Can Saudi Arabia Reform its Economy in Time to Head Off Disaster?   [open pdf - 206KB]

The dozen years since the Persian Gulf War have seen slums grow up on the outskirts of Jeddah and Riyadh, the capital. Beggars hawk bottles of water at intersections. Penniless women huddle in strips of shade outside their crumbling mud-brick houses, begging for money. Many families in the capital are so poor they can't afford electricity. Raw sewage runs through parts of Jeddah... The increasingly perilous economic situation that all in Saudi Arabia but the royalty faces today may be a big factor in recruiting young Saudis to terrorist groups such as Al Qaeda. Chronic joblessness, diminished incomes and difficulty in collecting enough money to marry and start families are all issues that can evoke anger. The deteriorating economic situation is manifesting itself in new and troubling ways. Virtually free of crime since its founding, the country's deeply conservative Islamic society is grappling with a rapid increase in crime. Crime among young jobless Saudis rose by 320 percent between 1990 and 1996, and was expected to go up by another 136 percent by 2005. Saudi Arabia's problems have been decades in the making and certainly will not be solved quickly. This essay identifies the main factors responsible for Saudi Arabia's economic deterioration. Have fundamental changes taken place in the economy, perhaps since 1980, to cause the decline in non-oil economic growth? If so, what are they? And what are their implications for the future?

Public Domain
Retrieved From:
Naval Postgraduate School, Center for Contemporary Conflict: http://www.ccc.nps.navy.mil
Media Type:
Strategic Insights (January 2004), v.3 no.1
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