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amarsha5

How long can Saudi Arabia afford Yemen war? - Al-Monitor: the Pulse of the Middle East - 14 views

  • long history of political animosity; this is a history that continues until our present day.
    • joepouttu
       
      "However, as Saleh continued to kill, these countries had no choice but to issue a forceful declaration to show that they were not in favor of Saleh's relentless, murderous campaign to ignore a civil war in Yemen." pg 128
  • Yemen's treasury was burdened by the costs of unification such as paying for southern civil servants to move to the new capital, Sanaa, and paying interest on its massive debt. On top of its other economic challenges, Yemen was to absorb the shock of 800,000 returnees and their pressure on the already weak job market. With their return, the estimated $350 million a month in remittances
    • joepouttu
       
      "My father had decided to leave Eritrea and return to Yemen, his homeland, after long years of exile..." pg 110
  • Civil war broke out in the summer of 1994 in what could be interpreted as a symptom of economic failure.
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  • By 1995 the Yemeni government implemented a program of macroeconomic adjustment and structural reforms with support from the World Bank and the International Monetary Fund and reduced spending on defense and civil service and cut subsidies. The Yemeni economy started showing signs of recovery and stability.
  • Masood Ahmed, director of the IMF’s Middle East and Central Asia Department, wrote in 2012 that “fiscal sustainability will be an issue” for Gulf Cooperation Council countries. In its 2012 regional economic outlook, the IMF recommended to “curtail current expenditures while protecting the poor” as a response to the risk of declining oil prices.
  • Policies to cut spending were unlikely to be introduced in a monarchy like Saudi Arabia, especially after the Arab Spring, where tax-paying citizens along with non-tax-paying Bahrainis and next-door Yemenis went out on the streets to claim their rights in shaping the policies that govern their daily lives. The risk of people demanding more political rights was growing and cutting spending was not the optimal strategy for the kingdom.
    • joepouttu
       
      "The students of Sanaa were unique, marching straight out onto the street from their classrooms and chanting, 'The people demand the fall of the President and the regime.'" pg 126
  • As the kingdom continued its generous fiscal policy by providing more benefits to its citizens in response to the people’s dissatisfaction with the economic and political situation, it ran a deficit of 3.4% of GDP in 2014 due to a fall in oil revenues.
  • The kingdom's economic reforms of raising gas and diesel prices, cutting fuel subsidies in half and supporting the introduction of a GCC-wide value-added tax might ease the pressure of sustaining a war for nine months and perhaps longer. These structural reforms were long overdue and their introduction at this time is revealing.
    • amarsha5
       
      CIG pg. 120 -> "We live in a world with many layers of linkages between countries. Nations will exchange goods and services through trade and will engage in cross-border investments from bank loans to setting up businesses. Each of these linkages can serve as a transmission mechanism in a time of crisis."
  • the political inclusion of the taxpaying citizen. It's a price the kingdom is now willing to pay, as we have seen Saudi women not only
  • and suffered an uprising fueled by anger at economic failure. The Saudi economy is trying to absorb
  • As they introduce revenue-collecting mechanisms, they should also reform mechanisms of capital transfer to the public to minimize the gap between the rich and the poor, as it is known that the poor are the most affected by tighter revenue-collecting policies. Otherwise, the Saudi war on Yemen will mark the beginning of an economic downturn that will surely spill over onto its political system in the long run.
    • joepouttu
       
      "So the young revolutionaries fight on, until all their demands are met and they are free to build their State: a state founded on social justice and equality between all citizens where Saleh's reign is just a page in the history books." pg 129
    • amarsha5
       
      CIG pg. 116 -> "Globalization, in the shape of freer trade and multinational investments, has been generally a force for good and economic prosperity. But it has also advanced, rather than harmed, social agendas"
    • ccfuentez
       
