Saudi Arabia and the long-term vison
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Transcript of Saudi Arabia and the long-term vison
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SAUDI ARABIA
AND LONG TERM VISION
Ha The He
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OUTLINE
1. General Evaluation
2. Economic Overview
3. Growth Model
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GENERAL EVALUATION
Challenges
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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
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CHALLENGES
1.Challenge of Employment issues
2.Challenge of Poverty reduction
3.Diversification of the economy
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OPPORTUNITIES
1.Investment in private sector
2.Demand for oil still increases
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ECONOMIC OVERVIEW
1.Gross Domestic Product (GDP)
2.Consumer Price Index (CPI)
3.Financial System
4.Unemployment
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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
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GDP
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CONSUMER PRICE INDEX (CPI)
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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).
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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.
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FINANCIAL SYSTEM
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UNEMPLOYMENT
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GROWTH MODEL
Diversification
Knowledge-based economy
Improve living standards
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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
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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.
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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.
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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
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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
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THANK YOU FOR YOUR ATTENTION!! (: