00-4852 MOREPRESS RELEASE
PRESS/TPRB/143
14 November 2000
TRADE POLICY REVIEW BODY
REVIEW OF BAHRAIN
TPRB'S EVALUATION
The Trade Policy Review Body of the World Trade Organization (WTO) concluded its first
review of Bahrain trade policies on 11 and 13 October 2000. The text of the Chairperson's concluding
remarks is attached as a summary of the salient points which emerged during the discussion.
The review enables the TPRB to conduct a collec tive examination of the full range of trade
policies and practices of each WTO member countries at regular periodic intervals to monitorsignificant trends and developments which may have an impact on the global trading system.
The review is based on two reports which are prepared respectively by the WTO Secretariat
and the government under review and which cover all aspects of the country's trade policies, including
its domestic laws and regulations, the institutional framework, bilateral, regional and other
preferential agreements, the wider economic needs and the external environment. A record of the
discussion and the Chairperson's summing-up together with these two reports will be published in duecourse at the complete trade policy review of Bahrain and will be available from the WTO Secretariat,
Centre William Rappard, 154 rue de Lausanne, 1211 Geneva 21.PRESS/TPRB/143
Page 2
MORESince December 1989, the following reports have been completed: Argentina (1992 and
1999), Australia (1989, 1994 and 1998), Austria (19 92), Bahrain (2000) Bangladesh (1992 and 2000),
Benin (1997), Bolivia (1993 and 1999), Botswana  (1998), Brazil (1992, 1996 and 2000), Burkina
Faso (1998), Cameroon (1995), Canada (1990, 1992, 1994, 1996 and 1998), Chile (1991 and 1997),
Colombia (1990 and 1996), Costa Rica (1995), Cô te d’Ivoire (1995), Cyprus (1997), the Czech
Republic (1996), the Dominican Republic (1996), E gypt (1992 and 1999), El Salvador (1996), the
European Communities (1991, 1993, 1995, 1997 and 2.000), Fiji (1997), Finland (1992), Ghana
(1992), Guinea (1999), Hong Kong (1990, 1994 and 1998), Hungary (1991 and 1998), Iceland (1994
and 2000), India (1993 and 1998), Indonesia (1991, 1994 and 1998), Israel (1994 and 1999), Jamaica
(1998), Japan (1990, 1992, 1995 and 1998), Kenya (1993 and 2000), Korea, Rep. of (1992, 1996 and
2000), Lesotho (1998), Macau (1994), Malaysia (1993 and 1997), Mali (1998), Mauritius (1995),
Mexico (1993 and 1997), Morocco (1989 and 1996) , New Zealand (1990 a nd 1996), Namibia (1998),
Nicaragua (1999), Nigeria (1991 and 1998), Norw ay (1991, 1996 and 2000), Pakistan (1995), Papua
New Guinea (1999), Paraguay (1997), Peru (1994 and 2000), the Philippines (1993), Poland (1993
AND 2000), Romania (1992 and 1999), Senegal (1994), Singapore (1992, 1996 and 2000), Slovak
Republic (1995), the Solomon Islands (1998), South Africa (1993 and 1998), Sri Lanka(1995),
Swaziland (1998), Sweden (1990 and 1994), Switzerl and (1991 and 1996), Tanzania (2000), Thailand
(1991, 1995 and 1999), Togo (1999), Trinidad and T obago (1998), Tunisia (1994), Turkey (1994 and
1998), the United States (1989, 1992, 1994, 1996 a nd 1999), Uganda (1995), Uruguay (1992 and
1998), Venezuela (1996), Zambia (1996) and Zimbabwe (1994).PRESS/TPRB/143
Page 3
MORETRADE POLICY REVIEW BODY
REVIEW OF BAHRAIN
CONCLUDING REMARKS BY THE CHAIRPERSON
We have had a frank and most informative discussion of Bahrain's trade policies and
practices.  Members noted that Bahrain's liberal policies have played a role in helping it to maintainstable economic growth despite the recent fluctuations in petroleum prices.  Bahrain's dependence on
petroleum exports, nevertheless, remains significant.  In this regard, Members were appreciative of
Bahrain's efforts in trying to reduce this dependence through reforms aimed at diversifying the
economic base.  Recent measures include efforts to reduce the public sector's role in the economy
through fiscal reform and privatization, as well as sectoral reform aimed at opening up sectors to
private investment.  Notwithstanding these efforts, Members also noted that the State continued to
play a major role in the economy, urging Bahrain to maintain its efforts to reduce the size of thepublic sector and to increase private domestic and foreign investment in the economy.  Some
Members also suggested that competition policy legi slation would be useful in enhancing competition
in the economy.
