Saudi Arabia’s surge in female workforce participation drives economic impact

Saudi Arabia’s surge in female workforce participation drives economic impact
Saudi conductors walk beside a high-speed train ferrying pilgrims to Mecca, in Saudi Arabia's Red Sea coastal city of Jeddah, on January 22, 2023. (AFP)
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Updated 18 August 2024
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Saudi Arabia’s surge in female workforce participation drives economic impact

Saudi Arabia’s surge in female workforce participation drives economic impact

RIYADH: Saudi Arabia’s workforce is experiencing a surge in female participation, driven by improved educational opportunities, declining fertility rates and a more inclusive cultural environment.

These developments have propelled the Kingdom beyond its Vision 2030 targets, according to a recent S&P Global report.

Both the government and private sector have implemented proactive measures, including legal reforms and diversity initiatives, to empower women and foster a more inclusive work environment.

This aligns with Saudi Arabia’s strategic goals to promote gender equality and encourage greater female participation in the workforce.

It comes as the Gulf Cooperation Council experiences unprecedented momentum in women’s participation in the workforce.

According to the latest figures from the World Bank, the female labor force participation rate in Saudi Arabia stands at 34.5 percent, compared to 79.9 percent for males.

Anne-Laure Malauzat, a partner at Bain & Co. in the Middle East, told Arab News that the statistic has surpassed the original target of 30 percent, prompting the Kingdom to set a new goal of 40 percent by 2030.

She highlighted several efforts in the Kingdom aimed at boosting female employment.

“On the governmental side, some examples include the Vision 2030 in Saudi Arabia — out of its 11 Vision Realization Programs, two of them are heavily focused on empowering women, namely the Human Capability Development Program and the Quality of Life Program, and female participation in the workforce is a critical enabler to the success of the other 9 programs,” Malauzat said.

Red Sea Global Spokesperson Zainab Hamidaddin Al-Hanoof Al-Hazzani said that the Kingdom surpassed its 30 percent female workforce participation target ahead of schedule.

“At Red Sea Global, we recognize the importance of promoting gender diversity in the workforce and have made significant efforts to leverage the growing trend of women entering the workforce,” she added.

The firm takes pride in having women across all levels of the organization and within the destination, including in senior executive roles, Al-Hazzani said.

“Women contribute significantly across all departments at Red Sea Global, spanning from master planning and construction to scientific research. In certain departments, female representation reaches as high as 44 percent, surpassing the company’s average.”

Laila Kuznezov, director of implementation practice at Oliver Wyman, cited S&P Global Rating’s projection that if the existing rate of growth in female workforce participation continues, Saudi Arabia’s economy could receive a boost of $39 billion, or 3.5 percent, by 2032.

She added that the Kingdom has implemented a series of initiatives to empower women, including raising awareness about the importance of female participation in the workforce, penalizing discrimination, improving job matching, and offering training and support programs specifically aimed at women.

Kuznezov highlighted how Saudi Arabia is committed to fostering a more diverse and inclusive work environment, acknowledging that tapping into the full potential of its workforce is crucial for reaching its ambitious goals.

“Women are increasingly entering the workforce at all levels, including in high-skilled and traditionally male-dominated sectors like engineering and finance,” she said.

“The government also recognizes the importance of family life and has implemented measures to support women’s professional growth alongside their family responsibilities. This includes initiatives like promoting flexible working arrangements and providing expanded childcare options.”

Beyond legal reforms, the government has led awareness campaigns designed to shift societal attitudes, Kuznezov added.

These initiatives highlight the accomplishments of prominent Saudi women, showcasing them as role models and fostering conversations about the benefits of enhancing female participation in the workforce.

“With this comprehensive approach, Saudi Arabia is paving the way for a future where women can actively participate and thrive in all sectors of the economy,” Kuznezov said.

She added that organizations like the Badir Program for Technological Entrepreneurs offer essential training and mentorship for Saudi women entrepreneurs in the tourism and hospitality sectors.

