Edited by Léo-Paul Dana, Mary Han, Vanessa Ratten and Isabell M. Welpe
Chapter 31: Saudi Arabia
Tim Rogmans 1 Introduction to Saudi Arabia The Kingdom of Saudi Arabia was founded in 1932 and has been ruled by King Saud and his descendants since then. Saudi Arabia has a population of 27.6 million, including an expatriate workforce of nearly 6 million. The country’s population is young and growing at a rapid rate of 3 percent per annum, with 38.2 percent of people being under 15 years of age. This makes education and tacking unemployment a major challenge, both today and in the next decade when millions of young people will enter the labor force. Saudi Arabia holds approximately 25 percent of the world’s proven oil reserves and is rich in other natural resources such as natural gas, iron ore, gold and copper. In order to reduce dependence on oil and to provide economic opportunities for its young population, Saudi Arabia has embarked on a major economic diversification and liberalization drive. Saudi Arabia joined the World Trade Organization (WTO) during 2005 and liberalized key economic sectors during the years preceding membership. Previously monopolistic sectors such as banking, insurance, telecommunications and real estate have now opened up to domestic and foreign competition. With a per capita gross domestic product (GDP) of US$13 800, Saudi Arabia is a middle-income country. The economy is growing rapidly at a rate of between 4 and 5 percent per annum, owing to population growth, economic liberalization, foreign direct investment (FDI) and the construction of major economic cities across the country. Liberalization and growth...
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