Saudi Arabia, despite moves to diversify its economy, is still almost entirely dependent upon oil. Petroleum sales provide the kingdom with 90 percent of its export earnings and 75 percent of its annual budget revenues. Saudi Arabia is a founding member of the Organization of Petroleum Exporting Countries (OPEC) which was founded in Baghdad, Iraq, in September of 1960 to unify and coordinate members' petroleum prices.
Iraq, Iran, Venezuela, and Kuwait were OPEC's other founding members. Qatar, Indonesia, Libya, the United Arab Emirates, Algeria, and Nigeria are also current members. OPEC countries are responsible for 40 percent of the world's oil production and 77 percent of its known reserves. Saudi Arabian oil exports make up nearly 30 percent of OPEC's yearly total exports. The government hopes to increase non-oil GDP by 4 percent between 2000 and 2004, with agriculture projected to expand by 3.1 percent per year, industry by 5.1 percent, and utilities (electricity, gas, and water) by 4.6 percent. Construction activity is expected to increase annually by over 6 percent.
And non-oil mining had been targeted for an expansion of 8.3 percent per year, which would make it the fastest growing sector of the economy. Despite all such efforts to increase non-petroleum related economic functions, it will be difficult to move the country away from dominance by the petroleum sector.
In 1998, industry, which included oil production, contributed 47 percent of GDP and employed 25 percent of the total workforce of 7 million. Agriculture contributed just 6 percent of GDP and employed 12 percent of the workforce, while the services sector contributed another 47 percent and employed 63 percent of the workforce.