beautiful, so why is our GDP lower than Saudi Arabia. The PPP is 200 billion lower. The diversity is higher for sure. It is their financial and oil sector that builds their GDP I assume?
GDP is generated by many elements.
A barrel of oil sold comes to economy as not only $53 or something.. For every dollar generated by selling oil comes 2 to 3 times more domestic product in form of services attached to it.
SAUDI Economy and GDP:
In the 1990s, Saudi Arabia experienced a significant contraction of oil revenues combined with a high rate of population growth. Per capita income fell from a high of $11,700 at the height of the oil boom in 1981 to $6,300 in 1998.
[239] Taking into account the impact of the real oil price changes on the Kingdom's real gross domestic income, the real command-basis GDP was computed to be 330.381 billion 1999 USD in 2010.
[240]Increases in oil prices in the aughts[
peacock term] helped boost per capita GDP to $17,000 in 2007 dollars (about $7,400 adjusted for inflation),
[241] but have declined since oil price drop in mid-2014.
[242]
In addition to petroleum and gas, Saudi also has a small gold mining sector in the
Mahd adh Dhahab region
[250] and other mineral industries, an agricultural sector (especially in the southwest) based on dates and livestock, and large number of temporary jobs created by the roughly two million annual
hajj pilgrims.
[251]
Statistics on poverty in the kingdom are not available through the UN resources because the Saudi government does not issue any.
[252] The Saudi state discourages calling attention to or complaining about poverty. In December 2011, the Saudi interior ministry arrested three reporters and held them for almost two weeks for questioning after they uploaded a video on the topic to YouTube.
[253][254][255] Authors of the video claim that 22% of Saudis may be considered poor (2009).
[256] Observers researching the issue prefer to stay anonymous
[257] because of the risk of being arrested.
The
petroleum sector accounts for roughly 92.5% of Saudi budget revenues,
[16] 90% of export earnings, and 55% of GDP.
In brief:
%55 of GDP comes directly from Petroleum. Another around %42 is generated by PRIVATE SECTOR, but as most of these private sectors enterprises are dependent on governmental revenues too we can say almost all Saudi GDP comes from OIL and GAS.
a bewildering (at least to outsiders) combination of a feudal fealty system and a more modern political patronage one. At every level in every sphere of activity, Saudis maneuver through life manipulating individual privileges, favors, obligations, and connections. By the same token, the government bureaucracy is a maze of overlapping or conflicting power center under the patronage of various royal princes with their own priorities and agendas to pursue and dependents to satisfy.[20]
The current GDP PPP of Saudi is somehow disputable. It is probably is not as high as they claim and whatever it is, it is not a GDP out of brain or hard work rather only a wealth extracted by Foreigners and spent mostly by a family of dictators.
Iranian GDP:
GDP by sector
agriculture (10%), oil (25%), industry (20%), services (45%) (2011 est.)[3]
After sanctions on oil sector the above number certainly have changed. Now agriculture and oil have lower share of controbution while industry and services increased their shares in Iranian GDP.
Main Industries:
petroleum, petrochemicals, fertilizers,caustic soda, car manufacture, parts,pharmaceuticals, home appliances,electronics, telecom, energy, power,textiles, construction, cement and otherconstruction materials, food processing(particularly sugar refining and vegetable oil production), ferrous and non-ferrous metal fabrication,armaments
Iran has progressed in various
scientific and technological fields, including
petrochemical,
pharmaceutical,
aerospace,
defense, and
heavy industry. Even in the face of
economic sanctions, Iran is emerging as an
industrialized country.
[187]
Today only a fraction of Iranian budget comes from oil, while Taxes are claiming more share.
Iranian economy has many unofficial numbers hidden in it due to its unique political situation. A big part of Iranian economy is still under ground as it is not counted in GDP numbers. There are huge number who were missing due to obvious reasons. Iran has to spend a lot for his support to his allies and her activities in more than 130 countries around the world... some know what I mean...
Now, saying why Iran with all these advanced, light and heavy industries still have not reached a European level of GDP. The answer is most of other industrialized GDP income comes from a very developed SERVICE SECTOR and not from industry directly. A big part of almost all Western Industrialized nations GDP comes from Service sector. Sometimes as big as %80 of their GDP comes from Services.
Share of Service Sector in GDP of some other Industrialized countries:
UK (%73), Germany (%71) and France (%80)
Iranian service sector due to two major factors was not developed enough to generate this much of income as GDP. The reasons are First of all, Iranian sanctions that limits Iranian trade, banking sector, credit cards, swift, commercial airliners, shipping etc. Second, due to Islamic nature of Islamic republic Iran has limitations in some of the main service wealth generators. These are Liquor, night clubs, pleasure tourism, fashion, and many other industries that Iran could not have due to religious, cultural or political reasons.
Despite above mentioned limitations, Iranian service sector started to expand in other service sector elements. Now, Iranian service sector is somehow between %45 to %55 of Iranian GDP. As soon as above mentioned problems are solved or current service sector get expanded, we will see a huge increase in Iranian overall GDP.
In brief of briefest:
Saudi economy is not an economy as we know it. It is only oil and bit of Hajj and mining money that first goes to pockets of Saud family and then if they feel generous they will let other Saudis to taste some of it!!
Comparing to Iran and its vast industries, Saudis are no better than Somalia.
Iranian industry sector has as big share in Iranian GDP as other industrialized nations.
The problem lies in service sector that will be fixed soon and we will witness European level GDPs in Iran that won't get fluctuated by the price of oil as it is the case for GCC nations.
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