      But it became apparent that Saleh was not going to leave me to my own devices. He declared war in mid-1994, occupying the South and defeating the Socialist Party. Everything was finished, or so I believed. Its property stolen by the regime, the paper shut down, and once more I found myself broken, defeated and without hope. Worse, I was a known employee of the Socialist Party through my work at the paper. In the region where I lived agents for the regime had been hunting down and detaining anyone who had belonged to the Socialist Party or getting them fired from their jobs. Although I had not been a party member myself, just worked at a party newspaper, the regime made no distinction. My mother intervened, however, and hid me. She wouldn't let me out of the house. My mother always protects me.   (2013-12-31). Diaries of an Unfinished Revolution: Voices from Tunis to Damascus (p. 115). Penguin Publishing Group. Kindle Edition. 
    • atownen
       
      Civil War: in 1994 Jamal currently in high school, describes the times as a world, when the color of his skin would define him. The Civil War, "interpreted as a symptom of economic failure", was evident in the reading when Jamal described the lack of jobs as a college graduate, members of the socialist party were completely shut out when Saleh took the presidency, depriving hard workers the ability to integrate into the economy. 
    • ccfuentez
       
      CIG Ch. 4 -> in relation to international rulemaking on fiscal policy -> is international intervention needed to contain and reverse financial crises in countries, esp. when it comes to the human rights and economic equality of citizens
    • mcooka
       
      Relating to page 120 Sanaa could not find work after college. While his degree wasn't very fluid, he was unable to find work for about 5 years. He got into journalism which blacklisted him against the government. Now he is unemployed again. 
    • mcooka
       
      This paragraph, while not highlighted, is important to the idea of globalization and why the war is not stopping. There is a flow of revenue from these oil prices that Yemen is reliant on, but they are also competing with countries that produce higher amounts of oil. This would have happened during the time Sanaa was in College writing scathing articles
    • mcooka
       
       On page 113 around this time the author was working as a journalist for the newspaper. 
    • mcooka
       
      Related to page 129 Sanaa is still living in hiding and in poverty. The animosity keeps him in fear. 
    • csherro2
       
      Market liberalization outlook
    • csherro2
       
      When Saleh came to power he and the leader of the southern part of Yemen, Salem al-Beid, agreed to coesxist as leaders of Yemen.  WIthin weeks of this in play, Saleh began to try to make the south his and this created the civil war.  
    • csherro2
       
      Jamal notes that the standard of living in Yemen was decreasing gradually the longer Saleh stayed in power.  
    • csherro2
       
      People, including Jamal, were writing about the Saleh regime and how they were upset with them.  
    • csherro2
       
      When Saleh's son was coming into power, Jamal saw that Yemen was moving towards a monarchy, realizing that his and the country's future was in the hands of an unqualified person.  
aavenda2

The New Saudi King's Basic Problem: Saudi Arabia Has A Malthusian Economy - 0 views

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    This article focuses on the unstable demographics of Saudi Arabia in respect to the future of oil and Saudi's private sector. 50% of the population is under 25.
mjumaia

What now for oil after Saudi king's death? - 0 views

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    After the king death the oil price went higher 2%, which mean that Saudi Arabia has huge influence in the oil market. All signals indicate Saudi Arabia will stay the course on its oil production and policies. Saudi Arabia will not cut oil production.
aavenda2

Saudi Arabia's Muhanna Sees Oil Recovering From 'Temporary' Drop - 0 views

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    An article of Saudi oil leaders projecting their optimistic views on the future of the oil economy. + a very interesting quote "Saudi Arabia sets its crude prices based on refining margins and not politics, al-Muhanna said."
ralqass

How Saudi Arabia plans to shake up its economy | Reuters - 0 views

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    In late February, several hundred Saudi officials, company executives and foreign consultants gathered in a luxury Riyadh hotel to discuss how Saudi Arabia's economy could survive an era of cheap oil.
aavenda2

King Salman must reform Saudi Arabia's economy - before it's too late - 1 views

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    Diversifying the private sector In an economy where oil generates 90% of all government income is no easy task. This article touches on the future of Saudi Arabia and its potential economic and unemployment risks if the country does not seek new ways of generating revenue and creating non-oil related jobs.
mjumaia

