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PROFILE OFFICIAL NAME: Kingdom of Saudi Arabia
Geography
Area: 1,960,582 million sq. km. (1,176,349 mi.), about one-fourth the size
of the continental United States.
Cities (2001 est.): Capital--Riyadh (pop. 4.3 million). Other
cities--Jeddah (2.25 million), Makkah, (1.2 million), Dammam/Khobar/Dhahran,
(1.6 million).
Terrain: Primarily desert with rugged mountains in the southwest.
Climate: Arid, with great extremes of temperature in the interior; humidity
and temperature are both high along the coast.
People
Nationality: Noun--Saudi(s). Adjective--Saudi Arabian or Saudi.
Population (2001 est.): 22.7 million (16.3 million Saudis, 6.4 million
foreign nationals).
Annual growth rate: 3.0%.
Ethnic groups: Arab (90% of native pop.), Afro-Asian (10% of native pop.).
Religion: Islam
Language: Arabic (official).
Education: Literacy--male 87.9%, female 74.2%.
Health: Infant mortality rate--19/1,000. Life expectancy--male 66 years,
female 70 years.
Work force: 7.8 million (about 59% foreign workers); industry--10%;
services (including government)--78%; agriculture--11%.
Government
Type: Monarchy with Council of Ministers and Consultative Council.
Unification: September 23, 1932.
Constitution: The Holy Qur'an (Governed according to Islamic Law)
Branches: Executive--King (chief of state and head of government).
Legislative--none; a Consultative Council with advisory powers was formed
September 1993. Judicial--Supreme Council of Justice, Islamic Courts of
First Instance and Appeals.
Administrative divisions: 13 provinces.
Political parties: None.
Economy
GDP (2001 est.): $170.5 billion.
Annual growth rate (2001 est.): 1%.
Per capita GDP (2001 est.): $7,564.
Natural resources: Hydrocarbons, gold, uranium, bauxite, coal, iron,
phosphate, tungsten, zinc, silver, copper.
Agriculture : Products--dates, grains, livestock, vegetables. Cultivated
land--1%.
Industry : Types--petroleum, petrochemicals, cement, fertilizer, light
industry.
Trade (2000 est.): Exports--$79.0 billion: petroleum and petroleum
products. Imports--$27.8 billion: manufactured goods, transportation
equipment, clothing and textiles, processed food products. Major trading
partners--U.S., Japan, western Europe.
PEOPLE
Saudi Arabia's 2001 population is estimated to be about 22.7 million,
including about 6.4 million resident foreigners. Until the 1960s, most of
the population was nomadic or seminomadic; due to rapid economic and urban
growth, more than 95% of the population now is settled. Some cities and
oases have densities of more than 1,000 people per square kilometer (2,600
per sq. mi).
Saudi Arabia is known as the birthplace of Islam, which in the century
following Muhammad's death in 632 A.D. spread west to Spain and east to
India. Islam obliges all Muslims to make the Hajj, or pilgrimage to Makkah,
at least once during their lifetime if they are able to do so. The cultural
environment in Saudi Arabia is highly conservative; the country adheres to a
strict interpretation of Islamic religious law (Shari'a). Cultural
presentations must conform to narrowly defined standards of ethics. Men and
women are not permitted to attend public events together and are segregated
in the work place.
Most Saudis are ethnically Arab. Some are of mixed ethnic origin and are
descended from Turks, Iranians, Indonesians, Indians, Africans, and others,
most of whom immigrated as pilgrims and reside in the Hijaz region along the
Red Sea coast. Many Arabs from nearby countries are employed in the
kingdom. There also are significant numbers of Asian expatriates mostly
from India, Pakistan, Bangladesh, Indonesia, and the Philippines. There are
less than 100,000 Westerners in Saudi Arabia.
HISTORY
Except for a few major cities and oases, the harsh climate historically
prevented much settlement of the Arabian Peninsula. People of various
cultures have lived in the peninsula over a span of more than 5,000 years.
The Dilmun culture, along the Gulf coast, was contemporaneous with the
Sumerians and ancient Egyptians, and most of the empires of the ancient
world traded with the states of the peninsula.
