Saudi Arabia General Information
HEAD OF STATE
Crown Prince, Deputy Prime Minister & Minister for Defence & Aviation & Inspector
DIPLOMATIC REPRESENTATION IN SAUDI ARABIA
During the month of Ramadan business is restricted and usually stops completely 2 days prior to Eid Al Fitr and 5 days prior to Eid Al Adha.
Travelers to the Kingdom may not carry alcohol, firearms, pork products, religious items, or pornographic materials. Prescription drugs should be carried in their original labeled containers.
CLIMATE & WEATHER
The transport and communications sector is expected to grow by 2.9 percent annually during the period of the sixth development plan as a result of higher level of economic activity and anticipated higher demand for communications services.
Airports: Most travel within the Kingdom is done by air, given the difficult terrain and distances between population centers. There are 23 airports, three of which are international.
King Abdul Aziz International Airport in Jeddah opened in 1981 and is noted for its separate terminal for pilgrims.12 miles west of the city. Tel: 6483550
King Khalid International Airport serves the greater capital city of Riyadh.
King Fahad International Airport was open late 1999, located 36 km (approximately 22 miles) Northwest of Dammam. reports by the Saudi Civil Air Aviation estimate the total cost of this project exceeds SR7.5 billion (U.S. $2 billion).
Dhahran International Airport - 5 miles south-east of Dhahran. (CLOSED)
Railway: Riyadh-Dammam takes four hours on new train. Dep: 14.00 Wednesday-Saturday. One stop at Hofuf. Air-conditioned restaurant car. Tickets should be bought the day before.
King Fahd Causeway links Al Khobar in Saudi Arabia to Bahrain. Visa requirements for non Gulf nationals are exactly the same as for visitors flying into Saudi Arabia. The toll fee for a private car is one way SR20/-.
SEAPORTS: The maritime transport system of Saudi Arabia is one of the most advanced in the world. The largest and busiest port is located in Jeddah. However, expansion of the ports of Jizan and Yanbu on the Red Sea, and Jubail and Dammam on the Arabian Gulf has relieved some of the Kingdoms traffic concentration at Jeddah Islamic Port.
West Coast: Jeddah Islamic Port, Tel: (02) 6471200,
The launching of the Arab Satellite in 1985 and the television complex in Riyadh provide up-to- the-minute telecommunications facilities. Access to domestic and international telephone service is available at varying rates and is being modernized at an estimated cost of SR15.00 billion (U.S. $4.00 billion) to be one of the best in the world.
OIL & NATURAL GAS SECTORS
There are few key elements regarding the structure and organization of the oil industry. The entire industry is dominated by the government, which retains title to all mineral resources in the country, sets basic policy and makes all major decisions regarding production, investment and domestic energy pricing. The government also holds majority ownership interest in major operating companies including ARAMCO, SAMAREC, the Petromin Lubricating Oil Refining Company (LUBEREF) and the Petromin Lubricating Oil company (PETROLUBE). The two small foreign companies operating in the Neutral Zone between Kuwait and Saudi Arabia, Getty Oil company and the Arabian Oil Company of Japan are exceptions to this rule.
ARAMCO manages the oil fields, pipelines, crude oil export facilities, crude oil tankers and the Master Gas System throughout the country. The company set up in 1988 as a joint venture is ranked 17th in terms of employees (43,000). SAMAREC, established in 1988 manages three wholly-owned Saudi refineries at Riyadh, Jeddah and Yanbu. It also controls governments 50% interest in three joint venture export refineries at Jubail, Yanbu and Rabiah.
Saudi Arabia does not have the dominant position in natural gas despite reserves of 186.5 trillion cubic feet. The Master Gas System which is designed, built and operated by ARAMCO has made Saudi Arabia, the worlds largest exporter of natural gas liquids. Saudi Arabia accounts for 7 to 10 per cent of annual world output of natural gas liquids (propane, butane, and natural gasoline) and 30 per cent of the worlds seaborne trade in LPGs (propane and butane). It is the largest exporter of LPGs in the world. ARAMCO has the capacity to produce about 600,000 b/d of NGLs.
