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Saudi Arabia Export Partners
Positive for Investment Growth (SWOT)
Negative for Investment Growth (SWOT)
Industry & Commodity Exports
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When local governments provide a favorable economic environment, the demand and value of their currencies will also increase. WikiWealth's Fundamental Currency Analysis is a combination of four different valuation methods: investment flows, purchase price parity, interest rate parity, and inflation rate parity (see Fundamental Currency Analysis). WikiWealth, and website visitors, examine the conditions for companies to prosper through the "Investor Survey." Countries with strong fundamental freedom, transparency, stability, strengths & opportunities (see Main Street Analysis), will aid the long term potential of companies. A "Buy" rating from both approaches mean a country's currency has high potential to increase in value.
Saudi Arabia Summary
Saudi Arabia Country Analysis ► (edit / improve) Saudi Arabia (SAR) is an energy export driven economy in the Middle East. Currency Analysis: Saudi Arabia’s currency is correctly valued with low investment flow potential and high purchase price potential. Investor Survey: Saudi Arabia’s economic environment is unfavorable for long term economic growth due to low scores on government transparency and economic diversity. Trade Analysis: China, the EU, Japan, and the US are the top export partners, while the leading industry is related to energy. Commodity Analysis: Saudi Arabia produces a significant amount of crude oil, gasoline, and propane for use as an export. Saudi Arabia is also part of the OPEC cartel, which adjusts the supply of oil to maintain price. SWOT Analysis: The leading Saudi strength is their large oil supply, while the main weakness is their discriminatory problems. Economic cities have the opportunity to propel growth, while terrorism may lower growth. Profit Conclusion: A moderately-priced currency, low investment flow potential and unfavorable business environment leads to a negative outlook for Saudi investments.
Investment Impacts (help)
Crude Oil Commodity Analysis ► (edit / improve) Crude oil is used to produce fuel oil and gasoline. Gasoline is the largest supplier of fuel for internal combustion engines. Commodity Analysis: Crude oil is rated a Sell. Crude oil demanders have a moderate potential to increase in value and crude oil suppliers have a very high potential to increase in value. Investor Survey: Crude oil’s long term growth potential is very favorable due to high scores on sensitivity to price changes, demand not sensitive to price changes, and the SWOT analysis. SWOT Analysis: Strength: Limited natural resource / supply; Weakness: Emits carbon dioxide. Opportunity to grow: the overall growth of vehicles will increase demand for crude oil; Threats to growth: environmental concerns could slow growth potential in the near term. Profit Conclusion: The commodity analysis sell rating indicates that crude oil prices should decrease over the short term, whereas a very favorable investor survey means crude oil prices increase over the long term.
Crude oil is Saudi Arabia's biggest asset and foreign earnings recipient. Crude oil is volatile, but very lucrative.
USA Country Analysis ► (edit / improve) The United States (US) has a highly productive, capitalist economy and is the largest and most diverse market in the world. Currency Analysis: the US dollar (USD) has the potential to increase in value especially versus the Australian and Canadian dollar because of the significant potential of undervalued companies (see investment flows analysis). Investor Survey: the economic environment is very favorable for long term economic growth due to high scores on economic freedom and economic diversity. Trade Analysis: China, Japan, Mexico, and Canada are the top US trading partners, while the leading export and import are electrical machinery and vehicles, respectively. Commodity Analysis: The US produces a significant amount of coal and wheat for use at home and as an export. However, the US consumes a larger amount of oil, which contributes to their trade deficit. SWOT Analysis: The leading US strength is its entrepreneurial culture, while the main weakness is high health care cost. Energy independence has the opportunity to propel growth, while the housing crisis may lower growth. Profit Conclusion: An undervalued currency, high investment flow potential and favorable business environment lead to a positive outlook for US investments, which will also benefit from positive international actions.
The US is the world's biggest importer of oil, which powers the US's transportation system. Any changes in the demand for oil by the US would decrease the price of oil and earnings.