The Saudi state began in central Arabia in about 1750. A local ruler,
Muhammad bin Saud, joined forces with an Islamic reformer, Muhammad Abd
Al-Wahhab, to create a new political entity. Over the next 150 years, the
fortunes of the Saud family rose and fell several times as Saudi rulers
contended with Egypt, the Ottoman Empire, and other Arabian families for
control on the peninsula. The modern Saudi state was founded by the late
King Abdul Aziz Al-Saud (known internationally as Ibn Saud). In 1902, Abdul
Aziz recaptured Riyadh, the Al-Saud dynasty's ancestral capital, from the
rival Al-Rashid family. Continuing his conquests, Abdul Aziz subdued
Al-Hasa, the rest of Nejd, and the Hijaz between 1913 and 1926. In 1932,
these regions were unified as the Kingdom of Saudi Arabia.
Boundaries with Jordan, Iraq, and Kuwait were established by a series of
treaties negotiated in the 1920s, with two "neutral zones"--one with Iraq
and the other with Kuwait--created. The Saudi-Kuwaiti neutral zone was
administratively partitioned in 1971, with each state continuing to share
the petroleum resources of the former zone equally. Tentative agreement on
the partition of the Saudi-Iraqi neutral zone was reached in 1981, and
partition was finalized by 1983. The country's southern boundary with Yemen
was partially defined by the 1934 Treaty of Taif, which ended a brief border
war between the two states. A June 2000 treaty further delineated portions
of the boundary with Yemen. The location and status of Saudi Arabia's
boundary with the United Arab Emirates is not final; a defacto boundary
reflects a 1974 agreement. The border between Saudi Arabia and Qatar was
resolved in March 2001. The border with Oman also is not demarcated.
King Abdul Aziz died in 1953 and was succeeded by his eldest son, Saud, who
reigned for 11 years. In 1964, Saud abdicated in favor of his half-brother,
Faisal, who had served as Foreign Minister. Because of fiscal difficulties,
King Saud had been persuaded in 1958 to delegate direct conduct of Saudi
Government affairs to Faisal as Prime Minister; Saud briefly regained
control of the government in 1960-62. In October 1962, Faisal outlined a
broad reform program, stressing economic development. Proclaimed King in
1964 by senior royal family members and religious leaders, Faisal also
continued to serve as Prime Minister. This practice has been followed by
subsequent kings.
The mid-1960s saw external pressures generated by Saudi-Egyptian differences
over Yemen. When civil war broke out in 1962 between Yemeni royalists and
republicans, Egyptian forces entered Yemen to support the new republican
government, while Saudi Arabia backed the royalists. Tensions subsided only
after 1967, when Egypt withdrew its troops from Yemen.
Saudi forces did not participate in the Six-Day (Arab-Israeli) War of June
1967, but the government later provided annual subsidies to Egypt, Jordan,
and Syria to support their economies. During the 1973 Arab-Israeli war,
Saudi Arabia participated in the Arab oil boycott of the United States and
Netherlands. A member of the Organization of Petroleum Exporting Countries
(OPEC), Saudi Arabia had joined other member countries in moderate oil price
increases beginning in 1971. After the 1973 war, the price of oil rose
substantially, dramatically increasing Saudi Arabia's wealth and political
influence.
In 1975, King Faisal was assassinated by a nephew, who was executed after an
extensive investigation concluded that he acted alone. Faisal was succeeded
by his half-brother Khalid as King and Prime Minister; their half-brother
Prince Fahd was named Crown Prince and First Deputy Prime Minister. King
Khalid empowered Crown Prince Fahd to oversee many aspects of the
government's international and domestic affairs. Economic development
continued rapidly under King Khalid, and the kingdom assumed a more
influential role in regional politics and international economic and
financial matters.
In June 1982, King Khalid died, and Fahd became King and Prime Minister in a
smooth transition. Another half-brother, Prince Abdullah, Commander of the
Saudi National Guard, was named Crown Prince and First Deputy Prime
Minister. King Fahd's brother, Prince Sultan, the Minister of Defense and
Aviation, became Second Deputy Prime Minister. Under King Fahd, the Saudi
economy adjusted to sharply lower oil revenues resulting from declining
global oil prices. Saudi Arabia supported neutral shipping in the Gulf
during periods of the Iran-Iraq war and aided Iraq's war-strained economy.