A more competitive Saudi middle class - 0 views

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    While it seems that the country is doing great on a national level, many local and international economic observers have showed their fear over the impact of changes that are affecting Saudi society. The stereotype about Saudi Arabia thats everybody is rich but not really. Saudi Arabia has middle class that struggle sometimes.
aavenda2

Saudi economic reforms must focus on efficiency - minister - 0 views

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    This article focuses on the economic weakness that Saudi Arabia faces with its current and future workforce. Mainly focusing on the youth and future workforce of the country. "If you talk to young people now, most of them want to be entrepreneurs." Said Muhammad al-Jasser at the opening ceremony of the Euromoney Conference in Riyadh
eyadalhasan

How Saudi Arabia Turned Its Greatest Weapon on Itself - 0 views

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    FOR the past half-century, the world economy has been held hostage by just one country: the Kingdom of Saudi Arabia. Vast petroleum reserves and untapped production allowed the kingdom to play an outsize role as swing producer, filling or draining the global system at will.
wmulnea

BBC News - Falling oil prices: Who are the winners and losers? - 0 views

  • The reasons for this change are twofold - weak demand in many countries due to insipid economic growth, coupled with surging US production. Added to this is the fact that the oil cartel Opec is determined not to cut production as a way to prop up prices.
  • Russia loses about $2bn in revenues for every dollar fall in the oil price,
  • Russia has confirmed it will not cut production to shore up oil prices.
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  • Venezuela is one of the world's largest oil exporters, but thanks to economic mismanagement it was already finding it difficult to pay its way even before the oil price started falling.
  • Saudi Arabia, the world's largest oil exporter and Opec's most influential member, could support global oil prices by cutting back its own production, but there is little sign it wants to do this.
  • There could be two reasons - to try to instil some discipline among fellow Opec oil producers, and perhaps to put the US's burgeoning shale oil and gas industry under pressure.
  • Saudi Arabia needs oil prices to be around $85 in the longer term, it has deep pockets with a reserve fund of some $700bn - so can withstand lower prices for some time.
  • were to force some higher cost producers
  • In the 1980s the country did cut production significantly in a bid to boost prices, but it had little effect and it also badly affected the Saudi economy.
  • Saudi Arabia, Gulf producers such as the United Arab Emirates and Kuwait have also amassed considerable foreign currency reserves, which means that they could run deficits for several years if necessary.
  • Islamic State, capturing oil wells. It is estimated it is making about $3m a day through black market sales - and undercutting market prices by selling at a significant discount - around $30-60 a barrel.
  • "The growth of oil production in North America, particularly in the US, has been staggering," says Columbia University's Jason Bordoff.
  • It has been this growth in US energy production, where gas and oil is extracted from shale formations using hydraulic fracturing or fracking, that has been one of the main drivers of lower oil prices.
  • "Shale has essentially severed the linkage between geopolitical turmoil in the Middle East, and oil price and equities," says Seth Kleinman, head of energy strategy at Citi.
  • With Europe's flagging economies characterised by low inflation and weak growth, any benefits of lower prices would be welcomed by beleaguered governments. A 10% fall in oil prices should lead to a 0.1% increase in economic output, say some. In general consumers benefit through lower energy prices, but eventually low oil prices do erode the conditions that brought them about.
mjumaia

In Saudi Arabia, Shiite Muslims Challenge Ban On Protests - 0 views

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    When Arab Spring protests broke out in Saudi Arabia in 2011, the government reacted quickly, pumping $130 billion into the economy and cracking down on dissent. While this approach has worked in some cities, the Shiite Muslims in the Eastern Province continued to demonstrate.
mjumaia

As Oil Prices Fall, Who Wins And Who Loses? - 0 views

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    This is one likely reason the Saudis have been willing to pump oil at high levels even though that's contributing to low prices. The Saudis publicly cite a business motive, saying they want to maintain their current share of the oil market. But the Saudis are also well aware that low prices mean less money for archrival Iran.
aavenda2

