Current Economic Issues Facing Saudi Arabia

CCurrent Economic Issues Facing Saudi Arabia

Saudi Arabia is a developing country in the Arabian Gulf region that has been growing dramatically over the past two decades. Saudi Arabia's 2011 population has grown tremendously and is estimated to now be about 26.1 million, including about 5.6 million resident foreigners. Until the 1960s, most of the population was nomadic or semi-nomadic but now due to rapid economic and urban growth, more than 95% of the population is settled now.

Out of that 26 million people in Saudi Arabia, is has been found that the annual per capita income is anywhere from $11,500 to 24,500. This sounds kind of ridiculous because the country is known to the world to be oil rich. At first glance, one would view economic statistical indicators and convey the fact Saudi Arabia is a developed nation. However, close analysis of political and social statistical indicators would suggest that their standard of living and individual freedoms are severely suppressed. Believe it or not, this 'developed' nation has abnormalities in its statistical indicators which are similar to those that characterize third world nations.

As a person who was born into this culture and is originally of Saudi Arabian descent, I find these statistics hard to believe. During my time there I never witnessed despair or poverty. These indicators and information is why I chose to research this topic and see for myself what this once wealthy nation is in fact doing now.

Economic Success

Saudi Arabia was a poor country until oil was discovered beneath the eastern deserts in the late 1930's. The country suddenly found itself very wealthy as it became an important exporter of oil in just a few years. The price of the oil increased very dramatically from just $3 a barrel to over $40 a barrel. This economic success ensured that the leaders became very wealthy. The GNP per capita is economically sound. However, this figure is misleading. A large proportion of GNP is...