The Kingdom of Saudi Arabia is the largest Arab country of the Middle East. It is bordered by Jordan and Iraq on the north and northeast, Kuwait, Qatar, Bahrain and the United Arab Emirates on the east, Oman on the southeast, and Yemen on the south.
The origins of Saudi Arabia go back as far as 1744 with the establishment of the first Saudi State. The formation of the current Kingdom began in 1902, when Abdulaziz bin Saud captured the Al-Saud's ancestral home of Riyadh, and culminated in 1932 with the proclamation and recognition of the Kingdom of Saudi Arabia.
Saudi Arabia is a monarchy. King Salman bin Abdulaziz Al Saud succeeded to the throne on 23 January 2015, following the death of his brother, the late King Abdullah bin Abdulaziz Al Saud.
The second in line to the throne is the son of the King, Crown Prince Mohammed bin Salman bin Abdulaziz Al Saud. The King is assisted by a Council of Ministers that he appoints. In recent years the consultative Shura Council, which consists of 150 members (including 30 women) appointed by the King, has developed a modest but increasing role in public debate. Municipal elections were last held in December 2015, with women granted the right to vote and to run as candidates for the first time. Saudi Arabia has also embarked on program of social reform including the decision to allow women to drive from June 2018.
Saudi Arabia is a member of the Gulf Cooperation Council (GCC). It is also a member of the Arab League, the Organization of Islamic Cooperation (OIC), the G20, the United Nations, World Trade Organization (WTO) and the Organization of Petroleum Exporting Countries (OPEC). Saudi Arabia will host the G20 in 2020.
Australia and Saudi Arabia enjoy a friendly relationship. This is underpinned by commercial ties and supported by shared membership in the G20 as well as Australia's engagement with the GCC and OIC, which are both headquartered in Saudi Arabia (Riyadh and Jeddah respectively).
Australia and Saudi Arabia also have well-established cooperation in countering terrorism and are both members of the anti-ISIL coalition and the International Syria Support Group.
People-to-people contacts are also an important aspect of the relationship, with over 4,500 Saudi enrolments at Australian education institutions in 2018.
Saudi Arabia is Australia's second largest trading partner in the Middle East region. There is significant potential for economic ties to grow, given areas of complementarity in agriculture, mining services, education and construction. The launch in April 2016 by the Saudi government of a plan (Vision 2030) for economic reform and diversification also provides potential opportunities for Australian business.
With a population of around 33 million (2018) and nearly 20 per cent of the world's conventional oil reserves, Saudi Arabia is the Middle East's largest economy. Real GDP growth in 2017 was -0.7 per cent, with the economy having contracted as a result of continued low oil prices.
The Saudi Government initiated structural reform measures in the 1990s designed to encourage privatisation, liberalise foreign trade and reform investment regimes. Commercial laws were revised and initial steps were taken to free up foreign investment and privatise parts of the state sector. Education and skills development are a major focus for the government, as the policy of 'Saudisation' looks to increase the percentage of Saudi citizens working in the private sector. An approximately $5 billion scholarship program was launched in 2005, funding over 185,000 young Saudis to undertake tertiary studies abroad. The program, titled the King Salman Scholarship Program, has recently been revamped to ensure closer alignment between scholarships and in demand skills. The Saudi Government is also engaged in a major program for the construction of educational institutions in Saudi Arabia.
Trade and investment
As Australia's second largest market in the Middle East, Saudi Arabia is an important trading partner for Australia. In 2016-17, the two-way goods and services trade totaled $2.14 billion. Passenger motor vehicles were Australia's largest commodity export to Saudi Arabia, worth $392 million in 2017. Saudi Arabia is also a substantial market for beef, sheep meat, barley, wheat, dairy products, cosmetics, pharmaceuticals, vehicle parts and accessories and vegetables.
Saudi Arabia is also an important source of investment into Australia with an estimated $3.9 billion worth of assets (2016).
Exports of services, notably education, are also significant. A large number of Saudi tertiary students study in Australia, mostly under the King Salman Scholarship Program (formerly known as either the Custodian of the Two Holy Mosques Scholarship Program or the King Abdullah Scholarship Program). In 2018, there were more than 4,500 Saudi enrolments in Australian educational institutions, with Saudi students representing the largest cohort from the Middle East region.
Saudi Arabia's needs are well suited to Australian capabilities. Saudi Arabia has a sound economy with a fast-growing and young population, a well-managed banking system, good infrastructure, and generally low import duties and barriers. Its business community is sophisticated and familiar with Western practices. Austrade is represented in both Riyadh and Jeddah.
Information on doing business and opportunities in Saudi-Arabia
High level visits
- September 2018: A delegation from Saudi Arabia's Shura Council visited Australia. The delegation was invited by the Parliament of Australia.
- September 2018: Saudi Assistant Minister for Defence visited Adelaide to attend Land Forces 2018.
- October 2017: Minister for Trade, Tourism and Investment visited Saudi Arabia with business delegation.
- October 2017: Minister for Defence Industry visited Saudi Arabia.
- September 2017: Assistant Minister for Trade, Tourism and Investment visited Saudi Arabia.
- April 2017: Minister for Trade, Tourism and Investment visited Saudi Arabia with business delegation.
- December 2016: Minister for Defence Industry visited Saudi Arabia.
- January 2016: Minister for Tourism and International Education visited Saudi Arabia.