These programs are designed to equip women with the skills necessary to start and run their own businesses, thereby nurturing a culture of entrepreneurship within these industries.

“However, it’s important to recognize that Saudi women are well prepared to enter the workforce. They boast a high level of education across a range of qualifications. To fully unlock their potential, a focus on job creation is crucial, particularly within the private sector,” Kuznezov said.

As it stands, 20 percent of women are over-educated for the positions they hold, compared to 14 percent of men, she added. “The availability of a highly educated and motivated workforce is a strong foundation for the creation of more high-quality and productive employment opportunities.”

Kuznezov highlighted the importance of empowering women to assume leadership and managerial roles, which are expected to become more prevalent in high-growth sectors such as tourism and hospitality.

“By facilitating these advancements, we can ensure that women’s skills and talents are fully utilized, contributing significantly to the Kingdom’s economic diversification and overall success,” she said.

From RSG’s perspective, the goal is to see Saudi women take on leadership roles and drive a more inclusive society, particularly within the tourism and hospitality sectors.

“We’re dedicated to fostering opportunities for women in these fields. To achieve this vision, we’ve implemented various programs and initiatives aimed at attracting, retaining and promoting female talent within our organization,” Al-Hazzani said.

The spokesperson added that RSG prioritizes fairness in its recruitment processes by using gender-neutral job advertisements and ensuring diverse candidate pools.

The company has launched several programs, including the Red Sea Vocational Training Program and The Red Sea Pioneers Vocational Training Program, to provide training and employment opportunities for Saudis in the tourism sector, she said.

“Additionally, our partnership with the University of Prince Mugrin and Ecole Hotellerie de Lausanne in Switzerland ensures that young Saudis receive world-class education in hospitality. While these schemes are for men and women, we expect young Saudi women to benefit greatly given tourism, traditionally, is a sector that women over-index in.”

RSG acknowledges that increasing the number of women in the workforce is only part of the effort, Al-Hazzani said. The company is also focused on nurturing women’s professional development through various avenues, including training, mentorship and leadership programs.

“Our Female Leadership Program is designed to fortify the presence of women in leadership positions within our organization, equipping them with the necessary skills to thrive in traditionally male-dominated roles globally over the long term.”


Saudi e-commerce sales using Mada cards hit $53bn in 2024

Saudi e-commerce sales using Mada cards hit $53bn in 2024
Updated 07 February 2025
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Saudi e-commerce sales using Mada cards hit $53bn in 2024

Saudi e-commerce sales using Mada cards hit $53bn in 2024
  • Year-on-year growth of 25.82%, according to Saudi central bank data
  • Spending power, nation’s economic strength are ‘fueling market growth’

RIYADH: E-commerce sales using Mada cards in Saudi Arabia reached SR197.42 billion ($52.64 billion) in 2024, a year-on-year growth of 25.82 percent, according to data from the Kingdom’s central bank.

Figures released by the institution showed that in December, sales totaled SR19.37 billion, representing a 42.06 percent increase compared to the same month in the previous year.

These figures include payments for online shopping, in-app purchases, and e-wallet transactions, but exclude transactions using credit cards such as Visa and MasterCard.

Mada, the Kingdom’s national payment card system, supports both debit and prepaid services within its network. The cards utilize near-field communication technology for contactless payments, enabling secure transactions at both physical retailers and online.

Mohammed Dhedhi, partner in the consumer and retail practice team at Kearney Middle East and Africa, told Arab News: “The growing spending power in Saudi Arabia, driven by factors such as dual-income households and higher overall economic strength, is fueling market growth.”

He added: “Additionally, the proliferation of NFC-capable devices has significantly boosted the penetration of digital payment channels like Mada, further supporting the shift toward a more digital economy.”

In addition to the surge in sales, the number of e-commerce transactions also experienced a significant rise, increasing by 28.86 percent year-on-year to nearly 1.13 billion transactions in 2024.

