Saudi Arabia's oil and gas exports exceeded $190 billion and made up 65% of the country's $295 billion exports in 2018. Consequently, it is the most dependent on oil and natural gas revenues among the world's top 30 exporting counties.
If Saudi Arabia is taken out of the list, given its level of dependency on petroleum exports, Turkey, whose exports consists of highly diversified commodities, rises up to 30th on the list.
For the U.S., ranked second in the list, the share of oil and natural gas is just $80 billion in its total exports worth $1.66 trillion.
Similarly, 12th-placed Canada's petroleum exports are worth $80 billion in its total $451 billion in exports. Russia ranks 14th with its total exports of $449 billion, of which close to $140 billion come
from energy exports. Only $60 billion of the United Arab Emirates' (UAE) – which is 19th on the list – $317 billion exports come from petroleum.
Taking into account the surface area and population of Hong Kong, which ranks seventh with $569 billion; Singapore, which ranks 15th with $412 billion, and the UAE, we can see how significant export revenue these countries have gained from transit trade.
Among the top 30 exporters, every country other than Saudi Arabia has a variety of products. As global competition becomes increasingly more difficult and trade wars get more vicious, these countries will not enjoy the appreciation of their money.
As a matter of fact, since the beginning of the summer, the central banks of the 30 countries in question have focused on measures to prevent the appreciation of their national currencies by reducing interest rates.
Therefore, with autumn, we are entering a period when exchange wars will gain momentum. And this situation will increase the pressure to cut the interest rates on the central banks of the G20 countries, especially the U.S. Federal Reserve (Fed) and the European Central Bank (ECB).
Autumn preparations accelerated
As the U.S. has threatened China with more and more severe sanctions, doing business and exporting for U.S. manufacturers, dependent on supplies from China, have started to struggle and face difficulties in terms of price.
Therefore, the U.S. government suspended the sanctions on Huawei for 90 days; with the condition that U.S. companies rapidly find new procurement opportunities with other companies.
On the other hand, the Chinese side, in addition to sustaining its policy of weakening the value of the yuan, the Central Bank of China (PBOC) decreased the benchmark interest rate for one-year bank loans from 4.35% to 4.25%. This rate was 6% in 2013.
In order to keep the Chinese economy vibrant, by continuing to take steps that will make borrowing costs even more attractive for both the real sector and consumers, it will not neglect the steps that will make the Chinese economy's wheels turn.
On the ECB front, at the end of October, when President Mario Draghi finally hands over the title to International Monetary Fund (IMF) President Christine Lagarde, he will have implemented a series of measures to support the economy.
U.S. President Donald Trump, on the other hand, has increased his pressure on Fed President Jerome Powell for a "massive" interest rate cut. Although international financial institutions expect a 0.25 point consecutive interest rate cut from the Fed's September and October meetings, Trump wants a strong step to reach U.S. growth potential with a 1-point rate cut at the Fed's September meeting.
The central banks of all the G20 countries have sensed the preparations by other countries and will raise the bar in autumn in the race to soften the monetary policy and keep the value of their money low.