General Information » Economy » Bahrain Overview

Bahrain has a vibrant and growing economy based primarily on its petroleum production and refining industries, which account for 60% of export receipts and government revenue, and the financial sector, which is the largest employer and the largest contributor to GDP (over US$2 billion). In recent years the government has concentrated on diversifying the economy and the kingdom now has significant tourism, trading, construction, metal smelting and ship repairing sectors.

The industrial growth rate is 2% per annum. Total GDP is around US$10 billion with an annual growth rate of 5.6%. Per capita GDP is approximately US$ 14,000 (all 2003 figures). Bahrain’s main export markets are other GCC countries and Arab states (37%), Asian countries (35%), the US (16%) and Europe (7%). Bahrain is a member of the GCC together with Kuwait, Oman, Qatar, Saudi Arabia and the UAE.

The six states are in the process of instituting a free trade area between all the members and signed a Customs Union in January 2003 unifying their tariff rates. They have also set 2010 as the target for a single currency within the GCC.

Bahrain’s Free Trade Agreement with the United States became effective from 2006 and it is expected to increase trade significantly in the future. The Bahrain dinar is pegged to the US dollar, with a fixed exchange rate of US$1 = BD0.376.

Bahrain’s main exports are aluminium, textiles, petroleum and petroleum products, and its main imports are crude oil, machinery and equipment, chemicals, foodstuffs and construction materials. Bahrain is the base for the headquarters of many international companies operating in the Gulf region. It has an excellent transport and communications infrastructure and the government is working to make the kingdom business friendly to both local industry and international investors.