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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)
$1.775 trillion (2017 est.)
$1.79 trillion (2016 est.)
$1.761 trillion (2015 est.)

note: data are in 2017 dollars

$696 billion (2017 est.)
$690.5 billion (2016 est.)
$670.5 billion (2015 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)
$54,500 (2017 est.)
$56,400 (2016 est.)
$56,800 (2015 est.)

note: data are in 2017 dollars

$68,600 (2017 est.)
$70,100 (2016 est.)
$70,000 (2015 est.)

note: data are in 2017 dollars

GDP - composition by sector
agriculture: 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 line
NA
19.5% (2003 est.)
Household income or consumption by percentage share
lowest 10%: NA
highest 10%: NA
lowest 10%: NA
highest 10%: NA
Inflation rate (consumer prices)
-0.9% (2017 est.)
2% (2016 est.)
2% (2017 est.)
1.6% (2016 est.)
Labor force
13.8 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 occupation
agriculture: 6.7%
industry: 21.4%
services: 71.9% (2005 est.)
agriculture: 7%
industry: 15%
services: 78% (2000 est.)
Unemployment rate
6% (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.)
Budget
revenues: 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

Industries
crude oil production, petroleum refining, basic petrochemicals, ammonia, industrial gases, sodium hydroxide (caustic soda), cement, fertilizer, plastics, metals, commercial ship repair, commercial aircraft repair, construction
petroleum 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 - products
wheat, barley, tomatoes, melons, dates, citrus; mutton, chickens, eggs, milk
dates, vegetables, watermelons; poultry, eggs, dairy products; fish
Exports
$221.1 billion (2017 est.)
$183.6 billion (2016 est.)
$308.5 billion (2017 est.)
$298.6 billion (2016 est.)
Exports - commodities
petroleum and petroleum products 90% (2012 est.)
crude oil 45%, natural gas, reexports, dried fish, dates (2012 est.)
Exports - partners
Japan 12.2%, China 11.7%, South Korea 9%, India 8.9%, US 8.3%, UAE 6.7%, Singapore 4.2% (2017)
India 10.1%, Iran 9.9%, Japan 9.3%, China 5.4%, Oman 5%, Switzerland 4.4%, South Korea 4.1% (2017)
Imports
$119.3 billion (2017 est.)
$127.8 billion (2016 est.)
$229.2 billion (2017 est.)
$226.5 billion (2016 est.)
Imports - commodities
machinery and equipment, foodstuffs, chemicals, motor vehicles, textiles
machinery and transport equipment, chemicals, food
Imports - partners
China 15.4%, US 13.6%, UAE 6.5%, Germany 5.8%, Japan 4.1%, India 4.1%, South Korea 4% (2017)
China 8.5%, US 6.8%, India 6.6% (2017)
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 rates
Saudi riyals (SAR) per US dollar -
3.75 (2017 est.)
3.75 (2016 est.)
3.75 (2015 est.)
3.75 (2014 est.)
3.75 (2013 est.)
Emirati dirhams (AED) per US dollar -
3.673 (2017 est.)
3.673 (2016 est.)
3.673 (2015 est.)
3.673 (2014 est.)
3.673 (2013 est.)
Fiscal year
calendar year
calendar year
Public debt
17.2% 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)
$686.7 billion (2017 est.)
$382.6 billion (2017 est.)
Stock of direct foreign investment - at home
$264.6 billion (31 December 2017 est.)
$258.1 billion (31 December 2016 est.)
$129.9 billion (31 December 2017 est.)
$134.8 billion (31 December 2016 est.)
Stock of direct foreign investment - abroad
$56.09 billion (31 December 2017 est.)
$46.45 billion (31 December 2016 est.)
$124.4 billion (31 December 2017 est.)
$114.6 billion (31 December 2016 est.)
Market value of publicly traded shares
$421.1 billion (31 December 2015 est.)
$483.1 billion (31 December 2014 est.)
$467.4 billion (31 December 2013 est.)
$195.9 billion (31 December 2015 est.)
$201.6 billion (31 December 2014 est.)
$180.3 billion (31 December 2013 est.)
Central bank discount rate
2.5% (31 December 2008)

NA

Commercial bank prime lending rate
8.3% (31 December 2017 est.)
7.1% (31 December 2016 est.)
6% (31 December 2017 est.)
5.7% (31 December 2016 est.)
Stock of domestic credit
$267.1 billion (31 December 2017 est.)
$219.7 billion (31 December 2016 est.)
$395.5 billion (31 December 2017 est.)
$396 billion (31 December 2016 est.)
Stock of narrow money
$312.6 billion (31 December 2017 est.)
$305.2 billion (31 December 2016 est.)
$134 billion (31 December 2017 est.)
$129.1 billion (31 December 2016 est.)
Stock of broad money
$312.6 billion (31 December 2017 est.)
$305.2 billion (31 December 2016 est.)
$134 billion (31 December 2017 est.)
$129.1 billion (31 December 2016 est.)
Taxes and other revenues
26.4% (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 15-24
total: 24.2%
male: 17.4%
female: 46.3% (2016 est.)
total: 7.7%
male: 6%
female: 13.5% (2017 est.)
GDP - composition, by end use
household 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 saving
30.1% of GDP (2017 est.)
27.2% of GDP (2016 est.)
26.5% of GDP (2015 est.)
28.5% of GDP (2017 est.)
30.9% of GDP (2016 est.)
30.7% of GDP (2015 est.)

Source: CIA Factbook