Introduction:
Saudi Arabia is the birthplace of Islam and home to Islam's two holiest shrines in Mecca and Medina, and the king's official title is the Custodian of the Two Holy Mosques. The modern Saudi state was founded in 1932 by ABD AL-AZIZ bin Abd al-Rahman AL SAUD (Ibn Saud) after a 30-year campaign to unify most of the Arabian Peninsula. A male descendent of Ibn Saud, his son ABDALLAH bin Abd al-Aziz, rules the country today as required by the country's 1992 Basic Law. Following Iraq's invasion of Kuwait in 1990, Saudi Arabia accepted the Kuwaiti royal family and 400,000 refugees while allowing Western and Arab troops to deploy on its soil for the liberation of Kuwait the following year. The continuing presence of foreign troops on Saudi soil after the liberation of Kuwait became a source of tension between the royal family and the public until all operational US troops left the country in 2003. Major terrorist attacks in May and November 2003 spurred a strong on-going campaign against domestic terrorism and extremism. King ABDALLAH has continued the cautious reform program begun when he was crown prince. To promote increased political participation, the government held elections nationwide from February through April 2005 - for half the members of 179 municipal councils. In December 2005, King ABDALLAH completed the process by appointing the remaining members of the advisory municipal councils. The country remains a leading producer of oil and natural gas and holds approximately 25% of the world's proven oil reserves. The government continues to pursue economic reform and diversification, particularly since Saudi Arabia's accession to the WTO in December 2005, and promotes foreign investment in the kingdom. A burgeoning population, aquifer depletion, and an economy largely dependent on petroleum output and prices are all ongoing governmental concerns.

Location: Middle East, bordering the Persian Gulf and the Red Sea, north of Yemen

Population: 27,019,731
note: includes 5,576,076 non-nationals (July 2006 est.)

Languages: Arabic

Country name: conventional long form: Kingdom of Saudi Arabia
conventional short form: Saudi Arabia
local long form: Al Mamlakah al Arabiyah as Suudiyah
local short form: Al Arabiyah as Suudiyah

Capital: name: Riyadh
geographic coordinates: 24 38 N, 46 43 E
time difference: UTC+3 (8 hours ahead of Washington, DC during Standard Time)

Economy - overview:
This is an oil-based economy with strong government controls over major economic activities. Saudi Arabia possesses 25% of the world's proven petroleum reserves, ranks as the largest exporter of petroleum, and plays a leading role in OPEC. The petroleum sector accounts for roughly 75% of budget revenues, 45% of GDP, and 90% of export earnings. About 40% of GDP comes from the private sector. Roughly 5.5 million foreign workers play an important role in the Saudi economy, particularly in the oil and service sectors. The government is encouraging private sector growth to lessen the kingdom's dependence on oil and increase employment opportunities for the swelling Saudi population. The government is promoting private sector and foreign participation in the power generation, telecom, natural gas, and petrochemical industries. As part of its effort to attract foreign investment and diversify the economy, Saudi Arabia acceded to the WTO in December 2005 after many years of negotiations. With high oil revenues enabling the government to post large budget surpluses, Riyadh has been able to substantially boost spending on job training and education, infrastructure development, and government salaries.