The decree issued by King Salman bin Abdulaziz Al Saudi allowing women to drive in Saudi Arabia could well offer the kingdom a financial output of $90 by the year 2030.
According to a research carried out by Bloomberg’s Middle East Economist, Ziad Daoud, the new decree will offer a greater female engagement in the Saudi labor market over the long-term, which can cause a GDP growth.
Daoud estimates the potential output to be comparable to income generated by Saudi oil company Aramco’s initial public offering.
“The research finds that just adding one percentage point to the rate every year could add 70,000 more women a year into the labor market,” a release issued by Bloomberg read.
“While not all of these women may find work, even assuming a structural unemployment rate for women of 17% means the growth consequences are sizable.
“This could lift potential GDP growth by up to 0.9 percentage points a year. Should this be realized, the Kingdom’s GDP would be around $90 billion larger by 2030 than it would have been if the ban had remained in place,” the release concluded.
No more than 20% of females in Saudi are currently active in the market, nonetheless, the kingdom’s National Vision 2030 program is aiming at increasing the involvement of females in the Saudi economy.