SAUDI ARABIA

AND LONG TERM VISION

Ha The He

OUTLINE

1. General Evaluation

2. Economic Overview

3. Growth Model

GENERAL EVALUATION

Challenges

Its growth curves in many of these areas are steeper than almost any other country for 3 decades.

STRENGTHS1. Excellent record of economic

success.

2. Political stability.

3. World-class infrastructure.

4. Vast Oil and Gas Resources.

5. Good execution of key projects.

6. Geography diversity.

7. Young and healthy population

is known as the second to none; a major element of competitive advantage for

the Saudi economy

deep rooted and strong cultural and religious traditions; high priorities on the human development

excellent coast lines; the bridge between East and

West

successfully implemented several big and ambitious projects

the largest reserves in the world;

estimated to be 262.7

billion barrels60% people are under the age of 18

CHALLENGES

1.Challenge of Employment issues

2.Challenge of Poverty reduction

3.Diversification of the economy

OPPORTUNITIES

1.Investment in private sector

2.Demand for oil still increases

ECONOMIC OVERVIEW

1.Gross Domestic Product (GDP)

2.Consumer Price Index (CPI)

3.Financial System

4.Unemployment

GDP

GDP in the top 20 (19th)GDP per capital: $31,275 (PPP; 28th)ÞThere is an income gap of Saudi ArabianÞ Problem about poverty reduction

GDP

CONSUMER PRICE INDEX (CPI)

INFLATION RATE

Both CPI and Inflation rate of Saudi Arabia dramatically decrease in 2012 because the government has been successful in controlling the impact of the Economic Crisis (2008).

FINANCIAL SYSTEM

• The government has huge amounts of cash.

• Public debt declined from 104 percent of GDP in 1999 to about 13 percent in 2008 easy to response/ restrict the impact of economic crisis (2008)

• SAMA (Saudi Arabia Monetary Agency)’s operation has built up a very confident financial system; liquidity both in Saudi Arabian riyals (SR) and in dollars; ensure the safety of local banks and bank deposits.

• Foreigners only own about 1% of stock in the Saudi market.

• But still be significantly affected by oil price decline.

FINANCIAL SYSTEM

UNEMPLOYMENT

GROWTH MODEL

Diversification

Knowledge-based economy

Improve living standards

DIVERSIFICATION• Fact: mainly depends on oil industry; not good for long-run

development because of the limitation of natural resource

ÞDiversification: Chemicals & Industries, Food & Consumer Goods, Telecom & ICT, Financial Services, Transport & Utilities.

ÞDecrease in oil-sector

(Oil sector decreases from 27.5% of GDP 2004 to 17.3% of GDP 2025)

Þ Private sector: main engine in the future

KNOWLEDGE-BASED ECONOMY• The targeted economic development requires high

degrees of skill and specialization. The volume university graduates will grow at an average annual rate of 8.4 percent.

• Focuses on developing human capital and cutting edge technologies.

•High technologies compensate

for experience.

KNOWLEDGE-BASED ECONOMY• Establishing many centers dealing with professional trainings and

researches.

Ex: Saudi Aramco, officially the Saudi Arabian Oil Company has the training and development budget about $1 billion per year - the “Great Grew Change” sponsoring more than 2,000 young men and women in university studies in Saudi Arabia and around the world.

Cutting-edge technologies for water desalination and water re-use for potable, non-potable and industrial water serving Saudi Arabia.

Use high technology to increase the productivity of exploiting oil.

IMPROVE LIVING STANDARDS

1.National employment

2.Poverty reduction

3.Gender discrimination 4.7 million

foreign employees over total 8.55million

unemployment rate is still high

CONCLUSION

• Strong and safe economy; But depends so much on oil reserve

• Need to diversify; increase private sector.

• Cutting-edge technologies and Knowledge-based economy;

• Improve living standards

=> Sustainable development

THANK YOU FOR YOUR ATTENTION!! (: