All it does is give Saudi women a privilege others have had for more than a 100 years, but this is a landmark decision for the kingdom. And it’s great timing too.
Saudi Arabia is in the market to sell dollar bonds today, it’s second this year.
The decision to lift a ban that activists have fought for decades is a sign the kingdom is serious about transforming its society, one of the world’s most conservative, as part of a larger drive to diversify the Arab world’s biggest economy away from oil.
“In terms of achieving one of the goals of the economic reform plan (increasing female participation in the workforce), lifting the ban on driving is a big step in the right direction,” said Khatija Haque, the head of research for the Middle East and North Africa at Emirates NBD PJSC. “It’s also a signal to investors, ahead of the upcoming bond issue, that the authorities remain committed to implementing their ambitious economic reform agenda, even though visible progress has been a little slow in recent months.”
For Michael Cirami, the Boston-based money manager at Eaton Vance Management who oversees about $13 billion of assets, the change improves his outlook on Saudi Arabia, but says he will be looking out for a backlash.
“It will be an important indicator to watch,” Cirami said.
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