King Fahd played a major part in bringing about the August 1988 cease-fire
between Iraq and Iran and in organizing and strengthening the Gulf
Cooperation Council (GCC), a group of six Arabian Gulf states dedicated to
fostering regional economic cooperation and peaceful development.
In 1990-91, King Fahd played a key role before and during the Gulf war.
King Fahd's action also consolidated the coalition of forces against Iraq
and helped define the tone of the operation as a multilateral effort to
reestablish the sovereignty and territorial integrity of Kuwait. Acting as
a rallying point and personal spokesman for the coalition, King Fahd helped
bring together his nation's GCC allies, Western allies, and Arab allies, as
well as nonaligned nations from Africa and the emerging democracies of
eastern Europe. He used his influence as Custodian of the Two Holy Mosques
to persuade other Arab and Islamic nations to join the coalition.
King Fahd suffered a stroke in November 1995. Since 1997, Crown Prince
Abdullah has taken on much of the day-to-day responsibilities of running the
government.
GOVERNMENT AND POLITICAL CONDITIONS
The central institution of Saudi Arabian Government is the monarchy. The
Basic Law adopted in 1992 declared that Saudi Arabia is a monarchy ruled by
the sons and grandsons of King Abd Al Aziz Al Saud, and that the Holy Qur'an
is the constitution of the country, which is governed on the basis of
Islamic law (Shari'a). There are no political parties or national
elections. The king's powers are limited because he must observe the
Shari'a and other Saudi traditions. He also must retain a consensus of the
Saudi royal family, religious leaders (ulema), and other important elements
in Saudi society. The leading members of the royal family choose the king
from among themselves with the subsequent approval of the ulema.
Saudi kings gradually have developed a central government. Since 1953, the
Council of Ministers, appointed by and responsible to the king, has advised
on the formulation of general policy and directed the activities of the
growing bureaucracy. This council consists of a prime minister, the first
and second deputy prime ministers, 20 ministers (of whom the minister of
defense also is the second deputy prime minister), two ministers of state,
and a small number of advisers and heads of major autonomous organizations.
Legislation is by resolution of the Council of Ministers, ratified by royal
decree, and must be compatible with the Shari'a. Justice is administered
according to the Shari'a by a system of religious courts whose judges are
appointed by the king on the recommendation of the Supreme Judicial Council,
composed of 12 senior jurists. The independence of the judiciary is
protected by law. The king acts as the highest court of appeal and has the
power to pardon. Access to high officials (usually at a majlis, or public
audience) and the right to petition them directly are well-established
traditions.
The kingdom is divided into 13 provinces governed by princes or close
relatives of the royal family. All governors are appointed by the King.
In March 1992, King Fahd issued several decrees outlining the basic statutes
of government and codifying for the first time procedures concerning the
royal succession. The King's political reform program also provided for the
establishment of a national Consultative Council, with appointed members
having advisory powers to review and give advice on issues of public
interest. It also outlined a framework for councils at the provincial or
emirate level.
In September 1993, King Fahd issued additional reform decrees, appointing
the members of the national Consultative Council and spelling out procedures
for the new council's operations. He announced reforms regarding the
Council of Ministers, including term limitations of 4 years and regulations
to prohibit conflict of interest for ministers and other high-level
officials. The members of 13 provincial councils and the councils'
operating regulations also were announced in September 1993.
In July 1997, the membership of the Consultative Council was expanded from
60 to 90 members, and again in May 2001 from 90 to 120 members. Membership
has changed significantly during expansions of the council as many members
have not been reappointed. The role of the council is gradually expanding
as it gains experience.
Principal Government Officials
King, Prime Minister, Custodian of the Two Holy Mosques--King Fahd bin Abdul
Aziz Al Saud
Minister of Foreign Affairs--Prince Saud Al Faysal bin Abdul Aziz Al Saud
Ambassador to the U.S.--Prince Bandar bin Sultan bin Abdul Aziz Al Saud
The embassy of the Kingdom of Saudi Arabia is located at 601 New
Hampshire Avenue NW, Washington, DC 20037; tel. 202-342-3800.
ECONOMY
Oil was discovered in Saudi Arabia by U.S. geologists in the 1930s, although
largescale production did not begin until after World War II. Oil wealth
has made possible rapid economic development, which began in earnest in the
1960s and accelerated spectacularly in the 1970s, transforming the kingdom.
