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Saudi embrace of ride-hailing apps drives economic, social change

Saudi Arabia hopes its plan to bring a further 1.3 million women into the workforce by 2030 will be given a lift from ride-hailing apps Uber and Dubai-based rival Careem.

The cars, which the government says should only be driven by Saudi men, offer women, who are banned from driving in the conservative Muslim country, an alternative to being driven to work by chauffeurs, male relatives or the shabby taxi system.

Ride-hailing apps have come under intense scrutiny from governments and regulators across the globe as they disrupt traditional taxi businesses.

But Saudi Arabia courted Uber and Careem, offering state investments, to support its Vision 2030 economic reform plan.

With a budget squeezed by lower oil prices, the plan aims to draw workers away from government jobs by creating 450,000 private sector positions by 2020. Uber and Careem say they will create up to 200,000 jobs for Saudi men in the next two years.

By offering women a way to get to work, it should also help meet the goal of increasing the female workforce by five percentage points in the next five years to 28 per cent.

An alternative to being driven to work by chauffeurs, male relatives or the shabby taxi system

“This is the next best thing to women being able to drive, because you are in control of your time, no more wasteful waiting around,” said Marwa Afandi, a 36-year-old marketing executive.

With the workforces of Uber and Careem easily expected to overtake the 65,000 nationals employed by state oil giant Saudi Aramco, the kingdom has invested in both companies.

Saudi’s sovereign wealth fund put $3.5 billion into Uber in June 2016 while state-controlled Saudi Telecom Co. announced on December 18 it bought 10 per cent of Careem for $100 million.

“The percentage of Careem captains who are Saudi has jumped from effectively zero to 60 per cent in the last 12 months and we aim to employ 70,000 Saudis by the end of 2017,” said Abdulla Elyas, co-founder of Careem.

Women already account for around 80 per cent of Uber and Careem’s passengers, the companies say.

“In a country where they (women) cannot get behind the wheel we are offering both the women and the government a win-win solution,” said Zeid Hreish, Uber’s general manager in Saudi.

Traditional social norms dictate local women cannot interact with men to which they are not related. However, the ride-hailing scenario has jumped ahead of such restrictions, aided by a zero tolerance policy for driver complaints operated by Uber and Careem.

The proliferation of ride-sharing services has also done little to take away the yearning for women to drive. Some are concerned that it has made it even less likely that the government will ever allow women to get behind a steering wheel.

In June, when Uber announced the Saudi wealth fund had invested in its business, some Saudi women took to Twitter to unveil their disapproval with the hashtag “Saudi women announce Uber boycott,” trending within hours of the news.

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