How Bahrain uses its small size and is Saudi Arabia’s neighbor to its advantage

Bahrain has only 1.5 million people. It is smaller than many cities around the world and much less than other countries. Regionally speaking, the Persian Gulf Island country is only 300 square miles.

However, according to Bahrain’s Minister of Sustainable Development, Noor Al Kleif, its size is not at a disadvantage.

“The way we see it is Bahrain is a national testing ground in this region,” Al Kreif said. luckLast week, the most powerful women’s summit in neighbouring Saudi Arabia.

Companies keen to do business with the Gulf Cooperation Council (GCC), including Saudi Arabia, Kuwait, the United Arab Emirates, Qatar, Bahrain and Oman, use Bahrain for this purpose.

“You can test and test ideas on a small scale. If it’s wrong, it’s 1.5 million people. It wasn’t really wrong,” she said. But if it succeeds, she noted, you gain confidence in expanding it across the region. “We consider Bahrain to be our gateway to the GCC.”

Al Khulaif, CEO of Bahrain Economic Development Committee, said small sizes also allow for tough cooperation.

“We don’t talk much about government, the private sector, the society,” she said. “We have a Bahrainian team across the country. We’ll do this together.”

This helps explain how Bahrain effectively changed its economy beyond oil.

“For us, oil isn’t even the biggest sector in our economy and hasn’t been in the last two years. That’s the result of a decades of travel,” she said.

Instead, she said financial services is the biggest sector and fintech is a major growth sector. Manufacturing, logistics, tourism and technology are also important fields.

Bahrain has long had close economic ties with Saudi Arabia, which has learned to complement its much larger neighbors connected via the Causeway.

“We consider ourselves a Saudi service centre,” Alkraf said.

For example, if Saudi Arabia is developing manufacturing, Bahrain is a back office, and so on, she says, “We are trying to provide support for that.”

This story was originally introduced Fortune.com