The Media Line Staff
Saudi Arabia (TML) – About five years ago, Shroog Radain, a 29-year-old teacher’s aide at King Abdul Aziz University in Jeddah, saw the perfect niche for her skills as a baker and confectioner. She founded Mini Bites, a small company based on Quraish Street in the Al-Salamah District of Jeddah.
Radain brought in her friend, Maha Aboulola, also 29, as her partner and named her husband, Mowaffaq Aboulolaa, as Mini Bites’ marketing manager. Radain and Aboulola supervise the entire operation.
Mini Bites specializes in homemade sweets, cupcakes and canapés, including traditional Arabic baked goods.
“We’re doing quite well,” Radain said recently. “We do weddings and go to food conventions and wedding expos.”
The company remains small and Radain and Aboulola, a journalist, haven’t quit their day jobs, but Mini Bits’ Facebook page alone boasts more than 1,000 members and has a loyal following.
Radain and Aboulola, daughters of upper-middle class liberal parents, are the new face of the Saudi woman entrepreneur. They came into adulthood in the aftermath of 9/11 with a fistful of Saudi riyals and an ambition to chart their own destiny by trying to steer clear of traditional female employment, such as in education.
Studies performed in Saudi Arabia and by foreign think tanks show in the past two years that Saudi women are emerging with influence. Changes in the population and access to deep pockets are giving Saudi women growing economic influence that just a decade ago was unthinkable.
According to Saudi Arabia’s statistics department, the country’s population grew from 7 million in 1975 to 25 million in 2009, including the 7 million expatriate workers now living in the kingdom. Saudis under the age of 34 account for 70% (13.3 million) of the total population of 18 million Saudis in 2009. Saudi women represent about half of that 34-year-old and under segment.
Earlier this year, the Cayman Islands-based asset management company Al Masah Capital conducted a survey that found that Saudi women controlled an estimated $11 to $12 billion in assets in Saudi banks. Further, the Jeddah Chamber of Commerce estimates that women invested about $1.9 billion in real estate.
Yet in late 2010 the pace of female investments remains slow as Saudi women are unwilling or unable to invest their funds effectively. A Jeddah Chamber of Commerce study (“Businesswomen in Saudi Arabia: Characteristics, Challenges, and Aspirations in a Regional Context” by Noura Alturki and Rebekah Braswell, July 2010) reports that Saudi women are not taking advantage of their funds.
Women’s investments and business account for about 4.3% of the private businesses in the kingdom. Still, 72.6% of those Saudi businesses registered by women are outside the home and 92% of those businesses have employees on the payroll. Saudi women’s businesses are generally interior design, fashion, jewelry, beauty salons, wholesale/retail, marketing, consulting, event management and public relations.
According to the Jeddah Chamber study, obstacles preventing Saudi women from achieving economic parity with their male counterparts are numerous but not insurmountable. Roadblocks include:
• Lack of government infrastructure to grant business licenses for female-oriented businesses such as beauty salons and child day-care facilities
• Lack of public transportation and an urban driving ban on women, which lead to logistical planning problems and incurring high costs for private transportation
• Severe restrictions on international travel
• Severe restrictions on government-issued business visas for foreign women or iqamas (work permits) to foreign wives of expatriate workers
• Refusal of some government officials to recognize changes in laws that allow real estate investment, access to public services and appointing a person as power of attorney
• Lack of decision-making powers in government women’s sections
• Lack of access to traditional funding mechanisms, such as commercial bank loans
Saudi women with supportive families get around many of these obstacles. Travel issues are often solved through a notarized document from a woman’s mahram (male guardian) allowing her the ability not only to travel within the kingdom but to other countries. A female-owned beauty salon may open under a different licensing category like a tailor shop, because licensing for beauty salons don’t exist. Women possessing a national identity card can open bank accounts and obtain personal loans, although limited funding through such loans denies businesswomen to be more competitive.
Although women open and conduct business in this manner, it doesn’t solve the larger issue of government officials failing to honor changes in the law designed specifically to make it easier for Saudi women to conduct business.
One Saudi businesswoman, who asked not to be identified because she is negotiating several sensitive real estate deals, said it took two years to establish her real estate company. The primary roadblock was the names of 24 women listed as investors.
Local government officials were reluctant to grant her a license, but never specified their concerns. The government sought a closer look at the company, yet never provided information what laws and regulations. Ultimately, the woman obtained her license.
Yet Saudi Arabia has taken incremental steps to ease restrictions. Perhaps the most significant step was an effort in 2005 by then-Minister of Labor Ghazi Al-Ghosaibi to permit women to work in lingerie shops. Al-Ghosaibi, known for his liberal attitudes toward women’s rights, spearheaded the effort. But shop owners refused to hire women fearing interference from religious conservatives, particularly the Commission for the Promotion of Virtue and Prevention of Vice. The ministry’s efforts failed, revealing that the theory of female empowerment, even given at the highest levels, is not compatible with the reality of dealing with conservatives who up until 2010 held virtual veto power over many government decisions.
The lingerie shop issue, however, served as a lightning rod for equally bold moves by the Saudi government that were successful. In 2008, Mecca’s governor, Prince Khaled Al-Faisal, abolished the law banning men and women from interacting while conducting business. During the same year, the Labor Ministry under Al-Ghosaibi made it legal to allow women to not only choose where to work but to no longer seek a mahram’s permission to seek work or change jobs. In addition, travel restrictions were eased slightly in which a ban was lifted preventing women from staying alone in hotels.
Ministry decisions are often a response to the shifting social attitudes of the kingdom. Although Al-Ghosaibi, who died in August, had long established his credentials as supporting the right of women to engage in commerce, the impetus comes largely from women born after 1975. They came of age when the Internet was in its infancy and later when satellite television offered a daily window into Western culture.
As young women graduate from Saudi and foreign universities, they are less likely to wear the niqab (face veil) in Saudi Arabia and more likely to socialize in a mixed environment. Indeed, upscale malls in Jeddah are filled with Saudi women who remove their hijabs and wear open abayas, a style unheard of five years ago. The new attitude has led to the changing tide of working alongside men in private universities and the private businesses.
“Things are different now,” Radain said. “Yes, it’s still hard to find jobs, but starting your own business can solve that and it doesn’t necessarily take a lot of money. With hard work, a woman can succeed in’shallah.”
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