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Saudi Arabia vs. United Arab Emirates

Economy

Saudi ArabiaUnited Arab Emirates
Economy - overview

Saudi Arabia has an oil-based economy with strong government controls over major economic activities. It possesses about 16% of the world's proven petroleum reserves, ranks as the largest exporter of petroleum, and plays a leading role in OPEC. The petroleum sector accounts for roughly 87% of budget revenues, 42% of GDP, and 90% of export earnings.

Saudi Arabia is encouraging the growth of the private sector in order to diversify its economy and to employ more Saudi nationals. Approximately 6 million foreign workers play an important role in the Saudi economy, particularly in the oil and service sectors; at the same time, however, Riyadh is struggling to reduce unemployment among its own nationals. Saudi officials are particularly focused on employing its large youth population.

In 2017, the Kingdom incurred a budget deficit estimated at 8.3% of GDP, which was financed by bond sales and drawing down reserves. Although the Kingdom can finance high deficits for several years by drawing down its considerable foreign assets or by borrowing, it has cut capital spending and reduced subsidies on electricity, water, and petroleum products and recently introduced a value-added tax of 5%. In January 2016, Crown Prince and Deputy Prime Minister MUHAMMAD BIN SALMAN announced that Saudi Arabia intends to list shares of its state-owned petroleum company, ARAMCO - another move to increase revenue and outside investment. The government has also looked at privatization and diversification of the economy more closely in the wake of a diminished oil market. Historically, Saudi Arabia has focused diversification efforts on power generation, telecommunications, natural gas exploration, and petrochemical sectors. More recently, the government has approached investors about expanding the role of the private sector in the health care, education and tourism industries. While Saudi Arabia has emphasized their goals of diversification for some time, current low oil prices may force the government to make more drastic changes ahead of their long-run timeline.

The UAE has an open economy with a high per capita income and a sizable annual trade surplus. Successful efforts at economic diversification have reduced the portion of GDP from the oil and gas sector to 30%.

Since the discovery of oil in the UAE nearly 60 years ago, the country has undergone a profound transformation from an impoverished region of small desert principalities to a modern state with a high standard of living. The government has increased spending on job creation and infrastructure expansion and is opening up utilities to greater private sector involvement. The country's free trade zones - offering 100% foreign ownership and zero taxes - are helping to attract foreign investors.

The global financial crisis of 2008-09, tight international credit, and deflated asset prices constricted the economy in 2009. UAE authorities tried to blunt the crisis by increasing spending and boosting liquidity in the banking sector. The crisis hit Dubai hardest, as it was heavily exposed to depressed real estate prices. Dubai lacked sufficient cash to meet its debt obligations, prompting global concern about its solvency and ultimately a $20 billion bailout from the UAE Central Bank and Abu Dhabi Government that was refinanced in March 2014.

The UAE’s dependence on oil is a significant long-term challenge, although the UAE is one of the most diversified countries in the Gulf Cooperation Council. Low oil prices have prompted the UAE to cut expenditures, including on some social programs, but the UAE has sufficient assets in its sovereign investment funds to cover its deficits. The government reduced fuel subsidies in August 2015, and introduced excise taxes (50% on sweetened carbonated beverages and 100% on energy drinks and tobacco) in October 2017. A five-percent value-added tax was introduced in January 2018. The UAE's strategic plan for the next few years focuses on economic diversification, promoting the UAE as a global trade and tourism hub, developing industry, and creating more job opportunities for nationals through improved education and increased private sector employment.

GDP (purchasing power parity)$1,609,323,000,000 (2019 est.)

$1,604,007,000,000 (2018 est.)

$1,565,891,000,000 (2017 est.)

note: data are in 2017 dollars
$655.789 billion (2019 est.)

$644.968 billion (2018 est.)

$637.384 billion (2017 est.)

note: data are in 2017 dollars
GDP - real growth rate-0.9% (2017 est.)

1.7% (2016 est.)

4.1% (2015 est.)
0.8% (2017 est.)

3% (2016 est.)

5.1% (2015 est.)
GDP - per capita (PPP)$46,962 (2019 est.)

$47,597 (2018 est.)

$47,309 (2017 est.)

note: data are in 2017 dollars
$67,119 (2019 est.)

$66,968 (2018 est.)

$67,184 (2017 est.)

note: data are in 2017 dollars
GDP - composition by sectoragriculture: 2.6% (2017 est.)

industry: 44.2% (2017 est.)

services: 53.2% (2017 est.)
agriculture: 0.9% (2017 est.)

industry: 49.8% (2017 est.)

services: 49.2% (2017 est.)
Population below poverty lineNA19.5% (2003 est.)
Household income or consumption by percentage sharelowest 10%: NA

highest 10%: NA
lowest 10%: NA

highest 10%: NA
Inflation rate (consumer prices)-2% (2019 est.)

-4.5% (2018 est.)

-0.8% (2017 est.)
-1.9% (2019 est.)

3% (2018 est.)

1.9% (2017 est.)
Labor force13.8 million (2017 est.)

note: comprised of 3.1 million Saudis and 10.7 million non-Saudis
5.344 million (2017 est.)

note: expatriates account for about 85% of the workforce
Labor force - by occupationagriculture: 6.7%

industry: 21.4%

services: 71.9% (2005 est.)
agriculture: 7%

industry: 15%

services: 78% (2000 est.)
Unemployment rate6% (2017 est.)

