Central Bank: File)

Money Supply

Bahrain classifies its money supply in 3 parts – M1, M2 and M3.

M1 includes –

• Currency outside banks
• Demand deposits (private sector)

 M2 includes M1 and –

• Time deposits (private sector)
• Saving deposits of (private sector)

M3 is comprised of M2 and general Government deposits.

Labour Force

Bahrain employed a total of 597,402 people at the end of the third quarter of 2010. Of the total workers, the male population accounted for 79%. Compared to the previous year, the female working population showed growth of 3.17% whereas male workers declined by 1.01%.

(Source: LMRA: File, File, File)

As of 2008, the child dependency ratio stood at 49.6% compared to 61.1% in 2001. The aging dependency ratio reached 6.9% in 2008, which was 6.2% in 2001.

(Source: CIO: File)

Unemployment Rate

In Bahrain, the unemployment rate is seen mainly amongst females. In March 2010, the unemployment rate was reported to be 3.7%, declining by more than 1% from 2009.

(Source: Gulf News)

Minimum Wage

The average monthly wage rate for all workers is BHD 326 as of 2010. Wage rate for males was BHD 313 and for females was BHD 374.

(Source: LMRA: File, File, File)

Bahrain has a constitutional monarchy system of government. It has its own written constitution based on democracy and sovereignty.

The Government has divided its powers into legislative, executive and judicial. Legislation is headed by the King, Sheikh Hamad bin Isa Al Khalifa under National Assembly. The National Assembly consists of Consultative Council and Chamber of Deputies. There are 40 members in the Consultative Council who are appointed by orders of the King. The Chamber of Deputies also comprises of 40 members who are elected directly by secret general ballot. Members of both the chambers are elected for a term of four years.

Executive powers are handled by the King together with the Council of Ministers. The Council of Ministers comprises of one Prime Minister and several other ministers.

The country is divided into five directorates:

• Capital
• Central
• Muharraq
• Northern
• Southern

(Source: Bahrain.bh, Constitution of Bahrain: File, Economic Development Board)

Regulatory Environment

The country is ranked 10^th at the 2011 Index of Economic Freedom, with an economic freedom score of 77.7 (out of 100). It is a rise of 1.4 points from the previous year due to an increase in investment and labour freedom.

(Source: Heritage.org)

Corruption perception

The country is ranked 48^th on the World’s Corruption Perception Index 2010, with an index score of 4.9 (out of 10). It shows that corruption has great coverage over the nation, especially in management of water resources and related government activities.

(Source: transperancy.org: Report, Heritage.org)

Freedom of information

Bahrain is ranked 144^th in the World Press Freedom Index 2010. It suggests low freedom of press. Relatively, its neighbouring country Qatar permits more freedom to press.

(Source: rsf.org)

Major newspapers in the country include:

Arabic:

• Al Ayam
• Akhbar-Alkhaleej
• Almeethaq
• Al-Wasat news
• Al-Ahad
• Al-Watan News
• Al-Naba News
• Al-Waqt
• Albilad News

English:

• Bahrain Tribune
• The Gulf Daily News

 (Source: CAA)

Judicial system

The Judicial system of the country is governed by the Supreme Judicial Council which is headed by the King. The civil law courts under it have the power to decide on civil, commercial and administrative subjects. These courts are classified into:

Civil law courts:

• Court of Cassation
• High Civil Court of Appeal
• High Civil Court
• Lower Court

Shariaa Judiciary Courts:

• High Shariaa Court of Appeal
• High Shariaa Court
• Lower Shariaa Court

 (Source: Ministry of Justice, Ministry of Justice)

Bahrain reported a population of 1,106,509 in 2008. Males constitute a majority of the population with 61.27%. Density of population was recorded at 1,461 people per sq km. The majority of the population belonged to age group 25-44.

(Source: CIO: File)

The following table shows total population growth from 2000 to 2008:

(Source: Central bank: File)

(Source: CIO: File)

Birth and Death rate

There were 17,022 births recorded in 2008, with a crude birth rate of 15.4 births per 1,000 persons. The premature birth rate stood at 100.1 births per 1,000 live births. 86.3% of total births took place in government hospitals, whereas 11.2% births were in private hospitals.

