Saudi Arabia

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Running heading: Saudi Arabia

Saudi Arabia

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27th October, 2010

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Abstract

This paper looks at Saudi Arabia in a very in-depth manner. The paper tries to unveil

Saudi Arabia’s foreign policy and how this affects its stand with the outside world. This paper

also tries to find out Saudi Arabia’s transformation list view. In doing this the paper brings out

the position of the country’s globalization process and the country’s representation of the losers

and the winners NIE, the Outliners, and the SPG OR Feminist Economics point of view.

The paper also looks at the development agenda and how social, economic and political

factors have contributed to this. In this it tries to put clear on how developed Saudi Arabia is with

regard to the international cities and the general competitive advantage that are brought about by

the countries. The paper alto tries to find out the relationship between the state and the various

companies and whether this relationship is a kind of market oriented capitalism, collective social

or state.

The paper also tries to find out whether Saudi Arabia has been affected or not by the

geographic politics that involves energy, water and other naturally occurring resources. This has

been the case with her oil producing neighbors and so we look at this in the context of Saudi

Arabia. In looking at this issue the paper also focuses on how Saudi Arabia does outsourcing and

whether the country has positively handled its economic development impediments.

Saudi Arabia’s foreign policy

Since the early 1950s Saudi Arabia has walked on the path of three principals. These

principles are nationalism that is Arab based regional security and Islam religion. These

principals have played a key role in the formulation of the policies concerning her relationship

with other countries. It is of no coincidence that the country established a kingdom with close
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alliance with the United States in the wake of regional instability and the need to protect its oil

resources.

The closeness of the kingdom often challenged its relations with other Arabian countries

which considered the United States as an enemy. This enmity was due to the Saudi’s support for

Israel which most Arabian countries considered was against their national interests. This

positioned weakened Saudi Arabia’s solidarity with other Arabian nations.

The issue that is Arab nationalism is a key factor in the foreign policy of Saudi Arabia

just as are the regional issiues.The government s relationship with the Arab world in the far east

and North Africa have always been out of the influence of the Arab nationalist considerations.

Saudi Arabia has, since the 1950s been in the forefront in pushing amicable solution for the

Palestinian – Israeli conflict. However Saudi Arabia has never had an extreme view of the

conflicts that are in the Middle East and hence it always took a moderate stand that would

sometimes put it at loggerheads with its Arabian partners such as Iran and Iraq.

Saudi Arabia’s Development

The long drawn economic stimulus and government policies have led to general

development of the Kingdom. The fast rate of growth of its cities is a show of just how fast the

kingdom is growing. The figures of the per capita income are always on the increase. This is a

sign of empowerment of its own people. The stimulus has also been infrastructural based in the

sense that the transport infrastructure has been well developed to allow for easy movement of

goods and personnel from one place to the other.

Saudi Arabia boasts of having large cities that have actually employed millions of

dwellers. Such cities being highly populated provides conducive environment for investments.
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The first four cities and their population as by 2005 include: Riyadh 4205961, Jeddah 2867446,

Mecca 1323624 and Medina 1300000.The cities are cosmopolitan in nature hence attracting

people from all places in the world to come either to work, tour or for pilgrimage.

Riyadh, the capital is a city that competes amongst the world’s best. The development of

many industries has attracted so many both foreign and local who earn their living in this great

city. The city boasts of having good accommodation facilities and other infrastructure such as

roads, schools and airlines. The hosting of the pilgrimage site by the city of Mecca has been a

great boost to the economy of the Kingdom. The pilgrimage period together with tourists who

tour the sites has generated millions of US dollars to the economy of the country.

Energy in Saudi Arabia

Saudi Arabia is the world’s top producer and exporter of crude oil. As such the country

economy is dependant on the industry for most of the revenue. Oil exported account for

approximately 90% of the total exports by the country and Saudi revenues. This could sum up to

about 40% of the total Gross Domestic Product.

