GEOGRAPHY

765 sq. km. (295 sq. mi.); approximately four times the size of Washington, D.C. Bahrain is an archipelago of 33 islands located off the eastern coast of Saudi Arabia. The four main islands are joined by causeways, and make up about 95% of the total land area. Cities: Capital–Manama, pop. (2010 est.) 157,000. Other cities–Al Muharraq. Terrain: Low desert plain (highest elevation point: 122 m). Climate: Hot and humid from May-September, with average highs ranging from 30-50 C (86-122 F). Maximum temperatures average 20-30C (68-86F) the remainder of the year.

PEOPLE

Nationality: Noun and adjective: Bahraini(s). Population (2016 est.): 1,378,000, of which 568,000 (46%) locals and 666,000 (54%) expatriates. Population growth rate: 3.8%. Primary religions: Islam (70.3%), Christian (14.5%), Hindu (9.8%).

LANGUAGES

Arabic (official), English, Farsi, and Urdu are widely spoken. Education: Bahrain’s UNDP HDI (Human Development Indicator) ranking is 47. Estimated net primary school enrolment ratio (2015) is 96.4%. Adult literacy rate (% age 15 and over HDI) (2010)) is 94.6% for the overall population. Adult literacy rate (% ages 15 and above) male is 96.1% and female is 91.6%.

HEALTH

Infant mortality rate (2010) is 7/1,000 live births. Life expectancy at birth (2015) is 76.8 years with male life expectancy at birth at 76.2 years (2015) and females at 77.9 years (2015). The crude death rate is 2.1 per 1000 population (2014). The under-five year mortality rate is 6.2 per 1000 live births (2016). Internet users make up 77.0% of the population (2011).

GOVERNMENT

Type: Constitutional Monarchy. Independence: August 15, 1971 (from the UK). Constitution: Approved and promulgated May 26, 1973; suspended on August 26, 1975; amended and approved by a national popular referendum again on February 14-15, 2001. Branches: Executive–King (chief of state); Prime Minister (head of government); Council of Ministers (cabinet) is appointed by the King and headed by the Prime Minister. Legislative–The bicameral parliament (al-Majlis al-Watani) consists of a 40-member elected House of Deputies and a 40-member Shura Council appointed by the King. Members of both chambers serve four-year terms. Judicial–Civil Laws Court and Shari’a Laws Court. The judiciary is independent with right of judicial review. Administrative subdivisions: 12 municipalities (manatiq): Al Hidd, Al Manamah, Al Mintaqah al Gharbiyah, Al Mintaqah al Wusta, Al Mintaqah ash Shamaliyah, Al Muharraq, Ar Rifa’ wa al Mintaqah al Janubiyah, Jidd Hafs, Madinat Hamad, Madinat ‘Isa, Juzur Hawar, Sitrah. Political parties: None. Formal parties are banned but political societies have been formally sanctioned since 2001. Suffrage: Universal at age 18.

GOVERNMENT

In 2016, foreign direct investment flows into Bahrain stood at $280 million. GDP (2015): $31.1 billion. Real GDP growth rate stood at 2.9% (2015) and per capita GDP at $46.6k. Natural resources: Oil, natural gas, fish, pearls. GDP break-up by sector: agriculture (0.3%) industry (33.8%), services (65.9%) (2016). In 2015-2016, government budget was –17.70% of GDP and had a deficit of 17.70% of GDP. Trade balance was -$781 million. Exports stood at $12.1 billion, with top exports including Refined Petroleum ($2.62B), Raw Aluminium ($748M), Aluminium Bars ($542M), Aluminium Wire ($532M) and Computers ($347MMajor markets for exports included Saudi Arabia ($4.14B), the United Arab Emirates ($959M), the United States ($931M), Kuwait ($468M) and South Korea ($463M). Imports stood at $12.9 billion and included Cars ($1.57B), Aluminium Oxide ($470M), Broadcasting Equipment ($356M), Gold ($312M) and Special Purpose Ships ($286M). Major suppliers were China ($1.56B), the United States ($1.17B), the United Arab Emirates ($1.15B), Japan ($1.11B) and Saudi Arabia ($915M). With a score of 43, Bahrain ranks 70th internationally on Transparency International’s Corruption Perception Index in 2016.

