At the 11th hour, on the 11th day of the 11th month, in the year 2005, and after ten long years of serious and tireless negotiations with 148 countries, the World Trade Organization (WTO) approved the accession protocol documentation of Saudi Arabia. The Kingdom’s accession was ratified one month later in Hong Kong at the 6th Ministerial Conference, placing Saudi Arabia as the 149th member of the WTO which became a truly globalized multilateral trading system.
As the Kingdom was blessed with the world’s largest proven oil reserves and therefore the largest producer and exporter of energy, Saudi Arabia always honored this responsibility and thrived to maintain international oil price stability and its sustainable availability. And as the Kingdom commands the largest economy in the Middle East and one of the largest economies in the world, Saudi Arabia is one of the world’s largest development aid donors and the world’s 12th largest importer and 22nd largest exporter of goods, and therefore it plays an important role in international financial and trade institutions, including the International Monetary Fund (IMF), the World Bank and, now, the World Trade Organization. Our economy is highly integrated globally and our trade regime is impressively accessible and liberal. In fact our foreign trade accounts for 70 percent of our GDP and visiting expatriates from over 90 countries amount to 33 percent of our population and 57 percent of our work force. We also recognize our immediate problems and bravely face our future challenges such as our pursuit to diversify our economic base in order to reduce our dependence on oil as the sole source of income, capacity building and restructuring of our education system, and the increase of our GDP growth.
Today, one year later, we are proud to have implemented the vision of our leader, Custodian of the Two Holy Mosques King Abdullah, and accomplished the mission of our nation. Self-imposed economic reform and restructuring strategy is well under way with four supreme authorities, eight new regulators and five commissions. We have issued and implemented 42 new laws and regulations creating one of the world’s most comprehensive legislation covering Intellectual Property Rights (IPR), Import Licensing, Trade Remedies, Customs Valuation, Sanitary and Phyto-Sanitary Measures (SPS), Technical Barrier to Trade (TBT), Cooperative insurance, Capital Market and Accredited Laboratories among other areas. All of the new regimes are implemented in a manner that is transparent and predictable, and ensures due process. These legal reforms have significantly increased confidence in our market economy and free trade regime. Today, one year later, our WTO accession has substantially strengthened Saudi Arabia’s economy. It has boosted our investment environment ranking from the 67th to 38th position in the world, placing the Kingdom ahead of France, Italy and Portugal, and the first amongst all 22 Arab countries. Together with the Kingdom’s undaunted political stability and its successful eradication of terrorism, foreign direct investment has increased by 250 percent and our debt reduced by 60 percent which helped the Kingdom achieve its A+ sovereign credit rating. With oil prices reaching record high, our GDP grew by 6.5 percent in real terms for the first time in two decades reaching $335 billion, coupled with a handsome 30 percent trade surplus and depositing 50 percent of GDP as cash in the banks. Equally important, our non-oil exports reached 97 countries and increased by 13 percent annually to over $20 billion, thus creating thousands of jobs for our young generation.
Today, one year later, is a memorable day in the history of Saudi Arabia. The vision of our leader is taking our country to new heights by further diversifying our economic base. To capitalize on the vigor and vitality of our private sector, four world-class mega economic cities were inaugurated in Rabigh, Madinah, Hail and Jizan with more than $85 billion of investment and a prospect for 800,000 new jobs. The privatization of 20 state-owned enterprises is also under implementation and the recycling of our oil income by allocating one trillion dollars for development projects in the next decade is a major milestone toward a healthy economy and a future full of prosperity.
Achieving modernity while preserving valuable traditions has always been the vision of our leader and the mission of our nation. We should be proud of our accomplishments.
(Fawaz Al-Alamy, chief technical WTO negotiator, is based in Riyadh.)
