You`ve reached the limit of premium items that you can view for free. The recovery in oil prices since 2017 has pushed the kingdom`s trade balance towards more positive ground since it collapsed in 2014-15, reaching about $158 billion in 2018, according to the Saudi monetary authority. However, this trend only highlights the correlation between oil prices and the Kingdom`s ability to maintain a trade surplus. Given the importance of hydrocarbon activity to the economy, this link will not be interrupted for the foreseeable future; However, a weakening of the correlation through the diversification of export activities would be a success for the government`s ongoing economic reform agenda. The government`s determination to attract investment has led to a change in mentality in its long-standing policy of preventing special economic zones (SEZ). Free trade zones and zenics are a growing trend in the region and, according to the OECD, have added a global trade value of $500 billion and created employment opportunities for 66 million people in 2018. The United Arab Emirates has 45 free zones and another 10 are under construction in 2018. Saudi has historically preferred to promote its low-tax, low-cost input framework as a single economic area, but in late 2018 it revealed details of its first SEZ, to be located to Riyadh`s international airport. The area will focus on integrated logistics and allow investors to work according to specific rules and regulations. The United States currently has several bilateral free trade agreements with nations in the region.
The main obstacle for MEFTA is the involvement of Israel. There are other complications in securing agreements between the United States and countries such as Iran and Syria. There could still be complications in the rapprochement of trade with Lebanon and the Palestinian Authority, with Israeli autonomy constantly controlling the occupied territories[2] and militant groups such as Hamas and Hezbollah. The United Arab Emirates is a party to several multilateral and bilateral trade agreements, including with GCC partner countries. Under the GCC, the United Arab Emirates enjoys close economic relations with Saudi Arabia, Kuwait, Bahrain and Oman, which means that the United Arab Emirates shares a common market and customs union with these nations. Under the Greater Saudi Free Trade Area (GAFTA) agreement, the United Arab Emirates has free access to Saudi Arabia, Kuwait, Bahrain, Qatar, Oman, Jordan, Egypt, Iraq, Lebanon, Morocco, Tunisia, Palestine, Syria, Libya and Yemen A notable exception to this rule is food production. While most foodstuffs are not convenient for importing from the United States, where they are relatively cheap, the removal of trade barriers between Arab states can lead to lower prices for regionally grown foodstuffs and protests among farmers. [Citation required] Improving the kingdom`s global connectivity is also a matter of improving the physical infrastructure that underpins domestic and external trade. The NTP instructs the Ministry of Transportation to improve transportation infrastructure, including reducing the total amount of planning projects from 60% to 25%. The government is also trying to co-opt the private sector to finance half of new rail projects and 70% of port development. In the meantime, efficiency gains are being sought in areas such as the average length of stay of containers in ports.