December saw a 30.47 percent annual increase, reaching 105.73 million transactions.

According to Dhedhi: “Today, local Mada cards account for over 90 percent of cards issued in the country and over 95 percent of the total transactions made. One of the main reasons for Mada’s popularity is because of how convenient it is to use.”

He added that Mada is widely accepted both in-store and online across Saudi Arabia, providing secure transactions as it is operated by Saudi Payments, a subsidiary of the Saudi Central Bank.

The growing adoption of Mada aligns with the government’s push toward a cashless society, promoting the transition from cash to digital payments.

Dhedhi explained that the COVID-19 pandemic significantly accelerated e-commerce penetration in Saudi Arabia, driving faster digital adoption across various sectors.

This growth was further supported by increased investments from both regional and global players looking to expand their operations.

He noted that in 2022, noon.com opened a Customer Fulfillment Center in Riyadh to improve delivery speed and meet the growing demand from consumers.

Saudi Arabia’s growing spending power, supported by factors including dual-income households and a robust economy, continues to drive market expansion.

At the same time, the widespread adoption of NFC-enabled devices has propelled the use of digital payment solutions like Mada.

As a result, the Kingdom is witnessing a rapid shift toward a more digital economy, with seamless and secure transactions becoming an integral part of the evolving e-commerce landscape.

The rise in e-commerce activity aligns with Saudi Arabia’s goal to make digital transactions account for 80 percent of the retail sector by 2030, with 70 percent conducted online by the same year.

According to the International Trade Administration, the Saudi e-commerce market, valued at $5.15 billion in 2023, accounted for 6 percent of the Kingdom’s $92.6 billion retail market.

Dhedhi said: “To improve online shopping experiences, Saudi Arabia’s Ministry of Commerce has introduced reforms focusing on refunds, delivery options, and payment choices.”

He added: “These changes aim to address consumer concerns such as unclear warranties, limited delivery coverage, slow complaint resolutions, and delayed refunds. Retailers are now required to submit performance reports and conduct consumer awareness campaigns.”

According to Dhedhi, Saudi Arabia’s e-commerce market growth will be driven primarily by appliances and electronics, which will account for 23 percent of total growth, with a compound annual growth rate of 8 percent from 2024 to 2028.

The fashion sector is expected to contribute 18 percent, also growing at 8 percent CAGR, while health and beauty will make up 14 percent, expanding at a much faster 16 percent CAGR.

The dominance of electronics and appliances reflects a strong demand for advanced technology and gadgets, particularly among younger, tech-savvy consumers.

In addition, the rising popularity of beauty and home care products aligns with an increasing focus on self-care and wellness across the Kingdom.

Meanwhile, the food and beverage segment is projected to experience the highest growth rate at 25 percent CAGR, although its overall market size remains smaller compared to other leading categories, according to Dhedhi.

“The rise in food and beverage e-commerce reflects a growing demand for convenience. Quick commerce has been growing rapidly, and while it historically took players much longer to achieve profitability, the current focus on dark stores and improved unit economics is accelerating this process,” Dhedhi said.

He also noted that while this shift has accelerated growth in the sector, it has also intensified competition. This dynamic ultimately benefits market players in Saudi Arabia by fostering innovation and enhancing service quality.

According to the International Trade Administration, Saudi Arabia’s digital economy is expanding rapidly, driven by substantial government investments and widespread adoption of emerging technologies.

As of 2023, the Kingdom’s Information and Communications Technology sector was the largest and fastest-growing in the Middle East and North Africa region, valued at $40.94 billion and contributing 4.1 percent of gross domestic product, the report stated.

The Kingdom ranked second among G20 countries on the UN International Telecommunication Union’s ICT Development Index in 2023, highlighting its strong digital infrastructure.

Over the past six years, Saudi Arabia has invested $24.8 billion in this area, leading to a 99 percent internet penetration rate and mobile internet speeds of 215 megabits per second, nearly double the global average.

