Investor’s Guide to

Bahrain

ALBA

ASRY

BATELCO

BAS

BIEC

GCC

IDD

OBU

SMEU

Aluminium Bahrain

Arab Shipbuilding and Repair Yard

Bahrain Telecommunication Company

Bahrain Airport Services

Bahrain International Exhibition Centre

Gulf Cooperation Council

Industrial Development Directorate

Offshore Banking Units

Small and Medium Enterprises Unit

During the last few decades, theGovernment of Bahrain has beenimplementing a national industrialdevelopment policy aimed at buildinga strong and diversified industrial baseand reducing the dependence on oil.The successful implementation of thatpolicy has resulted in the growth ofseveral major industries in Bahrain inthe aluminium, petrochemical, ironand steel, engineering, ship repair andother sectors. The success of thosemajor i n d u s t r i e s h a s , i n t u r n ,generated numerous downstreamindustrial investment opportunities,especially in the small- and medium-scale sector.

The UNIDO Investment PromotionService Office (IPSO) was establishedin Bahrain in April 1996 with theprime objective of further encouragingindustrial investment in Bahra inthrough the identification of viableindustrial projects, preparation ofproject profiles and promotion of thesame to investors.

I am happy to note that the IPS Officeis publishing this updated version ofthe Investor’s Guide to Bahrain. Itrust that the guide, which providesvarious information of interest toinvestors, will be of immense use toinvestors and visitors to Bahrain.

Shaikh Isa Bin Ali Al KhalifaMinister of Oil and Industry

III

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATIONINVESTMENT PROMOTION SERVICE OFFICE (IPSO)

in Bahrain

United Nations Industrial DevelopmentOrganization (UNIDO) is the specialistagency of the United Nations dedicated tobringing a better life through industrialdevelopment to the people who live indeveloping countries and countries intransition to market economies. The aim ofUNIDO’s services is to help these countriesovercome their social and economicdifficulties and achieve a greater stake in theglobal market.

Utilizing a wealth of expertise gained fromover 30 years of supporting industrialdevelopment around the world, theOrganization helps lay the foundation forlong term, sustainable development. As acatalyst for change, it provides the kind ofindustrial services essential for clients togenerate their own economic wealth anddevelop national capabilities.

With a broad membership of 169 nations,UNIDO is a unique forum for global debateon industrial development. As an honestbroker, it builds on the complementaryinterests of its clients to developinternational partnerships. One of the keypriorities of UNIDO’s activities is thepromotion of investment and technology,which started in the late 1960s, can beconsidered one of the first multilateralinvestment programmes. The objective istwo-fold-strengthen industries in developingcountries and establish enduringpartnerships between industries in thedeveloped and developing countries.

UNIDO’S investment programme is based onits unique network of Investment PromotionService (IPS) offices, which covers Athens,Beijing, Manama, Milan, Moscow, Paris,

Seoul, Tokyo, Warsaw and Vienna. Inaddition, there is an outer network of focalpoints (e.g., for the United Kingdom,Walloon region of Belgium, St. Petersburg,etc.) or similar offices established undertechnical co-operation projects (e.g., India,Saudi Arabia, etc.). Their role is to establishcontacts with firms in the host country thatare interested in business partnerships indeveloped and developing countries. Theyinform these firms about business conditions,potential business partnership opportunities,and sectors of interest. They also assistpotential partners to make contact andnegotiate the agreements for projectimplementation.

UNIDO’s World Investment Network Service(WINS) is a global electronic network linkinginvestment promotion a g e n c i e s i ndeveloping countries, UNIDO headquarters,IPS offices and similar offices. ThroughWINS, project proposals from entrepreneursin developing countries can be offered to alarge number of potential partners in bothdeveloped and developing countries in acost-effective manner, without delay. As partof the network, on-line information oncountry data, investment climate andfinancial institutions is being developed.

With the support of the Government ofBahrain, UNIDO set up IPS Bahrain in April1996 to facilitate industrial cooperationbetween companies in Bahrain and othernations. IPSO Bahrain is a branch of IPSnetwork from which potential investors ofBahrain can seek information and technicalexpertise UNIDO offers to gain access toforeign capital, technology, managerial skills,marketing, equipment etc.

Chapter Page

I

II.

III.

IV.

V.

WHY CHOOSE BAHRAIN AS AN INVESTMENTLOCATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

BAHRAIN AND ITS PEOPLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2GeographyGovernment and human resourcesSociety

INFRASTRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Industrial areas and free zonesTransport and communicationsExhibition

ECONOMIC RESOURCES AND POTENTIAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8The economyGovernment economic policyIndustryBanking and financial centreTourism

INVESTMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13General investment climate

Areas for potential investmentIncentives for foreign companies

Annexes

I.II.III.

Legal structure of commercial companies . . . . . . . . . . . . . . . . . . . . . . 13General information on Bahrain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16Relevant Bahrain Government bodies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

prospects as well as its financial and commercialincentives and the amenities of its lifestyle. Theprincipal advantages of Bahrain in the above-mentioned areas are outlined below:

Market

l A strategic location in Western Asia.

l Situated halfway between eastern and westerntime zones.

l A regional market of 100 million people.

l Duty-free access to States of the GulfCooperation Council.

l The hub of aviation in Western Asia.

l Modern integrated air, sea and roadtransportation system.

Financial Incentives

l No personal, corporate or withholding taxes.

l No exchange control restrictions on repatriationof capital. profits and dividends.

l A freely convertible and stable currency linkedat a fixed rate to the United States dollar.

l Low-cost utilities. fuel and telecommunications.

l Attractive industrial incentive packageincluding development finance.

l Serviced factory and warehouse sites availableat low cost.

l Labour costs one t h i r d o f those inindustrialized countries.

Commercial Incentives

l 100 percent foreign ownership of companiespermitted.

l Mature legal infrastructure and internationallyaccepted trade practices.

l Western Asia’s international financial Centre.

l A major centre of regional insurance activities.

l Extensive free-zone facilities.

l The region’s most advanced digitaltelecommunications system.

l Skilled and resourceful workforce fluent inArabic and English.

Lifestyle

l Pleasant, secure and cosmopolitan lifestyle.

l Uniquely popular Arabian vacation resortattracting 2 million visitors per annum.

l Desert safaris, water sports, exotic bazaars anddesigner shopping.

l Well-appointed museum and archaeologicalsites reflecting regional history and culture.

l Welcoming attitude towards expatriates andtheir families.

l Excellent schools with international curriculafrom various countries, including France, Japan,t h e U n i t e d K i n g d o m o f g r e a t B r i t a i n a n dNorthern Ireland and the United States ofAmerica.

c e n t r a l l y on the southern shores of the ArabianGulf between latitude 25OC 32OC and 26OC 20OCNorth and longitude 50OC 20OC and 50OC 51OC East.It lies within the western coastline of the ArabianGulf waterways, about 22.1 kilometres off theeastern coast of Saudi Arabia, 48.3 kilometres tothe north-west of Qatar, 473.4 kilometres to thesouth-east of Kuwait and 473.4 kilometres to thenorth-west of the United Arab Emirates. It islinked with Saudi Arabia by the King FahadCauseway.

