The $2 Trillion Project to Get Saudi Arabia’s Economy Off Oil

Saudi Arabia possesses about 20 percent of the world’s proven petroleum reserves is among the world’s largest exporters, reports OPEC. The oil and gas sector accounts for about half the country’s gross domestic product and almost 90 percent of the state budget, but a slump in oil prices has spurred the kingdom to reduce dependence on oil and act on diversifying the economy. Deputy Crown Prince Mohammed bin Salman, 31, leads on economic policy and defense and has called for creation of the world’s largest sovereign wealth fund with $2 trillion in assets by selling about 5 percent of Saudi Aramco, the national oil producer. The country has reduced subsidies for gasoline, electricity and water and may impose new taxes for additional revenues. Saudi Arabia confronts a number of demographic challenges, including a young population that struggles to find work in a country where the government is the major employer, a regional sectarian divide as well as severe restrictions for women that discourage foreign investment. – YaleGlobal