These advancements place the Kingdom among the top 10 countries globally for mobile internet speed, according to the ITA.

Saudi Arabia was an early adopter of 5G technology, with coverage reaching 77 percent of the country — significantly above the global average — and 94 percent in Riyadh, positioning it among the world’s leading cities for 5G accessibility.

This high-speed internet expansion is fueling growth in e-commerce, telecommunications, and digital services, the ITA added.

The number of e-commerce users is projected to reach 34.5 million by 2025, with penetration rising from 66.7 percent in 2023 to 74.7 percent by 2027, according to the report.

Digital payments are also surging, aligning with Vision 2030’s goal of a cashless society. Electronic payments in retail transactions surpassed 57 percent in 2021, exceeding the 55 percent target set by the Financial Sector Development Program.

This shift is expected to further accelerate e-commerce growth, attracting more investment in digital financial services.

Dhedhi said: “Millennials, who constitute around 50 percent of the population, are key drivers of e-commerce growth due to their digital fluency and tech-savviness.”

He added: “Expats, on the other hand, prioritize the delivery experience more than locals and show a strong preference for international brands or diverse product offerings, contributing to a broader assortment in the offerings.”

Dhedhi said quick commerce players are tapping into the demand for fast delivery, affordable subscriptions, and influencer partnerships to target younger consumers.

By offering low delivery costs, they are setting new convenience standards. Chinese e-commerce giants including Shein and Temu have successfully attracted Gen Z and millennials with trendy, affordable products, despite occasional compromises in product quality, he said.

Urbanization and rising female workforce participation are further fueling the shift to online retail, with families increasingly relying on e-commerce for groceries, fashion, and household items.

Dhedhi noted that these demographic shifts are broadening the customer base, diversifying consumer behavior, and fueling the expansion of Saudi Arabia’s e-commerce sector, which plays a pivotal role in the Kingdom’s economic transformation.


Oil Updates — crude set for 3rd straight weekly decline amid tariff concerns

Oil Updates — crude set for 3rd straight weekly decline amid tariff concerns
Updated 07 February 2025
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Oil Updates — crude set for 3rd straight weekly decline amid tariff concerns

Oil Updates — crude set for 3rd straight weekly decline amid tariff concerns

LONDON: Oil prices rose on Friday after new sanctions were imposed on Iran’s crude exports but were on track for a third straight week of decline, hurt by US President Donald Trump’s renewed trade war on China and threats of tariffs on other countries.

Brent crude futures were up 51 cents, or 0.7 percent, at $74.80 a barrel by 3 p.m. Saudi time, but were poised to fall 2.6 percent this week. US West Texas Intermediate crude rose 48 cents, or also 0.7 percent, to $71.09 a barrel, down 2.1 percent on a weekly basis.

The US Treasury said on Thursday it was imposing new sanctions on a few individuals and tankers helping to ship millions of barrels of Iranian crude oil per year to China, in an incremental move to increase pressure on Tehran.

“Trump has talked about maximum pressure (on Iran). The market takes that quite seriously,” said Michael Haigh, global head of commodities research at Societe Generale. The French bank projects that Iranian oil exports are set to halve.

“The imposition of tariffs and the pauses should be bullish for the oil market because it adds uncertainty. But you haven’t seen this response because of demand concerns. Tariffs and tit for tat responses from nations, it hurts global GDP ... and oil demand,” Haigh added.

Trump had announced a 10 percent tariff on Chinese imports as part of a broad plan to improve the US trade balance, but suspended plans to impose steep tariffs on Mexico and Canada.

“Downside pressure has stemmed from the news flow around tariffs, with concerns over a potential trade war fueling fears of weakening oil demand,” analysts at BMI said in a note on Friday.

Oil prices settled lower on Thursday after Trump repeated a pledge to raise US oil production, unnerving traders a day after the country reported a much bigger-than-anticipated jump in crude stockpiles.