Apart from Saudi Arabias oil and gas reserves, there are believed to be sizeable deposits of other minerals. At present, salt, limestone, gypsum and gold are produced commercially, while deposits of phosphate, copper, bauxite and uranium are considered to have economic potential. Meanwhile, Arabian Shield Development Co. (ASDC) has secured a licence to tap a mineral deposit in Saudi Arabia and is negotiating a loan for half the $88 million cost. The deposit with proven reserves for 11 years, is expected to produce an annual 58,000 tonnes of zinc concentrates with 54% zinc per tonne and 35,000 tonnes of copper concentrates with 25% copper. It also expects output of 22,000 ounces of gold and 800,000 ounces of silver per year.
The Saudi Industrial Development Fund (SIDF) was founded in 1974 and is the major government funding agency for existing and new manufacturing projects. The Saudi Arabian Basic Industries Corporation, the largest industrial entity in the Kingdom was established in 1976 to help the private sector develop basic industries. SABICs aim has been to establish downstream petrochemical industries using mainly associated gas as feed stock and, since its inception, it has set up local industries mostly on a joint-venture basis with overseas interests. It has now 5% share of the world petrochemical market, with key areas of production in basic and intermediate chemicals, thermoplastic polymers, fertilizers and metals.
The Royal Commission for Jubail and Yanbu was established in 1975 to create twin industrial cities in the eastern and western parts of the Kingdom. In 1992, 16 primary industries covering products such as ethylene, MTBE (methyl tertiary butyl ether) and urea with a total invested capital of US$14 billion had been set up in Jubail and four secondary industries and 67 support/light manufacturing industries were operational.
Saudi Arabias first MTBE plant was built by the Saudi-European Petrochemical Company, an affiliate of SABIC in Jubail and has been in production since 1988. The country operates eight refineries, three of them are either wholly or majority-owned by SAMAREC and oriented towards the domestic market. Three others are large, export-oriented refineries in which SAMAREC is a joint venture partner with Shell, Mobil, and Petrogal. A seventh at Ras Tanura is owned by ARAMCO.
The first downstream investment by Saudi Arabia was with Texaco in the US. The deal, initiated in 1988, gives the Kingdom a guaranteed market in the US for 615,000 b/d of crude oil exports. This is the biggest export deal for any OPEC country. In 1991, Saudi ARAMCO paid US$ 470 million for a 35 per cent stake in South Koreas Sangyong refining company. There has been an agreement for a third major oil deal with Japans Nippon Oil Co. These three oil deals seem to set the pattern for Saudi Arabias overseas partnerships. This strategy should enable the Saudi Arabian national oil company to become one of the largest integrated companies in the world by the year 2000.
SABIC and Mobil Corp. will spend $2.5 billion to double the capacity of their joint venture petrochemicals project on the Red Sea. The expanded Saudi Yanbu Petrochemical Co. or Yanpet complex will be one of the largest, lowest cost petrochemicals producers in the world. They will build a new ethylene plant with the capacity to make 800,000 tonnes a year, doubling Yanpets current ethylene capacity to more than 1.6 million tonnes. The joint venture will build its first polypropylene plant, able to make 260,000 tonnes of plastic a year.
Saudi Iron & Steel Company (Hadeed) is the largest producer of iron and steel in the Kingdom. The Saudi Arabian Fertilizer Company (SAFCO) started production since 1970. Another plant, Al Jubail Fertiliser Company (SAMAD) started production in 1983.
FOREIGN INVESTMENT CODE
In 1956, the first Import Control Law and the first Foreign Exchange Control Law and a Currency Law were issued. Until 1960, SAMAs task was to implement currency reforms and banking business. According to a Royal Decree issued on December 15, 1957 SAMAs objectives were defined as:
i. To issue and strengthen the Saudi currency and to stabilise its
internal and external value
During the 1970s SAMA focused on Saudiisation of the branches of foreign banks operating in the Kingdom. Presently, there are 12 commercial banks in the Kingdom, three of which viz. National Commercial Bank, Riyadh Bank and Al-Rajhi Banking and Investment Corporation are fully Saudi-owned while the rest are joint ventures with Saudi citizens. There are also five specialised credit institutions in the Kingdom.
