In Saudi Arabia, unemployment and booming population drive growing poverty

December 3, 2012

A few miles from the blinged-out shopping malls of Saudi Arabia’s capital, Souad al-Shamir lives in a concrete house in a trash-strewn alley, with no job, no money, five children younger than 14 and an unemployed husband who is laid up with chronic heart problems.

“We are at the bottom,” she said, sobbing hard behind a black veil that left only her eyes visible. “My kids are crying, and I can’t provide for them.”

Millions of Saudis live in poverty, struggling on the fringes of one of the world’s most powerful economies, where job-growth and welfare programs have failed to keep pace with a booming population that has soared from 6 million in 1970 to 28 million today.

Under King Abdullah, the government has spent billions to help the growing numbers of poor people, estimated to be as much as a quarter of the native Saudi population.

But critics complain that those programs are inadequate, and that some royals seem more concerned with their wealth and the country’s image than with helping the needy. Last year, for example, three young Saudi video bloggers were arrested and jailed for two weeks after they produced an online video about poverty in Saudi Arabia.

“The state hides the poor very well,” said Rosie Bsheer, a Saudi scholar who has written extensively on development and poverty. “The elite don’t see the suffering of the poor. People are hungry.”

The Saudi government discloses little official data about its poorest citizens. But media reports and private estimates suggest that between 2 million and 4 million of the country’s native Saudis live on less than about $530 a month — about $17 a day — which analysts generally consider the poverty line in Saudi Arabia.

The kingdom has a two-tier economy made up of about 16 million Saudis, with most of the rest of the population consisting of foreign workers. The poverty rate among Saudis continues to rise as youth unemployment skyrockets. More than two-thirds of Saudis are younger than 30, and nearly three-quarters of all unemployed Saudis are in their 20s, according to government statistics.

In just eight decades as a nation, Saudi Arabia has grown from an impoverished backwater of desert nomads to an economic powerhouse with an oil industry that brought in $300 billion last year.

Forbes magazine estimates Abdullah’s personal fortune at $18 billion, making him the world’s third-richest royal, behind the rulers of Thailand and Brunei.

He has spent government funds freely on high-profile projects, most recently a nearly $70 billion plan to build four gleaming new “economic cities,” where government literature says “up to five million residents will live, work and play.”

The king last year also announced plans to spend $37 billion on housing, wage increases, unemployment benefits and other programs, which was widely seen as an effort to placate ­middle-class Saudis and head off any Arab Spring-style discontent. Abdullah and many of the royals are also famous for their extensive charitable giving.

For many years, image-
conscious Saudi officials denied the existence of Saudi poverty. It was a taboo subject avoided by state-run media until 2002, when Abdullah, then the crown prince, visited a Riyadh slum. News coverage of the visit offered many Saudis their first look at poverty in their country.

Prince Sultan bin Salman, a son of Crown Prince Salman, said in an interview that the government has acknowledged the existence of poverty and is working to “meet its obligations to its own people.”

Prince Sultan said the Saudi government was “three to five years” away from dramatically reducing poverty through economic development, micro-
lending, job training and creation of jobs for the poor.

The Saudi government spends several billion dollars each year to provide free education and health care to all citizens, as well as a variety of social welfare programs — even free burials. The government also provides pensions, monthly benefits and payments for food and utility bills to the poor, the elderly, the disabled, orphans and workers who are injured on the job.

Much of the welfare spending comes from the Islamic system of zakat, a religious requirement that individuals and corporations donate to charity 2.5 percent of their wealth; the money is paid to the government and distributed to the needy.

“Living in Saudi Arabia is like living in a charitable foundation; it is part and parcel of the way we’re made up,” Prince Sultan said. “If you are not charitable, you are not a Muslim.”

Despite those efforts, poverty and anger over corruption continue to grow. Vast sums of money end up in the pockets of the royal family through a web of nepotism, corruption and cozy government contracts, according to Saudi and U.S. analysts. Bsheer said some Saudi royals enrich themselves through corrupt schemes, such as confiscating land from often-poor private owners, then selling it to the government at exorbitant prices.

At the other end of the spectrum, many of the poorest Saudis are in families headed by women like Shamir, who are either widowed, divorced or have a husband who is sick or disabled. Under Islamic law, men are required to financially support women and their children. So women who suddenly find themselves without a man’s income struggle, especially because the kingdom’s strict religious and cultural constraints make it hard for women to find jobs.

The situation for many families, including Shamir’s, is worse because they are “stateless” and not officially recognized as Saudi citizens, even though they were born in the country. The United Nations estimates that there are 70,000 stateless people in Saudi Arabia, most of them descended from nomadic tribes whose traditional territory included parts of several countries. Their legal limbo makes it harder for them to receive government benefits.

Shamir, 35, lives in the shadow of a huge cement factory. The houses and streets are covered in a haze of smoke and dust. Her concrete house is down a narrow alley, where graffiti covers the cracked walls and litter piles up in the street.

The landlord is threatening to kick her out, and a neighborhood shop owner has cut off her credit for food and gas for her stove. She lives mainly on charity from wealthy Saudis who show up with food and clothes.

One recent morning, her children ran to the door to help unload food being dropped off by a middle-class Riyadh couple in an SUV. Shamir said donations help her pay for the electricity to run an air conditioner, but she does not have enough to buy school supplies for her children.

While middle-class Saudi youths have all the latest gadgets, Shamir’s 14-year-old daughter, Norah, has never sent an e-mail or seen Facebook. Her husband has a second wife who has 10 children who live across town. Most are unemployed.

Shamir said her husband earned about $500 a month as a security guard until his health forced him to quit five years ago. She said she has tried in vain to find work as a seamstress or a cleaner.

“I’ve been patient all these years,” Shamir said. “I hope that God will reward me with a better life for my children.”

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