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The Impact of Global Economic Crisis on the organizations in oil producing countries - Essay Example
Finance & Accounting
Pages 10 (2510 words)
The impact of the financial crisis of 2008-2009 affected the global world with threats to long term objectives including the Millennium Development Goals. Developed Countries, Emerging Economies and Least Developed Countries are suffering the effects, as financial markets have collapsed…
The economies in Middle East, which were then among the fastest growing in the world; primarily driven by the soaring crude oil prices, were first considered immune, but by 2009 it began affecting the region including Gulf Cooperation Council (GCC) States. Most of the economies including UAE, Qatar, Bahrain, and Kuwait suffered significantly, due to the steep decline in their housing markets, which formed the crux of economic development in these countries.
Saudi Arabia Economy: Saudi Arabia, which is the largest economy in the region, too suffered dearly due to its heavy dependent on crude oil, whose prices had retreated at record pace in 2009 (Berkmen et al., 2009). The impact of economic crisis was felt by the firms not only because of the dependence on oil, but also, as a result of numerous government controls over the main economic activities in the economy. The country has at least 25% market share of the world’s petroleum reserves, is regarded as the largest petroleum exporter in the world and plays a very crucial in OPEC deliberations and decision makings. The petroleum sector takes up to at least 55% of the GDP, 90% of export earnings and 45% of all budget revenue. 40% of this GDP is from the private sector. At least, 5.2 million workers play a vital role in the Economy of Saudi and especially in the service and oil sector. ...
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