Saudi oil reserves are the largest in the world, and Saudi Arabia is the
world's leading oil producer and exporter. Oil accounts for more than 90%
of the country's exports and nearly 75% of government revenues. Proven
reserves are estimated to be 260 billion barrels, about one-quarter of world
oil reserves.
More than 95% of all Saudi oil is produced on behalf of the Saudi Government
by the parastatal giant Saudi ARAMCO. In June 1993, Saudi ARAMCO absorbed
the state marketing and refining company (SAMAREC), becoming the world's
largest fully integrated oil company. Most Saudi oil exports move by tanker
from Gulf terminals at Ras Tanura and Ju'aymah. The remaining oil exports
are transported via the east-west pipeline across the kingdom to the Red Sea
port of Yanbu. A major new gas initiative promises to bring significant
investment by U.S. and European oil companies to develop nonassociated gas
fields in three separate parts of Saudi Arabia. Following final technical
agreements with concession awardees in December 2001, development should
begin in 2002.
Due to a sharp rise in petroleum revenues in 1974 following the 1973
Arab-Israeli war, Saudi Arabia became one of the fastest-growing economies
in the world. It enjoyed a substantial surplus in its overall trade with
other countries; imports increased rapidly; and ample government revenues
were available for development, defense, and aid to other Arab and Islamic
countries.
But higher oil prices led to development of more oil fields around the world
and reduced global consumption. The result, beginning in the mid-1980s, was
a worldwide oil glut, which introduced an element of planning uncertainty
for the first time in a decade. Saudi oil production, which had increased
to almost 10 million barrels per day (b/d) during 1980-81, dropped to about
2 million b/d in 1985. Budgetary deficits developed, and the government
drew down its foreign assets. Responding to financial pressures, Saudi
Arabia gave up its role as the "swing producer" within OPEC in the summer of
1985 and accepted a production quota. Since then, Saudi oil policy has been
guided by a desire to maintain market and quota shares.
However, beginning in late 1997, Saudi Arabia again faced the challenge of
low oil prices. Due to a combination of factors--the East Asian economic
crises, a warm winter in the West caused by El Nino, and an increase in
non-OPEC oil production--demand for oil slowed and pulled oil prices down by
more than one-third.
Saudi Arabia was a key player in coordinating the successful 1999 campaign
of OPEC and other oil-producing countries to raise the price of oil to its
highest level since the Gulf War by managing production and supply of
petroleum. That same year, Saudi Arabia established the Supreme Economic
Council to formulate and better coordinate economic development policies in
order to accelerate institutional and industrial reform.
In recent years, Saudi Arabia sought to join the World Trade Organization.
Negotiations have focused on the degree to which Saudi Arabia is willing to
increase market access to foreign goods and services and the timeframe for
becoming fully compliant with WTO obligations. In April 2000, the
government established the Saudi Arabian General Investment Authority to
encourage foreign direct investment in Saudi Arabia. Saudi Arabia maintains
a "negative list" of sectors in which foreign investment is prohibited, but
the government plans to open some closed sectors such as telecommunications,
insurance, and power transmission/distribution over time.
Through 5-year development plans, the government has sought to allocate its
petroleum income to transform its relatively undeveloped, oil-based economy
into that of a modern industrial state while maintaining the kingdom's
traditional Islamic values and customs. Although economic planners have not
achieved all their goals, the economy has progressed rapidly. Oil wealth
has increased the standard of living of most Saudis. However, significant
population growth has strained the government's ability to finance further
improvements in the country's standard of living. Heavy dependence on
petroleum revenue continues, but industry and agriculture now account for a
larger share of economic activity. The mismatch between the job skills of
Saudi graduates and the needs of the private job market at all levels
remains the principal obstacle to economic diversification and development;
about 4.6 million non-Saudis are employed in the economy.
Saudi Arabia's first two development plans, covering the 1970s, emphasized
infrastructure. The results were impressive--the total length of paved
highways tripled, power generation increased by a multiple of 28, and the
capacity of the seaports grew tenfold. For the third plan (1980-85), the
emphasis changed. Spending on infrastructure declined, but it rose markedly
on education, health, and social services. The share for diversifying and
expanding productive sectors of the economy (primarily industry) did not
rise as planned, but the two industrial cities of Jubail and Yanbu--built
around the use of the country's oil and gas to produce steel,
petrochemicals, fertilizer, and refined oil products--were largely
completed.
