Posted: June 6th, 2019

Module 01: Discussion Forum

Module 01: Discussion Forum
In reference to key exports, a country’s risks and opportunities are important in determining the impact of globalization on the world economy. Country’s risks include political and macroeconomic risks that could reduce the expansion of exports growth (Carbaugh, 2011). On the other hand, the opportunities such as growing macroeconomic indicators and increased demand for exports are important to help in expanding globalization on the global economy.
The strengths of Saudi Arabian oil & gas industries include that it has huge production and refining potential, increased downstream production and marketing capacity, and the fostering of advancement in technology and the sustainable growth progress. In terms of Qatar, the industries have huge production capacity too. However, it has limited sustainable growth potential to improve progression. On the other hand, the weaknesses include that both Saudi Arabia and Qatar have high dependence on the profitability of crude oil sales. Another weakness is that there is weak corporate governance and transparency because there are few disclosures within both Qatar and Saudi Arabian oil & gas industries.
The opportunities of oil & gas industries in Qatar and Saudi Arabia includes the global economic growth is likely to drive the increased consumption of energy and expanding the dependency on fuels. The issuance of IPO of Saudi Arabian oil and gas industries would also help in understanding the actual valuation of the sector and expanding financial and operational transparency. In contrast, Qatar oil and gas industries has no plans to issue an IPO and thus, it faces corporate governance challenges and transparency issues (Carbaugh, 2016). In terms of threats, both Saudi Arabia and Qatar oil & gas industries faces various threats including the reduction in global market share in relation to newer exploration capabilities of other economies and the continued review on the renewable energy and other sources.
In Saudi Arabia, the most important strength for Saudi Arabia’s long-term petroleum products industry view is the huge production capacity and potential. The significant weakness is the increased reliance on the profitability of crude oil sales. The critical opportunity for Saudi Arabia oil and gas sector is the issuance of IPO to understand the actual valuation of the company on oil and gas industries. The core threat is the decrease in global market share due to the exploration of technology capabilities.
In Qatar, the key strength for Qatar’s oil and gas industries is the fostering of enhanced technology to improve capacity. The main weakness for Qatar is weak corporate governance programs due to reduced disclosures. The opportunity for Qatar oil and gas industries is the increased dependency on fuels across the global economy. The key threat is the continued use of renewable energy sources that reduces the demand for the oil and gas industries in Qatar.

References
Carbaugh, R. J. (2011). International economics, 13 Edition. Boston, MA: Cengage Learning
Carbaugh, R. (2016). Contemporary economics: an applications approach. London, UK: Routledge.