The Bahrain t ime zone has the advantage ofbridging the market opening times of Eastern Asiaand Europe, a fact that has contributed to theemergence of the island as a financial centre forWestern Asia.

The State comprises a grouptotal land area of about 694.15

of 33 islands, with as q u a r e k i l o m e t r e s .

It has three islands of major demographic andeconomic importance, together accounting forover 85 per cent of its total area. The threeislands are Bahrain, Muharraq and Sitra. Thelargest in the archipelago is Bahrain, where thecapital city, Manama, is located.

Bahrain is hot in summer and mild in winter. Theclimate is pleasant from October -to April withtemperatures averaging from 15OC to 24OC. FromJuly to September the average temperature is 36OCwith high humidity.

Government and human resources

Government

Bahrain gained ful l independence from theUnited Kingdom of Great Britain and NorthernIreland on 16 December 1971. The Head of Stateis His Highness the Amir, Shaikh Isa Bin SulmanAl-Khalifa. The Government is administered by acabinet, comprising members of the ruling Al-Khalifa family and a group of experts. TheConsultative Council, composed of 40 members,was established on 16 January 1993. Its mainmandate is to advise the Government.

Bahrain is a member of the Gulf CooperationCouncil (GCC), together with Kuwait, Oman,Qatar, Saudi Arabia and the United Arab Emirates.GCC was first established when leaders of thosecountries signed the protocol of GCC at AbuDhabi, on 25 May 1981 to promote unificationand cooperation in security matters , foreignpolicy and economic development.

Population and employment

By the end of 1996, the population was estimatedto be 598,625, two thirds of whom are Bahrainis,t h e b a l a n c e b e i n g f o r e i g n e r s . T h e r e a r ea p p r o x i m a t e l y 1 9 0 . 0 0 0 w o r k e r s i n B a h r a i n ,84,000 of whom are Bahraini and 106,000 non-Bahraini.

Society

Religion

Islam is the State religion, which is practiced by85 per cent of the Bahraini population. There arealso Christians, Jews, Hindus, and Buddhists.Places of worship for various faiths exist in thecountry

Language

Arabic is the official language, although English iswidely spoken and used as a working language.

Education

State education is free. There is also a widerange of private schools catering to the Arab.B r i t i s h , F r e n c h , G e r m a n , I n d i a n , J a p a n e s e ,Pakistani, British and American communities.

Health and medical facilities

The World Health Organization rates the health-care system of Bahrain among the top three inthe world for readily accessible services to thepopulation. State medical services are providedf r e e o f c h a r g e . In addition, full primary,secondary and tertiary care is available underprivate system.

2

Ten purpose-built industrial areas strategicallylocated around the country provide facilities forover 341 different industrial companies offering adiverse range of products and services.

A significant incentive to business is providedthrough exemptions of duties on imports of rawmaterials, semi-manufactured goods, machineryand equipment, as well as free exports and re-exports.

Hidd industrial area

I n o r d e r t o m e e t B a h r a i n I n d u s t r i a l L a n dr e q u i r e m e n t f o r t h e n e x t c e n t u r y , t h eGovernment of Bahrain decided to invest in thereclamation of a total of 650 hectares of landcovered by shallow water to the South Hidd onMuharraq Is land for development of a newindustrial area.

The major advantages of the new area are asfollows:

l Adjacent to the proposed new Bahrain portl Adjacent to Bahrain International Airportl Access to the causeway leading to Saudi

Arabia and rest of the GCC countriesl Excellent road net work leading to the new

area including a causeway that will beconstructed as part of this project to link thenew area to the old industrial areas

l Adjacent to the new power and desalinationplant in South Hidd

l Natural gas distribution station is beingavailable to those industries in need of

madesuch

requirementl Close to the business and commercial Centre

of Manama.

The infrastructure will be constructed in phases,as briefly described below.

Phase I

The total area of the first phase is 240 hectares,with great flexibility in the planningcan be offered the size and type of

so that usersplot that best

suit their particular needs. The layout of phaseo n e w i l l i n c l u d e p r o v i s i o n f o r c o m m e r c i a lfacilities such as:

l Administration buildingl Shopping area

l Medical centerl Control/security stationl Mosquel Bank/post officesl Fire stationl Sewage treatment plant.

Phase II

The second phase will include the infrastructurefor the rest of the area as and when needed.

Expected types of industries

I t i s e x p e c t e d t h a t t h e f o l l o w i n g t y p e s o findustries could be located in the Hidd industrialarea:

l Industries in metal, wood, textiles, food etc.l Downstreaming of aluminium, iron and steell Petrochemical and chemical industriesl High-tech industriesl Marine related industries and servicesl All types of consumer and household productsl Assembly and packagingl Electrical/electronic industriesl Precision Engineering industriesl Regional distribution warehousing.

Further information may be obtained from thefollowing:

Director, Directorate of Industrial DevelopmentMinistry of Oil and IndustryP.O. Box 1435, BahrainFax: (0973) 730939Telephone: (0973) 731011

Transport and communications

The transport and communications sector, with itsfour branches (land, sea, air andtelecommunications), plays an effective role infacilitating industrial development.

Transport

Lund transport

B a h r a i n h a s a s o p h i s t i c a t e d r o a d n e t w o r k .Motorways and dual carriageways cover thecountry to such an extent that the furthermostpoints are minutes away from each other. In theearly 1980s the most ambitious project of recentt imes was embarked upon the Bahrain-SaudiA r a b i a c a u s e w a y , w h i c h w a s o p e n e d o n 2 6November 1986. The 25 ki lometre causewaylinks Bahrain with the Saudi Arabian mainlandand has opened up excit ing new commercialopportunities.

Sea transport

The development of the port facilities of, Bahrainand the upgrading of i ts infrastructure haveplayed a major role in the economic progress ofthe country.

The major sea port of Mina Sulman, strategicallylocated at the heart of the Arabian Gulf area, isable to take full advantage of regional economicopportunities.

fMina Sulman is virtually self-

suficient, providing its own range of supportservices, from engineering and maintenance tosecurity, fire and medical facilities. I t c a naccommodate vessels up to 65,000 tonnes, andhas a container capacity of 150,000 twenty-feetequivalent units (TEU) per year,

T o c o m p l e m e n t t h e M i n a S u l m a n m a r i t i m efacilities, plans for a new port and associatedindustrial zones have been initiated in the SouthHidd district of Muharraq, across the water fromMina Sulman. This new infrastructure will meanthat industries in the new industrial area will havee a s y a c c e s s t o t h e o t h e r r e g i o n a l m a r k e t s .Bahrain International Airport wil l be a fewkilometres away to provide the added option ofdistribution by air. The immediate focus for firmsbeing established in the zone will probably bethe massive consumer market of neighbouringSaudi Arabia. In this connection, plans areunderway to build a four-lane highway andbridge to the causeway, which will link the newport and industrial area with Mina Sulman.

By investing in new port facilities and furtherdeveloping i ts industrial and manufacturingi n f r a s t r u c t u r e , B a h r a i n w i l l b e e v e n m o r eattractive to potential industrialists and investorsas a premium transshipment, export and re-export Centre.