HISTORY

The site of the ancient Bronze Age civilization of Dilmun, Bahrain was an important center linking trade routes between Mesopotamia and the Indus Valley as early as 5,000 years ago. The Dilmun civilization began to decline about 2,000 B.C. as trade from India was cut off. From 750 B.C. on, Assyrian kings repeatedly claimed sovereignty over the islands. Shortly after 600 B.C., Dilmun was formally incorporated into the new Babylonian empire. There are no historical references to Bahrain until Alexander the Great arrival in the Gulf in the 4th century B.C. Although Bahrain was ruled variously by the Arab tribes of Bani Wa?el and Persian governors, Bahrain continued to be known by its Greek name Tylos until the 7th century, when many of its inhabitants converted to Islam. A regional pearling and trade center, Bahrain came under the control of the Ummayad Caliphs of Syria, the Abbasid Caliphs of Baghdad, Persian, Omani and Portuguese forces at various times from the 7th century until the Al Khalifa family, a branch of the Bani Utbah tribe that have ruled Bahrain since the 18th century, succeeded in capturing Bahrain from a Persian garrison controlling the islands in 1783.

In the 1830s the Al Khalifa signed the first of many treaties establishing Bahrain as a British Protectorate. Similar to the binding treaties of protection entered into by other Persian Gulf principalities, the agreements entered into by the Al Khalifa prohibited them from disposing of territory and entering into relationships with any foreign government without British consent in exchange for British protection against the threat of military attack from Ottoman Turkey. The main British naval base in the region was moved to Bahrain in 1935 shortly after the start of large-scale oil production. from all aggression by sea and to lend support in case of land attack.

In 1968, when the British Government announced its decision (reaffirmed in March 1971) to end the treaty relationships with the Persian Gulf sheikdoms, Bahrain initially joined the other eight states (Qatar and the seven Trucial Sheikhdoms now the United Arab Emirates) under British protection in an effort to form a union of Arab emirates. The nine sheikhdoms still had not agreed on terms of union by 1971, however, prompting. Bahrain to declare itself fully independent on August 15, 1971.

Bahrain promulgated a constitution and elected its first parliament in 1973, but just two years later, in August 1975, the Amir disbanded the National Assembly after it attempted to legislate the end of Al-Khalifa rule and the expulsion of the U.S. Navy from Bahrain. In the 1990s, Bahrain suffered from repeated incidents of political violence stemming from the disaffection of the Shi?a majority. In response, , the Amir instituted the first Bahraini cabinet change in 20 years in 1995 and also and increased the membership of the Consultative Council, which he had created in 1993 to provide advice and opinion on legislation proposed by the cabinet and, in certain cases, suggest new laws on its own, from 30 to 40 the following year. . These steps led to an initial decline in violent incidents, but in early 1996 a number of hotels and restaurants were bombed, resulting in several fatalities. Over 1,000 people were arrested and held in detention without trial in connection with these disturbances. The government has since released these individuals (see Government and Political Conditions Section below for details).

GOVERNMENT AND POLITICAL CONDITIONS

Shaikh Hamad bin Isa Al Khalifa succeeded the throne in March 1999, after the death of his father Shaikh Isa bin Hamad Al Khalifa, Bahrain’s ruler since 1961. He championed a program of democratic reform shortly after his succession. In November 2000, Shaikh Hamad established a committee to create a blueprint transform Bahrain from a hereditary emirate to a constitutional monarchy within 2 years. The resulting National Action Charter was presented to the Bahraini public in a referendum in February 2001. The first public vote in Bahrain since the 1970s, held by universal suffrage, the charter was overwhelmingly endorsed by 94.8% of voters. That same month, Shaikh Hamad pardoned all political prisoners and detainees, including those who had been imprisoned, exiled or detained on security charges. He also abolished the State Security Law and the State Security Court, which had permitted the government to detain individuals without trial for up to 3 years.

On February 14, 2002, one year after the referendum endorsing his National Action Charter, Shaikh Hamad pronounced Bahrain a monarchy and changed his constitutional status from Amir to King. He simultaneously announced that the first municipal elections since 1957 would be held in May 2002, and that a bicameral parliament, with a representative lower house, would be reconstituted with parliamentary elections in October 2002. As part of these constitutional reforms, the government also created an independent financial watchdog empowered to investigate cases of embezzlement and violations of state expenditure in July 2002.

