Saudi Arabia: Economy#
Saudi Arabia has an oil-based economy with strong government controls over major economic activities. It possesses about 16% of the world's proven petroleum reserves, ranks as the largest exporter of petroleum, and plays a leading role in OPEC. The petroleum sector accounts for roughly 87% of budget revenues, 42% of GDP, and 90% of export earnings.Saudi Arabia is encouraging the growth of the private sector in order to diversify its economy and to employ more Saudi nationals. Over 6 million foreign workers play an important role in the Saudi economy, particularly in the oil and service sectors; at the same time, however, Riyadh is struggling to reduce unemployment among its own nationals. Saudi officials are particularly focused on employing its large youth population, which generally lacks the education and technical skills the private sector needs.
In 2015, the Kingdom incurred a budget deficit estimated at 13% of GDP, and it faces a deficit of $87 billion in 2016, which will be financed by bond sales and drawing down reserves. Although the Kingdom can finance high deficits for several years by drawing down its considerable foreign assets or by borrowing, it has announced plans to cut capital spending in 2016. Some of these plans to cut deficits include introducing a value-added tax and reducing subsidies on electricity, water, and petroleum products. In January 2016, Crown Prince and Deputy Prime Minister MUHAMMAD BIN SALMAN announced that Saudi Arabia intends to list shares of its state-owned petroleum company, ARAMCO - another move to increase revenue and outside investment. The government has also looked at privatization and diversification of the economy more closely in the wake of a diminished oil market. Historically, Saudi Arabia has focused diversification efforts on power generation, telecommunications, natural gas exploration, and petrochemical sectors. More recently, the government has approached investors about expanding the role of the private sector in the healthcare, education and tourism industries. While Saudi Arabia has emphasized their goals of diversification for some time, current low oil prices may force the government to make more drastic changes ahead of their long-run timeline.
Economic Facts#
| GDP (purchasing power parity) | $1.731 trillion (2016 est.) $1.711 trillion (2015 est.) $1.653 trillion (2014 est.) note: data are in 2016 dollars |
|---|---|
| GDP (official exchange rate) | $637.8 billion (2015 est.) |
| GDP - real growth rate | 1.2% (2016 est.) 3.5% (2015 est.) 3.6% (2014 est.) |
| GDP - per capita (PPP) | $54,100 (2016 est.) $54,500 (2015 est.) $53,700 (2014 est.) note: data are in 2016 dollars |
| Gross national saving | 25% of GDP (2016 est.) 26.4% of GDP (2015 est.) 38.3% of GDP (2014 est.) |
| GDP - composition, by end use | household consumption: 42.3% government consumption: 29.6% investment in fixed capital: 29.5% investment in inventories: 5.9% exports of goods and services: 30.7% imports of goods and services: -38% (2016 est.) |
| GDP - composition, by sector of origin | agriculture: 2.4% industry: 42.9% services: 54.7% (2016 est.) |
| Agriculture - products | wheat, barley, tomatoes, melons, dates, citrus; mutton, chickens, eggs, milk |
| Industries | crude oil production, petroleum refining, basic petrochemicals, ammonia, industrial gases, sodium hydroxide (caustic soda), cement, fertilizer, plastics, metals, commercial ship repair, commercial aircraft repair, construction |
| Industrial production growth rate | 0.6% (2016 est.) |
| Labor force | 12.02 million note: about 80% of the labor force is non-national (2016 est.) |
| Labor force - by occupation | agriculture: 6.7% industry: 21.4% services: 71.9% (2005 est.) |
| Unemployment rate | 11.2% (2016 est.) 11.4% (2015 est.) note: data are for Saudi males only (local bank estimates; some estimates are as high as 25%) |
| Population below poverty line | NA% |
| Household income or consumption by percentage share | lowest 10%: NA% highest 10%: NA% |
| Distribution of family income - Gini index | 45.9 (2013 est.) |
| Budget | revenues: $149.7 billion expenditures: $236.7 billion (2016 est.) |
| Taxes and other revenues | 23.5% of GDP (2016 est.) |
| Budget surplus (+) or deficit (-) | -13.6% of GDP (2016 est.) |
| Public debt | 31% of GDP (2016 est.) 15% of GDP (2015 est.) |
| Fiscal year | calendar year |
| Inflation rate (consumer prices) | 4.4% (2016 est.) 2.2% (2015 est.) |
| Central bank discount rate | 2.5% (31 December 2008) |
| Commercial bank prime lending rate | 7.1% (31 December 2016 est.) 6.9% (31 December 2015 est.) |
| Stock of narrow money | $295.5 billion (31 December 2016 est.) $305.5 billion (31 December 2015 est.) |
| Stock of broad money | $513.3 billion (31 December 2015 est.) $461.2 billion (31 December 2014 est.) |
| Stock of domestic credit | $221.3 billion (31 December 2016 est.) $134.1 billion (31 December 2015 est.) |
| Market value of publicly traded shares | $421.1 billion (31 December 2015 est.) $483.1 billion (31 December 2014 est.) $467.4 billion (31 December 2013 est.) |
| Current account balance | -$42.28 billion (2016 est.) -$53.48 billion (2015 est.) |
| Exports | $205.3 billion (2016 est.) $202.3 billion (2015 est.) |
| Exports - commodities | petroleum and petroleum products 90% (2012 est.) |
| Exports - partners | China 13.2%, Japan 10.9%, US 9.6%, India 9.6%, South Korea 8.5% (2015) |
| Imports | $157.7 billion (2016 est.) $155 billion (2015 est.) |
| Imports - commodities | machinery and equipment, foodstuffs, chemicals, motor vehicles, textiles |
| Imports - partners | China 13.9%, US 12.7%, Germany 7.1%, South Korea 6.1%, India 4.5%, Japan 4.4%, UK 4.3% (2015) |
| Reserves of foreign exchange and gold | $553.7 billion (31 December 2016 est.) $616.4 billion (31 December 2015 est.) |
| Debt - external | $200.9 billion (31 December 2016 est.) $169.8 billion (31 December 2015 est.) |
| Stock of direct foreign investment - at home | $258.7 billion (31 December 2016 est.) $250.7 billion (31 December 2015 est.) |
| Stock of direct foreign investment - abroad | $42.95 billion (31 December 2016 est.) $37.98 billion (31 December 2015 est.) |
| Exchange rates | Saudi riyals (SAR) per US dollar - 3.75 (2016 est.) 3.75 (2015 est.) 3.75 (2014 est.) 3.75 (2013 est.) 3.75 (2012 est.) |