In spite of the recent surge in its oil income, Saudi Arabia continues to face serious long-term economic challenges, including high rates of unemployment (around 13 percent of Saudi nationals, possibly higher), one of the world's fastest population growth rates, and the consequent need for increased government spending. All of these place pressures on Saudi oil revenues. The Kingdom also is facing serious security threats, including a number of terrorist attacks (on foreign workers, primarily) in 2003 and 2004. In response, the Saudis reportedly have ramped up spending in the security area (reportedly by 50 percent in 2004, from $5.5 billion in 2003). Saudi Arabia's per capita oil export revenues remain far below high levels reached during the 1970s and early 1980s. In 2004, Saudi Arabia earned around $4,564 per person, versus $22,589 in 1980. This 80 percent decline in real per capita oil export revenues since 1980 is in large part due to the fact that Saudi Arabia's young population has nearly tripled since 1980, while oil export revenues in real terms have fallen by over 40 percent (despite recent increases). Meanwhile, Saudi Arabia has faced nearly two decades of heavy budget and trade deficits, the expensive 1990/1991 war with Iraq, and total public debt of around $175 billion. On the other hand, Saudi Arabia does have extensive foreign assets -- around $110 billion -- which provide a substantial fiscal "cushion."
