العربية السعودية

Saudi Arabiaالسعودية العربية

STRENGTHS

Education

• Saudi Arabia Education system under– Government agencies of Ministry of Education– The Ministry of Higher Education– General Organization for Technical Education and

Vocational Training• Education starts at 6 years old• Examination at end of the 6th grade

Education (cont.)

• Schools are not co-educational• Women are prevented from studying– Engineering– Journalism– Architecture

• Saudi Arabia literacy rates– 85% among males– 70% among females

Economics

Growth in GDP• 80% between 2009-

2011• 5% growth in U.S

Ease of Doing Business• Named 11 out of 183

in Annual Report

WTO Member

• Trade negotiations

• Implementations and monitoring

• Dispute settlement

• Building trading capacity

• Outreach

Road, Rail, & Port Infrastructure

There is a new road being

established in Saudi Arabia

called the Atlantic Route Corridor.

It will start in northern Saudi

Arabia stretching due south, and

then east to Westford.

Road, Rail, & Port Infrastructure

Currently the kingdom has

1,200 km of rail ways. When the

project is finished in 2015, the

kingdom will have 7,000 km of

rail roads.

Road, Rail, & Port Infrastructure

15 Ports in Saudi Arabia. The

Majority of them are located in Eastern and

Southern Saudi Arabia, for a total of 9 major ports.

WEAKNESSES

Political Forces Outside Saudi Arabia

• Political Unrest in the Middle East

• Revolts

• Terrorism

Geographic Location

Because of the recent unrest in the Middle East, problems may

arise from exposing the company to this

location.

Culture

• Religion

– Schedule of prayers

–Month of Ramadan

• Women’s social standing

• Pork-free diet

• Advertisements aimed at Men

OPPORTUNITIES

Favorable Taxes

• Joint ventures – five year tax holiday

• Agricultural – ten year tax exemption

• Company tax rates between 25 and 45 percent

• Foreign employees not taxed on income

• Zakat religious tax

U.S. – Saudi Arabia Relations

• Ancestral ties and shared values

• 9/11 Attacks

– Both take the stance Saudi Arabia wasn’t involved

Promising Economic Growth

• Privatization

• Laws to Encourage Investment

• Capital Markets Law

• Foreign Investment Law

Limited Competition

• Consumes 45% of all feed barley in global

markets

• Import millions of sheep each year

• Pilgrimage to Mecca

– 2 million people

– Government provides food all month

THREATS

Unemployment

• Unemployment Rate• 10.9%• Production Capacity• Potential Opportunity

Terrorism in Saudi Arabia

• New wave of youth activism– Government reinforces strict limits on political

activism• Related Developments– Internet – social media tools– “Reform stimulus” package - $37 billion –Municipal council elections

Terrorism – 9/11 Attack

Company ABC is thinking about moving into Country XYZ. Recently, XYZ has been found to be involved in funding terroristic attacks.

• Would you still buy from them?

• If you were an investor, would you still invest or sell your stock?

Terrorism

Terrorism

SUMMARY

Strengths

• Education

• Economy

• WTO Member

• Road, Rail, & Port Infrastructure

Weaknesses

• Political Forces outside Saudi Arabia

• Culture

Opportunities

• Favorable Taxes

• U.S. and Saudi Arabia Relations

• Promising Economics Growth

• Limited Competition

Threats

• Unemployment

• Terrorism

Recommendation

Saudi Arabia does have considerable downsides such as terrorism, extremely high unemployment rates, and migration. However, Saudi Arabia does have a promising growth in economic areas and Saudi Arabia continues to have strong ties with the U.S. as far as trade relations and investments. The lower corporate taxes, the ability to move products and services freely throughout the Middle East, and limited competition in the food and beverage industries have lead Team Saudi Arabia to recommend in favor of moving forward and expanding business to Saudi Arabia.

Saudi Arabiaالسعودية العربية