Specif ications of the new facil i t ies coveringreclaimed land of around 820 hectares are asfollows:

Port facilities.

l 2 / 300-metre berths for container operationsl 1 / 300-metre multipurpose berths -

RO/RO/LO/LOl 3 / 300-metre berths for general cargo

operationsl 1 / 24,000 m2 container freight warehousel 1 / 18,000 m2 aluminum export shadel 3 / 18,000 m2 general cargo shedsl Purpose-built straddle carrier workshop with

general maintenance facility and officesl Operations control tower and administration

blockl Fire stationl Harbour master’s control tower and

administration blockl Small craft maintenance workshop and

slipwayl Security gate housel Offices for customs, health and immigration

services.

Container and cargo operations equipment:

l Container stacking area with 5000 twenty-footground slots

l 2 / 45- to 50-tonne capacity gantry cranes and2 post panamax type cranes with 45- to 60-tonne capacity

l 14 straddle carriersl 4 / 35 tonne capacity top spreader container

handling fork lift truckl 6 / I2-tonne capacity general duty fork lift

trucksl 60 / 2.5-tonne capacity low profile container

specification fork lift trucksl0 / 60-tonne capacity tugmaster units20 / 60-tonne capacity low bed trailers2 / 30- to 40-tonne capacity mobile cranesSewage disposal unit with 120 reefer containerplug-in points

l Computerized container and cargo trackingsystem

Marine equipment:

l 2 / 42-tonne bollard pull harbour tugsl 2 pilot cuttersl Computerized vessel traffic radar management

system

Further information may be obtained from thefollowing addresses:

Ministry of Finance and National EconomyP.O. Box 333 BahrainTelex: 8933 MALEYA BNFax (0973) 532853Telephone: (0973) 530800

Directorate of Customs and PortsCustoms P.O. Box 15Ports P.O.Box 453Telex: 8642 MINA BNFax: (0973) 725534Telephone: (0973) 725333/725555

Port area: 130 hectaresIndustrial area: 650 hectares

Air transport

Bahrain International Airport , with i ts newterminal and with more than 35 airlines operatingthrough it, is considered a gateway to the region.Over 300 regional passenger flights and 60 cargoflights operate each week. Nearly 3.5 millionpassengers pass through the airport each year, afigure that is expected to grow to 10 millionpassengers during the present decade. Theimportance of the airport is reflected in thefollowing data:

Airport facts and figures

.

.

.

.

.

.

.

.

.

.

4.02-kilometer runwav20,000 in-flight meals’ a day42 check-in desks8 immigration desks for departures14 immigration desks for arrivals7 air-conditioned air-bridges260-seat restaurant250-seat fast-food outlet15,000 square metres of covered warehouse131 unit load devices of storage handlingcapacity.

Annual handlings (1996)

l 3.5 million passengersl 550,000 transit passengersl Over 56,000 aircraft landings and departuresl 117,000 tonnes of cargol Over 36 airlines using the airport.

Distance from the airport to:

l Manama city Centre: 3.5 kilometresl Mina Sulman port: 4.5 kilometresl Bahrain International Exhibition Centre: 5

kilometresl King Fahad Causeway to Saudi Arabia: 15

kilometres

The strategic location of Bahrain InternationalAirport, hiw ch enables it to serve the ArabianGulf area, its high frequency of regional flights,i t s c o m p e t i t i v e p r i c i n g a n d t e c h n o l o g i c a l l yadvanced faci l i t ies supported by l iberal andcommercially oriented government policies, offersubstantial o

fportunities for investment in areas

such as theollowing:

(a) cargo storage, consolidation, re-export anddistribution

(b) sea and air cargo(c) cargo handling systems; courier operations(d) aviation-related engineering support and

maintenance facilities(e) tourism projects and travel services(f) hospitality services(g) road transportation.

Further information may be obtained from CivilAviation Affairs, the government body concernedwith civil aviation in general, and Bahrain AirportServices, the ground handling concessionaire, atthe following addresses:

Marketing DepartmentCivil Aviation AffairsBahrain International AirportP.O. Box 586, BahrainFax: (973) 321139Telephone: (973) 321094 / 321095

Bahrain Airport Services (BAS) P.O. Box 22285, BahrainFax: (973) 335304Telephone: (973) 321700/321709SITA: BAHKBGF

Telecommunications

The telecommunications system in Bahrain isamong the most advanced in the world. TheBahrain Telecommunications Company(BATELCO) provides an excellent service for allsectors of the economy. The telecommunicationssystem has played a central role in makingBahrain a major global and business Centre in theMiddle East.

Telecommunication services in Bahrain employfully digital ized systems and state-of-the arttechnology. The rates for local and internationalcommunications compare favourably with othercountries in the region and other trading centresin the world.

The comprehensive range of servicesi n c l u d e s d i r e c t d i a l l i n g

provided by

transmission facilities to almost anywhere in theworld, GSM mobile telephony, high-speed datacircuits, Internet access, integrated services digitaln e t w o r k s ( I S D N ) a n d c o r p o r a t e m e s s a g i n gfacilities.

Exhibition

Bahrain Exhibition Centre

The Bahrain International Exhibit ion Centre(BIEC), one of the most advanced exhibit ionfacilities in the region, was inaugurated on 2November 1991. The concept was to embodystate-of-the-art technology within a traditionalarchitecture and, even more importantly, toi m b u e i t w i t h a n a m b i a n c e of hospitality,f lexibi l i ty and dynamism that ref lects of thea t t i t u d e s o f t h e p e o p l e a n d G o v e r n m e n t o fBahrain.

BIEC covers a total site of 20,000 square meters,8,000 of which is covered space, allowing roomfor further 2,000 square meters of outside displayarea and substantial car parking.

To meet the rising demand for more tenancies,especially during the peak exhibitions season,BIEC will increase its exhibition space by theaddition of a new 6,400 m2 hall that is due toopen in 1999.

An operable folding partition that will divide thearea into two halls, each having independente l e c t r i c a l a n d m e c h a n i c a l s y s t e m s , w i l l b ei n c l u d e d i n t h e e x t e n s i o n . W i t h t h edevelopment of the new hall, the exhibitionsbusiness in Bahrain is expected to increase byabout 30-35 per cent per season.

Main hall: 6,760 squaremetres of column-freefloorspace with seating forup to 4,000

Ceiling height: 11.6 metres

Access: Four-lane roadway tothesouth; two-roads to thenorth and west

storage: Sufficient storage for ten 40foot containers at any time

Conference/banquet hall: 400 square metres; can

accommodate up to500 for reception-styleconferences; up to300 at theatre seating style

Car parking: Paved area for 700 vehicles;additional space for overspillin the secondary site area

Otherfacilities:

l Eight hospitality suitesl Two meeting roomsl Simultaneous translation public address

system in the conference/banquet halll Congress/conference audio visual system

More information may be obtained from thefollowing address:

Bahrain International Exhibition CentreP.O. Box 11644BahrainE-mail: biec@batelco.com.bhFax: (0973) 553447Telephone: (0973) 550111

oil, in 1932. The petroleum sector has been amajor source of income, but i ts share in thenational economy has been declining along withoil reserves. T h e d e c l i n e i n o i l r e s e r v e spersuaded the Government in the early 1970s toembark on an extensive programme of economicdiversification by converting energy resourcesinto higher value-added products. Currently,Bahrain has a well-diversified economic base thatincludes oil-refining, petrochemicals, aluminumand r e l a t e d d o w n s t r e a m i n d u s t r i e s , s h i p -repairing, small- and medium-scale industries anda major financial services sector.

