The Kingdom of Saudi Arabia is the largest country in the Arabian Peninsula, with the Red Sea and the Gulf of Aqaba to the west and the Persian Gulf to the east. Neighbouring countries are Jordan, Iraq, Kuwait, Qatar, the United Arab Emirates, the Sultanate of Oman, Yemen, and Bahrain, connected to the Saudi mainland by a causeway. Saudi Arabia’s population is 28.29 million (2012) and its capital city is Riyadh. Saudi Arabia's economy is petroleum-based; 90% of export earnings come from the oil industry; the Kingdom is the world’s largest producer and exporter of oil.
Saudi Arabia traces its roots back to the earliest civilizations of the Arabian Peninsula. Over the centuries, the peninsula has played an important role in history as an ancient trade centre and as the birthplace of Islam, the world’s second largest religion.
Since King Abdulaziz Al-Saud established the modern Kingdom of Saudi Arabia in 1932, its transformation has been astonishing. In a few short decades, the Kingdom has turned itself from a desert nation to a modern, sophisticated state and a major player on the international stage.
Saudi Arabia has gone through several historical changes before it was completely unified. In 1880, Abdul Aziz bin Abdul Rahman Al Saud (Ibn Saud) is born in Riyadh, but is exiled with his family to Kuwait at the age of 10. In 1902, Abdul Aziz Al Saud recaptures the city of Riyadh, beginning the process of unification and four years later Najd is united.
He contiunted his journey in uniting the Kingdom by uniting Mecca in 1924, Madina in 1925 and Asir in 1926. Finally, in 1932, the kingdom of Saudi Arabia is unified with King Abdul Aziz Al Saud assuming the throne.
Oil was discovered in 1936 with commercial production of oil begins in 1938, allowing for start of modernization. After oil discovery, Saudi Arabia becomes one of the original 51 chartered members of the United Nations in 1945.
Moving towards development, in 1958 the cabinet system is introduced. Six years later, King Faisal bin Abdul Aziz Al Saud assumes the throne with a vision to modernizes the government and its administration. By 1969/1970 Saudi Arabia introduces its the First Development Plan.
In 1975, King Khalid bin Abdul Aziz Al Saud assumes the throne, overseeing the nation's growth and industrialization and in 1982 King Fahd bin Abdul Aziz Al Saud assumes the throne, continuing the nation's growth and modernization during which the Consultative Council (Majlis al Shura) is established in 1992 and later the Provincial Act is introduced.
In 2003, the Consultative Council is given authority to propose new laws and two years later Municipal elections are introduced to the country.
In 2005, King Abdullah bin Abdul Aziz succeeds King Fahd bin Abdul Aziz to the throne. Since King Abdullah succeeded the throne, Saudi Arabia has been moving towards prosperity and modernity.
The Kingdom adopts the development planning approach in mapping out its socioeconomic policies and programs within the framework of comprehensive five-year plans that involve two basic complementary roles: directive role concerned about state institutions and the public sector, and an indicative role concerned about the private sector.
In this regard, the Ninth Development Plan, sets the directions for all aspects of the country's socio-economic development for the next five years. The plan also addresses expected major challenges, along with the policies, programs and resources required to meet these challenges and to achieve development goals and objectives.
The Plan marks a new stage in the process of development planning, which extends over the past four decades, and constitutes the second phase in the strategic path of the national economy over the coming fifteen years. The MDGs are part and parcel of the goals of this strategic path.
The following issues hold a strategic position in the Kingdom’s development process:
- Raising Standard of Living and Improving Quality of Life
- Diversification of Economic Base
- Enhancing Non-Oil Revenues
- Balanced Regional Development
- The Move to a Knowledge-based Economy
- Enhancing Competitiveness
- Development and Productive Employment of Human Resources
- Sustainability of Natural Resources
Saudi Arabia is witnessing tangible economic prosperity and progress in all domains of socio-economic development, which produced substantial improvement in all human development indicators such as standard of living, health and education services, environmental conditions as well as potentials of comprehensive development.
Over the period (1999-2010), the national economy achieved an average annual growth rate of 3.4%, with income per capita reaching around SR61,875 ($16,500) by the end of this period. Moreover, diversification of the economic base increased, with the share of non-oil sectors constituting some 75.7% of total GDP in 2010, despite the remarkable growth of the oil sector in recent years.
The Saudi economy also realized growing integration into the global economy, with the ratio of foreign trade in commodities to GDP reaching some 80% by the beginning of the first year of the Ninth Plan (2010). Concerning foreign trade structure, the non-oil merchandise exports share in total exports increased from around 8.5% in 2000 to some
14.3% in 2010.
On the other hand, the share of imports of consumer goods in total imports has declined, which is an indicator of increased reliance on domestic products and their improved competitiveness.