Description Total Posts Unread Posts Egy Formulation on Saudi Arabia - International Spotlight After reading chapter 8 in your textbook, read the case: Saudi Arabia International Spotlight span (PDF) 1. Answer the two questions at the end of the case, using knowledge learned from the chapter. 2. Respond to another student. If you do not respond to another student, you will only receive 50% of the grade earned until you do respond. Do not attach documents to Discussions. Properties of various discussions Ip with Blackboard? Review the Blackboard Student Duive, vioussion. gement Decision Do decision-making philosophies and practices differ from country to country? Saudi Arabia BRASIL In the International Spotlight Saudi Arabia is a large country in the Middle East cover 16 percent of proven petroleum reserves. Foreign workers ing 856,000 square miles. The country borders the Persian play a vital role in the economy, with more than 6 million Gulf to the north and the Red Sea to the south. About expatriates employed in a variety of industries, especially one-fifth the size of the United States, its natural resources construction and manufacturing. The government is making include petroleum and natural gas among the largest in efforts to diversify its economy by growing the private sec- the world), iron ore, gold, and copper. The two major holy tor and by seeking to employ more nationals, balancing the cities of Islam are in Saudi Arabia: Mecca and Medina's workforce. 130 With just over 27 million people, Saudi Arabia is! As oil prices have plummeted in recent years due to a almost entirely Arab Muslim (approximately 90 percent variety of factors, Saudi Arabia and the other OPEC coun- Sunni and 10 percent Shia). The country's population tries have been keeping output levels relatively high, growth rate is estimated at 1.46 percent. Additionally, the resulting in huge losses. While the country can cover the country's population is overwhelmingly (approximately deficits for the time being, a prolonged period of low oil 90 percent) younger than 55 years of age. According to demand could have devastating effects on the economic U.N. reports, 30 percent of the country's population con health of the country. 131 sists of immigrants. 126 The country's GDP in 2014 was US$746 billion.27 You Be the International Management From 2011 through 2013, annual GDP growth plummeted Consultant from 10 percent to 2.7 percent. With low oil prices world- wide, Saudi Arabia's GDP growth remains stunted at As oil prices continue to drop. Saudi Arabia is actively about 3.5 percent. 28 seeking foreign investors to come into the country, espe- Saudi Arabia operates its government as a monarchy, cially in sectors such as transportation, health care, tour- wherein the king makes all important official decisions ism, and building materials. The country has also opened 17 2006/respone she country's U.N. reports, 30 percent of the country's population con health of the country. 131 sists of immigrants. 126 The country's GDP in 2014 was US$746 billion. 127 You Be the International Management From 2011 through 2013, annual GDP growth plummeted Consultant from 10 percent to 2.7 percent. With low oil prices world- wide, Saudi Arabia's GDP growth remains stunted at As oil prices continue to drop, Saudi Arabia is actively about 3.5 percent. 128 seeking foreign investors to come into the country, espe- Saudi Arabia operates its government as a monarchy, cially in sectors such as transportation, health care, tour- wherein the king makes all important official decisions.ism, and building materials. The country has also opened The king appoints ministers who act as his advisers. In the retail sector to companies seeking complete ownership 2011, women were granted the right to vote and run for of their business, negating the need for joint venture part- seats in municipal elections, though gender oppression is nerships. The Saudi officials courting foreign investors still commonplace and integrated into the legal system. say that, despite falling oil prices, the country's other sec- The country's laws are based on Islamic law with some tors are still growing and provide excellent investment Western elements incorporated. For many years, Saudi opportunities. Moreover, officials have said they are will Arabia has enjoyed favorable relationships with many I ing to discuss modifying any rule or regulation that might Western nations. As it is a large exporter of fossil fuel, impede investment by a major foreign company." Western nations are somewhat dependent on maintaining civility with the Saudis despite alleged human rights vio- Questions lations. In recent years, however, the Saudi monarchy and royal family have been suspected of aiding terrorism 1. Given that the country is actively seeking foreign efforts, leading to somewhat strained relations with investors and appears to be creating a pro-business countries in Europe and the U.S. 29 atmosphere, what non-oil businesses do you think The government maintains strong controls over the coun would be best suited for expanding into Saudi try's economy, which is highly reliant on extraction and Arabia? production of oil and gas. It is the largest exporter of petro 2. If you were a foreign investor, what concerns would leum, is the leader of the Organization of Petroleum Export you have about the country? Would you make an ing Countries (OPEC), and accounts for approximately investment in the country? otv