The extent of the transition of the economy ofB a h r a i n a w a y f r o m i t s d e p e n d e n c e o n t h eprimary production of oil is reflected in the factthat the contribution of such production to thegross domestic product fell from 36 per cent in1975 to 18 per cent by the late 1980s. Over thesame period, the share of services increased by athird, mainly due to banking and insurance,which increased its contribution from 3 to 12 percent.

Banking is one of the major sources of prosperityof Bahrain through licensing of offshore bankingunits (OBUs) that are not involved in localbanking but serve to channel money from thepetroleum-producing region back into worldmarkets. Bahrain has embarked on a major planto market the country as a base for OBUs byencouraging overseas banks to set up operationsin the country.

Government economic policy

In order to implement its policy of providing analternative source of income for the country andto avoid dependency on oil, the Government ofBahrain has given increased attention to industryin the last two decades.

In the past decade, the economy of Bahrain hasbeen transformed from an economy dependenton the primary sector for output and employmentto a modern industrial economy and serviceCentre. The economic strategy of the Governmentis currently under review, and the liberalization ofinward investments is stated to be an importantissue.

The main goals set by the Government are gearedtowards the following:

(a) diversifying the economy and nationalincome, to be pursued through the

development of small- and medium-scaleindustries

(b) encouraging the services sector, notablycommercial services

(c) developing off-shore banking and tourism,removing obstacles to foreign investment

(d) encouraging the contribution of the privatesector in economic development.

Industry

T h e n o n - o i l m a n u f a c t u r i n g s e c t o r p a r t i a l l yembodies the efforts of the Government to bringabout a diversification of the sources of incomein the economy. The approach was mainly toestablish large-scale, energy-intensive, export-oriented industries, thus taking advantage of therelatively cheap natural gas.

The manufacturing sector is currently dominatedby petrochemicals, aluminum-related industriesand ship-repairing. Moreover, light industry,including the production of supplementary gassupplies, asphalt, prefabricated buildings, softdrinks, air-conditioning equipment, paperproducts, plastics, tiles and garments, is alsocontinuing its expansion.

The growing industry of Bahrain, with some 341manufacturing establishments, is characterized bytwo types of companies. On the one hand, thereare a few large enterprises, mainly State-ownedor multinational corporations, in the oil and gasprocessing and petrochemical sectors and in thealuminum and iron-ore processing sectors. Mostcompanies expor t most o f the i r product ionmainly to European and East Asian marketsdirectly or through marketing companies.

The largest and most important industrial projecto u t s i d e t h e p e t r o l e u m s e c t o r i s A l u m i n u mBahrain (ALBA). The ALBA smelter startedproduction in 1971, with a production of 120,000tonnes per year. By the end of 1996, the capacityof ALBA was expanded to 461,000 tonnes peryear and it is forecasted to reach 500,000 tonnesby the end of 1997. That major expansion makesALBA one of the world’s largest smelters. Itcurrently employs more than 2,000 people. To

8

utilize the smelter’s output, downstreamindustries were designed. First the satelliteindustry atomized the aluminum powder in 1973.Aluminum extrusion and midal cables plantswere founded in 1977. In 1986, the largest andmost important venture to be undertaken in theregion was the expansion of the rol l ing mil lplant. When the expansion was completed, theplant’s rated capacity was increased from 120,000to 170,000 metric tonnes in 1981.

A s t h e f l a g s h i p o f B a h r a i n ’s i n d u s t r i a ldevelopment programme, the aluminum industryhas continually looked to the future, improvingefficiency and increasing output. Total aluminumproducts increased from 72,243 metric tonnes in1980 to 1,035,844 metric tonnes in 1995. Thepercentage share of manufacturing in grossd o m e s t i c p r o d u c t c o n t i n u a l l y i n c r e a s e d . I treached 22.0 per cent in 1995 compared to 10.1per cent in 1985, while the percentage share ofcrude oil andin 1985 to 16.6

as went down from 28.0 per centper cent in 1995.

T h e t w o o t h e r l a r g e p r o j e c t s a r e t h e G u l fPetrochemicals Industrial Complex (GPIC) andthe Arab Shipbuilding and Repair Yard (ASRY).The Government of Bahrain established the GPICin December 1979 for the production of basicpetrochemical products, ammonia and methanol.G P I C h a s b e e n s u c c e s s f u l l y d e v e l o p e d a n doperated above the designed production capacityduring the years 1985-1989, when the totalquantity of ammonia exported reached 444,193metric tonnes in 1995 against 104,921 metrictonnes in 1985, and the total quantity of methanolexported increased from 126,054 metric tonnes in1985 to 424,910 metric tonnes in 1995.

ASRY commissioned i ts dry dock in 1977. I tcurrently has a capacity of 500,000 dead-weighttonnes, and can accommodate four ultra-largecrude-oil carriers. Two floating docks wereacquired in 1991 to handle smaller vessels. ASRYhas plans to construct a second graving dock.

On the other hand, there are a large number ofsmall and medium companies which manufacturemainly for domestic and regional markets.

As a result of the increased interest in industrialdevelopment in the country in recent years, andas part of the economic diversification efforts, 89pre-licenses for industrial projects were issued in1997. Most involved small-and medium-scalealuminum ventures, food processing and garmentmanufacturing.

Banking and financial centre

The banking sector in Bahrain has over 5,000employees. It contributes over 17 per cent of thegross national product of Bahrain, and is thesecond largest sector of the economy.

The accelerated economic growth that followedthe oil price rises in 1973 and 1974 created theneed for an expanded and more sophisticatedbanking service. With efficient planning andadequate investment incentives, Bahrain emergedas the main financial centre in Western Asia.

The expansion of the financial sector led to thecreation in 1973 of the Bahrain Monetary Agency,which h a s w i d e - r a n g i n g c e n t r a l b a n k i n gauthority. The Agency considers applications forlicences from financial institutions.

Bahrain has developed into a major financialservices centre, with the largest volume of tradein Western Asia. Some of the factors contributingto the growth of Bahrain include its convenientlocation midway b e t w e e n t h e e a s t e r n a n dwestern time zones (permitting it to deal withb o t h f o r a m a x i m u m n u m b e r o f h o u r s ) , i t ssophisticated telecommunications network,exchange controls and its stable administration.

A major factor in the development of Bahraino c c u r r e d i n 1 9 7 5 , w h e n t h e g o v e r n m e n tintroduced OBU licences obtainable withoutmany of the former restrict ive requirements.Thereafter, financial institutions were permitted toaccept deposits from both residents and non-residents through investment banking licences.

