Sectarian tension between the Shiʿite majority (some 65% of the population) and the Sunni minority surfaced in Bahrain during 2008. Denunciations and exchanges of grievances between the two sects dominated discourse in the parliament, in the press, and among mosque preachers; the conflict spilled into the streets in political agitation, which was brutally suppressed by the police. The Shiʿites asked for greater participation in running the country—specifically less control over the cabinet by the Sunni ruling family, al-Khalifah, and increased numbers of Shiʿite ministers. On more than one occasion, King Hamad ibn Isa al-Khalifah called for national unity, harmony, and tolerance among Bahrainis regardless of sect or religion. He declared a general amnesty on July 31 that affected most prisoners, political and nonpolitical. To demonstrate tolerance, on July 3 the king appointed Huda Nonoo, a Bahrain Jew, as ambassador to the U.S.—the first Jewish person ever appointed as ambassador by any Arab country.
Security dominated Bahraini discussions when the heads of two powerful states, which were both jockeying for position in the Gulf region, visited Bahrain. U.S. Pres. George W. Bush arrived in January 2008, some two months after Iranian Pres. Mahmoud Ahmadinejad’s visit. Bahrain, wary of increased Iranian influence in the Gulf region, remained a staunch ally of the United States.
Bahrain’s economy benefited from the oil boom early in 2008, but by the end of the year its banking and real estate sectors had been affected by the global recession.