(Source: CIO: File)

The crude death rate was 2.16 deaths per 1,000 persons as of 2008. The country recorded a total of 2,390 deaths in 2008. Diseases of the circulatory system were one of the major causes of deaths in the country. Other causes included neoplasm, diseases during prenatal period, and disorders of endocrine nutrition, metabolism & immunity.

(Source: CIO: File)

(Source: CIO: File)

Infant mortality rate

The infant mortality rate reported 7.2 deaths per 1,000 live births in 2009. The infant mortality rate reduced by more than 1% compared to 2005.

(Source: Ministry of Health: File)

Life expectancy

In 2009, life expectancy at the time of birth stood at 73.1 years for male children and 77.3 for female children. This rate has been stable over the past few years.

(Source: Ministry of Health: File)

Ethnic environment

Of the total population, about 49% are Bahrainis and the remaining belong to different ethnic environments. In terms of religious classification, 81.2% people are Muslim, 9% are Christian, and 9.8% belong to other religions like Judaism, Hinduism, Baha'i, Sikhism, etc.

(Source: CIO: File, SLRB)

Human Development Index

The country ranks 39^th out of 169 countries on the Human Development Index 2010 conducted by the United Nations. The HDI provides a composite measure of three dimensions of human development: living a long and healthy life (measured by life expectancy), being educated (measured by adult literacy and gross enrolment in education) and having a decent standard of living (measured by purchasing power parity, PPP, income).

(Source: UNDP)

Literacy rate

Bahrain’s literacy rate (of Bahraini people above 15 years of age) was reported at 92.5% for males and 83% for females. The literacy rate has been stable for the past few years.

(Source: Ministry of Health: File)

Education resources

The country has more than 30 schools including international schools such as The British School of Bahrain, Al-Hekma International Model School, Bahrain School, Ecole Francaise de Bahrain, Ibn Khuldoon National School, International School of Choueifat, Japanese School of Bahrain, The Children's Academy, and many others.

University of Bahrain is the largest university which offers a wide range of education across the country. Other universities like Arabian Gulf University, Bahrain Institute of Banking and Finance, University College of Bahrain, RCSI - Medical University of Bahrain, Arab Open University, Bahrain, Ahlia University Bahrain, Kingdom UniversityGulf University, etc. also offer a variety of international level education.

(Source: Ministry of Education: File, Economic Development Board, Economic Development Board)

Healthcare resources

The country has 23 government and private hospitals with staff of over 8,000 including physicians, dentists, nurses, pharmacists and technicians. In 2009, total public health expenditure amounted to BHD 1,856 million.

(Source: Ministry of Health: File)

People in Bahrain mainly travel through road transport. The Government operates road transport networks majorly through the private sector for providing better services to common people. It is contracted to A.A. Bin Hindi B.S.C. and CARS Transport Corporation in partnership.

(Source: Ministry of Transportation)

Roads

As of 2010, the total road length of the country was 4,122 kms. Compared to 2008, the total length of surfaced roads indicates an increase of 180 kms in 2010, while un-surfaced roads are un-altered.

(Source: CIO – File)

Ports

Mina Salman Port, Khalifa Bin Salman Port and Muharraq Port are three ports situated around north-east sides of Bahrain.

Mina Salman Port is the key harbour for transport of general cargo and containers. It consists of 15 berths which can manage around 2.5 million tons of cargo volume in a year. The port is operated by APM Terminals.

Khalifa Bin Salman Port is made up of about 900,000 square meters of container terminals and cargo area. Its overall berths length totals about 1,800 meters and comprises 23,600 square meters of warehouses.

Muharraq Port is relatively small port which is situated in the island of Muharraq.

(Source: GOP, GOP)

Airports

The country owns one civil airport – Bahrain International Airport (BIA). Its runway length is about 3,962 meters. It is served by 43 airline services which include 30 passenger, 9 cargo and 4 charter airlines.

The following table shows top-ten passenger airlines according to its weekly frequency at the airport:

 (Source: BIA, Aircraft Charter World)

Telecommunications

There are around 18 active telecommunications and internet service operators in the country. Of the 176,092 households reported in 2009, 83% owned a fixed line telephone service and 85% were occupied with broadband internet connection. Pre-paid mobile subscribers were 1,156,196 and people having post-paid subscription were 245,778. Out of total internet subscribers, around 57% people use dial-up internet and the remaining 43% use broadband service.

(Source: TRA: File)