Bahrain has consequently become the financialservices centre of Western Asia. It currently has19 commercial banks, 2 specialized banks, 45OBUs, 30 investment banks, 41 representativeoffices, 7 money and foreign exchange brokersand 26 money changers. The aggregate assetsand liabilities of OBUs were US$ 69.0 billion atthe end of March 1997.

Bahrain is also a major insurance Centre, andthere is a significant reinsurance business. Thereare 9 Bahraini insurance companies, 12 branchesof foreign insurance companies and 42 exemptinsurance companies trading offshore.

More information may be obtained from thefollowing address:

Bahrain Monetary AgencyP.O.Box 27BahrainTelex: 8295 BAHMON BNFax: (973) 533342 / 534170Telephone: (973) 535535

Bahrain Development Bank

In December 1991, the Bahrain DevelopmentBank was established by an Amiri decree. TheBank aims to further both business activities andthe industrialization of Bahrain. With a mandatewhich allows scope for maneuver in the businessarena, the Bank is able not only to provide long-term financing but also to participate, as ashareholder, in the projects it finances.

The Bahrain Development Bank has becomeinstrumental in creating n e w e m p l o y m e n topportunities by acting as an important catalyst inattracting foreign and local entrepreneurs, theircapital, skills and technology. Additionally, theBank can, through its key local business contacts,offer assistance in identifying suitable joint-venture partners and provide impartial advice onlocal business practices. By combining itsk n o w l e d g e o f l o c a l m a r k e t c o n d i t i o n s a n dexpertise in structured financing, the BahrainDevelopment Bank has been able to effectively

9

contribute to establishing a number of diverseand successful projects of varying sizes andactivities.

Furthermore, strategic al l iances, such as i tsp a r t n e r s h i p i n t h e E u r o p e a n C o m m i s s i o n ’sI n v e s t m e n t P a r t n e r s h i p S c h e m e ( E C I P ) , t h eIslamic Development Bank’s Long-Term TradeF i n a n c e P r o g r a m m e a n d t h e A r a b T r a d eFinancing Programme, provide BahrainDevelopment Bank with broader resources uponwhich it can draw when considering appropriatefinancing for each project.

The primary focus of the Development Banks isas follows:

(b)

(c)

(d)

Long-term concessionary loans of up to 10years to finance capital equipment and fixedcosts;

Venture capital subscriptions for selectprojects in the form of 49 per cent equitycontributions;

Seed capital loans of up to eight years forsmall businesses and professions to financeStart-up costs;

Working capital loans to fund cash flow gapson a revolving basis.

Further information may be obtained from thefollowing address:

Bahrain Development BankP.O. Box 20501BahrainFax: (973) 534005Telephone: (973) 537007

Tourism

Today, tourism is an important sector in theeconomy of Bahrain. In order to diversify theeconomy, the Government is trying to developthe tourism infrastructure to attract tourists to thecountry. A new directorate has been establishedin the Ministry of Cabinet Affairs and Informationconcerned with tourism and archaeology in aneffort to introduce Bahrain to visitors. Thegovernment has recognized the importance ofcultural development and improvement of mediaservices as an effective tool to enhance publicopinion for stronger social unity. The history ofBahrain presents a mult i tude of enchantinglegends and myths. In the old days, ancientBahrain was referred to by several names. Forinstance, its oldest name was Dilmun, meaning“The Land of Immortality” and other namesincluded, Tylos, Aradous and Awal.

According to myths, a rare and magical lotusgrew on the island a flower that was believed tohave the power to bestow the gift of immortalityto whoever drank from its nectar. The famoustraveler, Gilgamesh, visited “The Garden of Eden“meaning Dilmun, too, in search of the flowerwith the magical elixir, that would grant himeternal life.

From an island of affluent heritage and mythicalhistory, to a sophisticated metropolitan centrewith a vibrant economy, the transformation ofBahrain has made it a glowing hub for industryand tourism.

On the basis of 1994 data and estimates on visitora r r i v a l s a n d a 1 9 9 6 e x p e n d i t u r e survey, it isestimated that total expenditure in Bahrain byforeign tourists amounted to nearly BD 328million Bahraini dinars (BD). In addition, thei n d i r e c t a n d i n d u c e d i n c o m e g e n e r a t e d a nadditional 13000 jobs and income of nearly BD 53million. Overall, tourism is responsible for 9.2 peradditional 13000 jobs and income of nearly BD 53million. Overall, tourism is responsible for 9.2percent of the total GDP and around 16.7 per centof the workforce.

Bahrain has one of the fastest developing touristindustries in the region, attracting more than twomillion visitors per year, mostly from States of theArabian Gulf area. T h e k e y f e a t u r e s a n dattractions of Bahrain as a tourist centre includethe following:

A wealth of historical, cultural and traditionalattractions (a history going back 4,000 years)

Water sports, pearl-diving expeditions, scuba-diving and dhow trips;

First-class hotel accommodation,entertainment and restaurants

Excellent and varied clubs

Amusement and wildlife parks and socialamenities for families

Friendly and hospitable staff

Modern shopping complexes.

The development of facilities and attractions fortourists has become a major industry in Bahrainoffering development opportunities to local ,regional and international companies in suchareas as the following: catering; sports facilities;conference and exhibit ion centres; souvenirmanufacture; historical and cultural locations;entertainment programmes; and amusementparks.

More information may be obtained from thefollowing address:

Ministry of Cabinet Affairs and InformationP.O. Box 253, BahrainTelex: 8399 INFORM BNFax: (0973) 682777Telephone: (0973) 781888

Directorate of Tour ismFax: (0973) 210969Telephone: (0973) 211199

10

control constrains, add to the appeal of Bahrainto those wishing to invest in a dynamic growingeconomy. The Government, an ardent supporterof private enterprise, has adopted a policy ofensuring that new companies may be registeredwith administrative ease.

The cosmopolitanstandard of

lifestyle offers a very highliving in secure and comfortable

surroundings, including a congenial network ofsocial amenities.

Areas for potential investment

Industrial diversification is important to Bahrainand other Arabian Gulf economies, and importsubstitution receives vital Government support.Opportunities for new industrial operations existin the following areas:

(a) Downstream investments from existingprimary aluminum, oil, gas and steelindustries, especially in petrochemicals,plastics, engineering, ship repair servicesand product fabrication:Manufacturing to meet demands of fast-expanding consumer markets in the region;Food processing, packaging and distribution;Local assembly and parts manufacture forfinished goods;High-technology production processes;Manufacture of components or industrial,fdrilling, refinery and mining applications;Equipment and machinery repair andmaintenance;Machine shop services for regional needs;Production of construction equipment andmaterials;Other specific opportunities includepharmaceuticals, transportation equipmentand systems, educational and health-carematerials, furnishing, machinery, packagingsystems, materials for agriculture and fishing,textiles, clothing, toys and leisure goods andcraft.

Incentives for foreign companies

Establishing an industry

Assistance with every aspect of establishing anew industry or service is provided by theMinistry of Oil and Industry through the IndustrialDevelopment D i r e c t o r a t e ( I D D ) . IDDcoordinates the entire industrialization drive,providing assistance and guidance for new andexisting manufacturing operations.

