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OUTLOOK AND DIRECTIONInternational tradeRecent years have been marked by a steadily increasing integration of Saudi Arabia in theglobal economy. Total exports jumped by 32.0% to USD278.9bn in 2007, supported by high oilprices and the various economic diversification initiatives. Imports grew from USD69.8bn in2006 to USD90.3bn in 2007, buoyed by the oil price-fueled boom. Oil exports accounted for themajority of KSA’s total exports, while engineering products (machinery, electric appliances andequipment) constitute the leading category of imports. The strength of the hydrocarbons marketallowed KSA to record a trade surplus of USD148.3bn in 2007. Official estimates put totalexports of goods and services in 2008 at USD326.9bn. Non-oil exports of goods are expectedto account for a still relatively modest USD30.7bn of this. Total imports of goods and servicesare expected to reach USD162.7bn.Exhibit 20: International trade(USD bn)35030025020015010050100%80%60%40%20%01999 2000 2001 2002 2003 2004 2005 2006 2007 20080%Total exports fobCrude oil as % of total exportsTotal imports cifMachinery as % of total importsSource: Ministry of Finance, Government of KSA , SAMA, EIUKSA’s major export destinations in 2007 included Japan (17.7% of total exports), the U.S(15.9%), South Korea (9.1%), China (7.2%), Taiwan (4.7%) and Singapore (4.5%). Oil exportsform the major component of KSA’s total exports, while other products include barley, dates,dairy products, flowers, chemicals, and plastic products. Since Japan and the US are the twomost important export destinations, an economic slowdown in those countries will inevitablyadversely affect KSA’s exports.The picture is similar on the import side. In 2007, the U.S accounted for 12.3% of total importsfollowed by Germany (8.6%), China (7.9%), Japan (7.3%), the United Kingdom (4.9%), Italy(4.8%), and South Korea (4.1%). Over the past two years, China has quickly established itselfas an important import partner of KSA. Machinery and electrical equipment, transport equipmentand base metals, in that order, are the three leading import categories, accounting for 60% ofthe total.JUNE 2009SAUDI ARABIA FACTBOOK22