Bahrain flag

Bahrain country brief

General information

The State of Bahrain comprises an archipelago of islands with a total size of 760 sq. km (less than one third the size of the Australian Capital Territory), situated in the Persian Gulf, to the East of Saudi Arabia and to the West of Qatar.  Bahrain also shares a maritime border with the Islamic Republic of Iran.  Bahrain has a population of 1.25 million people, of whom an estimated 235,100 are non-nationals (as at July 2012).  The majority of Bahrainis are Shi’a Muslims, while Bahrain’s traditional rulers are Sunni Muslims.

In 1783, the Sunni Al-Khalifa family captured Bahrain from the Persians.  During the 19th century, the Al-Khalifa family secured its hold on the islands of Bahrain by entering into a series of treaties with the United Kingdom to make Bahrain a British protectorate.  The archipelago attained its independence in 1971. 

Facing declining oil reserves, Bahrain has turned to petroleum processing and refining and has transformed itself into an international banking centre.  It has styled itself as a tourism destination and plays host to several international sporting events, including a Formula One Grand Prix.

Political overview

Bahrain’s Head of State is King Hamad bin Isa al-Khalifa, who acceded to the throne in 1999. The monarch appoints a Prime Minister, currently Khalifa bin Salman al-Khalifa.  Bahrain has a bicameral National Assembly (al-Jamiyh al-Watani), consisting of the Shura Council (Majlis Al-Shura) and the Council of Representatives (Majlis Al-Nuwab). The 40 Shura Council representatives are appointed by the monarch. The 40 Council of Representatives members are elected by an absolute majority vote in single-member constituencies to serve 4-year terms. A second, runoff round is held if no candidate receives an absolute majority in the first round.  Parliamentary elections were first held in 2002. The next Parliamentary elections are scheduled for 2014.

After boycotting the country's first round of democratic elections under the newly-promulgated Constitution in 2002, Shi’a political societies (parties are banned, but societies are permitted) participated in 2006 and 2010 in legislative and municipal elections and Wefaq, the largest Shi’a political society, won the largest bloc of seats in the elected lower-house of the legislature on both occasions.

In early 2011, Bahrain's mainly Shi’a opposition petitioned for the redress of popular grievances. In mid-March 2011, with the backing of Gulf Cooperation Council (GCC) capitals, King Hamad declared a state of emergency amid a wave of violent street protests which had begun in February 2011, involving clashes between mainly Shi’a protestors and the police and security forces.  There were also clashes between Shi’a protestors and Sunni supporters of the government.  After declaration of the State of Emergency, the GCC deployed a contingent of mostly Saudi and Emirati forces to guard critical infrastructure in an operation named “Peninsula Shield”.

The unrest, which saw many deaths and injuries and mass arrests, was eventually quelled by the authorities.  The Bahrain Independent Commission of Inquiry (BICI), formed in June 2011 on the order of the King, to investigate abuses during the unrest and state of emergency, released its final report in November 2011.  The King subsequently endorsed the report, undertaking to implement in full its recommendations. These include improving policing procedures, reinstating fired workers, rebuilding some mosques, and establishing a compensation fund for those affected by the unrest and crackdown.  As part of efforts to prevent further unrest, the Government subsequently revived a National Dialogue on political reform, including key opposition groups.  The country has continued to experience intermittent street protests, unrest, violent attacks and arrests.

Bahrain’s primary foreign policy focus has traditionally been on its Gulf Cooperation Council neighbours, with the 2011 unrest further solidifying these bonds.  Bahrain also plays a key role in regional security architecture.  It hosts the U.S. Navy's Fifth Fleet and participates in U.S.-led military coalitions.  

Bahrain is a member of the United Nations, International Monetary Fund, World Bank, World Trade Organization, Organization of Islamic Cooperation and Organization of Petroleum Exporting Countries.

Economic Overview

Facing declining oil reserves, Bahrain has invested strongly in communications and transport infrastructure, and worked to attract multinational businesses. As a result, it has one of the most diversified economies in the Gulf.

As part of its diversification plans, Bahrain implemented a Free Trade Agreement (FTA) with the US in August 2006, the first FTA between the US and a Gulf state. Bahrain's economy, however, continues to depend heavily on oil.  Petroleum production and refining account for more than 60 percent of Bahrain's export receipts, over 60 per cent of Government revenues, and 11 per cent of GDP (exclusive of allied industries

Other major economic activities are production of aluminium - Bahrain's second biggest export after oil – finance, construction and tourism. Bahrain competes with Malaysia as a worldwide centre for Islamic banking and continues to seek new natural gas supplies as feedstock to support its expanding petrochemical and aluminium industries. In 2011, Bahrain experienced economic setbacks as a result of domestic unrest. Bahrain's reputation as a financial hub has come under increasing competition regionally, notably from Dubai and to a lesser extent Doha.

Bilateral relationship

The Australia-Bahrain relationship is long-standing, predating the establishment of formal ties with other Gulf countries.  Australia maintained a Consulate-General in Bahrain from 1964 until 1986.  There is no Bahraini mission accredited to Australia; our Embassy in Riyadh is accredited to Bahrain.  Bahrain provides port access to Australian naval ships.

The last Australian Minister to visit Bahrain was then Foreign Minister the Hon Kevin Rudd MP, in December 2010 for the Manama Dialogue.  There have been no recent visits of Bahraini Ministers to Australia.

Commercial relations

Australia and Bahrain have had a commercial relationship for many years.  In 2012, exports were $152 million and imports $67 million.  The figures exclude Australian exports transhipped to Bahrain through Dubai, and alumina exports.  Australia’s exports to Bahrain have traditionally included meat (excluding beef), live animals and passenger motor vehicles (PMV exports were valued at $34 million in 2012) . Australia’s main imports from Bahrain are fertilisers, aluminium products and wire products.

Opportunities also exist in the market for educational services.  In 2012, 150 Bahrainis enrolled in Australian tertiary education institutions.

The Austrade office in Riyadh manages Austrade’s business within Bahrain.  For further information, refer to Austrade’s Bahrain Profile

Updated September 2013