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Saudi Arabia vs. Yemen

Economy

Saudi ArabiaYemen
Economy - overviewSaudi 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. Over 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, which generally lacks the education and technical skills the private sector needs.

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 plans to introduce a value-added tax. 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.
Yemen is a low-income country that faces difficult long-term challenges to stabilizing and growing its economy, and the current conflict has only exacerbated those issues. The ongoing war has halted Yemen’s exports, pressured the currency’s exchange rate, accelerated inflation, severely limited food and fuel imports, and caused widespread damage to infrastructure. More than 80% of the population is in need of humanitarian assistance and over half are food insecure.

Prior to the start of the conflict in 2014, Yemen was highly dependent on declining oil and gas resources for revenue. Oil and gas earnings accounted for roughly 25% of GDP and 65% of government revenue. The Yemeni Government regularly faced annual budget shortfalls and tried to diversify the Yemeni economy through a reform program designed to bolster non-oil sectors of the economy and foreign investment. In July 2014, the government continued reform efforts by eliminating some fuel subsidies and in August 2014, the IMF approved a three-year, $570 million Extended Credit Facility for Yemen.

However, the conflict that began in 2014 stalled these reform efforts and ongoing fighting continues to accelerate the country’s economic decline. In September 2016, President HADI announced the move of the main branch of Central Bank of Yemen from Sanaa to Aden where his government could exert greater control over the central bank’s dwindling resources. Regardless of which group controls the main branch, the central bank system is struggling to function. Yemen’s Central Bank’s foreign reserves, which stood at roughly $5.2 billion prior to the conflict, have declined to negligible amounts. The Central Bank can no longer fully support imports of critical goods or the country’s exchange rate. The country also is facing a growing liquidity crisis and rising inflation. The private sector is hemorrhaging, with almost all businesses making substantial layoffs. Access to food and other critical commodities such as medical equipment is limited across the country due to security issues on the ground. The Social Welfare Fund, a cash transfer program for Yemen’s neediest, is no longer operational and has not made any disbursements since late 2014.