In the fourth plan (1985-90), the country's basic infrastructure was viewed
as largely complete, but education and training remained areas of concern.
Private enterprise was encouraged, and foreign investment in the form of
joint ventures with Saudi public and private companies was welcomed. The
private sector became more important, rising to 70% of non-oil GDP by 1987.
While still concentrated in trade and commerce, private investment increased
in industry, agriculture, banking, and construction companies. These
private investments were supported by generous government financing and
incentive programs. The objective was for the private sector to have 70% to
80% ownership in most joint venture enterprises.
The fifth plan (1990-95) emphasized consolidation of the country's defenses;
improved and more efficient government social services; regional
development; and, most importantly, creating greater private-sector
employment opportunities for Saudis by reducing the number of foreign
workers.
The sixth plan (1996-2000) focused on lowering the cost of government
services without cutting them and sought to expand educational training
programs. The plan called for reducing the kingdom's dependence on the
petroleum sector by diversifying economic activity, particularly in the
private sector, with special emphasis on industry and agriculture. It also
continued the effort to "Saudiize" the labor force.
The seventh plan (2000-2004) focuses more on economic diversification and a
greater role of the private sector in the Saudi economy. For the period
2000-2004, the Saudi Government aims at an average GDP growth rate of 3.16%
each year, with projected growths of 5.04% for the private sector and 4.01%
for the nonoil sector. The government also has set a target of creating
817,300 new jobs for Saudi nationals.
FOREIGN RELATIONS
Saudi foreign policy objectives are to maintain its security and its
paramount position on the Arabian Peninsula, defend general Arab and Islamic
interests, promote solidarity among Islamic governments, and maintain
cooperative relations with other oil-producing and major oil-consuming
countries.
Saudi Arabia signed the UN Charter in 1945. The country plays a prominent
and constructive role in the International Monetary Fund, the World Bank,
and Arab and Islamic financial and development assistance institutions. One
of the largest aid donors in the world, it still gives some aid to a number
of Arab, African, and Asian countries. Jeddah is the headquarters of the
Secretariat of the Organization of the Islamic Conference and its subsidiary
organization, the Islamic Development Bank, founded in 1969.
Membership in the 11-member OPEC and in the technically and economically
oriented Arab producer group--the Organization of Arab Petroleum Exporting
Countries--facilitates coordination of Saudi oil policies with other
oil-exporting governments. As the world's leading exporter of petroleum,
Saudi Arabia has a special interest in preserving a stable and long-term
market for its vast oil resources by allying itself with healthy Western
economies which can protect the value of Saudi financial assets. It
generally has acted to stabilize the world oil market and tried to moderate
sharp price movements.
The Saudi Government frequently helps mediate regional crises and support
the Israeli-Palestinian peace negotiations. A charter member of the Arab
League, Saudi Arabia supports the position that Israel must withdraw from
the territories which it occupied in June 1967, as according to United
Nations Resolution 242. Saudi Arabia supports a peaceful resolution of the
Arab-Israeli conflict but rejected the Camp David accords, claiming that
they would be unable to achieve a comprehensive political solution that
would ensure Palestinian rights and adequately address the status of
Jerusalem. Although Saudi Arabia broke diplomatic relations with and
suspended aid to Egypt in the wake of Camp David, the two countries renewed
formal ties in 1987.
In 1990-91, Saudi Arabia played an important role in the Gulf War,
developing new allies and improving existing relationships between Saudi
Arabia and some other countries. However, there also were diplomatic and
financial costs. Relations between Saudi Arabia and Tunisia, Algeria, and
Libya deteriorated. Each country had remained silent following Iraq's
invasion of Kuwait but called for an end to violence once the deployment of
coalition troops began. Relations between these countries and Saudi Arabia
have returned to their pre-war status. Saudi Arabia's relations with those
countries which expressed support for Saddam Hussein's invasion of
Kuwait--Yemen, Jordan, and Sudan--were severely strained during and
immediately after the war. For example, several hundred thousand Yemenis
were expelled from Saudi Arabia after the Government of Yemen announced its
position, thus exacerbating an existing border dispute. Saudi-Yemeni
relations, especially in the wake of the 1994 Yemen civil war, remain
fragile and of significant concern to the Saudi Government. The Palestine
Liberation Organization's support for Iraq cost it financial aid as well as
good relations with Saudi Arabia and other Gulf states. Recently, though,
Saudi Arabia's relations with Jordan and the Palestinian Authority have
improved, with the Saudi Government providing assistance for Palestinian
Authority.
