South American girl within borders of Bahrain (8)
I believe the answer is:
bolivian
'south american' is the definition.
(Bolivian is an example)
'girl within borders of bahrain' is the wordplay.
'girl' becomes 'olivia' (**).
'within' indicates putting letters inside.
'borders of' means to remove the middle letters.
'bahrain' with its middle removed is 'bn'.
'olivia' going into 'bn' is 'BOLIVIAN'.
(Other definitions for bolivian that I've seen before include "from South American country" , "Eg, a native of La Paz" , "Eg, native of Sucre" , "Nationality of citizen of La Paz" , "one from La Paz?" .)