The services provided extend through thedevelopment process “fast-track”commercial registrat ion with the Ministry ofCommerce to the start-up of operations. Otherservices include assistance with land surveying,maintenance a n d l i a i s o n w i t h m u n i c i p a lauthorities. Decisions are made quickly, therebyminimizing red tape.

In recognition of the importance of small andm e d i u m e n t e r p r i s e s ( S M E s ) t o t h e n a t i o n a leconomy and in order to develop them, the Smalland Medium Enterprises Unit (SMEU) has beenestablished in the Ministry of Oil and Industry,Bahrain, for the i m p l e m e n t a t i o n o fcomprehensive policies to assist SMEs.

Tax, duty and ownership incentives

The following incentives are offered:

l No personal, corporate or withholding tax; norestriction on repatriation of capital, profits,royalties or wages; and freedom of movementof foreign exchange

l Foreign ownership of up to 100 per cent of acompany allowed

l Duty-free import of materials and machineryfor manufacturing, and duty-free merchandisefor re-export.

11

Active government support

The Government offers activefollowing ways:

support in the

l Consistent government policy of encouragingoverseas investment, including assistance inundertaking market studies

l Administrative ease of company registration

l Mature, internationally oriented and highlydeveloped legal framework

l Cheap energy and fuel costs

l Competitive industrial, commercial andresidential rents; duty-free zones at ports andindustrial estates; and serviced industrialestate.

The promotion of private enterprise is publicpolicy. T o e n c o u r a g e m a n u f a c t u r i n g , t h eGovernment actively promotes Bahraini productsand protects the manufacturer against dumpingfrom abroad through import tariffs.

Labour force and amenities

The labour incentives and amenit ies offeredinclude the following:

l Well-educated, skilled indigenous workforce,proficient in English, at one third of the costin industrialized countries

l Straightforward processing of labour permits

l Excellent housing, schooling and socialamenities

l Modern health care, hospital and medicalfacilities

l Unique quality of life with superb sports andleisure activities

l Highly stimulating business and culturalenvironment.

Development infrastructure

Bahrain enjoys the benefits of a highly developedinfrastructure, which offers the fo l lowingadvantages:

l Foremost financial centre in western Asia

l State-of-the art telecommunications network

l Regional centre of insurance

l Home to Gulf Air and hub of regional airlineoperations

l Modern international airport with efficientcargo-handling facilities

l Technologically advanced port facilities

l Twenty-five kilometer road bridge to SaudiArabia providing access to nearby majorpopulation centres

l International and GCC arbitration Centre.

Stable currency

The Bahrain dinar, which is freely convertible, islinked to the United States dollar.

Further information may be obtained from thefollowing address:

Industrial Development DirectorateMinistry of Oil and IndustryP.O. Box 1435BahrainTelex: 8344 TANMYA BNFax: (0973) 290 302 / 293 007Telephone: (0973) 291 511

12

Joint stock companies whose main offices aree s t a b l i s h e d i n B a h r a i n , b u t w h i c h o p e r a t ee x c l u s i v e l y o f f s h o r e , m a y b e 1 0 0 p e r c e n tforeign-owned. T h e y m u s t c o m p l y w i t hconditions of Government resolution 25 of 1977.

The conditions of operation are as follows:

(a) The company must be a joint-stock company

(b) It may not deal in financial activities(investment, banking) except by permissionof the Bahrain Monetary Agency

(c) Its capital must be at least BD 20,000. Wherethe company has obtained permission toengage in financial dealings (investment,insurance, banking), the Ministry ofCommerce reserves the right to satisfy itselfthat the capital is adequate for the purpose

(d) The capital may be owned by anyproportion of non-Bahraini and Bahrainipartners, but transfer of shares of thefounders is governed by the memorandumand articles of association, and needs theconsent of the Ministry of Commerce

(e) Its name must be approved by the Ministryof Commerce and be followed by “BahrainiExempt Joint-Stock Company”

(f) Its term is 25 years (maximum), dating fromregistration, but may be extended bypermission of the Ministry of Commerce

(g) The head office must be in Bahrain, andcompany activities conducted offshore,except for any business expressly permittedby the Ministry of Commerce. It may notown land or property in Bahrain

(h) Its nationality is Bahraini

(i) A deposit, on which interest is earned, isrequired upon registration (see (j) below) forthe duration of the company

(j) A registration fee is payable uponacceptance of application and an annual feethereafter

(k) Application must be made on a special formobtained from the Ministry of Commerce,which has absolute discretion as to whether

not o f fe red for publ i c subscr ip t ion may beestablished without a decree of the Amir. It musth a v e a t l e a s t f i v e p r o m o t e r s , w h o j o i n t l yguarantee the following:

(a) Provisions of articles and memorandum ofassociation are in accordance with theCommercial Companies’ Law

(B) The promoters have subscribed and paid allshares (that is, capital must be fully paid upbefore the company is established) in a bankauthorized by the Ministry of Commerce, andany shares in kind have been evaluated andpaid up

(C) Suitable administrative machinery has beenset up.

T h e u n d e r t a k i n g s h o u l d b e a p p r o p r i a t e l ydocumented, t h e c o m p a n y m u s t t h e n b eregistered in the Commercial Registry, and anannouncement must be published in the OfficialG a z e t t e a n d o n e o t h e r p u b l i c a t i o n . Theminimum capital for a closed joint-stock companyis BD 200,000.

O w n e r s h i p o f 1 0 0 p e r c e n t i s r e s t r i c t e d t oindustrial companies, or to the case of servicescompanies where Bahrain is used as the centrefor regional distribution of goods or services.Such companies may be exempted from therequirement of a minimum level of share capital.

Closed joint-stock share

In either kind of company, shares must be ofequal value, and not less than 0.100 fils nor morethan BD 100, issuable at nominal value or higher,in which Lcase the surplus must coverexpenditures and provide a reserve.

F u l l d e t a i l s o f s h a r e s s u b s c r i b e d m u s t b esubmitted to the Ministry of Commerce.

Increasing capital

Once shareholders have paid the authorizedcapital in full, capital may be increased by issuingnew shares to the value of the amount required,or by transferring the reserve fund to the capital.In that case, the face value of the shares may beincreased and the difference paid from ther e s e r v e , o r n e w s h a r e s m a y b e i s s u e d a n ddistributed to shareholders without charge. Theymust have the same nominal value as perviousshares.

13

Loans

C o m p a n i e s m a y b o r r o w f r o m t h e p u b l i c b yissuing bonds with a value equal to the sumborrowed, at an agreed rate of interest.

In companies with major governmentparticipation, the number of promoters may beless than five. The Ministry of Commerce mayapprove that only 50 per cent be paid up, t h eremaining share value to be paid up within threeyears.

No one may hold office as chairman or memberof the board of directors of more than three joint-stock companies with head offices in Bahrain,and be managing director of more than one.

Branch/representative office

By permission of the Ministry of Commerce,foreign companies may establish branches orrepresentative offices in Bahrain without directlyentering Bahraini partnership, providing theirb u s i n e s s i s n o t c o v e r e d b y t h e c a t e g o r i e sincluded under “commercial agencies”. Theymust, however, engage a Bahraini in the samefield as their sponsor (for example, a Bahrainicontractor would sponsor a foreign contractingservices company). If the branch orrepresentative office is being established as ar e g i o n a l d i s t r i b u t i o n c e n t r e f o r g o o d s a n dservices, no sponsor is required.

