Economic Relations

The United States is Saudi Arabia 's biggest import and export partner. Saudi Arabia 's exports to US for the year 2003 were USD 18,068.6 Billion, whilst its imports from the US were USD $4,595.7 Billion

The two countries have had a strong political and military relationship dating as far back as the 1930s.

The American oil Company Standard Oil Company of California (now defunct) was one of the only companies which was willing to risk its money for the exploration of oil in the kingdom long before any oil had been found there. Therefore as one of the first investors in Saudi oil, America has continued to participate as a privilaged customer and investor in the Saudi oil industry. A number of US oil companies as well as the US economy continue to enjoy the high economic and financial returns of their investment in the kingdom's oil industry. The US-Saudi oil company Aramco is one of the biggest participants in the Saudi oil market and has the backing of some of the most senior members of the Saudi royal family. Saudi Arabia is also an important market for the US defence, aviation, transportation, agriculture and medical companies.

Saudi Arabia has also enjoyed the economic fruits of its close relationship in the US. The Saudi royal family and a large number of private owned Saudi enterprises have large investments in the US oil, transport and financial industry. At the same time a number of Saudi businessmen, investors and politicians enjoy close relations with some of the senior people in the American political hierarchy. This enables them to participate and bid for lucrative business and investment opportunities in the United States. All of which give backing to the claim by a number of sources that Saudi Arabia is one of the biggest foreign investors in the US economy.

Political and Security Relations

Saudi Arabia has had a strong political and security relationship with the US. To the US administration, the security of Saudi Arabia is viewed as important due to the following reasons:

Saudi Oil - America is one of the biggest purchasers of Saudi oil and a continued safe supply of petroleum is vital for the US economy.

Strategic position - Saudi Arabia occupies a very important strategic position in the Middle East. This is due to the fact that the kingdom occupies one of the largest areas of land in the Middle East with coastal borders on the Red Sea and the Persian Gulf. It also has borders with no less than 7 countries in the region. Thus explaining the motives behind the US military's choice for stationing its forces on the kingdom until 2003.

Friendly Arab nation - Saudi Arabia occupies an important position in the Arab and Islamic world. Therefore having the backing and friendship of an important Arab country is a positive contributor towards America's political and economic activities and relations with other Arab and Muslim countries in the region.

Furthermore in the 1960s and 1970s a strong US relationship with Saudi Arabia entailed the following advantages:

Until the breakup of the USSR, the US viewed Saudi Arabia as an important ally in its fight against the spread of Socialism and Communism in the region. The US and other Western governments also counted on Saudi Arabia as a counter balance towards Nasser's increasing anti-western socialist pan Arab movement.

To Saudi Arabia , specifically the country's royal family, close security relations with the US are important for the following reasons:

Extra protection against armed invasion - During Saddam's invasion of Kuwait Saudi Arabia 's leaders found that their armed forces were not ready nor sufficient to match Saddam's battle hardened Army. This is where Saudi Arabia's close relations with the US came to play an important role, where the US through the application of its massive armed forces came to Saudi Arabia 's assistance and deterred Saddam from attacking the country. During the reign of the USSR Saudi Arabia counted on the assistance of the US in the case of an attack, whilst as far back as the country's inception its leaders used their close close relationship with the US to balance the spread of British influence in the Middle East.

Supply of Weapons - In terms of quality, US manufactured weapons especially Aircraft and Tanks are some of the best in the world. The continued supply of these weapons to the Saudi armed forces ensures that the country has access to some of the best weapons. This is viewed as essential to Saudi defence planners.

Investment- American companies are some of the biggest investors in the Saudi oil industry and one of the biggest customers for Saudi oil. The continued purchase of Saudi oil, Saudi non oil products, and investment in the Saudi economy by US companies is viewed as important for the well being of the Saudi economy.

Saudi Arabia 's close relations with the US has also created problems for the royal family. Fundamentalist groups oppose this relationship, especially the stationing of US troops on Saudi soil. This is one of the reasons behind the attacks of militant groups such as Al Qaeda against Saudi and US interests inside the country. Although the presence of US troops on Saudi soil has reduced considerably, the country's economic and political relation with the US continues to serve as a reason for those who wish to depose the royal family. It must also be noted that other countries in the region such as Iran and previously Iraq also oppose Saudi Arabia's close relations with the US.

The US administration has also faced the disadvantages of its close relationship with Saudi Arabia. One of the main reasons used by Al Qaeda for the September 11 2001 attacks was America's support for the Saudi royal family. Furthermore pro Israeli members of the American congress have viewed America's strong military relations with Saudi Arabia with concern due to Saudi Arabia's historical opposition to Israel (even to the country's existence until 1993).

By: Meir Javedanfar- www.meepas.com

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