Turnout for the May 2002 municipal elections was 51%, with female voters making up 52 % percent of voters. Turnout for the 2002 parliamentary elections–the first in almost three decades–was 53% in the first round and 43% in the second round, despite the fact that the four-largest Shi?a political societies organized a boycott to protest constitutional amendments enacted by the King that gave the appointed upper chamber of parliament voting rights equal to the elected lower chamber. Sunni Islamists won 19 of the 40 seats. Despite strong participation by female voters, none of the female candidates standing in these elections were returned. The new parliament held its first joint sitting in December 2002.

Bahrain has a complex system of courts, based on diverse legal sources, including Sunni and Shi’a Sharia (religious law), tribal law, and other civil codes and regulation created with the help of British advisers in the early 20th century. In 2001, Shaikh Hamad created the Supreme Judicial Council to regulate these courts and separate the administrative and judicial branches of government.

PRINCIPAL GOVERNMENT OFFICIALS

King–Shaikh Hamad bin Isa Al Khalifa
Crown Prince and Commander in Chief of the Bahrain Defense Force–Shaikh Salman bin Hamad bin Isa Al Khalifa
Prime Minister–Shaikh Khalifa bin Salman Al Khalifa
Deputy Prime Minister and Islamic Affairs Minister–Shaikh Khalid bin Ali Al Khalifa
Deputy Prime Minister and Foreign Minister–Shaikh Khalid bin Ahmed Al Khalifa

PEOPLE

One of the most densely populated countries in the Middle East, about 89% of the population of Bahrain lives in the two principal cities of Manama and Al Muharraq. Approximately 66% of the indigenous population is originally from the Arabian Peninsula and Iran. Bahrain currently has a sizeable foreign labor force (about 80% of the total population). The government’s policies on naturalization remain controversial. In June 2002, the King issued a decree allowing citizens of the Gulf Cooperation Council (GCC) to take up dual Bahraini nationality. Opposition political groups charge that the government is granting citizenship to foreign nationals who have served in the Bahraini armed forces and security services to alter the demographic balance of the country, which is primarily Shi’a. According to passport officials, about 40,000 individuals have been naturalized over the past 50 years (about 10% of the total population).

The indigenous population is 70.2% Muslim. Although more than 60% of the indigenous population is Shia Muslim, the ruling family and the majority of government, military, and corporate leaders are Sunni Muslims. The small indigenous Christian and Jewish communities make up the remaining 2% of the population. About 55% of foreign resident community are non-Muslim, and include Christians, Hindus, Bahais, Buddhists and Sikhs.

Bahrain has invested its oil revenues in educational system development, and boasts an advanced educational system. The first public schools for girls and boys were opened in the 1920s. Schooling and related costs continue to be entirely paid for by the government. Although not compulsory, primary and secondary attendance rates are high and literacy rates are currently among the highest in the region. Higher education is available for secondary school graduates and can be obtained through the Bahrain University, Arabian Gulf University and specialized Institutes including the College of Health Sciences — operating under the direction of the Ministry of Health — which trains physicians, nurses, pharmacists, and paramedics. The government has targeted provision of educational services to the Gulf Cooperation Council as a potential growth area, and is actively working to establish Bahrain as a regional center for higher education.

