It is so small that it suffers from virtually any change in the region or world. Privatization, which could help reduce Bahrain's deficit, is moving ahead. Utilities, banks, financial services, telecommunications, and other areas will shortly come under the control of the private sector. The government has used its modest oil revenues to build an advanced infrastructure in transportation and telecommunications. Bahrain is a regional financial and business center.
Regional tourism is also a significant source of income.
Bahrain benefited from the region's economic boom in the late 1970s and 1980s. Bahrain was the first Persian Gulf state to discover oil. Because of limited reserves, Bahrain has worked to diversify its economy over the past decade. Saudi Arabia provides most of the crude for refinery operation via pipeline. Bahrain also receives a large portion of the net output and revenues from Saudi Arabia's Abu Saafa offshore oilfield.