Bahrain's Offshore Banking Centre

An analysis of the development of the Bahrain OBU (offshore banking unit) and of the regional impact of the banking services that it provides for the Persian Gulf area. A look at the role of Bahrain in the Eurocurrency market. A principal concern is the development of the regional banking system, with particular emphasis on the banks of Saudi Arabia, which provide the mainstay of the OBU business. Saudi Arabia could act to curb the activities of the OBUs (offshore banking centers), but there is also cause for optimism that the business expertise gained in Bahrain might be utilized in the evolving banking system of the Gulf. This would especially be likely in light of the ongoing trend toward economic cooperation in the Gulf region. Saudi Arabia might lend support to this development to contribute to the region's overall development.