ECONOMY

The first Gulf state to discover oil, Bahrain has worked to diversify its economy over the past decade. Bahrain has stabilized its oil production at about 50,000 barrels per day (2015), and reserves are at 100 million bbl as of January 2016. Revenues from oil and natural gas currently account for 5% of GDP (2015) and provide about 60% of government income. The Bahrain Oil Company refinery built in 1935, the first in the Gulf, has a capacity of about 260,000 b/d. In 1975, 60% of the refinery was owned by the Bahrain National Oil Company and 40% by the U.S. company Caltex. In 1980, all BAPCO’s shares were taken over by the Government of Bahrain. In 1999 the current Bahrain Petroleum Company was created when the Bahrain National Oil Company, established in 1976, merged with BAPCO. Saudi Arabia provides most of the crude for refinery operation via pipeline. Bahrain also receives a large portion of the net output and revenues from Saudi Arabia’s Abu Saafa offshore oilfield. The Bahrain National Gas Company operates a gas liquefaction plant that utilizes gas piped directly from Bahrain’s oilfields. Gas reserves should last about 10 years at present rates of consumption (2017). The Gulf Petrochemical Industries Company is a joint venture of the petrochemical industries of Kuwait, the Saudi Basic Industries Corporation, and the Government of Bahrain. The plant, completed in 1985, produces ammonia and methanol for export. Growth in the hydrocarbons sector will be contingent upon new discoveries — Bahrain awarded exploration rights to Malaysia’s Petronas and the U.S. Chevron Texaco after the resolution of its long-standing territorial dispute with Qatar, but no meaningful finds have been announced to date. Bahrain’s other industries include the majority state-owned Aluminum Bahrain (Alba), which operates the largest aluminum smelter in the world outside Eastern Europe with an annual production of about 400,000 metric tons (mt)–and related factories, such as the Aluminum Extrusion Company and the Gulf Aluminum Rolling Mill. Other plants include the Arab Iron and Steel Company’s iron ore pelletizing plant (7.5 million tons annually as of 2014) and a shipbuilding and repair yard.

Bahrain’s development as a major financial center has been the most widely heralded aspect of its diversification effort. Bahrain is a regional financial and business center. International financial institutions operate in Bahrain, both offshore and onshore, without impediments, and the financial sector is currently the second largest contributor to GDP. More than 100 offshore banking units and representative offices are located in Bahrain, as well as 65 American firms. Bahrain has also made a concerted effort to become the leading Islamic finance center in the world, standardizing regulations of the Islamic banking industry. It currently has 24 Islamic banks, the largest concentration of Islamic financial institutions.

Bahrain is working to develop other service industries such as information technology, healthcare and education. The government has used its oil revenues to build an advanced infrastructure in transportation and telecommunications. The transport and communications sector grew by almost 9% in 2002 and is likely to expand as the government proceeds with liberalization of the state-owned telecommunications industry. The state monopoly Batelco was broken in April 2003. Bahrain’s international airport is one of busiest in the Gulf, serving an average of 507 flights a week. A new air traffic control tower, part of a program to upgrade and modernize the airport, is due for completion in June 2004. A modern, busy port offers direct and frequent cargo shipping connections to the U.S., Europe, and the Far East.

LIBERALIZATION OF THE WATER AND POWER INDUSTRIES IS ALSO PLANNED.

Regional tourism is also a significant source of income. The government continues to favor large-scale tourism projects. In 2003 it awarded several contracts to develop a state-of-the art international horse racing track and tourist complex.

Government revenues continue to be largely dependent on the oil industry. Bahrain has received significant budgetary support and project grants from Saudi Arabia, Kuwait, and the United Arab Emirates. The reconstituted parliamentary process has produced spirited debate over government spending, particularly defense spending, but no actual reductions. Ministry of Defense spending will account for 20% of current spending in 2003 and 2004 based on the budget approved by parliament in May 2003. The Ministry of Education and Ministry of the Interior are the second and third largest spenders. The bulk of capital outlays have been allocated to improving housing and infrastructure in line with government efforts to raise the standard of living of the Shi’a population and to attract foreign investment.

The government has also started to extend protections to workers. Private sector employees won permission to form unions in late 2002; King Hamad has given his tentative approval for the formation of unions in government departments.

DEFENSE

The Bahrain Defense Force (BDF) numbers about 13,000 personnel (2012) and consists of army, navy, air force, air defense, and royal guard units. The public security forces and the coast guard are separate from the BDF and report to the Ministry of the Interior. Bahrain’s defense spending since 1999 has been steady. The government spends around $630 million annually on their military, about 20% of current expenditures (2012). The reconstituted parliamentary process has produced spirited debate over government spending, particularly defense spending, but no actual reductions.

