One of the aims of a single currency zone is a thriving and robust intra-regional trade. Previous literature concluded that Bahrain exhibited high dissimilarity of exports within the Gulf Cooperation Council (GCC) compared to exports of other GCC states within the region (Ganguli, 2018, forthcoming) during 1995—2015. This paper aims to evaluate the potential of a single currency GCC union by analysing the detailed export structure of goods between Bahrain and the rest of the GCC to check for export diversity.
A quantitative analysis was applied to time-series merchandise data of export items with a three-digit Standard Industrial Classification (SIC) code. These were extracted from the United Nations Conference on Trade and Development (UNCTADstat) database for the period 1995—2015.
Bahrain’s merchandise exports within the GCC displayed significant diversity in terms of the composition during 1995 to 2015. Merchandise export diversity has similarities with the diversification trends of the economy.
Evidence of export diversification from Bahrain to other GCC states shows that Bahrain can be used as a model for other GCC states for diversification of exports to create a sustainable GCC currency union.
Ganguli, S. (2017): Analysis of Intra GCC Merchandise Trade during 1995—2015 amidst GCC Diversification Initiatives, International Journal of Innovation and Knowledge Management in Middle East and North Africa, Vol. 6, No. 1, pp. 41-60.
