Indonesia vs Saudi Economy 1950 to 2030

Indonesia and Saudi Arabia have followed very different economic paths, shaped by geography, resources, and policy priorities. Indonesia, with its vast population and diverse natural resources, built an economy that balanced agriculture, manufacturing, and services. Saudi Arabia, on the other hand, developed an economy almost entirely dependent on oil exports. In the mid-20th century, both nations were relatively poor, but the discovery of oil in Saudi Arabia in the 1930s and its exploitation after World War II rapidly transformed it into one of the richest countries in the Middle East.

During the 1950s and 1960s, Indonesia was still recovering from colonial rule and political instability. Its GDP per capita remained low, driven mainly by agriculture and raw material exports. In contrast, Saudi Arabia’s oil wealth began to skyrocket, allowing massive infrastructure projects and high living standards for its citizens. The 1970s oil boom made Saudi Arabia a global energy powerhouse, while Indonesia benefited indirectly through oil exports as a member of OPEC at that time, though the scale was far smaller.

In the 1980s, Indonesia diversified its economy, investing in manufacturing and industrialization under President Suharto’s “New Order.” This shift helped reduce poverty and stabilize growth. Saudi Arabia, meanwhile, faced volatility due to oil price fluctuations but maintained prosperity through government spending and foreign investments. Despite vast oil revenues, Saudi Arabia’s economy remained less diversified, making it vulnerable to oil market cycles.

By the 1990s, Indonesia emerged as one of Asia’s “Tiger Cub Economies,” driven by exports, foreign investment, and rising consumer demand. GDP growth averaged above 7% before the 1997 Asian financial crisis struck, causing sharp depreciation and economic contraction. Saudi Arabia was less affected by the crisis but continued to struggle with unemployment and overreliance on hydrocarbons. While Indonesia’s economy rebounded in the 2000s, Saudi Arabia’s growth was tied closely to global oil prices.

In the 2010s, Indonesia transitioned into a trillion-dollar economy, with strong domestic consumption, infrastructure investment, and steady manufacturing output. It became Southeast Asia’s largest economy and the 16th largest in the world. Saudi Arabia continued to enjoy oil-driven wealth but began serious reforms under Vision 2030, focusing on diversifying into tourism, technology, and renewable energy. The introduction of projects like NEOM symbolized its ambition to move beyond oil dependence.

During the COVID-19 pandemic in 2020, both economies were hit but recovered differently. Indonesia saw slower growth due to reduced exports and domestic restrictions, while Saudi Arabia suffered from an oil price crash but bounced back quickly as energy markets recovered. By 2025, Indonesia’s GDP is projected to exceed $1.6 trillion, supported by manufacturing, services, and digital economy growth. Saudi Arabia’s GDP, though smaller in population terms, remains higher per capita due to oil income, estimated around $1.3 trillion in nominal terms.

Looking toward 2030, Indonesia’s economy is expected to keep expanding steadily, becoming one of the top 10 global economies by size, powered by infrastructure, technology, and green energy transition. Saudi Arabia’s future growth depends on how effectively it diversifies away from oil and attracts foreign investment. While Indonesia’s strength lies in its large population and dynamic markets, Saudi Arabia’s edge remains its vast capital reserves and strategic global energy role. Together, they represent two contrasting models of development — one population-driven and industrial, the other resource-driven and investment-heavy — each offering lessons in resilience and transformation across decades.