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Saudi Arabia Table of Contents

Saudi Arabia

EXTERNAL TRADE AND FINANCE

Foreign Trade

Crude oil, refined products and natural gas liquids accounted for the bulk of Saudi exports. Nevertheless, the percentage of crude oil and petroleum product exports fell slightly during the 1980s as a result of the growth in petrochemical and other chemical exports. These products have come mainly from Sabic's companies. After declining to their lowest levels in the 1970s and 1980s, following the oil price crash of 1986, exports had steadily recovered by 1992, both as a result of improved oil prices and Saudi Arabia's international market share of world oil supplies. Moreover, as Sabic created a new petrochemical capacity, nonoil exports rose as well. The direction of exports has been influenced by Saudi Arabia's oil customers. During the early 1980s, Asia and Western Europe were the major purchasers of Saudi oil. By the end of the decade, Europe had ceded its share to Asia and North America (see table 10, Appendix).

Saudi import levels have closely followed overseas oil earnings and government expenditures. SAMA, which published data on imports, did not include military imports in merchandise import figures. Some military imports were included in the current account under government service imports (see Current Account , this ch.). Falling from a peak in the mid-1980s of US$40 billion to US$50 billion per annum, imports maintained levels of around US$20 billion during the late 1980s before starting to climb again in 1990 to 1992. Machinery, appliances, and electrical equipment constituted the largest import category, although in line with lower domestic investment these items fell in terms of total share. In 1984 this category accounted for 24 percent of imports but by 1990 it had declined to 16 percent. Foodstuffs have been the second largest category: in 1984 these items made up 16 percent and fell only slightly to 14 percent in 1990. The decline in food imports resulted mainly from domestic import substitution of vegetable products. During the 1980s, chemical products, jewelry and metals, and other transport items exhibited the largest growth in imports. Chemical products, the third largest import category in 1990, constituted around 12 percent of imports. The principal source of imports was Western Europe, which maintained its share at 44 percent for much of the 1980s. The United States supplied 17 percent of the kingdom's imports, whereas Japan's share was 15 percent, having decreased from around 20 percent in the mid-1980s. Saudi Arabia brought only 3 to 4 percent of imported goods from the rest of the Middle East.

Data as of December 1992