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Employment in Bahrain

  • Known for its oil industry, falling prices have seen Bahrain re-focus on the service and tourism sectors, and take steps to limit the number of expats in an attempt to curb local youth unemployment.
  • No personal income or capital gains tax means Bahrain is considered a financial haven for expats. However, low oil prices are putting pressure on government budgets and may see an expat tax introduced.
  • Though foreigners are not part of the social security system, they still qualify for low-cost medical care. Be prepared to take a taxi to the hospital in case of emergencies though as the ambulance service is in its infancy!
  • You will need a work visa to get a job in Bahrain, but can’t apply for one without a job offer! Don’t fear, you can still visit the country to build your network with a tourist visa.
  • Hospitality and trust are at the heart of doing business in Bahrain. Don’t try to rush the business process, and be sure to heed local customs such as accepting refreshments, and small talk about personal life.

With its strategic location in the North Persian Gulf, a good infrastructure, and a highly educated and skilled workforce, Bahrain has a successful history of doing business. The government has devised several strategies to make investing in Bahrain attractive to foreigners. Not only does it offer a liberal environment and low operational costs, but it also ranks in the top 5 globally for quality of life. Prospective expats planning to move to Bahrain should definitely check out Manama, the country’s capital.

An Oil-Based Economy

For a long time, Bahrain’s economy depended purely on oil. While oil is still a major economic driver, there have been increasing efforts to reduce dependency, and today Bahrain has one of the most diverse economies in the region.

However, the industrial sector still accounts for about 47% of the Bahraini GDP, employing nearly 80% of those working in Bahrain. Declining oil reserves have shifted the emphasis towards petroleum-processing and oil-refining based on crude oil imports, with the production and export of aluminum following close behind. Natural gas is an important feedstock to support the expanding petrochemical and aluminum industries. The construction and ship-repairing industries are also major employers.

While the agricultural sector is virtually non-existent, the services sector has started to play an important role. It accounts for the remaining 53% of the GDP, and has established Bahrain as the center for Islamic banking.

Numerous companies offering business and professional services have operations in Bahrain, particularly in Manama. A rise in regional and international tourism in particular is providing employment for locals as well as foreigners, and accounts for 10.3% of job opportunities in the country.

However, the economy experienced some setbacks as a result of the Bahraini uprising which started in February 2011 and still continues today. Bahrain may be in danger of losing its reputation as the financial hub of the Gulf to other regional centers, such as Dubai, Qatar, or Malaysia.

Cracking Down on Expat Opportunities

Bahrain is home to numerous multinational corporations doing business in the Gulf Region, who in turn account for the large numbers of expats. However, foreigners interested in working in Bahrain are likely to face more difficulties now than in the past. As well as social unrest, the main reason for this is continuing high local unemployment rates, especially among Bahrain’s youth. In 2007, Bahrain was the first Arab country to introduce a formal system of unemployment benefits.

As a result, the government has introduced measures to discourage expats, mainly by reducing sponsorship opportunities and increasing the corporate costs of hiring expat staff. A levy on the employment of foreign laborers has been re-introduced and further measures such as cutting water, fuel, and electricity subsidies only for the expat community have been implemented as a way of offsetting tumbling oil prices.

With these challenges in mind, sectors most likely to offer employment opportunities for expats in Bahrain include:

  • business services
  • financial services
  • healthcare
  • infrastructure
  • education & skills
  • manufacturing

Getting a Job in Bahrain

You can’t get a job in Bahrain without a valid work visa, and you need a confirmed offer in order to get a work visa. It is almost impossible to escape this circle, although expats interested in working in Bahrain can visit the country on a tourist visa to explore opportunities and establish contacts.

However, most expats working in Bahrain have either been recruited outside the country, normally by a headhunter or via an agency, or have been transferred by their company. Nearly all expatriates working in Bahrain are on a fixed-term contract. Casual or temporary work is not easy to find, but local recruitment agencies may be able to help spouses of expats already working in Bahrain.

Expat Business Info for Bahrain

Bahrain: Tax Haven… for Now

Taxation, or rather the lack of it, has always been one of the greatest benefits of working in Bahrain for expats. With no personal income tax, capital gains tax, or withholding tax, expats face only minor deductions from their monthly salary.

As foreigners do not qualify for most of the government’s social security schemes, there are few expenses on that front either: non-Bahraini employees pay 1% of their basic salary towards unemployment insurance, and their employer pays 3% of that salary into employment injuries insurance. The income ceiling is currently at 4,000 BHD per month. However, the pressure from low oil prices has led the Bahraini government to consider revising this policy, and an expat tax has been discussed.

In addition to low taxation, expats working in Bahrain are entitled to an end-of-contract payment when their assignment ends. Depending on how long they have been working in Bahrain, this bonus can amount to a considerable sum of money. Bahrain also has bilateral agreements with numerous countries in order to avoid double taxation. To see if your country of origin is on the list, please consult the Ministry of Finance website.

Staying Healthy in Bahrain

Bahrain has excellent healthcare facilities. There is no shortage of hospitals (both public and private) and doctors, and unless you need highly specialized treatment, there’s no reason to return to your home country if you fall ill. Doctors are highly qualified and can all speak English — in fact, many of them are expats themselves who work in Bahrain to enjoy the financial perks.

