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China and Saudi Arabia: How Does Culture Impact GNP?

by Rit Nosotro

Comparative Essay

Compare an Asian nation rising in economic power such as Japan, China, or India with a powerful OPEC member nation of the Middle East. How does culture impact GNP?

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Thesis:

Summary:

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Gross National Product: (GNP), in economics, a quantitative measure of a nation’s total economic activity, generally assessed yearly or quarterly.¹

Culture: in anthropology, the integrated system of socially acquired values, beliefs, and rules of conduct which delimit the range of accepted behaviors in any given society.¹

Saudi Arabia
The country that would eventually become Saudi Arabia took form over one hundred and fifty years ago, founded by a local ruler, Muhammad bin Saud, and Islamic reformer Muhammad Abd Al-Wahhab. These two set out to create a new Islamic state along the Arabian Peninsula. However, there was some competition for the land, as there were few places that could support a city, less so for an entire kingdom. Hence, the country was continually at war, be it with Egypt, the Ottoman Turks, or other Islamic Arabs. After a hundred years of almost continual war, the Kingdom of Saudi Arabia was officially recognized by the United Kingdom in 1927. Up to this point, Saudi Arabia had been no more important than any other country in the Middle East, economically speaking. That was about to change. In 1938, the discovery of the largest proven oil reserves in the world turned Saudi Arabia into one of the most important and powerful countries in the Middle East. Saudi Arabia is also one of the most prominent members of OPEC (Organization of Petroleum Exporting Countries), and has been instrumental in raising oil prices, especially during the 1973 energy crisis.

China
China is one of the oldest civilizations on earth, being several thousand years old. The earliest forms of government were the successive dynasties that controlled China up until 1912, when the Wuchang uprising created the republic of China. Yun Shikai was made president of the republic, and served until 1916, when he died of a nervous breakdown. After his death, the republic of China shattered, and the reign of the warlords began. After years of infighting, the Chinese mainland was taken over by the Communist party of China, and was declared the Peoples Republic of China (PRC) in 1949, while the Republic of China fled to Taiwan. Almost as soon as it was founded, the PRC began to base its society and government on those of the Soviet Union. It created a planned economy, and extended government authority into every facet of daily life. Communism, incidently had an enormous impact on the role of women in the USSR and China.

Comparing the Influence of Religion
The Peoples Republic of China, being a communist state, has declared that the entire country is atheist. However, religion is still practiced, even though the government takes sometimes violent action against those who practice religion. More astounding still is that three to four percent of the population practices Christianity, and that number has been on the rise in recent years.² Saudi Arabia, on the other hand, has a state-sponsored religion – Islam – that is practiced by 100 percent of the population.² The government is based on the Qur’an, and legal issues are decided by Shari’a, Islamic Law. An important contrast to draw at this point is each countries reaction to religion. China has been documented as taking action against religious peoples of all kinds, but the Qur’an, upon which Saudi Arabia’s very government is based, calls for the death of all those who will not follow Islam.

Comparing the Influence of Government
Religion is arguably the most important factor in how a country conducts itself, but a country cannot function without a government. The Peoples Republic of China (PRC) began as a communist state based upon the Soviet Union. However, in 1958, Mao Zedong broke from the Soviet model and began to craft a new government from a combination of Marxism and Leninism, which was eventually called Maoism. However, after Mao’s death in 1976, the PRC began to move away from Maoism, and embrace free enterprise. Saudi Arabia, on the other hand, has only in the past 10 years begun to move away from being a complete monarchy, and accept some privatization. This is mainly due to electrical outages and water shortages, forcing the government to hand these matters over to the private sector. China’s government, while still communist, has taken remarkable strides toward free enterprise. Saudi Arabia, on the other hand, has remained almost the same in terms of government since the countries creation over one hundred and fifty years ago.

Comparing the Influence of Culture on Economic in China:
The People’s Republic of China in the past functioned according to the Soviet model for government. One of the problems the Soviet Union had was a failing economy, and huge shortages of food or basic necessities. This was directly a result of a planned economy, and soon after, China began to fell the full effects. China, becoming disheartened with the Soviet way, turned instead to Maoism and the “Great Leap Forward”, a plan create to revive the Chinese economy. The Great Leap proved devastating. It was also planned upon communist principles, just as the Soviet model was. In less than three years, China was swept with a huge famine. After Mao’s death, China began to abandon Maoism, and, starting in the early eighties, gave the people more control over property and businesses. The Chinese government also began to foster competition between businesses, a sure sign of capitalism. During the 1990s, the economy picked up even more steam, helped along by less government restriction.

Comparing the Influence of Culture on Economic in Saudi Arabia:
Without oil, Saudi Arabia would have absolutely no significance in the world market. While this is true for almost all oil producing countries, the fact remains that oil accounts for over 90% of Saudi Arabia’s exports. Oil also makes up almost 80% of Saudi Arabia’s government revenue. As I have already states, Saudi Arabia is a monarchy, ruled by a king; and while there is a cabinet of advisors, most decisions are made by the king, and his decrees cannot be questioned. As such, the government has great control over the economy, which can cause great inefficiency. When combined with the traditions of Islam there is great resistance to change, and to outside influences, which explains why privatization only slowly began around the turn of this century.

Conclusion:
Culture effects the economy. China attempted a communist control of the economy, which failed miserably. The people began to reject what was rightly a failure. In response, the government began to give back to the people what they had had before: their property rights. China's economy began to boom. Even the government’s stance against religion began to fail, and allowed religious practices. This was a throwback to Chinese culture before communism: Hard work, and religion. Surprisingly, a popular religion in China is Christianity. In contrast, Saudi Arabia completely denies anything other than complete compliance with Islam. The monarchy has barely changed and retains great control over most matters in the country. Although Saudi Arabia fiercely opposes change, it has started to allow more independence in the private sector. In short we have China’s culture that allows Christian worship and free enterprise, and Saudi Arabia’s culture, which has one great natural resources, but completely denies Biblical Christianity. To show the full effect, China is 6th in the world when ranked in GNP: Saudi Arabia isn’t even in the top twenty. While per capita wealth is typical in a skewed distribution, at least China encourages free enterprise regardless of family connections as opposed to the tribal mentality of Saudi Arabia.

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Footnotes:

1. The Columbia Encyclopedia, Sixth Edition. 2001

2. CIA world factbook http://www.cia.gov/cia/publications/factbook/

Sources:

MSN Encarta
http://encarta.msn.com

Wikipedia
http://en.wikipedia.org

CIA world factbook
http://www.cia.gov/cia/publications/factbook/

Additional information about <http://hyperhistory.net/apwh/essays/comp/cw33gnpchinasaudiarabia.htm>

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