The Economist Intelligence Unit expects that Bahrain will experience persistent political unrest in the forecast period. The ruling Al Khalifa family faces a significant threat to its authority, and the response of the king, Hamad bin Isa al-Khalifa, will determine Bahrain's political landscape over the next five years. There were large protests early in 2011 inspired by events in Egypt, Tunisia and elsewhere in the Arab world, calling for political and social reform. The security services used force to disperse the protesters, and a number of deaths were reported. Tensions rose further after the arrival of the Peninsula Shield Force-the combined military force of the Gulf Co-operation Council (GCC)-which many Bahrainis view as an occupation force sent to crack down on opposition groups. The government will continue to use significant levels of violence and repression to quell the unrest-there have been reports of several opposition activists dying in custody and detentions are becoming more and more frequent. The king introduced a three-month state of emergency in March, which means Bahrain will be under martial law.

Bahrain has experienced protests in the past, and economic inequality, poor political representation and perceived sectarian discrimination have contributed to an already highly charged political climate by Gulf standards. Many of the country's Shia Muslims, who form a majority of the population, say that they are economically and politically marginalised by the Sunni Muslim ruling family, which holds most of the important cabinet posts, and the recent unrest will worsen relations between the two communities. There is a widespread belief among Shia Bahrainis that the government is fast-tracking citizenship for Sunni expatriates in order to alter the country's demographic balance. Such claims are hard to verify, but the perception will fuel social unrest.

Although parliament has not formally been dissolved, the resignation of 18 members of parliament (MPs) from al-Wefaq, a largely Shia-supported political society and the largest bloc in parliament, as well as the reported resignation of up to eight other MPs, brings the formalisation of the dissolution ever closer. The Ministry of Justice tried to bring a case forward to ban al-Wefaq, although it eventually backed off. The king is likely to rule by decree as the government will face immense difficulty trying to convince opposition factions to participate in (and therefore legitimise) the political process without making considerable concessions. The king may also face some resistance from his uncle, the prime minister, Sheikh Khalifa bin Salman al-Khalifa, who has held his position since the 1970s and is generally perceived to be less open to reform.