Trade Between Uae and Ksa

Currently Saudi Arabia is one of the leading producers of oil in the world. However, it is losing its foothold on the market. Many countries, like North America, are increasing their oil production and are looking for ways to become less dependent on foreign oil. The increased competition has caused oil prices to decrease. By producing their own oil, countries not only will increase their revenues, but will also reduce their need to rely on foreign oil. By reducing their need foreign an oil a country does not have to worry that their oil supply will be cut off if they go to war.

The two most important resources in this region are oil and water. The huge oil “deposits there and in the neighboring countries around the Persian Gulf (the United Arab Emirates, Kuwait, and Bahrain) established these countries as some of the richest in the world” (Document F). Nevertheless, the countries who do not have as much access to oil are weak economically. Oil is the biggest export in the Middle East, and in a way, the amount of oil a country has determines how wealthy that country will be. Another component of oil is that countries and ethnic groups are disputing for the control of prices of this economic resource. It has gone to the far extent of foreign countries attempting to control the oil price and also the use of weapons for this (Document E). In addition, it is impossible for each country to have equal access to water due to the unbalanced distribution of these essential resources. As a result of this, these countries are fighting for as much control of water sources they can get. Radically, there are many countries in the Middle East that are striving to obtain as many natural resources to strengthen their economy and lifestyle, and it seems most obvious that the scarcity of these resources is a significant problem in the region

The Gulf houses half of the world’s oil reserves and a third of the natural gas. The Gulf States still continue to supply the international markets with a significant amount of the hydrocarbons. The stability of the region is crucial for the stability in the global oil markets. The Gulf also hosts one of the most strategically and important choke points in global trade, The Straits of Hormuz, which moves about 35% of the global seaborne oil, natural gas and other trade goods.

Persian Gulf Development Literature Oil Curse Literature Arab and Islamic Factors Regional Ovemiew and Historical Background Dubai's Development History

Middle East is strategically important region where mostly world half of oil reserves are located. Three countries: Saudi Arabia, Iran and United Arab Emirates accounted for 57% of total Middle East liquids fuels production. (Liquid fuels production in Middle Eastern and North African countries n.d.) Although due to increased domestic production of petroleum and natural gas, the United States is reducing its dependence on foreign oil with imported liquid fuels, but still oil means a lot to the US as oil prices is determined internationally by what is available for all global consumers. Therefore, to safeguard the security of Oil supply in the Middle East and ensure stable access to affordable oil is in the vital interest of the America. (Mexican crude oil shipments to Europe and Asia are rising as U.S. imports fall

Economic: The UAE GDP forecast for 2013 is around 4%, not dissimilar to the global market as a whole. There has been increased confidence and signs of recovery for the housing market in the region,

United States –Saudi Arabia trade relations have grown significantly because the policy and trade challenges

United Arab Emirates occupies a total area of about 83,600 square kilometers (32,400 square miles), along the south-eastern tip of the Arabian Peninsula between 22°50 and 26°N and between 51° and 56°25 E. The UAE has 1 318 km of continental coastline along the Persian Gulf. The inflation rate, exchange rate and currency stability are important factors to consider in International trade, economically, the UAE has a 4% of GDP growth in 2012 with a lower inflation rate of 1.1%, In terms of days and cost of import procedure (United Arab Emirate). The Urbanization rate of the region is 84% (UAE) which would contribute to the product awareness in necessary part of the region since the urbanization rate is high. The common languages in

They should continue to seek more business in the UAE. The UAE is not a developed country. Because of oil and banking revenues, The UAE has the most developed economy. Doing business with the UAE includes the difference in presence and language skills and substantial efforts in meetings and marketing. These can make the business relationship between Swedish and the UAE is difficult, but just at the initial time of period. To find, contact, and to communicate with the end customer is something hard to do. The UAE is already a customer of A&T and “was eager to buy, making it and even more interesting situation” (348). Moreover, the UAE also wants to develop a long-term and trustful relationship and future sales. So, S&T should do more business with the UAE.

Saudi Arabia has an economy that is largely dependent on oil, with the government maintaining the biggest control over the country 's significant economic activities. Saudi Arabia owns about 16% of the global oil reserves and is the number one exporter of oil (Saudi Arabia, 2013). In addition, the Kingdom of Saudi Arabia was instrumental in the formation of the OPEC (Organization of the Petroleum Exporting Countries) group, which initially comprised Iraq, Venezuela, Iran, Kuwait and Venezuela (Energy indicators, 2004). Currently, the petroleum industry constitutes about 80% of the country 's budgetary incomes; about 40% of the country 's GDP and 87% of Saudi 's export earnings. Agriculture, in addition to petroleum products, has been a major contributor to the kingdom’s economy since 1970s (Saudi Arabia, 2013). The country has been able to produce enough agricultural products for their consumption as well as surplus for exportation to the GCC member countries.

The economy in the United Arab Emirates has experienced substantial increases in the last 40 years. The UAE’s capabilities with the pearling and oil industries have given the region its necessary budgets to expand so rapidly. The economic policies in the UAE have gone through stages, since the birth of the region in 1971. Changes in economic welfare of the markets, and privatization policies are also key aspects in understanding the UAE’s economic liberalization and growth. In order to understand the UAE’s economic standard, economic liberalization must be analyzed. The argument of this paper will discuss how economic liberalization has occurred in the United Arab Emirates and is continuing to grow.

Though the Saudi National holds majority of the interest, he is neither involved in any financial investments nor is he held responsible for any financial liabilities. The Saudi National acts as a silent partner and deals all the government related jobs. The products for doing the business is imported from many countries mainly China. The geographic location of Saudi Arabia with respect to China makes it simple for the business to be done. Nearly 27% of the electrical Equipments for commercial and Industrial usage have been imported from China (http://www.tradingeconomics.com/saudi-arabia/imports). The main mode of transport from china to Saudi Arabia will be shipping. An agency for port clearance and distribution will be used for clearing the items from the seaport and for supplying it to the facility. The fee for the agent is negotiated between the agent and the business owner. This business will be started in as a small scale with 5 employees including Manager, Accountant and 3 sales staff.

The UAE is one of the riches nations in the world as measure by per capita GNP. The economy is primarily based on the oil

The UAE 's economy is the most diversified in the Gulf and the wider region. There’s no income tax. The gross domestic product is 67,616 dollars US per capita. The country oil and gas reserves are among the richest in the world. Successful efforts at economic diversification have reduced the portion of GDP based on oil and gas output to twenty five percent with a plan to push it to zero within next fifty years (Renewable Energy Prospects: United Arab Emirates p. 30). Low prices of oil have prompted the UAE to take steps to reduce its spending on country wide social programs, including eliminating fuel subsidies in August 2015. The IMF recently praised the vision and fiscal policies adopted by the country that

Information on UAE and its Strategic Priorities xan be found at the following websites: http://www.uaeinteract.com/; http://www.ameinfo.com/; http://www.uae-embassy.org/business-trade/trade-export; information on logistics: read Basit, A. (2010), “UAE Top Logistics Hub in the Gulf”, Khaleej Times, dated 16 January, Available: