Saudi Arabia has recently increased its degree of openness, engaging in higher international (financial & non-financial) activities. Briefly discuss the following along with providing one example:

How would this affect our economy?

How would this affect our BoP? Current account & financial account.

How would this affect our exchange rate? Since it is a pegged exchange rate regime, increasing international trade will affect the exchange rate, so how would the Saudi Central Bank react to this?

Answer rating: 100% (QA)

Saudi Arabias increase in international financial and nonfinancial activities can bring about various impacts on the economy balance of payments and e... View the full answer