With the help of the U.S. and the Gulf Cooperation Council (GCC), Bahrain has made significant efforts to upgrade its defense systems and increase the modernity of its armed forces over the last 20 years. In 1982, the GCC gave Bahrain $1.7 billion for this purpose. Since the 1991 Gulf War, the U.S. has provided military and defense technical assistance and training to Bahrain from foreign military sales (FMS), commercial sources, excess defense article sales (EDA) and under the International Military and Education Training (IMET) program. The U.S. Office of Military Cooperation in Bahrain is attached to the U.S. Embassy and manages the security assistance mission. U.S. military sales to Bahrain currently total $1.4 billion. Principal U.S. military systems purchased by the BDF include one FFG-7 Class Frigate, 2 Mk-V Fast Patrol Boats, 8 Apache helicopters, 54 M60A3 tanks, 22 F-16C/D aircraft, 12 Northrup F-5E/F aircraft, 51 Cobra helicopters, 9 MLRS Launchers, 20 M109A5 Howitzers, 1 Avenger AD system, and the TPS-59 radar system. Bahrain has received $275 million in FMF, $50 million in Section 1206 Program funded equipment, and $415 million in U.S. EDA acquisition value delivered since the U.S.-Bahraini program began in 1993.

Military exercises are conducted on a regular basis to increase the BDF’s readiness and improve coordination with the U.S. and other GCC forces. The BDF also sends personnel to the United States for military training. This training includes courses from graduate-level professional military education down to entry-level technical training.

FOREIGN RELATIONS

Since achieving independence in 1971, Bahrain has pursued a policy of close consultation with neighboring states. Bahrain became a member of the United Nations and the Arab League in 1971. In 1981 it joined its five neighbors–Saudi Arabia, Oman, Kuwait, the UAE and Qatar-to form the strategic Gulf Cooperation Council (GCC). Bahrain has complied with GCC efforts steps to coordinate economic development and defense and security planning. In December 1994, for example, Bahrain concurred with the GCC decision to drop secondary and tertiary boycotts against Israel. Bahrain also responded positively to Kuwait’s request to deploy the GCC collective defense force, Peninsula Shield, during the build-up and execution of Operation Iraqi Freedom (OIF) in 2003.

In addition to maintaining strong relations with its largest financial backers, Saudi Arabia, Kuwait and the UAE, Bahrain has worked to improve its relations with Qatar and Iran in recent years. Currently, Bahrain has proper, but not warm, relations with Iran. Bahrain-Iran relations have been strained since the discovery in 1981 of an Iran-sponsored coup plot in Bahrain. Bahraini suspicions of the Iranian role in local unrest in the mid-1990s remain. However, with the decline of Iraq as a regional powerbroker, Bahrain has begun taking steps to improve relations. These efforts have included encouraging Bahrain-Iran trade and maritime security cooperation.

On March 16, 2001, the International Court of Justice (ICJ) announced its judgment on the long-standing maritime delimitation and territorial dispute between Bahrain and Qatar. The binding judgment awarded sovereignty over the Hawar Islands and Qit’at Jaradah to Bahrain and sovereignty over Zubarah (part of the Qatar Peninsula), Janan Island and Fasht ad Dibal to Qatar. The peaceful settlement of this dispute has allowed for renewed co-operation, including plans to construct a causeway between the two countries..

Bahrain’s strategic partnership with the U.S. has intensified since 1991. Bahraini pilots flew strikes in Iraq during the 1991 Gulf War, and the island was used as a base for military operations in the Gulf. Bahrain also provided logistical and basing support to international Maritime Interdiction efforts to enforce UN sanctions and prevent illegal smuggling of oil from Iraq in the 1990s. Bahrain also provided extensive basing and over flight clearances for a multitude of U.S. aircraft operating in support of Operations Enduring Freedom and Operation Iraqi Freedom. Bahrain deployed forces in support of coalition operations during both OEF and OIF and participates in the International Security Assistance Force (ISAF) in Afghanistan. Bahrain is currently offering humanitarian support and technical training to support the reconstruction of the Iraqi banking sector, and has offered support for each stage of Iraq’s political transformation. Bahrain has also cooperated effectively on criminal investigation issues in support of the campaign on terrorism; the Bahrain Monetary Agency (which became the Central Bank of Bahrain in September 2006) moved quickly to restrict terrorists’ ability to transfer funds through Bahrain’s financial system. In October 2006, Bahrain joined the U.S. and 23 other countries in a Proliferation Security Initiative (http://www.state.gov/t/isn/c10390.htm) interdiction exercise in the Persian Gulf.

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