Credit: Youtube
Credit: Youtube

That Uber was able to secure one of the largest ever investments in a tech company came as little surprise, but the fact that Saudi Arabia was the source of the $3.5 billion investment has raised more than a few eyebrows. While many analysts wonder what the cash infusion will allow Uber to accomplish, the bigger story is what the investment tells us about Saudi Arabia’s plans for a post-oil economy. The Gulf monarchy’s decision to recast its Public Investment Fund as a vehicle for economic diversification are part of the wide-reaching slate of reforms officially approved this week. As so much of that transformation revolves around creating opportunities for Saudis (both men and women) to enter the private-sector workforce, the Uber deal takes on extra significance—especially since so many Saudi women use the service as a way of getting around the driving ban.

Traditionally, Saudi national wealth was managed by the Kingdom’s central bank and went into assets like US Treasury bonds, shunning the headline-making investments made by the Qatar Investment Authority and its stakes in Volkswagen, Glencore, Siemens, and Shell. This past April, Saudi Arabia officially changed its approach with the unveiling of the “Vision 2030” program, devised by Crown Prince Mohammad bin Salman to open up the Saudi economy to entrepreneurship, foreign investment, and privatization. The flagship component of the project will be the sale of 5% of the national oil company Saudi Aramco, which (along with privatizations in a range of other industries) is expected to swell the coffers of the PIF to as much as $2 trillion. The Saudi investment fund’s new stake in Uber, as well as a potentially $3 billion deal recently concluded with GE, are a statement of intent as to what kind of economy Riyadh is looking to build in order to free itself of its systematic oil addiction: a hi-tech one.

This goal is probably the best fit for the Saudi population, the majority of whom are under 35. Like many other Middle Eastern states, Saudi Arabia faces a serious demographic challenge when it comes to youth employment; the unemployment rate for the 16-29 age bracket stands at 29%. Despite the Gulf monarchy’s image as insular and staunchly conservative, the kind of disruptive, entrepreneurial ethos that Uber represents is exactly what Saudi needs to keep up with its own youth population. Many thousands of young Saudis have pursued their educations abroad and are far more global in perspective than their conservative elders. Nearly 8,600 Saudi students were enrolled in British universities in the 2014-2015 school year, and institutions like Imperial College London and the University of Birmingham have become hubs for young Saudis presenting research and ideas. The US, of course, remains the education destination par excellence with nearly 60,000. An HSBC survey found that Saudi and the United Arab Emirates have the youngest successful entrepreneurs in the world, with the average age of somebody starting a company being 26. In America, by contrast, 62% of first-time entrepreneurs are over 55 years old.

Changing attitudes are also apparent when it comes to women in the workplace. Once restricted to roles like nursing, improvements in women’s education initiated by the late King Abdullah have been taken up by King Salman and his son Mohammad. Within the broader economic changes, the two have made expanding the female workforce a priority. While many other countries have set similar goals for themselves, Saudi women are the only ones in the world to have to contend with a very basic obstacle – a prohibition on driving. Even after they find a job, Saudi’s female workers are often entirely reliant for transport on a male guardian or private driver. Should either of these be unavailable or, as is the case with many women, unaffordable, they have no way of getting to work.

By providing a means for women to circumvent the driving ban, Uber has become something of an accidental savior for Saudi women. The young company has disrupted not just the local taxi industry, which has been the case for both Uber and other ride-sharing services elsewhere in the world, but also of oppressive social mores. Unofficial figures put the female segment of Uber’s ridership in Saudi from 70% to as much as 90%. As long as sitting behind the wheel remains out of the question, Uber (and its local competitor Careem) has found its niche helping women get out of the house without the need for a male chaperone.

This relationship between Uber and Saudi women’s freedom to movement has been promoted by some powerful local (female) voices. When Her Royal Highness Princess Reema bint Bandar Al Saud wanted to bring 10,000 women together in a rally to raise awareness for breast cancer, she asked for 2,000 Uber cars to be on standby to transport participants to and from the meeting place. Perhaps in recognition of the special relationship between Uber and Saudi women, Princess Reema has been appointed to the company’s public policy advisory board. Reema has made a name for herself as one of Saudi Arabia’s leading entrepreneurs, serving as the first ever female CEO of a retail company; starting with her time running the Riyadh branch of the London-based Harvey Nichols department store, the US-raised Saudi princess has helped empower women through employment while managing the opposition of the religious establishment (and large swathes of the general public) to the idea of working women.

Uber has endured some criticism from both inside and outside Saudi for its new relationship with the Kingdom, but the fact remains that the ride-hailing app has made it easier for Saudi women to get from place to place in spite of conservative resistance to their driving themselves. Controversial as it may be, the tentative coming together of progressive forces within the country and emancipatory technologies from without is (ever so slowly) bringing change to the country as well as new opportunities for foreign investment.