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BALANCE OF TRADE

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BALANCE OF TRADE IN SAUDI ARABIA


 

BALANCE OF TRADE

The Kingdom maintained a favorable balance of trade for the period from 1980 to 1994. The Kingdom’s balance of trade has improved noticeably since 1986, when it had a surplus of only SR3.6 billion (U.S.$0.96 billion). During the Gulf Crisis, the Kingdom’s balance of trade recorded a surplus of SR76.2 billion (U.S.$20.3 billion) in 1990 and SR 70.1 billion (U.S.$18.7 billion) in 1991 (see Table 11). This surplus declined to SR63,788.0 million (U.S. $17.0 million) in 1992 and then to SR53,154.1 million (U.S. $14,174.4 million) in 1993. However, the Kingdom’s balance of trade improved during 1994 and recorded a surplus of SR72,167.5 million (U.S. $19,244.7 million).

 

BALANCE OF PAYMENTS

Due to the fall in the Kingdom's oil export revenues in response to an over supply in the international oil markets, Saudi Arabia has been faced with the problem of a current account deficit since the mid 1980s. The balance of payments’ current account deficit during the period 1986-1989 were SR-43 billion (U.S. $11.5 billion), SR-36.6 billion (U.S. $9.8 billion), SR-27.5 billion (U.S. $7.3 billion), and SR-35.7 billion (U.S. $9.5 billion) respectively.

The Desert Storm war, coming at the start of the fifth development plan (1990-1994), had contradictory effects on the Kingdom’s foreign trade and balance of payments. The sharp increase in the value of oil exports at the start of the fifth plan period resulted in an average annual trade balance surplus of SR75.1 billion (about U.S. $20.00 billion) during the period from 1990 to 1993 (see table 11). On the other hand, The substantial cost of the war and the immense outflow of related payments had a substantial negative impact on the overall balance of payments' position. Thus, as table (15) shows, the average annual current account deficits during the years 1990 to 1993 were SR15,6 billion (U.S. $4.2 billion), SR103.3 billion (U.S.27.5 billion), SR78.1 billion (U.S. $20.8 billion) and SR54.7 billion (U.S. $14.6 billion) respectively.

TABLE 15
BALANCE OF PAYMENT
1410/1411 - 1413/1414 H. (1990-1993)
(In Millions of Saudi Riyals)

DESCRIPTION 1410/1411

1990

1411/1412

1991

1412-1413

1992

1413-1414

1993

Merchandise Trade (F.O.B.) 85,093 81,093 62,920 71,323
a. Oil Exports (Exchange Bunker Oil) 149,649 163,036 162,116 154,083
b: Other Exports 16053 15311 14082 14135
(of which Re-exports) (2414) (2297) (1545) 1525
Imports 80,609 97,254 113,278 96,895
Services and Transfers 10,065 184,410 140,993 126,057
Receipts 46,435 43,932 41,102 36,032
a. Investment Income 34,452 32,584 27,629 23,250
b. Oil Sector (Bunker Oil) 634 454 491 487
Others 11,349 10,894 12,982 12,295
Payments 147,086 228,342 182,089 162,089
Freight and Insurance 9,673 11,670 11,328 8,721
Oil Sector 4,569 7,243 7,281 8,614
Other Private Service 37,878 42,087 45,511 43,437
Other Govt. Services (a) 52883 115859 67803 42,457
Private Transfers 42,083 51,483 50,172 58,860
Capital Movement and Reserves 15,558 103,317 79,073 54,734
a. Net oil sector transactions & others 6,979 604 297 5,127
b. Other (b) 8,579 102,713 78,370 49,607
Average exchange rate (SR per US$) 3.745 3.745 3.745 3.745

Source: Saudi Arabian Monetary Agency/Economic research and statistics.

  

(a) Including official transfers and contribution or capital subscriptions to international or regional development agencies and certain government imports.

  

(b) Including short-term private capital, valuation adjustment, net errors and omissions and changes in commercial banks, net foreign assets, and official capital and reserves.

    


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 Sources: The Commercial office, Embassy of Saudi Arabia, Washington, D.C. and The Foreign Trade Statistics, Ministry of Finance and National Economy, Central Department of Statistics, Kingdom of Saudi Arabia.


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