The World Bank has warned that countries in the Middle East and North Africa (MENA) face a critical crossroads, requiring “urgent” reforms to turn major challenges, aging populations, climate change, and technological transformation, into real opportunities that can secure sustainable growth for future generations.
At the same time, the Bank highlighted Saudi Arabia’s coordinated reforms under its Vision 2030, which have raised women’s workforce participation from 17% in 2016 to over 35% in 2024.
In an interview with Asharq Al-Awsat, Fadia Saadah, World Bank Regional Director for Human Development in the Middle East, North Africa, Afghanistan, and Pakistan, outlined the Bank’s view on the most pressing reforms and how Gulf Cooperation Council (GCC) countries can leverage significant investments in human capital to close gaps and boost inclusive economic participation.
Developing Skills
Saadah noted that GCC countries, including Saudi Arabia, are seeking to maximize the benefits of foreign labor through labor market policy reforms, balancing the need to fill skills gaps with supporting economic growth, while investing in education, skill development, and incentives to encourage citizens’ participation in the private sector.
She highlighted Saudi Arabia’s extensive reforms in recent years to improve its sponsorship (kafala) system, enhancing the mobility of foreign workers and improving working conditions.
These reforms have been paired with Saudization programs, such as Nitaqat, which set quotas for employing Saudi nationals in the private sector.
According to Saadah, these measures—alongside financial support programs, retraining initiatives, and women’s empowerment policies—have contributed to increased citizen participation, particularly among women. Digital platforms and targeted training programs have also supported citizens, especially youth and women, by providing access to employment opportunities and developing skills required for a changing labor market.
Digital Transformation and Vision 2030
Under Vision 2030 and government digital initiatives, Saadah said Saudi Arabia has prioritized digital services, data-driven decision-making, and inclusive access, focusing on women and youth as central to the digital transformation. The kingdom is investing in digital infrastructure and artificial intelligence to modernize public service delivery and expand economic opportunities.
While human capital in the region has improved significantly, Saadah cautioned that its full potential remains untapped for driving economic growth. Despite progress in education and healthcare, aging populations and unhealthy lifestyle patterns continue to strain pension systems and healthcare infrastructure. Conversely, climate challenges and technological shifts offer opportunities to enhance green skills and digital readiness, opening new avenues for sustainable growth.
Institutional Reforms Needed
In its mid-September report, Embracing and Shaping Change: Human Development in MENA in a Transforming Phase, the World Bank noted that low human development investment is both a cause and consequence of economic performance and income growth. The report urged governments in the region to address governance gaps and ensure sustainable financing for human development.
The report identified three major trends that could erode development gains if not effectively addressed:
Aging populations: With the share of older adults expected to double by 2050, pension and healthcare systems face major challenges.
Climate crisis: Rising temperatures and water scarcity threaten health and food security, though green transition policies could create new opportunities.
Technological transformation: Although regional labor markets are less exposed to automation than elsewhere, the region must prepare to fully benefit from artificial intelligence, improve digital infrastructure, and reduce internet costs.
Saadah emphasized that building on these achievements requires continued investment in future-ready human development policies, including strengthening human capital, advancing institutional reforms, and adopting strategies tailored to each country.
Women’s Empowerment
Saadah said Saudi Arabia offers a clear example of achieving better outcomes through broad reform programs. Vision 2030, labor market strategy, and human capacity development initiatives have aligned education and skills development with labor market needs.
Efforts focus on technical and vocational education, digital skills, and lifelong learning to enhance private sector employment opportunities, particularly for youth and women. Digital platforms such as Qawi and Jadarat have facilitated access to jobs and training programs, improved labor market matching, supported flexible and remote work, and developed future-ready skills, making the labor market more inclusive and responsive.
Reforms have also included removing guardianship requirements for women to work or travel, criminalizing workplace harassment, unifying retirement ages, and banning gender discrimination in hiring and pay. Complementary support programs, such as Wasl for transportation, Qara for childcare, and Maran for workplace flexibility, along with training in nontraditional sectors like ICT and aviation, have further empowered women.
Saadah concluded that these measures have enabled women to enter and remain in the workforce, especially in the private sector, contributing to shifts in social attitudes and broader acceptance of women’s economic participation. She stressed that enhancing women’s participation is not merely a social choice but an economic strategy, as reforming social norms and official institutions is essential for achieving a sustainable and deeply impactful transformation.
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