Published in Bloomberg View
But then I talked to Omar Al-Ubaydli, an economist and program director at the Bahrain Center for Strategic, International and Energy Studies and a research fellow at the Mercatus Center in Virginia. He pointed out that while $3.5 billion is a lot of money for us, and for Uber, it’s almost pocket change for the Saudi government. He sees this as an investment in moving the Saudi economy beyond oil -- a well-documented priority.
“The gulf economies are very strange,” says Al-Ubaydli, himself a Bahraini national. He suggests that putting money into Uber, and taking a board seat, gives them a leg up at building a stronger private sector through similar decentralized applications, allowing Saudis -- particularly women, who are less mobile for cultural and legal reasons -- to begin to move the country beyond its dependence on oil revenue.
It's an odd thought, trying to build up the private sector with a targeted investment from the state wealth manager. But given the strange nature of gulf economies, there’s little alternative.
“The normal principles you’re used to deploying in a traditional economy don’t work," Al-Ubaydli says. "I agree it’s a bit ironic, but trying to shift an economy that’s so dependent on oil, you have to think outside of the box.”
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