Market Analysis Five-Year Development Plans Saudi Arabia has undergone tremendous development in relatively a short span of time. Since the 1960s, when the country’s major physical infrastructure was established, the objective was to diversify the economy away from oil into other fields. This shift, away from the large oil dependency, formally began in 1970 with the implementation of the First Development Plan in a series of five-year plans still in effect today. In the last 35 years, five-year development plans focused on infrastructure development that could support a strong modern economic base, economic diversification to include expansion of industrial and agricultural sectors and finally, strengthening the growing private sector. These accomplishments were achieved in phases and were well-advanced by the implementation of the current Eighth Five-Year Development Plan (2005-09). The plan in effect today underscores the value of human resources development as an added contribution to the outstanding economic transformation and ultimately focuses on increasing foreign as well as national investment. Since the start of these government guided plans in 1970, Saudi Arabia has experienced steady but dramatic industrial and economic changes. In just 25 years (1979-95), the non-oil sector’s GDP share increased from 46 percent to over 70 percent tripling it to $ 125.1 billion, and by 2002 it amazingly reached $ 186 billion. In this regard, there are several factors behind sustainability of growth that include:

• Long-term high oil prices and growing production and export
• Strong fiscal stimulus for years
• Mega projects everywhere (oil, petrochemical, power, telecoms, real-estate...)
• Inward bias to spending and investment
• Local business absorptive capacity of oil revenues
• Deepening of financial markets
• Macroeconomic reform and liberalization