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Bahrain: Foreign Trade and the Balance of Payments
Country Study > Chapter 4 > The Economy > Foreign Trade and the Balance of Payments

FOREIGN TRADE AND THE BALANCE OF PAYMENTS


Traditionally, Bahrain was the entrepĂ´t and distribution center for the northern Persian Gulf region. Since independence, however, it has lost much of its role as a result of the development of nearby Saudi Arabian ports and strong competition from Dubai in the UAE in the southern gulf. Oil continues to be the most important item in the country's international trade, representing well over one-half of the total value of both exports and imports. The industrial diversification program has resulted in the creation of non-oil manufactured exports, while investments in agriculture have reduced significantly the importation of certain food commodities.

The total value of imports in 1989, the latest year for which statistics have been published, was about US$2.8 billion, a 34 percent decrease from the 1982 total of US$3.7 billion. The cost of crude petroleum, imported from Saudi Arabia for processing at the Sitrah oil refinery, declined to US$1.5 billion in 1988, compared with US$1.9 billion in 1982 and US$2.5 billion in 1981. This significant drop, however, resulted more from the steady fall in international oil prices than from a decrease in the actual number of barrels imported. The major nonoil imports included machinery and transportation equipment, manufactured goods, alumina, chemicals, food, and live animals.

In 1989 Bahrain's principal trading partners were Britain, the United States, and Japan, accounting for approximately 16.3 percent, 12.4 percent, and 10.5 percent, respectively, of total imports, Italy, and Saudi Arabia.

In 1989 the value of Bahrain's exports was US$2.8 billion, down 12 percent from 1984. Depressed oil prices, especially in the 1986-88 period, continued to erode the value of oil and oil products, the principal components of the export trade. Non-oil exports consisted of manufactured goods, in particular aluminum products but also some construction materials. The chief trading partners were Saudi Arabia, the United States, and the UAE, accounting for 18.2 percent, 7.3 percent, and 6.9 percent, respectively, of all exports in 1989. Other export markets included Japan, India, Kuwait, and the Republic of Korea (South Korea).

The value of Bahrain's imports was slightly less than the value of its exports in 1989. Preliminary estimates for 1990 indicated that the trade balance would also have a slight surplus. The favorable balance was attributed to the dramatic rise in oil prices that followed the Iraqi invasion of Kuwait.

Data as of January 1993




Last Updated: January 1993


Editor's Note: Country Studies included here were published between 1988 and 1998. The Country study for Bahrain was first published in 1993. Where available, the data has been updated through 2008. The date at the bottom of each section will indicate the time period of the data. Information on some countries may no longer be up to date. See the "Research Completed" date at the beginning of each study on the Title Page or the "Data as of" date at the end of each section of text. This information is included due to its comprehensiveness and for historical purposes.

Note that current information from the CIA World Factbook, U.S. Department of State Background Notes, Australia's Department of Foreign Affairs and Trade Country Briefs, the UK's Foreign and Commonwealth Office's Country Profiles, and the World Bank can be found on Factba.se.

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