Although foreigners are not part of the social security system, they qualify for low cost health treatment — ca. 8 USD per doctor’s visit — offered through the public health system. However, most expats are either covered by their company’s private health insurance plan or take out an individual policy before they move to Bahrain. Treatment can be very expensive if you go to one of the luxurious private hospitals, which can seem more like 5-star hotels.

The only time you might encounter difficulties is in an emergency situation. Ambulance services are not always available, and may not have trained medical staff on board. The Bahrain “National Ambulance Project” has been ongoing since 2013, resulting in ten ambulance centers being established. There are plans to increase this by allocating two ambulances to each government hospital, bringing the total number to 14.  It is therefore not uncommon to call a taxi instead of an ambulance if you need to get to the hospital quickly. Operators usually speak English, but it doesn’t hurt to at least know the Arabic word for emergency or for any chronic health condition you may have.

Bahraini Business Hotspots

Bahrain has several locations which were conceived with one thing in mind: attracting business. They are usually strategically placed, with excellent infrastructure and transportation connections. They include:

  • The Bahrain Financial Harbor, a unique development right in the center of the capital Manama. Almost a city within a city, it combines a premium business location with residential and recreational developments on the waterfront.
  • The Bahrain International Investment Park, a project of the Ministry of Industry and Commerce, stands out due to its prime location: situated in close proximity to Bahrain International Airport and the new Khalifa Salman Port, it was built to attract export-oriented businesses. It also benefits from a highway connection to Saudi Arabia via a 25 km causeway connecting the countries.
  • The Bahrain Logistics Zone, operated by the General Organization of Sea Ports in Bahrain, offers companies various on-site services to facilitate their operations. This includes an efficient customs process, a company registration office, and various other amenities.

Business Etiquette in Bahrain

Once considered the most liberal of the GCC states, accusations of human rights violations since the beginning of the protest movement in 2011 have cast doubts on Bahrain’s reputation. Though it remains one of the more liberal states in the region, please remember that Bahrain is a Muslim country deeply rooted in local traditions and customs. The style of conducting business therefore differs widely from that of Western Europe or the USA. A basic understanding of Bahraini culture can earn you respect, and give you the edge over your competitors.

What to Expect at a Business Meeting in Bahrain

Arab culture is known for its hospitality, and Bahrainis are no exception. Your host or business partner will, to some extent, observe traditional customs during your meeting. One of these traditions is the open-door policy: don’t be surprised if your meeting is interrupted by the arrival of another guest. Your host is unlikely to turn anyone away as this would be considered very rude. The initial greeting may be followed by a period of silence while you wait for tea or coffee to be served. Don’t refuse refreshments that are offered to you. The meeting starts once everyone’s cups have been filled.

Every business meeting is preceded by small talk, which happens either before, during, or after refreshments. This serves to build trust — a vital aspect of business in Bahrain. You may be asked personal questions about your life and your family, and are expected to show an interest in your host’s personal life too. However, never ask any direct questions about female family members, unless you know them very well, as this may cause embarrassment to your host.

It is unusual for any decisions to be made or contracts to be signed at a first meeting. In fact, be prepared for a much slower pace of business than what you may be used to. As mentioned above, winning the trust of your Arab business partners is an important first step if you want to achieve something. People don’t do business with strangers in Bahrain, so invest time in building a good reputation. Similarly, your business partners will expect you to trust them, so being too pushy will come across as impolite. You should take someone’s word with as much weight as you would a written agreement.

Business Communication in Bahrain

The style of communication may also take some getting used to. It is not very direct and you will have to learn to interpret vague statements. This is due to the reluctance in Arab culture to be either the bearer of bad news, or to simply refuse anybody anything. You are unlikely to ever receive a straight “no” in answer to your requests, and it’s a good idea to ban the word from your vocabulary during business negotiations. A lack of commitment or very evasive language usually serves as sufficient indication of a negative answer.

Communication in Bahrain may be more formal than in your home country: it is important to use someone’s full name and title when you greet them. The most senior person should always be greeted first. This reflects the still very hierarchical society based on traditional family values.

Bahrain: Women in Business

Women are much better placed in the Bahraini business world and society than in many other Arab countries. While female employment was traditionally limited to education and medicine, local women increasingly work in banking, finance, and other service industries too. Expat women can be found in all sorts of professions — medicine, the law, education, PR, and the hotel industry.

As a foreign woman working in Bahrain, you should nevertheless observe certain rules. First of all, dress conservatively out of respect for your host culture. Men and women often do not mingle in their free time, enjoying meals and entertainment separately. Try to keep a certain distance from your male colleagues as being too friendly may be misinterpreted. There should be no physical contact between you and Bahraini men, the only exception being if he extends his hand to you first during the greeting process.

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  • Alain Nguyen

    I used the InterNations community to find a partner for my tennis matches in Bahrain and it worked very well.

  • Antonia Dreising

    Despite the very diverse, very international character of Bahrain, I felt quite lonely as an expat -- before joining InterNations, that is.

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