Prince Alwaleed welcomes move to allow women to drive in Saudi Arabia

Billionaire chairman of Kingdom Holding Company praises Riyadh's landmark decision

Prince Alwaleed has welcomed the decision to allow women to drive in Saudi Arabia. EPA

The new policy allowing women to drive in Saudi Arabia is seen as part of an effort by Crown Prince Mohammed bin Salman to overhaul the kingdom’s economy, society, and reputation globally.

The move to lift the ban was welcomed by one of the kingdom's most high-profile businessmen.

The billionaire Prince Alwaleed bin Talal, who said in November it was a matter of economic necessity as well as women's rights to lift restrictions, praised the decision in a tweet.

"It is high time that Saudi women started driving their cars," said Prince Alwaleed, who is the chairman of Kingdom Holding Company (KHC), which owns stakes in the huge US bank Citigroup and the Euro Disney theme park and which is listed on the Saudi stock exchange.

KHC claims to be one of the largest foreign investors in the US, with interests in hotels, property and news media. The company has stakes in Disney, 21st Century Fox, News Corp, Apple, General Motors, and Twitter.

The prince estimated that the average family spends each month 3,800 Saudi riyals [Dh3,936] on a driver, which drains family incomes, according to the BBC.

"Retaining foreign drivers not only has the effect of reducing a family's disposable income ... but also contributes to the syphoning of billions of riyals every year from the Saudi economy to foreign destinations in the form of remittances," he said.

The lifting of the ban will also more than likely add to the country's workforce and boost women's incomes. Lack of mobility tends to foster unemployment; according to the country’s own General Authority for Statistics, 34 per cent of Saudi women were unemployed last year.

The edict will go into effect in June 2018. Until then, the current ban makes it illegal for women to be granted a driver’s licence. Women who are employed have to hire private drivers to get to and from work, or use ride-hailing services like Uber or Careem, the Dubai-based firm valued at US$1 billion that operates across the Middle East, North Africa, and South Asia to get around, all of which eats up much of a woman's pay.

Of the ride-sharing apps, Uber, in particular, has a unique relationship with Saudi Arabia. Last year, the company raised a staggering $3.5bn investment from Saudi Arabia's main investment fund. As part of the deal, the Public Investment Fund managing director Yasir Al Rumayyan took a seat on Uber's board. In addition, Saudi Arabia’s Princess Reema Bint Bandar Al Saud sits on the company's policy advisory board.

At the time, Uber executives expressed support for allowing women to drive, but did not state explicitly whether they planned to hire women drivers. “We've always said that women should be allowed to drive,” an Uber spokesperson said today. “In the absence of that, we're proud to have been able to provide extraordinary mobility that didn’t exist before. We look forward to continuing to support Saudi Arabia's economic and social reforms.”

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However, the opportunity for women to drive is not the only economic benefit of the decree. "The ripple effect of this reversal of the ban on society at large will be hard to overstate," tweeted Zaki Safar, a 33-year-old Saudi consultant.

"The patent socioeconomic fruits Saudi society will reap as a result as women are allowed the freedom to drive instead of having to pay costly foreign chauffeurs, and as one of the barriers to women employment is broken down, are but a fraction of the good this change will usher in."

Another plus for the economy will be the growth of two car households in Saudi Arabia, according to the energy expert Ellen Wald. "This will require many households that do not already have a second car and driver to purchase a large product and contribute to the economy. Families of means often have cars and full-time drivers, but middle-class families will become more likely to purchase additional vehicles as more members of the families become drivers."

This is particularly important at this juncture as Saudi Arabia seeks to attract foreign investment for economic growth and economic diversification, she said.

Mr Safar added: the decree "will open more doors for Saudi women to shine and succeed. All this would be conducive to the realisation of Vision 2030".