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Bahrain : The complete guide for visitors and expatriates - Life before and after the discovery of oil
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Life before and after the discovery of oil
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The first electric power station was opened in 1930, allowing the spread of refrigeration, air conditioning and electric light for those who had the money.  Agencies for foreign goods and cars were taken by wealthy tradesmen. In being interviewed by National Geographic in 1946, Hussein Yateem (who had the agency for Carrier ice plants and air conditioning amongst others) comments “In modernizing their habits, the people of Bahrain have decided preferences for specific products…many of these - refrigerators, for instance – are American, and we naturally hope that nothing will hamper trade”.

The opening of the oil refinery in 1937 was an important development in that more employment of local people became available. Its construction projects and local purchases increased the prosperity of the island in general. From the beginning it was realized that Bahrain’s oil field was small, and to diversify into refining would bring income long after their own well had been depleted.

A visit to England in 1937 increased the desire of Sheikh Hamad to improve the health of his people. With oil revenues providing the resources, plans went ahead for a government hospital alongside a major programme to eradicate malaria. Mohammed Al Orrayed remembers “Malaria was a big sickness then”. This initiative has continued to this day with Bahrain having one of the best health systems in the Gulf, just last October Dublin’s world renowned, Royal College of Surgeons opened in Manama giving added gravitas to this important sector.

Education has long been a priority for the Bahraini government. The first school was opened in Muharraq in 1919 and the number has steadily grown. The 1930’s saw the opening of the first girls school, by 1956 there were 13 girls schools and now there are the same opportunities for both sexes.

As eldest son, Sulman succeeded Sheih Hamad in 1942. The impetus of change continued with the opening of the Manama-Muharraq bridge. Although rationing had occurred in Bahrain during the war, it was nowhere near as testing as war torn Europe. For the ten years of Sheikh Sulman’s reign Bahrain worked through the technological change creating an integrated infrastructure and the beginnings of what was to become the banking and commercial centre of Manama. The Gregorian calendar was adopted for official accounting procedures, although of course, to this day the Hejira calendar is used for all religious purposes.

Work on both Mina Salman (the deep water port) and the airport was started at this time . The 1950’s saw the growth of the development of Bahrain as an international transport hub. The Gulf aviation company was formed by Freddie Bosworth, acting as an air charter company (a story wonderfully retold by Nevil Shute in his novel Round the Bend). Gulf Air as a national airline was formed in 1950 and BOAC began to use Bahrain as a re-fuelling stop on its way to Australia. These developments further complemented Bahrain’s infrastructure transformation.

Nasser’s death in 1967 ended the period of Arab Nationalism that characterized the previous ten years and four years later Bahrain threw off the mantle of being a British protectorate August 14th 1971, followed by its joining the United Nations later that year. Only two years later it joined OPEC, and the next year formed the Bahrain Monetary Agency as the State’s Central Bank. This was a hugely important development as a supervisory and regulatory agency that operates a highly transparent and accountable legal framework, giving a very solid start.

The extremely high oil prices of the early seventies meant hugely increased revenues to all those countries involved in production. Iyad Al-Arrayed remembers returning to Bahrain as a teenager in 1972, after a period of living in England “I noticed Sieko watches, colour tv, luxury cars and designer clothes, all of which no-one could afford in the UK; there had been a definite giant leap forward in terms of wealth”.

This oil wealth led to a real estate boom, as personal and corporate investment went into construction Aqeel Al Modaweb comments that in the 1970’s “rents stood as the same rate as they are now, 30 years later”.  This was due to an influx of ex-pats who had come to work in the growing banking and financial services area. Previously Beirut had been the preferred centre for Middle Eastern finance but because of difficulties during the civil war, investors began to look for a safer environment. Bahrain fitted the bill perfectly. Here was a politically stable country, with an educated population, good facilities and the legislation in place to give a secure home for investments and financial transactions. It was from this point that Bahrain gained its reputation as a safe and flexible place in which international banks could operate.