During and after the Gulf War, the Government of Saudi Arabia provided
water, food, shelter, and fuel for coalition forces in the region. There
also were monetary payments to some coalition partners. Saudi Arabia's
combined costs in payments, foregone revenues, and donated supplies were $55
billion. More than $15 billion went toward reimbursing the United States
alone.
U.S.-SAUDI ARABIAN RELATIONS
Saudi Arabia's unique role in the Arab and Islamic worlds, its possession of
the world's largest reserves of oil, and its strategic location make its
friendship important to the United States. Diplomatic relations were
established in 1933; the U.S. embassy opened in Jeddah in 1944 and moved to
Riyadh in 1984. The Jeddah embassy became a U.S. consulate. Meanwhile, a
U.S. consulate opened in Dhahran in 1944.
The United States and Saudi Arabia share a common concern about regional
security, oil exports and imports, and sustainable development. Close
consultations between the U.S. and Saudi Arabia have developed on
international, economic, and development issues such as the Middle East
peace process and shared interests in the Gulf. The continued availability
of reliable sources of oil, particularly from Saudi Arabia, remains
important to the prosperity of the United States as well as to Europe and
Japan. Saudi Arabia is often the leading source of imported oil for the
United States, providing about 20% of total U.S. crude imports and 10% of
U.S. consumption. The U.S. is Saudi Arabia's largest trading partner, and
Saudi Arabia is the largest U.S. export market in the Middle East.
In addition to economic ties, a longstanding security relationship continues
to be important in U.S.-Saudi relations. A U.S. military training mission
established at Dhahran in 1953 provides training and support in the use of
weapons and other security-related services to the Saudi armed forces. The
United States has sold Saudi Arabia military aircraft (F-15s, AWACS, and
UH-60 Blackhawks), air defense weaponry (Patriot and Hawk missiles), armored
vehicles (M1A2 Abrams tanks and M-2 Bradley infantry fighting vehicles), and
other equipment. The U.S. Army Corps of Engineers has had a long-term role
in military and civilian construction activities in the Kingdom.
The Gulf War demonstrated U.S.-Saudi cooperation in the areas of cultural
accommodation, as well as in military operations. For example, the United
States military issued general orders prohibiting the consumption of alcohol
and setting guidelines for off-duty behavior and attire. Saudi Arabia
accommodated U.S. culture and its military procedures by allowing U.S.
servicewomen to serve in their varied roles throughout the kingdom--a major
step for a highly patriarchal society.
Currently, Saudi Arabia is an important partner in the campaign against
terrorism, providing assistance in the military, diplomatic, and financial
arenas.
Human Rights
Despite close cooperation on security issues, the United States remains
concerned about human rights conditions in Saudi Arabia. Principal human
rights problems include abuse of prisoners and incommunicado detention;
prohibitions or severe restrictions on the freedoms of speech, press,
peaceful assembly and association, and religion; denial of the right of
citizens to change their government; systematic discrimination against women
and ethnic and religious minorities; and suppression of workers' rights.
Principal U.S. Officials
Ambassador--Robert W. Jordan
Deputy Chief of Mission--Margaret Scobey
Counselor for Consular Affairs--Kenneth Sackett
Counselor for Economic Affairs--Alice A. Dress
Counselor for Political Affairs--Matthew Tueller
Counselor for Political-Military Affairs--Martin Adams
Counselor for Public Affairs--John Burgess
Consul General, Dhahran--Mark L. Desjardins
Consul General, Jeddah--Richard Baltimore
The U.S. embassy in Saudi Arabia is located in the Diplomatic Quarter of
Riyadh (tel. 966-1-488-3800). The Consulate General in Jeddah is located on
Palestine Road, Ruwais, Jeddah (tel. 966-2-667-0080); and the Consulate
General in Dhahran is located between ARAMCO Headquarters and the King Abdul
Aziz Airbase (tel. 966-3-330-3200). The Embassy and consulates are open for
business Saturday through Wednesday, in accordance with the official
workweek of Saudi Arabia.
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