Meanwhile, five banks are considering the possibility of joining the credit network in the Jeddah Chamber of Commerce and Industry in an effort to recover some of their bad debts.
Meanwhile, Saudi Arabia is moving cautiously to open its bourse to foreign investors and has no immediate plans to link with other Gulf Arab stock markets.
The country has achieved self-sufficiency in agricultural crops, eggs, fish and dairy products. The growth of agricultural output has been mostly due to the price support policy and other incentives provided by the government, as well as to the adoption of modern farming techniques. In spite of extreme climatic conditions and limited water resources, agriculture has been given priority due to social, economic and political factors.
The greenhouse industry, especially for the intensive production of tomatoes and cucumbers in the off season is growing rapidly. As part of efforts to provide water for irrigating the farms, more than 174 dams were built with a storage capacity of over 1,206 million cubic metres.
MINING AND QUARRYING
There is an apparent emphasis on the role of the Saudi private sector in the development of the mining and quarrying sector. This sector is expected to be one of the fastest growing sectors with an annual growth rate of about 9 percent over the period of the sixth development plan.
During the fifth development plan period, a number of factors contributed to the rising cost of public utilities. These include the rapidly growing urban population, the strong growth in energy-intensive production activities, and a change in consumption patterns following the reduction of already low and highly subsidized prices.
On the 25th of Rajab 1415 H. (corresponding to December 27, 1994) Royal decree number M/8 was issued raising prices of refined petroleum products, telephone services, water and electricity rates and visa, and residence (Igama) fees. This move by the Saudi government was a part of its efforts to bring user charges more in line with production costs and mobilize additional financial resources. Against this background, the output of this sector is expected to grow at an annual average rate of 5.5 percent.
The climax of the Saudi real estate market in the aftermath of the 1990 Gulf crisis subsided toward the end of the fifth development plan period. However, the real estate sector is expected to grow at an annual average rate of 3.3 during the sixth development plan period 1995-1999.
The increase in population and higher level of income during the sixth development plan will revive consumer demand for distribution, food and recreation services. This, together with the expected continuation of high level of general business activities will stimulate this sector to grow at an annual average rate of 6.2 percent
The Kingdom is 3 hours ahead of GMT and 8 hours ahead of U.S. eastern standard time. The work week in Saudi Arabia is from Saturday through Wednesday, with the weekend on Thursday and Friday. Friday is the Muslim holy day of the week. Government offices in the Kingdom are open Saturday through Wednesday from 7:30 a.m. to 2:30 p.m. All government offices and businesses close during prayer time, which occurs five times a day. Prayer times are listed in the daily newspapers.
Saturday through Wednesday, 8:00 a.m. to 11:30 a.m. and 4:00 p.m. to 6:00 p.m. Thursday, 8:00 a.m. to 11:30 a.m.
Saturday through Wednesday, 8:30 a.m. to noon and 4:30 p.m. to 6:30 p.m. Thursday, 8:30 a.m. to noon.
Saturday through Wednesday, 8:30 a.m. to noon and 5:00 p.m. to 7:00 p.m. Thursday, 8:00 a.m. to noon.
Businesses and Shops
7:30 a.m. to noon and 2:30 p.m. to 10:00 p.m.
8:30 a.m to noon and 4:30 p.m. to 10:00 p.m
9:00 a.m. to 11:00 a.m. and 4:30 p.m. to 10:00 p.m.
The Kingdoms legal system is based on the Islamic Sharia law and on Decrees promulgated by the Council of Ministers. Sharia is based on the provisions of the Holy Quran, the Sunnah (the teachings and deeds of the Prophet Muhammad), the consensus of the Ulema (religious scholars), and legal analogy.
Telephone Codes for Major Areas in the Kingdom
Country Code for Saudi Arabia 966
Send E-mail to
TSN@The-Saudi.Net with questions or
comments about The Saudi Network.