Impact of Interrelationships among the Economic Sectors on Achieving Sustainable Development in the Kingdom of Saudi Arabia

Abstract

This study is aligned with the vision of the Kingdom of Saudi Arabia 2030, which seeks to achieve sustainable economic development. This study aims to estimate the size of the interrelationships among the economic sectors in the Kingdom of Saudi Arabia from the period 1970 to 1920. The descriptive-analytical and econometric approaches were used to display the concepts and literature review relevant to the study as well as to analyze the interrelationships between the sectors of the national economy, which are represented in: the added value of (the manufacturing sector, the non-manufacturing industries sector, the service sector, and the agricultural sector) using Vector Auto- Regression model (VAR) and Impulse Response Functions. The results showed the weakness and limitations of the interrelationships among the economic sectors in the Kingdom of Saudi Arabia, in addition to the absence of leading sectors with a strong impact on the rest of the other economic sectors and are influenced by them as well. Accordingly, the study recommends the need to continue and intensify the diversification efforts made by the government to get out of the scope of a rentier economy, and to strengthen the interrelationships among the various economic sectors by applying appropriate reform models that are integrated with economic policies in a way that achieves the requirements of sustainable economic development.

 Keywords: Economic interdependence, economic development, economic sectors, economic diversification,  Added Value