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Doing Business in the MENA Region: The Kingdom of Bahrain

If you are considering expanding your business operations to the MENA region, this blog will help you understand how the business world operates in the Kingdom of Bahrain. I will briefly cover the health of the economy, the leading industries, the ease of starting a business and the laws and regulations of this Gulf region country, located near the Kingdom of Saudi Arabia.

  • Area: Bahrain is an island in the Gulf with an area of 770 sq. km and is comprised of 33 natural islands.
  • Capital city: Manama
  • Religion: Islam is the state religion and the country is also home to Christians, Hindus and Jews.
  • Currency: Bahraini Dinar (BD) (USD 1 = 0.376 BD).
  • Languages: Arabic and English
Current Business Environment

Health of the Economy

The economy in Bahrain is the most diversified among all regional Gulf countries. The growth rate of the non-oil sector reached 4.7% in the third quarter of 2016. The specific sectors that have grown the most are social and personal services, construction and financial services.

Bahrain’s growth, despite downward trends in the region, can be contributed to regulatory reforms, including:

  • Measures to cut the time to export goods to Saudi Arabia.
  • Reducing the minimum capital required for start-ups.
  • Regulations to support the creation of investment limited partnerships, protected cell companies and trusts.


Leading Industries
  • Financial Services: Bahrain hosts over 400 licensed financial institutions.
  • Tourism and Leisure: Bahrain has access to 36 million consumers across the Gulf Cooperation Council (GCC), tapping into the $1.6 trillion USD market. This allows Bahrain to offer significant potential for investors in its ever-expanding tourism sector.

Ease of Starting a Business

Bahrain provides a lot of assistance for businesses who are interested in setting up operations in the country. They allow 100% foreign ownership of business assets and help companies with assessments of their opportunities in the Gulf region, which they provide free of charge. The cost of doing business in Bahrain is a big advantage as it is approximately 40% lower than Dubai and Qatar. This is largely because of low rent and expenses.

Business is conducted in both Arabic and English.

Laws, Taxes and Regulations

Bahrain is known as the region’s most liberal business environment, there is no corporate income tax, no personal income tax, no wealth tax on capital gains, no withholding tax, few indirect taxes and free repatriation of capital, profits or dividends. Bahrain is also the only country in the region that has no ‘free zone’ restrictions.

Bahrain has a fully liberalized telecommunications sector. As a result, Bahrain is ranked the 18th freest economy worldwide, and the freest economy in the MENA region by the 2015 Index of Economic Freedom published by The Wall Street Journal and The Heritage Foundation.


To summarize, Bahrain is a great country to visit and invest in while experiencing its local and business culture. Its location in the center of the Gulf region is a great attraction, the assistance to investors and liberal laws are all great reasons for interested businesses to open operations in Bahrain.