Overview
Saudi Arabia is a sovereign Arab state in Western Asia constituting the bulk of the Arabian Peninsula. It is bordered by Jordan and Iraq to the north, Kuwait to the northeast, Qatar, Bahrain and the United Arab Emirates to the east, Oman to the southeast and Yemen to the south. It is the only nation with both a Red Sea coast and a Persian Gulf coast. Covering an area of approximately 2,150,000 km2 (830,000 sq mi), Saudi Arabia is geographically the fifth-largest state in Asia and second-largest state in the Arab world after Algeria. Its ranking shifts from being the world’s fourth-largest and second-largest oil exporter in January 2018 to the world’s sixth-largest oil producer in May 2018.
Importance of Oil
Oil was discovered in Saudi Arabia in the 1930s by the American firm ‘Standard Oil’ (now known as ExxonMobil). Since then, oil production and exports have become extremely important to the economy and livelihood of the country. Roughly 75% of state revenue comes from oil and gas revenues, making it the world’s largest oil producer and exporter. Tourism and foreign investments are also important to the economy.
Petrochemical Industry
Saudi Arabia is also heavily invested in the petrochemical industry and the production of refined petroleum products. The country’s laws mandate that all petroleum products must be refined and exported from the country. This ensures a consistent supply of oil to the world markets and helps to reduce global prices. Saudi Arabia is also home to several large petrochemical plants and refineries. These are managed by the state-owned Saudi Aramco, which is currently the world’s largest oil refining and production company.
Agricultural Exports
Saudi Arabia is also known for producing a variety of agricultural crop exports. The most common of these include dates, wheat, barley, vegetables, fruits, rice, and other grains. Historically, the people of the country have relied upon farming and animal husbandry for their sustenance, and the Saudi government has heavily invested in the modernisation of traditional farming techniques to help produce greater yields and increased efficiency.
Agricultural Research
The government of Saudi Arabia is investing heavily in agricultural research to increase crop yields and improve the quality of the country’s agricultural products. This research is helping to develop new varieties of crops which are better suited to the climate and more resilient to drought. It is also increasing the efficiency of traditional farming methods, allowing for bigger yields from smaller land areas.
Fishery Industry
The Arabian Sea is home to a wide variety of fish, and Saudi Arabia has become a major producer of processed fish products. It is one of the leading exporters of canned tuna and mackerel to international markets. Additionally, Saudi citizens consume an average of 20 kilograms per person per year, making fish a major part of the national diet.
Transportation Industry
Saudi Arabia is home to a number of large-scale transportation companies. Its rail network links major cities across the country and provides connections to neighbouring countries, while its port network facilitates the flow of goods and services across the region. Additionally, the country has invested heavily in the development of its aviation industry, and several major airports support the movement of people and goods.
Manufacturing Industry
Saudi Arabia is becoming increasingly invested in the manufacturing sector. The government has been taking steps to encourage manufacturers to move production operations into the country by offering tax incentives and other support packages. Most of the country’s production operations are focused on the metalworking industry, but other areas of production such as plastic, textile, and rubber products are also prominent.
Tourism Industry
Although tourism does not contribute significantly to the economy, Saudi Arabia has a budding tourism industry. The country has several UNESCO World Heritage sites, including the Al-Masjid al-Haram mosque, the old city of Hegra, and the city of Jeddah. The country is also home to several tourist attractions such as the Red Sea coast, the eco-lodge in Wadi al-Tayib, and the ancient ruins of Diriyah.
Energy Industry
Saudi Arabia is a major producer of many types of energy, including gasoline, diesel, and kerosene. The majority of the country’s gasoline is exported to international markets, while the remainder is used domestically. In addition to oil production, the country is also a major producer of natural gas, which is used for both domestic consumption as well as the production of electricity.
Information Communication Technology
The Saudi government is heavily investing in the development of the information communication technology (ICT) sector. The country ranks well for mobile phone penetration and internet users, with many citizens having access to the latest smartphones. As a result, there is increasing demand for software and web-based services within the country, and the government’s investments in the sector are helping it to become an attractive destination for ICT companies.
Retail Industry
The retail sector is increasingly becoming a major contributor to the economy of Saudi Arabia. The country has several malls and shopping centers which offer a variety of goods and services. In addition, supermarkets and hypermarkets are becoming increasingly popular, and there is a growing market for online shopping. As a result, the country has become a major destination for foreign retailers looking to tap into the highly lucrative Middle Eastern markets.
