Factors that determine the structure of GDP on the example of Saudi Arabia
Saudi Arabia is included in the group of highly profitable countries. In 2018, Saudi Arabia ranked 20th in terms of GDP with $659.66 billion. Let us consider the factors that determine the structure of the GDP of this state.
GDP structure of Saudi Arabia
The GDP structure of Saudi Arabia includes:
The largest part of the country’s GDP has long been the oil sector. The country has taken a course to accelerate the development of other sectors of the economy since the early 90s. This has become a necessity to ensure independence from oil price fluctuations. Nevertheless, the extractive industry still occupies a leading position in the composition of GDP (45%).
The industry is also represented by the production of reinforcing steel and shaped steel. Separately, the energy sector and the sphere of sea water desalination are developing. The light, food and pharmaceutical industries are developing at an accelerated pace.
A significant part in the structure of the country’s GDP is construction (9%). This includes transport construction.
Another growing sector is agriculture. In recent years, its volume has increased 3 times. Wheat, barley, potatoes, onions and fruit are the most cultivated in Saudi Arabia. However, further development is slow, as there is a lack of fresh water in the country.
Trade is a traditional segment of the state economy. The main share of exports falls on oil and oil products. Most are shipped to the US, Japan, China, South Korea and Singapore.
The transport sector is developed enough to be a source of income for Saudi Arabia. The length of the railways is more than 1,400 km, and several more sections are currently under construction. The length of motor roads is 221,372 km (most of them are unpaved). There are 208 airports in the country, three of which have international status. In addition, there are pipelines for transporting gas, oil and petroleum products.
The official currency of the country is the rial. Since 2007, there has been talk of abandoning the pegging of the rial to the dollar, but so far no active steps have been taken in this area.