Saudi Arabia’s surge in female workforce participation drives economic impact

Saudi Arabia’s surge in female workforce participation drives economic impact
Saudi conductors walk beside a high-speed train ferrying pilgrims to Mecca, in Saudi Arabia's Red Sea coastal city of Jeddah, on January 22, 2023. (AFP)
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Updated 18 August 2024
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Saudi Arabia’s surge in female workforce participation drives economic impact

Saudi Arabia’s surge in female workforce participation drives economic impact

RIYADH: Saudi Arabia’s workforce is experiencing a surge in female participation, driven by improved educational opportunities, declining fertility rates and a more inclusive cultural environment.

These developments have propelled the Kingdom beyond its Vision 2030 targets, according to a recent S&P Global report.

Both the government and private sector have implemented proactive measures, including legal reforms and diversity initiatives, to empower women and foster a more inclusive work environment.

This aligns with Saudi Arabia’s strategic goals to promote gender equality and encourage greater female participation in the workforce.

It comes as the Gulf Cooperation Council experiences unprecedented momentum in women’s participation in the workforce.

According to the latest figures from the World Bank, the female labor force participation rate in Saudi Arabia stands at 34.5 percent, compared to 79.9 percent for males.

Anne-Laure Malauzat, a partner at Bain & Co. in the Middle East, told Arab News that the statistic has surpassed the original target of 30 percent, prompting the Kingdom to set a new goal of 40 percent by 2030.

She highlighted several efforts in the Kingdom aimed at boosting female employment.

“On the governmental side, some examples include the Vision 2030 in Saudi Arabia — out of its 11 Vision Realization Programs, two of them are heavily focused on empowering women, namely the Human Capability Development Program and the Quality of Life Program, and female participation in the workforce is a critical enabler to the success of the other 9 programs,” Malauzat said.

Red Sea Global Spokesperson Zainab Hamidaddin Al-Hanoof Al-Hazzani said that the Kingdom surpassed its 30 percent female workforce participation target ahead of schedule.

“At Red Sea Global, we recognize the importance of promoting gender diversity in the workforce and have made significant efforts to leverage the growing trend of women entering the workforce,” she added.

The firm takes pride in having women across all levels of the organization and within the destination, including in senior executive roles, Al-Hazzani said.

“Women contribute significantly across all departments at Red Sea Global, spanning from master planning and construction to scientific research. In certain departments, female representation reaches as high as 44 percent, surpassing the company’s average.”

Laila Kuznezov, director of implementation practice at Oliver Wyman, cited S&P Global Rating’s projection that if the existing rate of growth in female workforce participation continues, Saudi Arabia’s economy could receive a boost of $39 billion, or 3.5 percent, by 2032.

She added that the Kingdom has implemented a series of initiatives to empower women, including raising awareness about the importance of female participation in the workforce, penalizing discrimination, improving job matching, and offering training and support programs specifically aimed at women.

Kuznezov highlighted how Saudi Arabia is committed to fostering a more diverse and inclusive work environment, acknowledging that tapping into the full potential of its workforce is crucial for reaching its ambitious goals.

“Women are increasingly entering the workforce at all levels, including in high-skilled and traditionally male-dominated sectors like engineering and finance,” she said.

“The government also recognizes the importance of family life and has implemented measures to support women’s professional growth alongside their family responsibilities. This includes initiatives like promoting flexible working arrangements and providing expanded childcare options.”

Beyond legal reforms, the government has led awareness campaigns designed to shift societal attitudes, Kuznezov added.

These initiatives highlight the accomplishments of prominent Saudi women, showcasing them as role models and fostering conversations about the benefits of enhancing female participation in the workforce.

“With this comprehensive approach, Saudi Arabia is paving the way for a future where women can actively participate and thrive in all sectors of the economy,” Kuznezov said.

She added that organizations like the Badir Program for Technological Entrepreneurs offer essential training and mentorship for Saudi women entrepreneurs in the tourism and hospitality sectors.

These programs are designed to equip women with the skills necessary to start and run their own businesses, thereby nurturing a culture of entrepreneurship within these industries.

“However, it’s important to recognize that Saudi women are well prepared to enter the workforce. They boast a high level of education across a range of qualifications. To fully unlock their potential, a focus on job creation is crucial, particularly within the private sector,” Kuznezov said.

As it stands, 20 percent of women are over-educated for the positions they hold, compared to 14 percent of men, she added. “The availability of a highly educated and motivated workforce is a strong foundation for the creation of more high-quality and productive employment opportunities.”

Kuznezov highlighted the importance of empowering women to assume leadership and managerial roles, which are expected to become more prevalent in high-growth sectors such as tourism and hospitality.

“By facilitating these advancements, we can ensure that women’s skills and talents are fully utilized, contributing significantly to the Kingdom’s economic diversification and overall success,” she said.

From RSG’s perspective, the goal is to see Saudi women take on leadership roles and drive a more inclusive society, particularly within the tourism and hospitality sectors.

“We’re dedicated to fostering opportunities for women in these fields. To achieve this vision, we’ve implemented various programs and initiatives aimed at attracting, retaining and promoting female talent within our organization,” Al-Hazzani said.

The spokesperson added that RSG prioritizes fairness in its recruitment processes by using gender-neutral job advertisements and ensuring diverse candidate pools.

