Saudi taxi drivers have taken the unusual step of a mass protest in Riyadh against the government’s postponement of the Saudization of taxis for another three years. They complain that cheaper expatriate drivers are undercutting them and that the decision demonstrates a lack of seriousness on the authorities’ part about Saudization.
If Saudi taxi drivers were simply objecting to competition, no one would have any sympathy for them. That is not what this is about. The Saudi drivers’ complaint is about unfair competition, about cheap labor being used to skew the business, about the lack of a level playing field.
Unlike expat drivers who generally pay a daily rental to a taxi owner for their cab, keeping whatever extra they make for themselves, Saudi taxi drivers are often self-employed, expending a considerable outlay buying and maintaining their own vehicles. Moreover, while expat drivers certainly work long hours, they are also willing to earn far less than would be considered reasonable by a Saudi citizen — which is precisely why taxi companies have so spectacularly ignored Saudization. Expat drivers are also willing to charge passengers less than the meter rate. It is illegal but it is very common, especially in Jeddah.
The accusation that the authorities are not serious about Saudization is, however, unfair. Saudization is an absolute necessity for the social and economic stability of the Kingdom, and the authorities’ commitment is total.
The problem is that the licensing authorities should have been far more involved in the process. After all, it should not be difficult to attract young Saudis into the taxi business. A driver, providing he owns his own vehicle, is his own boss. He can work when he wants, for as long as he wants. It is a good job.
The authorities should have started restricting expatriate licenses as soon as the Saudization directive was issued. They should have insisted that taxi companies adopt a rolling, verifiable program of Saudization, rather than demanding 100 percent completion by a specific day. But they preferred to leave it to the business to regulate itself. That can work with companies that can be fined for nonimplementation, but in the taxi business, where some drivers are their own masters, matters are far more complex. But even that has not been done. Where are the fines on taxi companies for noncompliance? Instead, they have been given another three-years’ grace. That is remarkable leniency. It is bad enough that the required 100 percent implementation by this month failed to materialize. But according to the authorities’ own estimates, only a mere one percent of the business has been Saudized! It is not the authorities that are not serious, it is the taxi companies.
Although the authorities have been forced into this deeply disappointing postponement, it must not happen again. There have to be monthly assessments of taxi companies’ progress, punitive fines for those that drag their feet and the phased withdrawal of licenses from expatriate drivers. It is the only way. Anything less than such proactive involvement will fail yet again.