Regarding trade policy measures, Members observed that Bahrain's applied MFN tariff was
relatively low, averaging 7.7%.  However, the bound tariff remained considerably higher at 35.6%,
presenting some uncertainty for investors and trader s as it gave the authorities scope to raise the
applied tariff within bindings.  They asked whether Bahrain would consider reducing or eliminating
this difference and sought and received assurance from the Bahraini delegation that Bahrain was
committed to reducing its applied tariffs.
Questions were also raised on non-tariff measures, including: Bahrain's import prohibitions
and restrictions and the rationale for maintaining th ese;  standards and technical regulations and their
conformity with international norms; and sanitary and phytosanitary measures.  In addition to its
participation in the WTO, they noted that Bahrain was a member of the Gulf Cooperation Council(GCC) and was attempting to integrate itself more closely with regional economies of the GCC and
others through the Greater Arab Free-Trade Area (GAFTA).  Details were requested on the
implementation status of the customs union betw een GCC members and the GAFTA and the question
was also raised whether regional agreements might make Bahrain over-dependent on a few markets.
Members noted that Bahrain was making an effort to amend its laws to bring them into
conformity with its WTO commitments, even though Bahrain's international treaty obligations
superseded national law.  In this regard, they asked whether Bahrain could provide more details
regarding the status of its current legislation, in particular with respect to intellectual property rights.
Several Members also expressed concern about the apparent discrepancy between Bahrain's
legislation on trade-related measures and the implementation of these measures.
On sectoral issues, the discussion focussed on Bahrain's plans to further diversify the
industrial base which is still largely based on energy intensive industries.  In services, several
Members asked for details on plans to encourage private sector participation in economic
development, including through privatization of services such as transport and telecommunications.
In addition, Members remarked that Bahrain had not made any commitments under the GATS inservices sectors with the exception of financial services.  They believed that making additional
commitments under the GATS was important to enhance transparency and predictability in the trade
and investment regime and to move the liberalization process forward.PRESS/TPRB/143
Page 4
ENDAdditional details were also sought on a number of issues, including:
- fiscal reform, in particular with regard to taxation;
- the "Bahrainization" programme (employment targets for Bahrainis in the private sector);
- Bahrain's priorities with regard to future trade negotiations in the WTO;
- customs procedures, valuation and rules of origin;- infant industry protection and plans to phase these out by 2005;
- tariff exemptions on certain products based on local content and plans to bring these into
conformity with the TRIMs Agreement;
- the rationale for import prohibitions and restrictions maintained on a number of products;
- import licensing procedures;
- anti-dumping and countervailing legislation and measures;
- state trading companies and plans to notify these to the WTO;- government procurement procedures (preference for local and GCC suppliers, plans to accede
to the WTO Agreement, procedures for appeals against decisions taken by the authorities);
- the current status of price controls and subsidies;
- sectoral issues including Bahrain's preparations for trade in textiles and clothing before the
end of the implementation period for the Agreement on Textiles and Clothing, details aboutthe construction sector, restrictions on foreign ownership of local banks and of companies
listed on the Bahrain Stock Exchange, plans to join the Information Technology Agreement
(ITA) and to establish a Telecommunications Act.
Members also expressed their appreciation of the written and oral responses provided by the
delegation of Bahrain during the meeting.
In conclusion, I feel that this Review has helped us to better understand the trade policies and
practices of Bahrain.  Members were appreciative of Bahrain's efforts to implement wide ranging
economic reforms to diversify the economy and increase real economic growth;  they, however,recognized that there was a need for accelerat ed reform to tackle the problem of growing
unemployment among Bahrainis.  It is my view that Members were also reassured by Bahrain's
statement that it was committed to the reform programme.  However, they urged Bahrain to improve
the transparency and predictability of its trade and investment regime.  Views were expressed in
favour of Bahrain's increased commitments under the GATS and through regular notifications to theWTO.  The Bahraini delegation also reiterated Bahrain's strong commitment to a rules based
multilateral system and its determination to bring all its legislation into conformity with its WTO
obligations.  On the whole it is my view that the re view succeeded in achieving what it sought to do.  I
conclude by expressing my sincere thanks to H.E. Shaikh Daij and his delegation, all other
participating colleagues and delegations, the discussant Dr. Barba in particular, Messrs. Boonekamp
and Daly, Ms. Rohini Acharya and their team, the interpreters, and all those whose endeavours went
into this effort.