Company with limited liability

A company with limited liability is the mostc o m m o n f o r m o f c o m p a n y , a n d m a y b eestablished for any kind of commercial purpose(usually industrial or services such as contractingor consultancy). It must have a fully paid-upcapital of a minimum of BD 10,000. Normally amaximum non-Bahraini participation of 49 percent is permitted, but recent legislation allows100 per cent foreign ownership of industrialcompanies or of service companies using Bahrainas the centre for regional distribution of theirmanufactured goods or services. Althoughparticipation by individual foreign investors ispermitted, the Bahrain authorities prefer thatforeign partnership be undertaken by a company,and there must not be less than two and not morethan 50 shareholders. It cannot issue publicshares or negotiate warrants, nor conduct saving,banking or investment operations. It normallyhas a term of 25 years, and (equal) shares mustamount to at least BD 50 each.

Establishment

The memorandum of association of a limitedcompany (which must be written in Arabic andattested by the notary public) should give thefollowing details:

(a) Names, designations and nationality of thepartners

(b) Head office of the company

(c) Company name and address followed by“Company with limited liability”

(d) Objects of the company

(e) Name of supervisory board, if any (whichmust be set up with a minimummembership, for a specified period, of threepartners, if the total number of partners ismore than 10).

Distribution of profits and losses

The memorandum (or articles) of association mayalso state the shares of partners in the profit andloss. If it does not, they are assumed to be indirect proportion to their shares in the capital.The Ministry of Commerce has the right to askthat extra details be stated.

The name of the limited liability company mayderive from the name of one or more partners orits objectives, but must always be followed by“WLL” (that is, with limited liability), in all officialbusiness dealings.

Articles of association are normally prepared inthe country of origin of the foreign partners.Once legally attested, they should be forwardedby the company manager, together with otherdocuments required, to the Commercial Registryat the Ministry of Commerce, so that the companycan be registered.

Maximum of 49 per cent foreignownership

A maximum foreign ownership of 49 per cent isallowed in the companies described below.

Joint-stock companies (public)

Although the law states that “all partners ofjoint-stock companies s h a l l b e B a h r a i n inationals”, it provides that “some partners mayb e n o n - B a h r a i n i i f a n d w h e n t h e n e e d f o rforeign capital or expertise arises”. In that case,the company may be established after approvalh a s b e e n s o u g h t f r o m b o t h t h e M i n i s t r y o fCommerce and the Council of Ministers, followedby the issue of an Amiri Decree. Normally, joint-stock companies are formed to undertake aspecific major project, sometimes withgovernment participation. Its name must indicateits objectives, and must always be followed by“Bahraini Joint-Stock Company”. It will have aspecific duration, usually the period needed tofulfill its objectives, which may only be extendedby permission of the Ministry of Commerce.

Establishment

All joint-stock companies require a promoter orpromoters who take responsibility for formationof the company, some of whom may be non-Bahraini, and who sign the initial memorandumand apply to license the company.

T h e m o d e l m e m o r a n d u m a n d a r t i c l e s o fassociation issued by the Ministry of Commercemust be followed. In all cases it will include thefollowing details:

(a) Name of the company(b) Main office(c) Objects for which the company has been

formed(d) Names of promoters (not less than seven,

unless the Government formed the company

14

(e)

( f )

(h)

The

or was associated in its formation)Authorized capital, issued capital, andnumber of sharesDuration of the companyConditions pertaining to shares and theirofferEstimate of expenditure and expenses.

initial memorandum must be signed by allpromoters, and forwarded to the Ministry ofCommerce for approval. It will be considered forone month, during which further information oramendments may be requested, and constitutesthe initial application. It will then be returned tothe promoters, who must authenticate it. TheMinistry of Commerce will finally issue a decreeof establishment, to be published in the OfficialGazette.

Capital and subscription of share

Subscription of shares may begin after the decreeo f e s t a b l i s h m e n t h a s b e e n p u b l i s h e d , b u tpromoters must subscribe for shares of not lessthan 7 per cent and not more than 20 per cent ofthe capital before other subscription is invited, atthe proposed public price (when there are 60 ormore promoters, they may subscribe for 40 percent of shares with permission from the Councilof Ministers).

They must provide a banker’s certif icate aswarranty, which should be submitted to theMinistry of Commerce together with a draftprospectus for inviting subscription, including thefollowing:

(a)

(b)

(c)

(d)

(e)

Abstract of the memorandum of associationand articles stating: objects of the company;head office; duration; name, addresses andnationality of promoters; capital of thecompany; number of shares; value of eachshare and amount to be paid of that value;shares in kind; expenditure (salaries and costof establishment of company)

Maximum number of shares per subscriber

Number of shares needed to qualify for theboard of directors and their rights and duties

Date, place and conditions of subscription

Date of issue of decree of establishment, anddate of its publication in the Official Gazette.

The prospectus must be published in the OfficialGazette, and one other local publication at leastfive days before subscription opens. Subscriptionis through the National Bank, subject to theapproval of the Ministry of Commerce, and allproceeds must be deposited there.

Subscription remains open for three months.Thereafter promoters may subscribe for anyremaining shares. If shares are oversubscribed,the Ministry of Commerce will direct suitabledivision. All holders of public shares must beBahraini nationals.

Capital for a public joint-stock company is aminimum of BD 500,000 of which a maximum of

49 per cent may be non-Bahraini. A minimum of20 per cent must be paid up within the first year,and the whole within four years.

Partnership

A partnership under a collective name is definedas “an association of two or more persons undera s p e c i f i c n a m e w h o a s s u m e ( t o t a l ) jointresponsibility for the partnership’s obligation”.Participation by non-Bahraini partners is allowed,with the consent of the Council of Ministers. Thetypes of enterprise involved are those offeringprofessional consultancy or advisory services (forexample, accountancy and engineering), whichm a y b e b r a n c h e s o f p a r t n e r s h i p s a l r e a d yestablished abroad.

The memorandum of association must contain thefollowing:

(a)

(b)

Address of company and commercial name,if anyMain office and its branchesObjectivesNames and nationalities of partnersNames of directors and their shareholdingsand voting rightsCapital and sharesProfit and loss sharing arrangementsDate of establishmentBeginning of company’s financial yearManner of liquidation and distribution ofassets.

T h e n a m e o f t h e c o m p a n y m u s t a l w a y s b efollowed by “Bahraini Partnership Co.“.

Simple commandite company

The company should be registered with theCommercial Registry and chartered in accordancew i t h t h e p r o v i s i o n s o f a r t i c l e 2 6 o f t h eCommercial Companies’ Law. The Memorandumof Association need not include the names of thesleeping partners, but must contain an adequatedescription of their shares in the capital and thevalue thereof. The articles of association shouldstate the joint partners and the sleeping partners,and the former should be Bahrainis. The share ofBahraini partners should not be less than 51 percent of the capital.

