In the wake of the global pandemic, businesses worldwide are reevaluating their strategies and seeking locations that offer stability and continuity in uncertain times. For American companies, Bahrain is a compelling case study. This island Kingdom doesn’t only serve as a regional gateway to the $3.7 trillion Middle East market but also provides a cost-effective, innovation-friendly environment for production and testing.
Bahrain boasts a rich history of ties with the United States, dating back to the 1890s when the first American school and the American Mission Hospital were established.
Today, it remains a strategic partner, hosting the US Navy’s Fifth Fleet and US Naval Forces Central Command. A significant milestone in this partnership was the signing of a Free Trade Agreement (FTA) in 2006, marking the first US FTA with a GCC member country. The US-Bahrain Free Trade Agreement eliminates investment barriers, facilitating trade, and fostering collaboration. In 2019, bilateral trade reached $1.63 billion, with an additional $340 million in Foreign Direct Investment.
While direct access to the US market via the FTA is a significant attraction for American companies, Bahrain offers more than that. It has trade and economic agreements with over 40 countries, including France, India, Singapore, and the UK. Additionally, Bahrain’s strategic location provides unparalleled access to the rapidly growing $1.5 trillion GCC market, particularly Saudi Arabia, just a 40-minute drive away via the King Fahd causeway.
Several American companies have already tapped into Bahrain’s potential. Bell Racing Helmets, a leading manufacturer of protective gear for motorsport drivers, relocated its headquarters to Bahrain in 2014, citing the “business-friendly environment” as a key factor. Mondelez International, a global confectionery giant, established its “$90 million Factory of the Future” in Bahrain, using its strategic location to access the GCC’s fast-growing FMCG market. Mueller Industries, a US firm, set up the region’s first Copper Pipe manufacturing plant in Bahrain, exporting 75% of its products back to the US. Westpoint Home, a US home textiles producer, exports 95% of its products to the US from its Bahrain plant.
Bahrain’s financial sector is the most established in the Gulf, home to regional headquarters for major institutions like Citibank, American Express, and Mastercard. The Kingdom’s skilled and educated local workforce, with over 65% employed in financial services, positions it favorably for global financial market access. The emerging FinTech ecosystem is thriving, thanks to initiatives like Bahrain FinTech Bay, which has direct consortium links to Detroit and Silicon Valley.
Amazon Web Services (AWS) launched its first Middle East data center region in Bahrain, powering numerous websites, games, and government services. Regulatory reforms, including data protection laws and cloud-first policies, facilitate Bahrain’s digital transformation. Startups and major corporations in the region, such as Careem, Aramex, Flydubai, and Virgin Middle East, now rely on AWS technology.
Bahrain’s business-friendly ecosystem stands as a significant attraction. It allows 100% foreign ownership in most sectors, has no free zone restrictions, and offers a favorable tax regime. The Kingdom also ranks first among all Arab countries for English proficiency, making it an ideal destination for international businesses.
Setting up a business in Bahrain is a streamlined experience, thanks to the government’s accessibility and support. Most processes and services are available online, making registration, notarization, and other essential steps frictionless. The Bahrain Economic Development Board (EDB) offers comprehensive support, including legal assistance, registration guidance, and networking opportunities.
In summary, American companies looking for a strategic base with global market access, innovation-friendly policies, and a supportive business environment should consider Bahrain as their destination of choice.
According to industry experts, “Bahrain’s strategic location and business-friendly environment make it an attractive destination for American companies seeking global expansion.” The US-Bahrain Free Trade Agreement, in particular, has eliminated investment barriers and fostered collaboration between the two countries. Bahrain’s proximity to Saudi Arabia and its efficient customs processes have further enhanced its appeal. American firms like Bell Racing Helmets, Mondelez International, Mueller Industries, and Westpoint Home have already benefited from Bahrain’s strategic advantages.
Moreover, Bahrain’s robust financial sector and growing FinTech ecosystem provide ample opportunities for American companies. The presence of major financial institutions and initiatives like Bahrain FinTech Bay have strengthened ties between Bahrain and the US. Amazon Web Services (AWS), another American firm, has established a data center region in Bahrain, further highlighting the Kingdom’s tech-friendly environment.
Additionally, Bahrain’s business-friendly policies, including 100% foreign ownership in most sectors and a skilled bilingual workforce, have attracted businesses from various industries. The ease of setting up a business in Bahrain, with most processes available online, simplifies the expansion process for American companies.
In conclusion, Bahrain offers a compelling proposition for American companies seeking to expand their global footprint. Its strategic location, coupled with a supportive business ecosystem, positions it as an ideal destination for growth and innovation.