idealized system of free economy asserts the prices of goods and services to be
set freely by the forces of demand and supply without the policy of government
interference to adjust the demand and supply equilibrium. It strongly
emphasizes the natural market phenomenon of demand and supply to reach their
point of equilibrium. Critics of the free market have argued that, in real
world situations, it has proven to be susceptible to the development of price
fixing monopolies, and thus it necessitates and upkeeps government intervention
into the market configuration. Two prominent Canadian authors also argue that government
at times has to intervene in order to ensure competition in large and important
Kingdom of Bahrain has also taken a place amongst the world’s best
economies. Growing fast and strong, Bahrain is an example of a successful
free market. Other than being rated one of the freest countries in the
world, it is also considered to have a high Human Development Index, a marker
of a successful free economy.
2015 Index of Economic Freedom has given it a score of 73.4, making it the
18th freest in the world and the topmost in the MENA region. It is also the
fourth in Asia, after Hong Kong, Singapore, Mauritius and Taiwan.
The kingdom has a free
and open market which works on a demand and supply system. It has a free market economy, with no restrictions on
capital movements, foreign exchange, foreign trade or foreign investment. The
Kingdom has a leading position in the region as an open, free, transparent and
welcoming environment for investors.
It is a country wherein exists
a free economic market, with only minor restrictions, for the welfare of the
traders, consumers and the community at large.
The Ministry of Industry
& Commerce, in particular as the main organ of Government, is responsible
for the registration and supervision of businesses. It is responsible for a
diverse range of activities which make up the commercial environment in
The Ministry’s aim is to
ensure the maintenance of an open, transparent and market driven commercial
environment so as develop Bahrain’s economic competitiveness, and to encourage
inward investment, at the same time promoting employment for the local
The other aspect of
Bahrain’s free or open market is its range of free trade agreements it has accrued.
Bahrain has bilateral trade agreements with over forty countries such as China,
France, India and the UK. It has free trade agreements with Singapore, the EFTA
states and 17 Arab states. Most notably, Bahrain was the first country in the
Middle East to forge a free trade agreement with the United States of America
in 2004, which came to be fully implemented in 2006.
Bahrain also makes a mark
in terms of fiscal freedom. The individual’s income is completely free of
taxation and most businesses are also exempt from taxation. Within the kingdom,
the foreigners are allowed to be absolute owners of their businesses.
The ‘free and open market’
regulations in Bahrain also allows Bahraini employers to ingress migrant labor.