Joint venture company

A joint venturelegal forms:

company may take the followingpartnership; simple commandite

comnanv: and company with limited liability.The lega1 structures of the companies are asprovided in the foregoing.

More information may be obtained from thefollowing address:

Ministry of CommerceP.O. Box 5479BahrainTelex: 9171 TEJERA BNFax: (0973) 530455Telephone: (0973) 531531

15

Transit visas, valid for 72 hours, are available atBahrain International Airport, ports or causeways.Extensions may be arranged inside Bahrain.

Visitor’s visas, valid for seven days, may beobtained by business persons, delegates, familiesand dependents. Tourist groups can arrange forseven-day visas through their travel agent.

Commercial hours

Government office hours are from 0700 - 1415,Saturday to Wednesday.

The hours of commercial organizations vary, but0800 - 1530 or 0800 - 1300 and 1500 -1730 arequite common. Five-day weeks are becomingmore favoured, though many establishments stillwork from Saturday to Thursday.

Many shops and supermarkets are open from0830 - 1230 and from 1530 - 1930 six days aweek. Markets and many shops are open onFriday morning ( times vary ).

Commercial banks are open from 0730 to 1200from Saturday to Thursday. Many branches areopen from 1530 to 1730 on the same days.

Amenities

The attractions of Bahrain which have drawnover 120,000 non-Bahrainis to live and workamong the people of the country include thefollowing :

l No taxationl High-class accommodationl Excellent schooling based on the systems of

various countries (Bahrain, India, Japan,Pakistan, United Kingdom and United Statesof America), from kindergarten to 18 years ofage

l Sports and social clubsl Historic island with well-appointed museums

and places of interestl A high-quality private and semi-private

medical systeml Amusement parks, wildlife centre, beaches,

swimming and sports facilitiesl Over 4,500 top-quality hotel roomsl Excellent licensed restaurants offering

some of the widest selections of cuisinein a highly cosmopolitan society

l Varied shopping, ranging from high-classantique dealers, department stores andsupermarkets to specialist jewelers, tailors,discount electrical shops, cold stores andcovered markets.

Housing

Out of town, the typical housing is bungalows orvillas in small compounds. The compoundsusually offer swimming pools, tennis and squashcourts and other sports facilities. The averagesize of the compounds is 10 - 20 homes. Two-,t h r e e - a n d f o u r - b e d r o o m h o m e s a r e m o s tcommon. M o s t w e r e b u i l t a f t e r 1 9 8 0 . I nManama, the capital, a p a r t m e n t s a r e m o r ecommon, often with access to sports facilities,service lifts and porterage.

Clubs and societies

National clubs exist, including Filipino, Indian,Pakistani, Thai and United Kingdom clubs andsimilar organizations. A United States businessperson’s association as well as various women’sorganizations are long established.

The temperature and climate of Bahrain are idealfor sea sports, enabling enthusiasts to enjoy theirhobby almost all year round. The warm shallowwaters of the Arabian Gulf offer a great setting formany aquatic pursuits, from night-time sea fishingto sailing and scuba diving. There are also sportsclubs and societies for sai l ing, windsurfingboards, w a k e b o a r d s , w a t e r - s k i i n g , k n e e -boarding, parasailing, rugby, soccer, basketball,tennis, squash, horse-riding, ice-skating, golf,bowling, hockey, softball, basketball, cricket,social running, chess and scrabble.

There are charitable and business organizations,including a Rotary Club, Lions Club, Bankers’Society, Engineering Society and many others.

Major sporting and social events include anannual marathon relay, a raft race, horse-racingevents, a u t o m o b i l e r a l l i e s a n d m a n y o t h e rsporting events.

16

Entertainment

The country is regularly visited bh

top performersfrom South East Asia, Europe, t e United Statesand elsewhere in the Arab World. Most hotelsand restaurants feature live entertainment. Thereare cinemas and a wide availability of recentvideotape releases for rental and viewing athome.

Media

B a h r a i n h a s A r a b i c - a n d E n g l i s h - l a n g u a g etelevision channels that broadcast a mixture ofnews, international programmes, films and othermaterial.

Additionally, English-language channels can bereceived from Saudi Arabia, Qatar and, at certain

t i m e s o f t h e y e a r , f r o m A b u D h a b i a n d Dubai Bahrain has a 24-hour a day Englishlanguage radio station and an Arabic station.Broadcasts from Saudi Arabia and Qatar and, insummer, from Dubai, can be received. Withshort-wave receivers, the BBC World Service, theVoice of America and other international radiostations can be picked up.

Bahrain has four daily newspapers: two in Arabicand two in English. Akhbar Al Khaleej and AlAyam are the Arabic papers, and Gulf Daily Newsand Bahrain Tribune are the English papers. Anumber of Arabic and English language businessmagazines are published locally. The two mainEnglish papers of the UAE, Khaleej Times andG u l f N e w s , a l s o a r e c i r c u l a t e d i n B a h r a i n .International news papers,

lmagazines and

publications are wide y available.

17

P.O. Box 253; Fax: 225202;Telephone: 223366

Ministry of DefenceP.O. Box 245; Fax: 663923;Telephone: 665599

Ministry of EducationP.O. Box 43; Fax: 261836;Telephone: 258400

Ministry of Electricity & WaterP.O. Box 2; Fax: 533035;Telephone: 533133

Ministry of Finance and National EconomyP.O. Box 333; Fax: 532853;Telephone: 530800

Ministry of Foreign AffairsP.O. Box 547; Fax: 210575;Telephone: 227555

Ministry of HealthP.O. Box 12; Fax: 252569;Telephone: 255555

Ministry of Housing, Municipalities &EnvironmentP.O. Box 5802; Fax: 534115;Telephone: 533000

Ministry of InteriorP.O. Box 13; Fax: 262169/270463;Telephone: 272111

Ministry of Justice and Islamic AffairsP.O. Box 450; Fax: 536343;Telephone: 531333

Ministry of Labor and Social AffairsP.O. Box 32333; Fax: 686954;Telephone: 687800

P.O. Box 2088; Fax: 215508;Telephone: 223366

Ministry of TransportationP.O. Box 10325; Fax: 534041;Telephone: 534534

Ministry of Works and AgricultureP.O. Box 5; Fax: 533095;Telephone: 535222

Bahrain Monetary AgencyP.O. Box 27; Fax: 534170;Telephone: 535535

Bahrain Stock ExchangeP.O. Box 3203; Fax: 256362;Telephone: 261260

Bahrain Centre for Studies & ResearchP.O. Box 496; Fax: 754468;Telephone: 754757

Bahrain Promotion & Marketing BoardP.O. Box 11299; Fax: 531117;Telephone: 533886

Central Statistics OrganizationP.O. Box 5835; Fax: 728989;Telephone: 725725

Consultative CouncilP.O. Box 2991; Fax: 715715Telephone: 714422

Equestrian & Horse Racing ClubP.O. Box 5029 Fax: 440222;Telephone: 440330

General Organization for Social InsuranceP.O. Box 5319; Fax: 530209;Telephone: 532222

The Supreme Council for Youth & SportsP.O. Box 5498; Fax: 728391;Telephone: 725500

18