Iran's return to market to delay oil price recovery | Economy | Saudi Gazette - 0 views

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    Iran's return in the oil market leads to new consequences for current producers, and consumers of oil. Including Saudi Arabia
wmulnea

The new economics of oil: Sheikhs v shale | The Economist - 0 views

  • The contest between the shalemen and the sheikhs has tipped the world from a shortage of oil to a surplus.
  • Big importing countries such as the euro area, India, Japan and Turkey are enjoying especially big windfalls. Since this money is likely to be spent rather than stashed in a sovereign-wealth fund, global GDP should rise.
  • There will, of course, be losers (see article). Oil-producing countries whose budgets depend on high prices are in particular trouble. The rouble tumbled this week as Russia’s prospects darkened further. Nigeria has been forced to raise interest rates and devalue the naira. Venezuela looks ever closer to defaulting on its debt
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  • But Saudi Arabia, in particular, seems mindful of the experience of the 1970s, when a big leap in the price prompted huge investments in new fields, leading to a decade-long glut.
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    This article suggests that increased shale oil production is changing the economy of oil, but at the same time Saudi Arabia is reluctant to slow OPEC production.
ralqass

Oil Crisis: Can Saudi Arabia Break Its Addiction And Save The Economy From Plunging Cru... - 0 views

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    Analysts are skeptical the kingdom, the world's top oil exporter, can diversify its economy, given its past struggles.
aavenda2

Saudi Arabia's Plan to Extend the Age of Oil - 0 views

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    An extremely detailed article about the current state of Oil and Saudi's decisions direct effects.
aavenda2

Markets fear Saudi-led military action in Yemen will choke oil delivery to Europe and U... - 0 views

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    This article focuses on the possibilities of action that Yemen could take that would affect oil supply, prices, and production.
wmulnea

Oil and Terror: ISIS and Middle East Economies - 0 views

  • ISIS's economic cost is significant not just for Iraq but also other Middle Eastern countries.
  • Iraq has the fifth largest oil reserves in the world and third highest in the Middle East after Saudi Arabia and Iran.
  • Part of ISIS's rise in Iraq can be attributed to sectarian politics.
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  • part of their dissatisfaction came from the distribution of oil revenues. 
  • The mismanagement of oil revenues is also manifest in Iraq's poor infrastructure
  • Though currently the Iraqi government has reserves and surplus funds, mounting expenditures and falling oil prices has economists to project that Iraq will run a deficit next year.
  • it is running a self-sustaining economy, making it the world's richest terror group.
  • Thankfully, 6 of 8 Iraq’s major oil fields lie in the Shia South, which is unlikely to come under ISIS control.
  • It sells crude at a steep discount, at a rate of USD $30 per barrel
  • Turkey runs a huge trade surplus with Iraq, which is likely to slow down dramatically due to lower demand from Iraq.
  • Jordan and Lebanon, which have both absorbed a large number of refugees.
  • Iran’s position seems to be the trickiest of all in that its interests align with those of the US in its fight against ISIS
  • Falling oil prices have definitely curtailed Iran’s ability to intervene without serious consequences for its economy. Iran needs oil prices well above USD $100 for it to balance its budget,
  • Any cooperation between Iran and the US over ISIS could lead to a gradual withdrawal of sanctions, which would allow Iran to sell its oil on the open market and generate revenue. The flip side is that Iran’s oil would surely depress oil prices further.
  • Saudi's allegiances have become muddled.
  • it finds its interests are aligned with those of Iran, a traditional foe, both of which are against ISIS.
  • Russia needs oil prices near USD $100 to balance its budget and Iran needs high oil prices to support its nuclear program.
  • Regionally, ISIS will disrupt and degrade the economy of several states, and that in turn may lead to further political chaos -- which is precisely ISIS's goal.
ralqass

Saudi Arabia approves ambitious plan to move economy beyond oil | World news | The Guar... - 0 views

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    15-year plan includes diversification, privatisation of state assets, tax increases and creating a $2tn sovereign wealth fund
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