Yemen will require significant international assistance during and after the protracted conflict to stabilize its economy. Long-term challenges include a high population growth rate, high unemployment, declining water resources, and severe food scarcity.
GDP (purchasing power parity)$1.789 trillion (2017 est.)
$1.787 trillion (2016 est.)
$1.756 trillion (2015 est.)
note: data are in 2017 dollars
$68.95 billion (2017 est.)
$70.37 billion (2016 est.)
$78 billion (2015 est.)
note: data are in 2017 dollars
GDP - real growth rate0.1% (2017 est.)
1.7% (2016 est.)
4.1% (2015 est.)
-2% (2017 est.)
-9.8% (2016 est.)
-28.1% (2015 est.)
GDP - per capita (PPP)$55,300 (2017 est.)
$56,300 (2016 est.)
$56,600 (2015 est.)
note: data are in 2017 dollars
$2,300 (2017 est.)
$2,400 (2016 est.)
$2,800 (2015 est.)
note: data are in 2017 dollars
GDP - composition by sectoragriculture: 2.6%
industry: 44.2%
services: 53.2% (2017 est.)
agriculture: 24.1%
industry: 14.3%
services: 61.6% (2017 est.)
Population below poverty lineNA%
54% (2014 est.)
Household income or consumption by percentage sharelowest 10%: NA%
highest 10%: NA%
lowest 10%: 2.6%
highest 10%: 30.3% (2008 est.)
Inflation rate (consumer prices)-0.2% (2017 est.)
3.5% (2016 est.)
20% (2017 est.)
5% (2016 est.)
Labor force12.34 million
note: about 80% of the labor force is non-national (2017 est.)
7.425 million (2017 est.)
Labor force - by occupationagriculture: 6.7%
industry: 21.4%
services: 71.9% (2005 est.)
note: most people are employed in agriculture and herding; services, construction, industry, and commerce account for less than one-fourth of the labor force
Unemployment rate5.6% (2017 est.)
5.6% (2016 est.)
note: data are for Saudi males only (local bank estimates; some estimates are as high as 25%)
27% (2014 est.)
35% (2003 est.)
Distribution of family income - Gini index45.9 (2013 est.)
37.9 (2009 est.)
37.3 (1999 est.)
Budgetrevenues: $171.6 billion
expenditures: $227.8 billion (2017 est.)
revenues: $3.467 billion
expenditures: $5.232 billion (2017 est.)
Industriescrude oil production, petroleum refining, basic petrochemicals, ammonia, industrial gases, sodium hydroxide (caustic soda), cement, fertilizer, plastics, metals, commercial ship repair, commercial aircraft repair, construction
crude oil production and petroleum refining; small-scale production of cotton textiles, leather goods; food processing; handicrafts; aluminum products; cement; commercial ship repair; natural gas production
Industrial production growth rate-0.3% (2017 est.)
13.7% (2017 est.)
Agriculture - productswheat, barley, tomatoes, melons, dates, citrus; mutton, chickens, eggs, milk
grain, fruits, vegetables, pulses, qat, coffee, cotton; dairy products, livestock (sheep, goats, cattle, camels), poultry; fish
Exports$231.3 billion (2017 est.)
$183.6 billion (2016 est.)
$501.2 million (2017 est.)
$163.6 million (2016 est.)
Exports - commoditiespetroleum and petroleum products 90% (2012 est.)
crude oil, coffee, dried and salted fish, liquefied natural gas
Exports - partnersChina 13.6%, Japan 11.3%, India 10.7%, US 9.8%, South Korea 9.1%, Singapore 4.7% (2016)
Egypt 26%, Saudi Arabia 15.4%, Oman 11.3%, Malaysia 9.8%, Thailand 5.8%, UAE 4.9% (2016)
Imports$136.8 billion (2017 est.)
$127.8 billion (2016 est.)
$4.573 billion (2017 est.)
$3.117 billion (2016 est.)
Imports - commoditiesmachinery and equipment, foodstuffs, chemicals, motor vehicles, textiles
food and live animals, machinery and equipment, chemicals
Imports - partnersChina 16.2%, US 15%, Germany 6.3%, Japan 5.3%, UAE 5%, South Korea 4.3% (2016)
UAE 12.8%, China 12%, Turkey 8%, Saudi Arabia 8%, Indonesia 6.8%, Brazil 6.6%, India 4.8% (2016)
Debt - external$212.9 billion (31 December 2017 est.)
$189.3 billion (31 December 2016 est.)
$7.252 billion (31 December 2017 est.)
$7.181 billion (31 December 2016 est.)
Exchange ratesSaudi 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.)
Yemeni rials (YER) per US dollar -
275 (2017 est.)
214.9 (2016 est.)
214.9 (2015 est.)
228 (2014 est.)
214.89 (2013 est.)
Fiscal yearcalendar year
calendar year
Public debt30% of GDP (2017 est.)
22.3% of GDP (2016 est.)
135.5% of GDP (2017 est.)
119.1% of GDP (2016 est.)
Reserves of foreign exchange and gold$509 billion (31 December 2017 est.)
$535.8 billion (31 December 2016 est.)
$245.1 million (31 December 2017 est.)
$592.6 million (31 December 2016 est.)
Current Account Balance$4.322 billion (2017 est.)
-$27.54 billion (2016 est.)
-$579 million (2017 est.)
-$1.532 billion (2016 est.)
GDP (official exchange rate)$678.5 billion (2016 est.)
$25.67 billion (2016 est.)
Stock of direct foreign investment - at home$264.6 billion (31 December 2017 est.)
$258.1 billion (31 December 2016 est.)
$NA
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.)
$NA
Central bank discount rate2.5% (31 December 2008)

NA%
Commercial bank prime lending rate8.3% (31 December 2017 est.)
7.1% (31 December 2016 est.)
26% (31 December 2017 est.)
27% (31 December 2016 est.)
Stock of domestic credit$250.1 billion (31 December 2017 est.)
$221.3 billion (31 December 2016 est.)
$3.706 billion (31 December 2017 est.)
$4.515 billion (31 December 2016 est.)
Stock of narrow money$311.2 billion (31 December 2017 est.)
$305.2 billion (31 December 2016 est.)
$5.542 billion (31 December 2017 est.)
$6.718 billion (31 December 2016 est.)
Stock of broad money$487.5 billion (31 December 2017 est.)
$476.6 billion (31 December 2016 est.)
$9.338 billion (31 December 2017 est.)
$11.95 billion (31 December 2016 est.)
Taxes and other revenues25.3% of GDP (2017 est.)
13.5% of GDP (2017 est.)
Budget surplus (+) or deficit (-)-8.3% of GDP (2017 est.)
-6.9% of GDP (2017 est.)
Unemployment, youth ages 15-24total: 28.5%
male: 19.7%
female: 56% (2015 est.)
total: 33.7%
male: 26%
female: 74% (2010 est.)
GDP - composition, by end usehousehold consumption: 41.3%
government consumption: 24.6%
investment in fixed capital: 24.4%
investment in inventories: 4.4%
exports of goods and services: 35.6%
imports of goods and services: -30.3% (2017 est.)
household consumption: 121.3%
government consumption: 13.5%
investment in fixed capital: 3.7%
investment in inventories: -7.8%
exports of goods and services: 4.2%
imports of goods and services: -34.8% (2017 est.)
Gross national saving28.8% of GDP (2017 est.)
25.2% of GDP (2016 est.)
26.1% of GDP (2015 est.)
0.1% of GDP (2017 est.)
-4.1% of GDP (2016 est.)
-3.7% of GDP (2015 est.)

Source: CIA Factbook