Saudi Arabia

FOOTBALL IN SAUDI ARABIAFOOTBALL IN SAUDI ARABIA The nation’s high point was in 1994, when the team qualified for the World Cup finals in the US, becoming the first Asian country to reach the second round since North Korea’s performance in 1966. Saudi Arabia is famous for the number of coaches leading its team. Since Eduardo Vingada guided the Saudis to the Asian Cup title in the United Arab Emirates in 1996, there have been no fewer than eight changes of head coach, with Otto Pfister and Nasser Al Johar both holding the position twice. THE STATE OF THE ECONOMY Oil production represents about 10% of world oil supply. More importantly, Saudi Arabia maintains one of the largest shares ofworld spare oil production capacity. The country has the unique capacity to quickly replace alone the exports of any small to medium oil producing country. As the world’s largest exporter of oil, Saudi Arabia growth and development have been closely related to trends in the international oil market. The recent rise in oil prices represented an improvement in the terms of trade. The key question will be whether OPEC countries will avoid using oil as a foreign policy weapon in the Middle East conflict. If production increase, and oil prices stay at current levels, the current account surplus could showsome impressive readings in 2002. While identifiable foreign assets are around $130 billion, the fiscal burden is also high. General government spending is about 35% and the total public debt to GDP is close to 100%. External debt remains relatively small at 20% of GDP. Thus, we do not foresee a change in the SAR peg to the USD, at 3.75. THE STATE OF THE NATION Despite recent effort to diversify the economy, Saudi Arabia near-term prospects remain closely tied to the oil market. Ongoing investment in petrochemicals sector should raise production in the future and spending in infrastructure projects should also boost activity. Politics will likely be the key topic during the coming months. In the weeks following the September 11th attack on the US, the US-Saudi relationship appeared publicly to be under strain. This strain has raised many questions about the future stability of oil markets. The domestic political, and the strength of previously close relations between Saudi Arabia and the US, should be the key to the stability in global oil markets. The World Cup and Economics 37 World Cup 2002 THE 2002 WORLD CUP Following five consecutive appearances in the final of the Asian Cup since 1984, Saudi Arabia has been the continent’s leading team. They are in the same group as hosts Germany, Ireland and Cameroon. Saudi Arabia has only a small chance of progress to the second round. But, it could show a surprising performance. In the latestWorld Cup warm-up it beat Uruguay 3-2 as the South Americans paid for some defensive errors. The Saudi star player is SamiAl Jaber.He has been the first to play overseas, on loan with English first division side Wolverhampton Wanderers. In France, Al Jaber’s goal in the 2-2 draw, against South Africa, made him the first Asian player to score a goal in two consecutive finals. Previous Appearances: 3 1978, 1994, 1998