The benchmarks were also under pressure from swelling US crude inventories, which rose sharply last week as demand softened on ongoing refinery maintenance.


PIF’s SIRC, Germany’s Concord Blue to launch first phase of sewage to renewable hydrogen station

PIF’s SIRC, Germany’s Concord Blue to launch first phase of sewage to renewable hydrogen station
Updated 07 February 2025
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PIF’s SIRC, Germany’s Concord Blue to launch first phase of sewage to renewable hydrogen station

PIF’s SIRC, Germany’s Concord Blue to launch first phase of sewage to renewable hydrogen station
  • Both parties will offer innovative solutions that contribute to environmental sustainability and promote the circular carbon economy
  • Plan will see around 100 million tonnes of waste recycled annually

RIYADH: A new agreement between the Saudi Investment Recycling Co. and the German company Concord Blue will lead to the construction of a station in the Kingdom that converts sewage into renewable hydrogen.

The Public Investment Fund firm inked the memorandum of understanding with the engineering company for the first phase of the development, whereby the plant will use Concord Blue Reformer technology to develop sludge treatment projects resulting from sewage and other organic waste, according to a statement.

Concord Blue Reformer’s non-combustion reforming process uses the principles of staged reforming to efficiently and cleanly recycle waste into energy.

This falls in line with SIRC’s goal of actively leading the charge in implementing impactful waste reduction strategies, accelerating the widespread adoption of renewable energy solutions, and championing the principles of environmental justice.

It also aligns with the comprehensive plan announced by the Kingdom’s Ministry of Environment in January 2024, which targets recycling a significant portion — up to 95 percent — of the country’s waste.

“Under this memorandum, SIRC will provide sewage and agricultural waste as raw materials, while Concord Blue will convert this waste into renewable hydrogen, in addition to transferring knowledge in this field and training national cadres to build, operate and maintain facilities for converting waste into hydrogen,” said Faisal Al-Solami, executive vice president of finance and strategic planning at SIRC.

When fully implemented, the plan will see around 100 million tonnes of waste recycled annually, showcasing the nation’s commitment to sustainability.

Under the terms of the newly signed MoU, both parties will offer innovative solutions that contribute to environmental sustainability and promote the circular carbon economy by producing high-quality green hydrogen and manufacturing biochar and industrial-activated coal. 

Al-Solami said signing the agreement is a key step toward achieving Vision 2030’s recycling and sustainability goals, as it promotes environmentally friendly energy solutions from waste, reduces emissions, and supports an eco-conscious economy.

This comes as the first phase of the project will achieve several goals, including reducing the volume of waste sent to landfills, enhancing hydrogen production on a large scale, and developing innovative solutions to reduce carbon emissions.

It will also support local manufacturing projects and contribute to achieving a zero-carbon future by producing clean fuel that supports the transition to a hydrogen economy in the industrial and transportation sectors.


Closing Bell: Saudi main index edges up to close at 12,433

Closing Bell: Saudi main index edges up to close at 12,433
Updated 06 February 2025
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Closing Bell: Saudi main index edges up to close at 12,433

Closing Bell: Saudi main index edges up to close at 12,433

RIYADH: Saudi Arabia’s Tadawul All Share Index edged up on Thursday, gaining 19.18 points, or 0.15 percent, to close at 12,433.58. 

The total trading turnover of the benchmark index was SR6.88 billion ($1.83 billion), as 123 of the listed stocks advanced, while 96 retreated.  

The MSCI Tadawul Index increased by 2.23 points, or 0.14 percent, to close at 1,545.99. 

The Kingdom’s parallel market Nomu also rose, gaining 135.68 points, or 0.43 percent, to close at 31,386.27. This comes as 40 of the listed stocks advanced, while 39 retreated. 

The best-performing stock was Almasane Alkobra Mining Co., with its share price surging by 7.49 percent to SR68.9. 

