As their political freedom shrinks, the lot of Shias grows worse
In 2010 nearly half the parliament was controlled by al-Wefaq, an opposition group that catered to the disgruntled Shia majority. Then came 2011, when Bahrainis joined the wave of Arab spring protests, demanding political freedoms and greater equality from the Sunni monarchy. The government crushed the uprising with the help of troops from its Gulf neighbours. Nearly 50 people were killed.
Now al-Wefaq is banned and its leader, Ali Salman, is in prison on trumped-up charges of spying for Qatar. A secular leftist group, Wa’ad, was also dissolved. Former members of al-Wefaq and Wa’ad are not permitted to stand for election. Sunni Islamist parties are still free to operate, but they hold few seats in parliament. International election monitors are banned.
As political freedom shrinks, inequality has been exacerbated by an economic crisis. Though the non-oil sector generates 80% of gdp, oil provides 70% of government revenue. When prices crashed earlier this decade Bahrain’s fiscal deficit soared, hitting 18.4% of gdp in 2015. The government has since cut spending. Electricity and water subsidies were reduced for expats and wealthy Bahrainis. An early-retirement scheme, launched last month, aims to trim the public payroll. More than 9,000 workers have applied for it.
These measures have helped, though this year’s deficit is still projected to be 8.9% of gdp. A new 5% value-added tax, due to be introduced in January, will raise more revenue. But it will also strain families already struggling to pay their bills. Wages are almost flat and the median monthly private-sector income, 416 dinars ($1,106), is 41% below its public-sector counterpart. The higher-paying government jobs tend to go to Sunnis. Shias are mostly excluded from the security forces.
Shias, who often live in poorer areas, also bear the brunt of Bahrain’s housing shortage. One minister has proposed importing cheap prefabricated homes. But there is little money for that. Public debt has soared to 88% of gdp and foreign reserves, at $2.3bn, are barely enough to cover a month of imports. In October Saudi Arabia, Kuwait and the United Arab Emirates (uae) had to step in with $10bn in aid.
But as they give, they also take away. Bahrain has thrived as a banking hub and a tourist trap for Saudis. Both Qatar and Saudi Arabia are now trying to build up their own financial centres (Dubai, in the uae, already has one). The Saudi crown prince, Muhammad bin Salman, has allowed movie theatres, concerts and other diversions in a bid to keep Saudi tourists (and their money) at home.
Bahrain’s banks still employ 14,000 people, most of them nationals. Saudi Arabia’s new nightlife cannot compete with that of Manama, where bars serve alcohol and the sexes mingle freely. But firms are nervous. Bahrain has long relied on its wealthier neighbours for business and charity. Now they are also competition.
One thing is certain. The people of Bahrain will have little say over how it deals with these economic challenges.