The Geopolitics of International Trade in Saudi Arabia: Saudi Vision 2030
Keywords:Geopolitical risk, vision 2030, infrastructure, trade, oil, energy trade
Trade is vital to a country's development and growth. However, geopolitical risks have been known to disrupt international trade. Saudi Arabia's economy is based on oil trade and remittances. Thus, geopolitical risks have a significant impact on Saudi Arabia's oil trade. To reduce the country's reliance on oil, the Saudi government has proposed Vision 2030, which focuses on boosting growth and revenue from public service sectors like education, healthcare, and tourism. The current study seeks to assess the impact of geopolitical risks on trade value to support Vision 2030. The study's findings will show the value of economic revenue diversification. The study uses a regression discontinuity and fixed effects model to assess the link between geopolitical risks and oil trade. The results confirm the negative impact of geopolitics on oil trade and the model's resistance to heterogeneity. The results show that geopolitical risks hurt both exports and imports. The lag and mediation effect models reflect the geopolitical impact mechanism. The effects of geopolitics on trade were found to be heterogeneous. The study has implications for theory, policy, and management.