Pre-crisis GDP level will be reached in 2022

B2

MEDIUM RISK for enterprise

  • Economic risk

  • Business environment risk

  • Political risk

  • Commercial risk

  • Financing risk

  • Economic risk

  • Business environment risk

  • Political risk

  • Commercial risk

  • Financing risk

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GDP
USD700.1bn (World ranking 20, World Bank 2020)
Population
34,81mn (World ranking 41, World Bank 2020)
Form of state Monarchy
Head of government King SALMAN bin Abdulaziz Al Saud
Next elections None
  • Natural resource base (oil and gas)
  • Strategic importance as an oil exporter and with spare capacity to increase output when needed
  • Large financial asset base and strong foreign exchange reserves
  • Net creditor
  • Generally good relations with the U.S.
  • Long-standing and stable exchange rate system
  • Dependence on international oil prices along with a narrow economy focused on the hydrocarbon sector
  • High unemployment and under-employment have the potential to fuel increased militancy, particularly among the minority Shia population
  • Data transparency is below average for a high income economy
  • Regional uncertainties, with land borders with Iraq and Yemen and with Iran as a close neighbor. The latter is seen by some as a competitor for regional power

Trade structure by destination/origin

(% of total, 2020)

Exports Rank Imports
China 19.9%
1
20.2% China
Japan 9.6%
2
11.2% United States
India 9.6%
3
6.9% United Arab Emirates
Korea, Republic of 8.6%
4
5.4% Germany
United Arab Emirates 5.0%
5
5.0% India

Trade structure by product

(% of total, 2020)

Exports Rank Imports
Petroleum, petroleum products and related materials 64.2%
1
10.0% Road vehicles
Plastics in primary forms 11.4%
2
6.9% Other industrial machinery and parts
Organic chemicals 7.7%
3
6.7% Telecommunication and sound recording apparatus
Gas, natural and manufactured 2.4%
4
5.4% Other transport equipment
Fertilizers other than group 272 1.4%
5
4.4% Iron and steel

As with all GCC states, late payment is common in Saudi Arabia. In practice, the law does not regulate late payment, while late payment interest is prohibited and collection costs cannot be recovered from the debtor unless a specific agreement has been concluded by the parties. As a result, debtors will often try to negotiate discounts in exchange for prompt payment.

  • Low

  • Medium

  • Sensitive

  • High

  • Payments

  • Court proceedings

  • Insolvency proceedings

  • Payments

  • Court proceedings

  • Insolvency proceedings

Local legal action is very slow, costly and uncertain overall, since the courts are not bound by a system of precedent and have considerable discretion in applying Shariah principles to specific circumstances. In addition, several weeks or months may separate each hearing and the courts hardly abide by time management requirements.

Insolvency laws in the Middle East are not as sophisticated as in other regions and the nonexistent company rescue culture in Saudi Arabia illustrates this point.
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