Involvement of young Saudis in the private sector, reforms in education, and encouragement of SMEs are the three main concerns of Hani Baothman, CEO of Sidra Capital.
“Organizing training programs and promoting work ethics among them should be undertaken on a massive scale to build a strong Saudi work force within the coming 20 years,” Baothman told Diana Al-Jassem of Arab News in an exclusive interview. He stressed the need for creating jobs not by depending on government but by encouraging small and medium enterprises (SMEs).
Baothman stated that labor laws should differentiate between big companies and SMEs. He also emphasized the importance of promoting housing projects for the benefit of low income groups.
What, in your opinion, are changes that would have a major impact on the lives of Saudis within the coming 20 years?
Globalization will be a major challenge facing our youth. Saudis say they have their own way of dealing with things, but this cannot last for ever. The large number of young Saudis coming from aboard will pose a big challenge because they will return with global values. From the economic perspectives, the continuous dependence on oil is a big challenge. Today, we are the main supplier of oil, but what will happen if the world starts using renewable energy. Whether we have enough time to move from the oil economy or not, we have to be brave enough to start asking that question.
Role of leadership
What do you think of the leadership roles regarding organizations in the Kingdom and what are the factors/reasons for their current state?
I was doing a job that exposed me to deal with businessmen throughout the Middle East. Most of the businessmen were impressed with the Saudi corporate culture as it is transparent and professional compared to other overseas business cultures. And I think it is due to the Kingdom’s openness; the government has created an open market and wants to protect this with perfect laws. Word Trade Organization (WTO) membership helps Saudi companies to develop their business internationally. Saudi leaders in most business sectors are qualified enough. For example, many important banks in the Middle East are Saudi banks with most of them led by Saudis and the rate of Saudization is high in these banks. Saudi business leaders are doing well.
What are the most difficult decisions that need to be applied in the Kingdom within the coming 20 years?
I think adapting youth to our progressive economy would be a major challenge. It is taken for granted that the government is the largest employer of our youth, but that should change. The youth should be pushed into the market for doing business. The only thing that our youth are lacking is training, and maybe business ethics. Enhancing these two elements will attract businessmen to push young Saudis into the market for business ventures.
What goals would you set regarding the Kingdom’s development and how would these goals be achievable through your current position?
I believe we should share our experience and resources to encourage enterprises rather than mere jobs. Creating new activities will reduce stress on the government to create job opportunities. This is one of the major goals that I am currently working on. Sidra started its CSR program that targets both Saudi male and female youth. Some of the initiatives that we launched have succeeded in promoting entrepreneurships and businesses.
Give me an example of the most creative project that you wish to establish in the Kingdom.
The most creative project that I really wish to see in the Kingdom is to turn the annual Haj season into one of the international gatherings with people talking about commitment, organization and a smooth traffic. Saudi Arabia is very proud of hosting millions of pilgrims for Haj, but we still want to improve Haj. I want the Haj to be a luxurious experience. Haj could become a huge business for Saudi Arabia if we develop its services.
Regarding Kingdom’s officials, what characteristics do you think are important for such individuals?
Officials should be more tolerant about the divergence of opinions. We have the largest segment of youth who are not heard. Officials should get closer to our young population and give them the opportunity to speak out loud and clear. We need more open communication methods. I am so pleased with Saudi officials who are talking to people through social media like the Minister of Culture and Information, the Minister of Labor, and the Minister of Commerce and Industry.
How can we all improve human rights in Saudi Arabia and what are your expectations?
I have to say that there have been occasions when we disliked people in different parts of the world abusing the system and workers. This is happening everyday all over the world, not in Saudi Arabia alone. It happens in the United States, the UK and the Arab world. As a Muslim nation, we shouldn’t allow these practices to continue. We should come up with laws that prevent discrimination against others. During the past 50 years, our values were different. Yet I see a big number of youth who are trying to restore the culture of Islamic values.
Education is always a priority of the Saudi government. What changes are required in the education system to fit Saudi youth in a knowledge-based economy?
The education system needs a major shift. Huge funds have been given to the Ministry of Education. Some of the universities that have made major moves are the government universities. The government has been making efforts to improve our universities but they are still lagging behind. Our primary education really needs much more effort for development.
What is the biggest challenge facing the Kingdom today?
The unrest in the region is a big challenge for us. It’s sad to see some Arab and Muslim nations going through a period of instability. It is our responsibility to help our neighboring Arab and Muslim nations. I want to see that help is extended to the people of Syria, Iraq and Yemen. We can’t turn a blind eye to what is happening worldwide; we should show concern for our brothers and sisters everywhere.
There is a huge demand for housing in the Kingdom because of rising young population. The government has also put an emphasis on this sector by allocating a big budget for housing. Do you believe housing needs much more attention from the government and the private sector?
Introducing the mortgage law is a very good decision. This law will have a big social impact. For example, the family that gets a housing loan will work hard and earn more to pay back the loan. Therefore, I believe that the mortgage concept is going to mature the thinking of young Saudis. I also think it will help the middle class people a lot. The mortgage law is going to check the soaring land prices and bring them down realistic levels. According to a research that I did, most of the Saudi families would be eligible to a SR 1.15 million loan. Developers can only develop units with such an amount. They will not be able to check the rising cost of land. The mortgage law will not help the low-income people, and this calls for the government to play an effective role. The government should work on developing special housing plans for low-income people. However, I believe that mortgage is helpful and will create new jobs, and serve a large segment of society.
Role of SMEs
There is a need to boost small business enterprises (SMEs) in the Kingdom as it creates various jobs. What kind of role do you think SMEs can have in the ongoing development of the Kingdom?
SMEs have a significant share in building the Saudi economy. SMEs are coming up in the Kingdom, which has a track record of being an entrepreneurial society. Promoting SMEs should be one of the major objectives of the government. We could start simply by differentiating between SMEs and big companies in terms of our laws related to taxes and Saudization.
How do you see Saudi women’s contribution in the labor, social and political arenas in the next 20 years?
Women should get equal opportunities just like men. Sometimes, Saudi women are getting international platforms simply because they enjoy Western values, but they don’t represent us. We have excellent Saudi skills, but their acquired values don’t allow them to represent us globally. What I am trying to say is let all women compete without promoting those with Western values. Why shouldn’t we be proud of our women who strictly adhere to our society, our values? We have big names who can be role models for our women.
What measures and standards are yet to be (and must be) applied to Saudi media and what are your expectations in the next 20 years? And how change in the Kingdom will impact our social media?
I think new media will dominate. I attended a workshop about new media, where big media institutions discussed the emerging new media. The expansion of smartphones also contributed to enlarge the use of new media. I think that traditional media will continue, but the newspaper will alone not be enough to be a media institution.
Learning from the past
What are three or four mistakes that have been repeated in the Kingdom during the past two decades and how could we eliminate these in the interest of the Kingdom’s onward progress?
We should teach our children the real meaning of nationalism. We taught our children to celebrate our national day with great enthusiasm and support our football players but we haven’t given them behavioral lessons. What youth did during the opening of the redeveloped Jeddah Corniche by trying to destroy part of it was really frustrating.
Message to youth
Given that the youth make up the majority of the Saudi population, what message would you want conveyed to them and what else would you say to the rest of the population?
We have to raise our kids for situations that are going to be more difficult than in our time. Many families are protective of their kids. Our youth should be strong, and should know that nothing is easy in life.