Bahrain Risk: More economic reform expected in a rigid political system

Bahrain’s latest GSN Risk Management Report remains unchanged at C3 with the political outlook showing positive momentum while the economic and financial outlook is negative. GCC allies led by Saudi Arabia are pressing harder for economic reforms. The oil price hike may generate some extra funds and but difficult deficit reduction measures are needed. King Hamad Bin Isa Al-Khalifa appears to be concentrating more power in the hands of Crown Prince Salman Bin Hamad Al-Khalifa, but in an opaque public sphere there is also speculation about his standing compared to that of his brother Sheikh Nasser. Majority Shia community concerns over social disadvantage and human rights abuses remain a big issue that gains only a limited hearing from the authorities and much of the media.