Historical, Emergence Issue and Current State of Saudi Arabia as a Free Market

1347 Words Apr 25th, 2014 6 Pages
Historical, Current state of the issue and Emergence of Saudi Arabia as free market
Saudi Arabia is a total monarchy ruled by King Abdallah bin Abdul Aziz Al Saud. Saudi Arabia has appeared to be satisfied with advance in economic. As a primary for oil producer and exporter, Saudi Arabia controls the whole Organization of Petroleum Exporting Countries.
Saudi Arabia’s free market economy has incredible changes in a relatively short term of time. I t has grown from agricultural base community into the regional and global economic power with a modern infrastructure. Petroleum is a fundamental part of the Saudi Arabia’s economy comprising 45 percent of the country’s GDP. Saudi Arabia is the world’s largest producer and exporter
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Saudi Arabia’s average tariff rate is 5.5 percent. Non-tariff barriers affect several categories of imports. The government limits foreign investment in several sectors of the economy. The financial sector has undergone gradual transformation, and some restrictions on foreign investment in financial services have been eased. The government retains majority shares in the largest bank and offers subsidized credit to preferred sectors.
Current state of the issue
The government has an essential role in industrial and economic development. The Ministry of Economy and Planning formulates economic and social development plans that set long-term economic goals. Additional sectors of the economy are overseen by individual ministries, such as agriculture, energy, transportation, communications and finance. The private sector is playing an increasingly larger role in the Saudi economy – it now accounts for 48 percent of the gross domestic product (GDP). The sector is expected to continue growing, especially as Saudi Arabia opens its doors further to foreign investment. In December 2005, Saudi Arabia joined the World Trade Organization (WTO), a significant development that gives Saudi products greater access to global markets, creates jobs and encourages foreign investment.
Emergence of the issue
When the modern Kingdom was established in 1932, the Arabian Peninsula was an agricultural society that depended on farming and commerce – especially date exports

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