Economic Diversification and the Youth Population in Bahrain and Saudi Arabia: Double Dividend or Do

In Considering how oil has shaped the social addition, the volatility of the oil price and contract between the state and its citizens, the economic effects of the COVID-19 how will the transition to a more diverse pandemic have made it clear that, from an economy affect state-society relations? In economic perspective, diversification away 2 order to shed light on the main drivers of from oil is. [...] Oil markets illustrate the urgency of economic reform in continue to struggle following the recent oil Saudi Arabia and Bahrain, it is useful to price dispute between Russia and Saudi reflect on these socio-economic differences Arabia and the economic effects of the across the GCC. [...] In addition, its youth respectively – a general advantage.19 unemployment rate – already the highest in the GCC – will worsen in future unless the Hence, a non-oil economy needs to be country is able to provide meaningful established in Bahrain and Saudi Arabia due employment, as a quarter of the population not only to the short-term volatility of oil is under the age of 15.21 However, reform is p. [...] Bahrain and Saudi Arabia have created a The result is substantial youth society where the population is heavily unemployment, which is most visible in dependent on the government.35 As a direct Saudi Arabia where, at close to 29 percent, result of the dominance of the public sector, youth unemployment is around five times the private sector is relatively the general unemployment rate. [...] According to the IMF, the required support low- and middle-income Saudis.57 changes in economic policy are larger and Bahrain’s political climate is complicating more urgent than is apparent from existing political reforms, as the ruling family is plans, especially in the light of the economic Sunni while the majority of the population is 47 See Kingdom of Saudi Arabia, “Vision 2030,” 2018.