Saudi Wells Running Dry — of Water — Spell End of Desert Wheat
Saudi Arabia, at one point, grew so much grain that they could fee Kuwait, United Arab Emirates, Quatar, Bahrain, Oman and Yeman (Blas, Javier; Saudi Wells Running Dry — of Water — Spell End of Desert Wheat). Unfortunately, that is no longer the case. The lack of rain and essentially hot weather, has caused the water to run dry, in turn causing their wheat crops to die. Saudi Arabia’s inability to produce wheat, has caused them to look elsewhere for their own supply, looking for imports and naming the Saudi’s "The largest new wheat buyer to emerge," (Blas, Javier; Saudi Wells Running Dry — of Water — Spell End of Desert Wheat). According to Ahmed bin Abdulaziz Al-Fares, managing director of the Grain Silos and Flour Mills Organization (GSFMO), all wheat farmers are to be phased out leading to 3.5 million metric tons, which is 100% of Saudi Arabia’s wheat for the year 2016, to come from imports.
How does Saudi Arabia’s lack of water and inability to grow wheat effect the global economy? Some farmers have lobbied the government to overturn their decision to cease farming, stating that they have loans to pay back and without the ability to grow and sell their crops, they will not be able to pay them back leading to financial hardship. While there is an economic downfall to those in Saudi Arabia, at the same time, there is a boost to other parts of the world. Saudi Arabia is now importing their wheat and buying land in many different countries, for example, investing in foreign farmland to cultivate their own crops. Almarai, a Saudi Arabian Dairy farm purchased 15 square miles of farmland in 2014 just outside of Phoenix Arizona. Ultimately, boosting much of the world’s economy.
Interest rates and loan duration
The interest rate is essentially the profit made by the lender over the duration