The demonstration of Saudi Hydrocarbon sector by state owned oil company called Saudi

Aramco is a show of capability that the government has in controlling its oil reserves without

much dependence on the foreign powers for support. This company happens to be the worlds

largest in terms of production and the reserves of hydrocarbons (Zuhur 71). The oil sector is

directly under the oversight of the Ministry of Petroleum and Mineral Resources and the

Supreme Council of Petroleum. The council draws members from various centers i.e. ministers

from the government, royal family members and other leaders with expertise in the energy
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sector. The Kingdom is the largest consumer of petroleum in the Middle East. This is due to its

wide grown transportation industry.

year production change

1980 9900 NA
1981 9815 -0.86 %
1982 6483 -33.95 %
1983 5086 -21.55 %
1984 4663 -8.32 %
1985 3388 -27.34 %
1986 4870 43.74 %
1987 4265 -12.42 %
1988 5086 19.25 %
1989 5064 -0.43 %
1990 6410 26.58 %
1991 8115 26.60 %
1992 8331.7 2.67 %
1993 8197.81 -1.61 %
1994 8120 -0.95 %
1995 8231.23 1.37 %

1996 8218.08 -0.16 %

1997 8362.03 1.75 %

1998 8388.9 0.32 %

1999 7833.39 -6.62 %

2000 8403.8 7.28 %

2001 8031.1 -4.43 %

2002 7634.4 -4.94 %

2003 8775 14.94 %

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2004 9100.82 3.71 %

2005 9550.14 4.94 %

2006 9152.33 -4.17 %

Methodology

The research carried by this paper was carried out through intertwining of the various

factors and figure obtained from official records of the United Nations Development Programme

and statistics from the various government agencies of the Islamic Kingdom of Saudi Arabia.

Further references have been obtained from the US Energy Information Administration.

Statistics from key players in the Economy of the Islamic Kingdom of Saudi Arabia has also

been incorporated in the research. The study of this figures and their comparability forms part of

the findings of this research (Nino 81).

The conclusions arrived at in this paper is also based on the analysis of the stated internal

factors that affect the factors of production in Saudi Arabia. The study of books on Saudi Arabia

has also been of great help in accomplishing this works. Such books have provided a basis

through which thorough analysis has been done to come up with substantial information on

Saudi Arabia. Finally my interaction with former resident of Saudi Arabia provided me with

second hand information that helped in coming up with this conclusions and recommendations

(Niblock 61).

Results
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The Kingdom that is Saudi Arabia is on a key note of development. This is attributed to a

given number of factors. These factors are both naturally occurring and others are caused by

humans’ effort. The occurrence of the mineral deposits in the Kingdom has been a boost factor

for the development of Saudi Arabia. The mining of the hydrocarbons has facilitated the

exportation of crude oil hence earning revenue. The oil reserves in Saudi are large enough to

facilitate widespread extraction.

Statistics from key players in the Economy of Saudi Arabia has also been incorporated in

the research. The Saudi government has its own company that is involved in the control of the

petroleum industry. The only outsourcing that is inevitable to the petroleum industry is the

skilled manpower which it readily gets from its neighbor Egypt (Christopher 32).

Saudi Arabia’s foreign policy is important to its economical growth. There are so many

foreign based workers from all over the world that have been allowed to work in the country.

Such have been able to provide the much needed skilled and non skilled personnel for the

various industries in the kingdom.

The fact that country rooted for a monarchical government system has worked well for it

to have a stable government contrary to the state of other petroleum energy producing countries

which are often embroiled in power struggles.

Conclusions and Recommendations

Saudi Arabia is a country that is on good economic course. Its foreign policies have

played a great role in boosting good relations with different countries hence boosting its trade

with such countries. The almost neutrality stand of Saudi Arabia has played a key role in
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ensuring peace in the kingdom hence promoting development. This has enabled the country to do

away with the instabilities that characterize most countries in the Arab world (Anderson 68).

The large cities and the large populations of people in the cities has been a boost for the

various industries in these cities. The ever growing industries have played a key role in ensuring

the development of various infrastructures which has boosted the ratings of the Saudi cities.

Having considered all the above ,it would only be okay if we conclude that Saudi Arabia is a

success story that should be emulated by the rest of the countries in the Arabian world. The

prospects are still high for the Kingdom to grow further. Saudi Arabia is a point in case to show

how political stability is necessary for development.

References

Anderson, Laurie H. Ticket to Saudi Arabia. New Jersey: Carolrhoda Books, 2001.

Christopher, Blanchard. Saudi Arabia: Terrorist Financing Issues. Saudi Arabia: Terrorist

Financing Issues

Niblock, Tim. Saudi Arabia: power, legitimacy and survival. New York: Routledge, 2006.

Nino, Tollitz. Saudi Arabia: terrorism, U.S. relations and oil. London: Nova Publishers, 2006.

Zuhur, Sherifa. Saudi Arabia: Islamic threat, political reform, and the global war on terror. New

York: DIANE Publishing, 2005.

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