Protesters besiege premier's office in Bahrain

Thousands of Shiite opposition supporters in Bahrain blocked the entrance to prime minister’s office but failed to disrupt a government meeting today as the campaign for reform in the strategic Gulf nation enters its third week.

Bahrain’s Shiite majority has long complained of discrimination and political persecution in the island kingdom, the home of US Navy’s 5th Fleet. The protesters demanded the prime minister step down because of corruption and a deadly crackdown on the opposition in which seven people were killed.

Sheik Khalifa bin Salman Al Khalifa, the prime minister and the king’s uncle, has been in power for 40 years, part of a Sunni dynasty that has ruled Bahrain for two centuries.

Mr Khalifa was presiding over a weekly meeting of government ministers today.

The Shiite opposition groups have called for a constitutional monarchy, but some of the protesters camped out in the capital’s Pearl Square are demanding that the Sunni monarchy step aside altogether.

Currently, one house of Bahrain’s parliament is the only elected body, but it holds limited authority since all the country’s decisions – including the appointment of government ministers – rest with the king.

Even the 40-member institution has been in limbo since the 18 opposition legislators resigned last month to protest the government’s deadly crackdown.

Bahrain holds particular importance to Washington as the host of US Navy’s 5th Fleet, the main American military counterweight to Iran’s efforts to expand its armed forces and reach into the Gulf.

The king, Sheik Hamad bin Isa Al Khalifa, has taken some steps to end the Shiite revolt that rattled one of the wealthiest corners of the Middle East. It was long assumed that the Gulf region’s oil wealth would stave off the kind of unrest that has troubled Tunisia, Egypt, Yemen and Libya.

Bahrain, however, has little oil compared to the regional crude titans that make up the other members of the six-nation Gulf Co-operation Council, and the unrest is taking its toll on the tiny country’s economy. International ratings agencies have either downgraded or warned about cuts to its ratings.

In a statement released today, Bahrain’s Chamber of Commerce said that “general economic conditions in the kingdom are very difficult”.

The island’s tourism industry was hit the hardest, the statement said, adding that the revenue fell “by about 80%” and the losses stemming from damage to the sector were estimated in “hundreds of millions of dollars”. Much of Bahrain’s tourism comes from neighbouring Saudi Arabia.

Compounding the damage was the cancellation of Formula 1’s season-opening Bahrain Grand Prix. The race, staged annually in the kingdom since 2004, is a major revenue earner for Bahrain.

In a bid to allay the tensions in the country, the king assigned Crown Prince Salman bin Hamad Al Khalifa to lead talks with the opposition and ordered the creation of 20,000 new government jobs.

Unemployment is particularly high among Shiite youth. They complain of government jobs often being given to Sunnis from Arab countries and Pakistan, who were granted Bahraini nationality to boost Sunni numbers in the Gulf nation.

Opposition leaders have accepted Mr Salman’s invitation for talks, but no date has been set for them to meet.