Bahrain tops Gulf and ranks second across Arab world for economic freedom

Finance Ministry report highlights Kingdom’s business growth in third quarter of 2025

Bahrain has been ranked first in the Gulf and second in the Arab world among countries with the highest levels of economic freedom, according to the Ministry of Finance and National Economy’s economic quarterly report for the third quarter of 2025.

The report cited the Fraser Institute’s 2025 Economic Freedom of the World Index, which compares 165 countries using five key measures: regulation, sound money, freedom to trade internationally, size of government, and the legal system.

Bahrain placed first in the Arab world for regulation, the ministry said, while GCC countries collectively led in the sound money and size of government indicators.

Results

The ministry said the findings reflect the strength of Bahrain’s economic and financial frameworks, as well as the outcomes of its economic policies.

According to the report, the rankings highlight a business environment built on flexibility and competition, supported by strong economic and financial systems. This has helped Bahrain maintain a high position among freer economies in the region and beyond.

The report added that Bahrain’s progress in international indices aligns with ongoing efforts to develop the economic environment and enhance regulatory framework performance in line with global standards of economic freedom.

In a related section, the quarterly report noted that Bahrain also performed strongly in the World Bank’s Business Ready (B-READY) Report, which replaced the earlier Doing Business report and offers a broader assessment of global business environments.

The ministry explained that B-READY measures how prepared business environments are by analysing data on trade and investment attraction across 101 countries at the current stage. The assessment is based on three main pillars: regulatory frameworks, public services, and operational efficiency, covering 10 detailed fields across the business lifecycle.

Resolution

Bahrain ranked third worldwide in dispute resolution, scoring 74.05 out of 100, reflecting high standards in handling legal and commercial disputes.

The report also said Bahrain led Arab countries included in B-READY in four of the 10 fields: utilities services, labour, dispute resolution, and corporate insolvency.

Additionally, Bahrain recorded strong results in the efficiency of regulatory frameworks and the ease of complying with laws and regulations.

Services

The report highlighted the effective use of public services available to businesses as a key indicator of the strength of Bahrain’s economic environment. It noted that these services support economic and investment activity while helping improve business performance across companies of different sizes and sectors.