Major Saudi-Arabia Trade Partners ► Press "Edit / Improve"
China Country Analysis ► (edit / improve) China (CNY) is a fast growing communist country with the largest population in the world. Currency Analysis: China’s currency is moderately undervalued. Purchase price parity shows that China’s currency is approximately 40% undervalued, however, the other three valuation approaches show that China is fairly valued. Investor Survey: China’s economic environment is very unfavorable for long term economic growth due to the lack of economic freedom, government transparency, and the SWOT analysis. Trade Analysis: Indonesia, Pakistan, Norway, Singapore, Europe, the US are the top export partners, while the leading industry is industrial goods, usually for export. Commodity Analysis: China produces a significant amount of coal for use at home. The use of coal to provide energy leads to other health related problems. SWOT Analysis: The leading Chinese strength is their cheap labor, while the main weaknesses are political risk and corruption. Renewable energy has the opportunity to propel growth, while general pollution and an aging population could slow growth rates. Profit Conclusion: An undervalued currency, average investment flow potential and an unfavorable business environment leads to a neutral outlook for Chinese investments.
USA Country Analysis ► (edit / improve) The United States (US) has a highly productive, capitalist economy and is the largest and most diverse market in the world. Currency Analysis: the US dollar (USD) has the potential to increase in value especially versus the Australian and Canadian dollar because of the significant potential of undervalued companies (see investment flows analysis). Investor Survey: the economic environment is very favorable for long term economic growth due to high scores on economic freedom and economic diversity. Trade Analysis: China, Japan, Mexico, and Canada are the top US trading partners, while the leading export and import are electrical machinery and vehicles, respectively. Commodity Analysis: The US produces a significant amount of coal and wheat for use at home and as an export. However, the US consumes a larger amount of oil, which contributes to their trade deficit. SWOT Analysis: The leading US strength is its entrepreneurial culture, while the main weakness is high health care cost. Energy independence has the opportunity to propel growth, while the housing crisis may lower growth. Profit Conclusion: An undervalued currency, high investment flow potential and favorable business environment lead to a positive outlook for US investments, which will also benefit from positive international actions.
European Union Country Analysis ► (edit / improve) The European Union (EUR) is a single market and currency group of countries, which creates one of the largest and most diverse markets in the world. Currency Analysis: The EUR is fairly valued versus other major global currencies. They have a positive investment flow and negative purchase price parity analysis. Investor Survey: the economic environment is favorable for long term economic growth due to favorable scores on government transparency and SWOT opportunities. Trade Analysis: Belgium, Hungary, China, Saudi Arabia, Russia, China, Norway and Japan are the top trading partners. Commodity Analysis: The EU does not produce many commodities, but they import many energy-related commodities from Russia and the Middle East. SWOT Analysis: The leading EU strength is their single currency and internal market, while the main weaknesses include a declining birth rate, labor restrictions and language barriers. New energy proposals have the opportunity to propel growth; there were no major threats to report. Profit Conclusion: A moderately-valued currency, high investment flow potential, but low purchase price potential and negative SWOT weaknesses lead to a slightly negative outlook for EU investments.
Japan Country Analysis ► (edit / improve) Japan (JPY), the second largest economy in the world, has an industrial, export oriented economy that benefits from its relationship with the USA and proximity to China. Currency Analysis: Japan’s currency (the Yen) is overvalued according to investment flow potential, the purchase price parity analysis, and the interest rate parity analysis. Investor Survey: Japan’s economic environment is moderately favorable for long term economic growth due to high scores on economic freedom and government transparency, but low scores on the SWOT Analysis. Trade Analysis: Indonesia, China, Singapore, the EU, Korea, and the US are Japan’s top export partners, while the leading industry is industrial manufacturing. Commodity Analysis: Japan imports many products because of its lack of arable land and energy resources. SWOT Analysis: The leading Japanese strength is their education system, while the main weakness is a declining birth rate. A major Japanese threat is the continuation of zombie companies. Profit Conclusion: An overvalued currency, low investment flow potential and moderate business environment leads to a negative outlook for Japanese investments.
Singapore Country Analysis ► (edit / improve) Singapore (SGD) has a highly productive, capitalist economy, which relies extensively on international trade. Currency Analysis: Singapore’s currency is correctly-valued on a global scale with low investment flow potential and high purchase price parity potential. Investor Survey: Singapore’s economic environment is very favorable for long term economic growth due to high scores on economic freedom, government transparency, and economic diversity. Trade Analysis: Indonesia, China, Japan, Hong Kong and the US are the top export partners, while the leading industry is related to trade. Commodity Analysis: Singapore acts as a facilitator for exports in the region. SWOT Analysis: Singapore's leading strength is their status as a regional airline hub. Profit Conclusion: A correctly valued currency, low investment flow potential, but favorable business environment leads a neutral outlook for investments.
