We are all enjoying low fuel prices. Low oil prices are really hurting the Saudis. If the Saudis can not maintain their influence using their moneyon the surrounding arab countries then the middle east may become a real powder keg. The article does not mention that Saudi Arabia has resorted to issuing $5 billion in bonds last week. If they have to curtail their internal social and infrastructure spending the local malcontents probably start an uprising (my guess anyways). It looks like a big storm on the horizon IMO. Saudi Arabia faces existential crisis after its misjudged gamble on oil | Financial Post
How long have they been making bank selling oil? Maybe they should have thought about diversifying. Their conservative (almost extremist) Muslim views and impossible immigration laws make it unlikely anyone would be interested in investing in anything they came out with.
Diversify into what? Selling sand or camel milk? There's very little else there but sand and underneath that: oil. A population consisting of 100's of different tribes that have little skills but hearding cattle and fought each other to the nail because only their little tribe is the most important or has the right beliefs does not have much room for diversification. For virtually every project in that country foreign skills need to be imported. Look at their healthcare system or even their airline: without foreigners it would simply collapse. It's only the (now quickly eveporating) wealth that keeps them at the current level. Once that is gone, chaos reigns supreme...
Dubai has done the tourist rout, Fantastic holiday destination. My niece who got married last year moved to Dubai with her husband (teachers) they are having a great time. Why can't the other Arab Nations take a leaf out of Dubais book?
Dubai Jim, I would say is one of the most liberal of the gulf States. and in the main welcomes Tourism. Saudi is very Strict and I am nor too sure Tourism would take off. Oman and some of the Others yes but Saudi.................. JP
Currently working in the Kingdom. There is really nothing here that you would want to visit in this god forsaken place, unless you fancy the friday afternoon executions. The only thing it has going for it just now is plenty of work in the offshore sector as my usual trading areas (Europe and Far East) are really in the doldrums just now. If the oil industry collapses here then its back to the dark ages. This country is ran by foreigners, the locals in general have a somewhat poor work ethic and huge sense of entitlement. A case in point at the moment I have 4 local crewmen on good money that have never left their cabins in a month apart from food. That takes serious dedication to the cause of idleness!! Cant fire them.......
Oh, but they do! A country like Oman is putting a lot of effort into becoming a major tourist attraction. However, the tourist industry cannot support all of the local population because there's just too many of them. One thing Oman has going for it is the work ethics of the local population. Contrary to other countries in that region, Omani's DO have regular jobs like a crane operator of forklift operator in the port. The wealth of Oman (mainly natural gas) is not squandered for power outside the country or buying influence, but rather used peacemeal to create adequate buffers in case things go sour. I think the influence of the people from India that have come across and settled there has made a positive impact on the local population in that respect.
If oil does run out, and some day it will, Saudi will get left behind. Hope they change, but I won't hold my breath. Definitely too strict, when that day comes when the oil fields run dry, hope I'm not around to see the outcome.
There are a lot of things they could focus on other than oil. Technology comes to mind. Others have mentioned how Dubai has attracted a lot of business outside of the oil industry (special economic zones/lower taxes for businesses/borderline tax haven)....Kuwait is trying to mimic that but they need to legalize alcohol if they want Western tourists to start coming in. Conservative Islam (or any other religion) is not conductive to a thriving economy, simple as that.
Agree with you to a certain extend, however (and there always appears to be a 'however'), this would require foreign companies to establish entities there. Add to this the fact that you will have to employ a bunch of local dead wood as high-ranking and high-paid executives/co-owners/directors and very few companies would like to invest in something they do not (fully) own and/or control. No matter what the financial incentives might be. Situation in Saudi is comparable to the situation here, although the dead wood is less expensive here and sometimes actually does work. Only when there is a major shift in the thought process of the Saudi's from being extremely well paid for showing up every now and then to actually performing a task (menial as it might be) things will not change. Ever seen a Saudi behind the counter in the local MacDo's?