Other top performers included the Thimar Development Holding Co., which saw its share price rise by 5.76 percent to SR56.9, and Makkah Construction and Development Co., which saw a 4.42 percent increase to SR108.60. 

Mutakamela Insurance Co. saw the largest decline of the day, with its share price dropping 2.19 percent to SR18.72. 

The Tanmiah Food Co. saw a decline of 1.99 percent, with its share price dropping to SR127.80, while the Saudi Industrial Investment Group fell by 1.69 percent to SR17.40. 

On the announcements front, Saudi Industrial Investment Group reported its annual financial results for 2024, with net profits reaching SR11 million, matching the previous year’s figure. 

Saudi Arabian Mining Co., known as Ma’aden, also announced the official launch of its US dollar-denominated trust certificates offering.

The offering is available to eligible investors both in Saudi Arabia and internationally, as part of Ma’aden’s strategic initiative to strengthen its financial position and expand investment opportunities. 

To facilitate the issuance, Ma’aden has appointed 10 companies as joint lead managers for the transaction, including Citigroup Global Markets Limited, HSBC Bank, Al Rajhi Capital Co., BNP Paribas, and GIB Capital.

The other five include J.P. Morgan Securities plc, Natixis, Saudi Fransi Capital, SNB Capital Co., and Standard Chartered Bank. 

In a statement to Tadawul, the company stated that the sukuk will be issued in two tranches, with maturities of 5 and 10 years. The minimum subscription amount is set at $200,000, with the final value and terms of the offering to be determined based on market conditions. 

Following the announcement, Ma’aden’s shares closed at SR48.15, up 4.05 percent in today’s session. 


Saudi crown prince launches ‘King Salman Automotive Cluster’ at KAEC

Saudi crown prince launches ‘King Salman Automotive Cluster’ at KAEC
Updated 06 February 2025
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Saudi crown prince launches ‘King Salman Automotive Cluster’ at KAEC

Saudi crown prince launches ‘King Salman Automotive Cluster’ at KAEC

RIYADH: Saudi Crown Prince Mohammed bin Salman has named the automotive manufacturing hub within King Abdullah Economic City the “King Salman Automotive Cluster,” the Saudi Press Agency reported on Thursday.

The King Salman Automotive Cluster will serve as a pivotal center for the automotive industry, housing the headquarters and manufacturing facilities for both local and international companies.

Notable brands, such as Ceer—the first Saudi electric vehicle brand—and Lucid Motors, which opened its first international factory in KAEC in 2023, are set to be key players in the cluster.

The site will also host multiple Public Investment Fund joint ventures with global manufacturers, including a highly automated factory with Hyundai Motor for car production in Saudi Arabia and a partnership with Pirelli to establish a tire factory.

This new cluster marks a significant milestone in Saudi Arabia’s economic diversification efforts, supporting the development of the automotive sector and advancing sustainable transportation. It will contribute to boosting the non-oil gross domestic product and increasing exports.

The King Salman Automotive Cluster will accelerate local manufacturing capacity, promote research and development, and optimize supply chains, making them more efficient for both regional and international markets.

The project is expected to create numerous investment opportunities for the private sector, fostering the growth of promising industries within the Kingdom.

By 2035, the cumulative GDP contribution from companies within the cluster is projected to reach approximately SR92 billion.

The cluster will generate thousands of direct and indirect jobs, support local manufacturing, and boost Saudi exports, positively impacting the nation’s balance of payments.

Leveraging KAEC’s robust infrastructure and its strategic location near a well-developed port, the cluster offers significant advantages for both local private sector entities and international companies. These factors will provide ample opportunities for collaboration between partners, suppliers, and investors within the automotive industry and related sectors.

The King Salman Automotive Cluster will play a key role in advancing the National Industrial Development and Logistics Program, which aims to position Saudi Arabia as a leading industrial hub and global logistics center by fostering high-growth sectors and attracting foreign investment.