5.6% (2016 est.)

note: data are for total population; unemployment among Saudi nationals is more than double
1.6% (2016 est.)

3.6% (2014 est.)
Distribution of family income - Gini index45.9 (2013 est.)32.5 (2014 est.)
Budgetrevenues: 181 billion (2017 est.)

expenditures: 241.8 billion (2017 est.)
revenues: 110.2 billion (2017 est.)

expenditures: 111.1 billion (2017 est.)

note: the UAE federal budget does not account for emirate-level spending in Abu Dhabi and Dubai
Industriescrude oil production, petroleum refining, basic petrochemicals, ammonia, industrial gases, sodium hydroxide (caustic soda), cement, fertilizer, plastics, metals, commercial ship repair, commercial aircraft repair, constructionpetroleum and petrochemicals; fishing, aluminum, cement, fertilizer, commercial ship repair, construction materials, handicrafts, textiles
Industrial production growth rate-2.4% (2017 est.)1.8% (2017 est.)
Agriculture - productsmilk, dates, poultry, fruit, watermelons, barley, wheat, potatoes, eggs, tomatoesdates, cucumbers, tomatoes, goat meat, eggs, milk, poultry, carrots/turnips, goat milk, milk
Exports$221.1 billion (2017 est.)

$183.6 billion (2016 est.)
$308.5 billion (2017 est.)

$298.6 billion (2016 est.)
Exports - commoditiescrude petroleum, refined petroleum, polymers, industrial alcohols, natural gas (2019)crude petroleum, refined petroleum, gold, jewelry, broadcasting equipment (2019)
Exports - partnersChina 20%, India 11%, Japan 11%, South Korea 9%, United States 5% (2019)India 11%, Japan 10%, Saudi Arabia 7%, Switzerland 6%, China 6%, Iraq 6% (2019)
Imports$119.3 billion (2017 est.)

$127.8 billion (2016 est.)
$229.2 billion (2017 est.)

$226.5 billion (2016 est.)
Imports - commoditiescars, broadcasting equipment, refined petroleum, packaged medicines, telephones (2019)gold, broadcasting equipment, jewelry, refined petroleum, diamonds (2019)
Imports - partnersChina 18%, United Arab Emirates 12%, United States 9%, Germany 5% (2019)China 15%, India 12%, Untied States 7% (2019)
Debt - external$205.1 billion (31 December 2017 est.)

$189.3 billion (31 December 2016 est.)
$237.6 billion (31 December 2017 est.)

$218.7 billion (31 December 2016 est.)
Exchange ratesSaudi riyals (SAR) per US dollar -

3.7514 (2020 est.)

3.75 (2019 est.)

3.7518 (2018 est.)

3.75 (2014 est.)

3.75 (2013 est.)
Emirati dirhams (AED) per US dollar -

3.67315 (2020 est.)

3.67315 (2019 est.)

3.67315 (2018 est.)

3.673 (2014 est.)

3.673 (2013 est.)
Fiscal yearcalendar yearcalendar year
Public debt17.2% of GDP (2017 est.)

13.1% of GDP (2016 est.)
19.7% of GDP (2017 est.)

20.2% of GDP (2016 est.)
Reserves of foreign exchange and gold$496.4 billion (31 December 2017 est.)

$535.8 billion (31 December 2016 est.)
$95.37 billion (31 December 2017 est.)

$85.39 billion (31 December 2016 est.)
Current Account Balance$15.23 billion (2017 est.)

-$23.87 billion (2016 est.)
$26.47 billion (2017 est.)

$13.23 billion (2016 est.)
GDP (official exchange rate)$792.849 billion (2019 est.)$421.077 billion (2019 est.)
Taxes and other revenues26.4% (of GDP) (2017 est.)28.8% (of GDP) (2017 est.)
Budget surplus (+) or deficit (-)-8.9% (of GDP) (2017 est.)-0.2% (of GDP) (2017 est.)
Unemployment, youth ages 15-24total: 28.8%

male: 19.9%

female: 62.6% (2018 est.)
total: 7.2%

male: 4.9%

female: 15% (2019 est.)
GDP - composition, by end usehousehold consumption: 41.3% (2017 est.)

government consumption: 24.5% (2017 est.)

investment in fixed capital: 23.2% (2017 est.)

investment in inventories: 4.7% (2017 est.)

exports of goods and services: 34.8% (2017 est.)

imports of goods and services: -28.6% (2017 est.)
household consumption: 34.9% (2017 est.)

government consumption: 12.3% (2017 est.)

investment in fixed capital: 23% (2017 est.)

investment in inventories: 1.8% (2017 est.)

exports of goods and services: 100.4% (2017 est.)

imports of goods and services: -72.4% (2017 est.)
Gross national saving33.6% of GDP (2019 est.)

33.2% of GDP (2018 est.)

30.4% of GDP (2017 est.)
28.5% of GDP (2017 est.)

30.9% of GDP (2016 est.)

30.7% of GDP (2015 est.)

Source: CIA Factbook