Saudi women are a captive market for Uber and Careem

NASHMIAH Alenzy, a doctor in Saudi Arabia’s conservative Qassim region, uses ride-hailing apps at least two or three times a week, and sometimes every day, to get to work or to run errands. Before she started using these apps last year, every journey needed to be planned well in advance as she negotiated getting a lift with her husband, her brother, or a private driver.

Barred from driving in a country with non-existent public transport, Saudi women are a profitable prospect for ride-hailing companies. Careem, a firm valued at $1bn that is based in Dubai and operates across the Middle East, north Africa and South Asia, set up shop in 2013. Uber followed in 2014. Both see the Saudi market as one of the most lucrative in the region. Around four-fifths of their respective customers are women.

Both firms are directly backed by the Saudi state. In response to falling oil revenues, the government’s “Vision 2030” programme seeks to diversify its sources of income. In June last year its sovereign-wealth fund ploughed $3.5bn into Uber; and in December Saudi Telecom, which is controlled by the same fund, took a 10% stake in Careem.

If the motives for these investments are chiefly financial, the two firms also fit the government’s social goals. Both help (male) participation in the gig economy, in line with an aim to push more Saudis into the private sector, which is currently dominated by expatriates. Unemployment is high, particularly for the young. Around two-thirds of those in work are employed in the cushy public sector. Last year the Ministry of Transport decided that only Saudi drivers could be licensed to use their own cars for ride-hailing. Foreigners must be employed directly by taxi firms.

Ride-hailing services also help with the government’s stated aim of boosting women’s labour-market activity. Only 1.9m out of 13.1m Saudi women participate in the workforce. One barrier to work is a lack of mobility; ride-hailing apps mean that more women—at least, those with credit cards and smartphones—can take up work or run their own businesses. Uber, under fire in its home market for its macho culture, has a better story to tell in the Gulf.

Saudi Arabia’s embrace of ride-hailing also exposes a contradiction. Because of pressure from Wahhabi clerics, women are not allowed to drive or to mix with men outside their family. Yet the state is actively encouraging them to spend time alone with total strangers, something that makes conservatives uncomfortable.

Some women are annoyed for different reasons. The state ensures that women are dependent on men to get around, says Hatoon al Fassi, an academic, and is now profiting from that dependence. Despite her qualms, Dr al Fassi often has little choice but to use the Uber app herself. So long as women cannot take the wheel themselves, ride-hailing companies will be firmly in the driver’s seat. (Source credit – The Economist)

Comments

comments

- Advertisement -