Middle Eastern Gulf states such as Kuwait, the United Arab Emirates (UAE), and Saudi Arabia have long been associated with oil. The region accounts for an estimated 55% of petroleum reserves globally, and controls an approximate third of total oil production. This sector dominates the region’s economies, with a contribution of up to 80% of government revenues on average. Yet there are major changes on the horizon, with the days of oil’s dominance perhaps coming to an end. This will have profound impacts on not only the economies of these countries, but also their societies. Could one of the largest impacts be felt by women?
While considered a blessing from many perspectives, academics, environmental scientists, and policymakers have long warned of the dangers of dependence on petroleum. Academic literature on the so-called “resource curse” highlights negative impacts such as fluctuating prices and resultant unstable economic relationships, the exploitation of resources for potentially destabilizing external security means, and the interdependence between oil exporters and importers leading to “oil wars.”
Not only does oil have noted adverse effects on interstate relations, it can negatively impact the internal dynamics of nations, including through its ability to confer legitimacy on authoritarian regimes and disadvantage other economic sectors. Gender tends to be ignored from these discussions, however, despite the fact that oil wealth can have significant negative implications for equality between men and women. Nowhere is this more noticeable than in the Gulf.
To better understand this relationship, it is useful to explore the concept of the “Dutch Disease,” coined by The Economist in 1977 to explain the negative impact of the Netherlands’ large hydrocarbon discoveries on other parts of its economy. In essence, booms in resource production are found to draw labor and capital away from other tradable sectors such as agriculture and manufacturing. As money from the growing resource sector penetrates the economy, it also raises the real currency exchange rate, making it cheaper to import rather than domestically produce these other goods. The increase in the real exchange rate also means that these sectors find it harder to compete on world markets due to the increased costs of their goods.
This is one of the factors behind the Gulf countries moving away from oil dependence. Others include market volatility owing to the ascension of non-conventional oil and gas production, primarily in North America, and moves toward low-carbon economies due to the threat of climate change and price-competitive renewable energy technologies.
Several Gulf states have already implemented economic diversification goals for the near future. These include Saudi Arabia’s Vision 2030 and Kuwait’s 2035 New Kuwait plan. There has also been talks of imposing taxes in many countries where they didn’t exist because of oil-generated state largesse.
The Gulf states have traditionally challenged any notions of economic development leading to greater gender equality, as was seen in the measured improvements of patriarchal cultures in Latin America, South Asia, and East Asia as a result of economic growth there. More often than not, the oil-dependent nature of Gulf wealth has provided a barrier toward women’s equality.
One factor in this is that women around the world have historically entered the labor force through low-wage, export-oriented industries, particularly agriculture and the garment and textile sectors, in which men have no natural strength advantage and there is little required in the way of specialized skills and training—to this day, more than 80% of global garment and textile employees are women. Yet these are the industries most affected by the dynamics of the Dutch Disease.
Export-oriented factories have also been found to employ higher numbers of women than domestically oriented firms. The reasons for this include the fact that they grow at a faster rate by opening up to mature markets and experience greater wage pressure as a result. This puts a premium on female workers, who are typically paid much lower wages in comparison to males. While exploitation is rife, through accessing the labor market via the tradable sector, women have historically also managed to progress into other sectors.
Women might logically also seek employment in the non-tradable sector, which also typically experiences growth in labor and capital as a result of growth in the booming tradable sector. An increase in female employment in these activities has largely been the case in oil-rich economies such as Norway, Russia, and Venezuela.
In the Gulf states, however, there is a much higher rate of occupational segregation, which places barriers on such mobility. The non-traded sector typically comprises jobs in construction and retail, which involves heavy labor or direct contact with men outside the family; both of which disadvantage women in patriarchal systems.
According to the World Bank, the oil economies of the Gulf states have, on average, just a 22% female labor force participation rate. There is good reason to believe that oil wealth plays a significant role in what is traditionally seen as solely a result of Islam-enforced restrictions on gender equality. In nearby North Africa, for example, oil-poor Morocco had 26% female labor force participation in 2011, in comparison to 15% in oil-rich Algeria, yet both are predominantly Muslim states.
Preventing easy access to the labor market in turn serves to perpetuate and reinforce patriarchal attitudes and arrangements, including men’s statuses as breadwinners and women’s roles in child-rearing and domestic duties. Marriage subsequently becomes a means to secure financial security.
Additionally, when women enter the labor market it broadens their social networks beyond their family units. They also become more inclined to join informal networks and groups to collectively fight for their economic rights and overcome discrimination. From here they are more likely to obtain political power. By forming networks and increasing their presence in the labor force, they can pressure politicians, policymakers and governments to take women’s interests into account.
This dynamic can thus also explain the statistically low rates of female political representations and political empowerment in the oil-rich Gulf states. The World Economic Forum, for example, indicates that these economies have a political representation and empowerment index ranging from 0.021 to 0.1, where 1.0 denotes total equality. Morocco and Tunisia, both oil-poor economies, on the other hand, have an index score above 0.2.
Talk of introducing taxes, meanwhile, could potentially also serve as a platform for women’s advancement. According to some analyses, taxes force authoritarian regimes to become more accountable to their citizens and thus allows for greater representation. Some, alternatively, argue that it is not the increase in taxes per se, but specifically an increase in taxes related to government services that achieves this. Increased gender equality would thus rely on the system that is implemented.
Promisingly, there are already signs of change in the Gulf at the same time as it considers moves away from oil. Saudi Arabia, for example, is discussing increasing the role of women in the workforce, abolishing the male guardianship system restricting women’s movement, allowing women the right to drive, and granting access to education and healthcare without the need for male consent.
Dalya Al Alawi is an Intern in the International Peace Institute’s Bahrain office and a student at the University of Birmingham.