Major Saudi-Arabia Production ► Press "Edit / Improve"
Crude Oil Commodity Analysis ► (edit / improve) Crude oil is used to produce fuel oil and gasoline. Gasoline is the largest supplier of fuel for internal combustion engines. Commodity Analysis: Crude oil is rated a Sell. Crude oil demanders have a moderate potential to increase in value and crude oil suppliers have a very high potential to increase in value. Investor Survey: Crude oil’s long term growth potential is very favorable due to high scores on sensitivity to price changes, demand not sensitive to price changes, and the SWOT analysis. SWOT Analysis: Strength: Limited natural resource / supply; Weakness: Emits carbon dioxide. Opportunity to grow: the overall growth of vehicles will increase demand for crude oil; Threats to growth: environmental concerns could slow growth potential in the near term. Profit Conclusion: The commodity analysis sell rating indicates that crude oil prices should decrease over the short term, whereas a very favorable investor survey means crude oil prices increase over the long term.
Gasoline Commodity Analysis ► (edit / improve) Gasoline is primarily used as a fuel for internal combustion engines. It is a significant source of carbon dioxide. Commodity Analysis: Gasoline is rated a Sell. Gasoline demanders have a potential to increase in value, while gasoline suppliers have very high potential to increase. Investor Survey: Gasoline’s long term growth potential is very favorable due to high scores on sensitivity to price changes and lack of good substitutes. SWOT Analysis: Strength: Gasoline is a limited natural resource; Weakness: gasoline produces considerable pollution. Opportunity to grow: Gasoline’s use increases with increases in cars; Threats to growth: environmental friendly awareness may curb the growth of gasoline. Profit Conclusion: The commodity analysis sell rating indicates that gasoline should decrease in price over the short term, whereas a very favorable investor survey means gasoline should increase in price over the long term.
Propane Commodity Analysis ► (edit / improve) Propane is derived from oil and natural gas and is used for engines, heating systems, grills… etc. Commodity Analysis: Propane is rated a Hold. Propane demanders and suppliers are expected to increase in value over the short term. Investor Survey: Propane’s long term growth potential is moderately favorable due to high scores on sensitivity to price changes and SWOT strengths. SWOT Analysis: Strength: Propane has a limited supply and is considered environmentally friendly. Opportunity to grow: Propane could replace other forms of fuel in small engines to reduce emissions; Threats to growth: carbon monoxide dangers can slow future growth of propane. Profit Conclusion: The commodity analysis hold rating indicates that coal should stay the same in price over the short term, whereas a favorable investor survey means coal may increase in price over the long term.
Major Saudi-Arabia Consumption ► Press "Edit / Improve"
Water Commodity Analysis ► (edit / improve) Water is the liquid form of the most important substance on earth. Water covers seventy percent of the world’s surface; 97% of which is saltwater. Commodity Analysis: Water is rated a hold. Water demanders and suppliers have a moderate potential to increase in value. Investor Survey: Water’s long term growth potential is very favorable due to high scores on sensitivity to price changes and substitute products. SWOT Analysis: Strength: Water is the most precious substance on earth; without it, life could not exist; Opportunity to grow: the demand for water will increase as the world’s population increases; Threats to growth: contamination and pollution could limit the supply of water. Profit Conclusion: The commodity analysis hold rating indicates that water should stay the same price over the short term, whereas a very favorable investor survey means water will increase in price over the long term.
Important Saudi-Arabia Industries ► Press "Edit / Improve"
Energy Industry Analysis ► (edit / improve) Description: The energy industry includes companies whose sales derive from the production and sale of energy related products and services such as the extraction, manufacturing, refining, and distribution of energy. Valuation Analysis: Based on WikiWealth's Wall Street analysis, this industry is a Buy, with strong potential for short term gains. The Main Street analysis says a Hold, with SWOT strengths great than weaknesses, but SWOT opportunities less than threats. Significant threats include the curtailment of energy use for environmental reasons. Trade Analysis: Some of the main energy hubs include Saudi Arabia, Canada, Mexico, and Russia while the main energy commodities include coal, ethanol, gasoline, natural gas, crude oil, heating oil, palm oil, propane, and uranium. Profit Conclusion: Energy investments tend to be very sensitive to commodity prices. Speculation and market manipulation by governments affect the energy market, therefore, cautiously invest in companies with significant potential.
Source: http://www.state.gov/r/pa/ei/bgn/3584.htm
