Should expats be concerned by the escalating protests in Bahrain?
Bahrain's status as the Gulf's preeminent financial centre may be long behind it, but the latest clashes are likely to impact the country's ability to attract expat talent.
Thousands of protesters marched in Manama yesterday following the death of a demonstrator during the so-called "day of rage" on Monday, and a second man died during clashes with police on Tuesday.
While the protests now appear more peaceful, the situation shows every sign of growing, with the main roundabout in the capital being labelled as the Shia protestors' version of Cairo's Tahir Square.
Bahrain is no stranger to political protests, with sectarian tensions between the ruling Sunni minority and the Shia majority a long-term source of unrest. But placed in the context of wider upheaval in the Middle East, the latest demonstrations have been given greater gravitas.
As Dr Christopher Davidson, a specialist in Gulf Affairs at the University of Durham, told the Christian Science Monitor: "Post-oil Bahrain has unemployment and few opportunities for the young population. However, there is the added dimension of sectarian unrest, with the Shia majority population having historically been second class citizens to the ruling Sunni elites."
The kingdom's financial sector has long since been usurped by Dubai as the most significant in the GCC, but it still relies on a significant proportion of expat talent who will be watching the developments in Manama closely.
The financial industry in Bahrain accounts for a significant chunk of GDP - 25% - and remains a major employer, despite a slowdown in job opportunities in recent years.
Moreover, many financial services professionals working in Saudi Arabia choose to base themselves in Bahrain - because of its more liberal lifestyle - and then make the commute over the causeway to its larger neighbour. Potentially, there could be a major fallout if this situation escalates.
"So far, we've seen little evidence of financial services professionals looking to leave Bahrain, and the protests appear largely peaceful and not entirely disruptive," says Rory Adamson, director of Manama-based headhunters Azrek Search. "But undoubtedly it will have an impact on attracting people from outside of region."
Mohammed al-Baker, executive director of financial institutions' supervision at Bahrain's central bank, has insisted the protests will have little affect on the kingdom's financial sector.
"It's a democratic way of doing things. It has nothing to do with the financial sector," he told said. "Investors are not worried."
This is something of a moot point anyway. Recruitment in Bahrain's financial sector has been subdued for some time now, and so-far this year there's little indication of this changing, suggests Adamson.