The company has launched several programs, including the Red Sea Vocational Training Program and The Red Sea Pioneers Vocational Training Program, to provide training and employment opportunities for Saudis in the tourism sector, she said.

“Additionally, our partnership with the University of Prince Mugrin and Ecole Hotellerie de Lausanne in Switzerland ensures that young Saudis receive world-class education in hospitality. While these schemes are for men and women, we expect young Saudi women to benefit greatly given tourism, traditionally, is a sector that women over-index in.”

RSG acknowledges that increasing the number of women in the workforce is only part of the effort, Al-Hazzani said. The company is also focused on nurturing women’s professional development through various avenues, including training, mentorship and leadership programs.

“Our Female Leadership Program is designed to fortify the presence of women in leadership positions within our organization, equipping them with the necessary skills to thrive in traditionally male-dominated roles globally over the long term.”


Saudi education POS defies trend, surges 178%: SAMA data

Saudi education POS defies trend, surges 178%: SAMA data
Updated 27 November 2024
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Saudi education POS defies trend, surges 178%: SAMA data

Saudi education POS defies trend, surges 178%: SAMA data

RIYADH: Education spending in Saudi Arabia soared 178.6 percent to SR249.5 million ($66.4 million) during the week of Nov. 17–23, bucking the broader decline across other sectors. 

According to the Saudi Central Bank’s weekly point-of-sale transactions bulletin, education was the sole sector to record growth. Transactions in the category climbed 62.3 percent to 164,000. 

By contrast, other consumer spending categories experienced sharp declines. Clothing and footwear posted the steepest drop, falling 25.1 percent to SR694 million. Hotel expenditures followed, dipping 23.5 percent to SR305.6 million. 

Spending in restaurants and cafes, which accounted for the second-largest share of total POS value, decreased 19.6 percent to SR1.66 billion. 

Overall, Saudi Arabia’s POS transactions shrank 13.1 percent week on week, with total expenditures declining to SR11.5 billion from SR13.2 billion in the prior week.  

The central bank’s figures showed that the electronics sector saw a 9.3 percent slide to SR179.6 million, while telecommunications expenditures dropped 11.2 percent to SR104 million. 

The food and beverages category — the largest contributor to POS transactions — saw a 9.8 percent dip to SR1.7 billion. Miscellaneous goods and services, which ranked third, fell 10.6 percent to SR1.3 billion. Together, the top three categories accounted for 41.3 percent, or SR4.7 billion, of the week’s total transaction value. 

At 3 percent, the smallest decrease occurred in spending on construction and building materials, leading total payments to SR340.5 million. Expenditures in the health sector dipped by 7.3 percent to SR710 million.  

Regional insights 

Geographically, Riyadh dominated POS transactions, representing 35.9 percent of the total, with expenses in the capital reaching SR4.1 billion — an 8.2 percent decrease from the previous week.  

Jeddah followed with a 14.2 percent dip to SR1.5 billion, and Dammam came in third at SR590.5 million, down 7.9 percent. 

Hail experienced the most significant dip in spending, decreasing 20 percent to SR177.4 million. Tabouk and Abha recorded declines by 11.4 percent and 9.8 percent reaching SR209 million and SR134.9 million, respectively. 

Makkah and Madinah saw the largest transaction decreases, falling 15.2 percent and 14.9 percent, respectively, to 7.6 million and 7.8 million transactions. 


Oil Updates – prices steady with focus on Israel-Hezbollah ceasefire, OPEC+ policy

Oil Updates – prices steady with focus on Israel-Hezbollah ceasefire, OPEC+ policy
Updated 27 November 2024
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Oil Updates – prices steady with focus on Israel-Hezbollah ceasefire, OPEC+ policy

Oil Updates – prices steady with focus on Israel-Hezbollah ceasefire, OPEC+ policy

TOKYO: Oil prices steadied on Wednesday, with markets assessing the potential impact of a ceasefire deal between Israel and Hezbollah, and ahead of Sunday’s OPEC+ meeting of producers.

Brent crude futures rose 5 cents to $72.86 a barrel by 7:15 a.m. Saudi time, while US West Texas Intermediate crude futures were up 3 cents at $68.80 a barrel.

Both benchmarks settled lower on Tuesday after Israel agreed to a ceasefire deal with Lebanon’s Hezbollah.

A ceasefire between Israel and Hezbollah will take effect on Wednesday after both sides accepted an agreement brokered by the US and France, US President Joe Biden said on Tuesday.

The accord cleared the way for an end to a conflict across the Israeli-Lebanese border that has killed thousands of people since it was ignited by the Gaza war last year.

Israeli Prime Minister Benjamin Netanyahu said he was ready to implement the deal with Lebanon and would “respond forcefully to any violation” by Hezbollah.

“Market participants are assessing whether the ceasefire will be observed,” said Hiroyuki Kikukawa, president of NS Trading, a unit of Nissan Securities.

“We expect WTI to trade within the range of $65-$70 a barrel, factoring in weather conditions during the Northern Hemisphere’s winter, a potential increase in shale oil and gas production under the incoming Donald Trump administration in the US, and demand trends in China,” he said.

On the Organization of the Petroleum Exporting Countries and allies led by Russia, or OPEC+, sources said the group is discussing a further delay to a planned oil output hike that was due to start in January, ahead of a Dec. 1 meeting to decide policy for early 2025.

The group pumps about half the world’s oil and had planned to gradually roll back oil-production cuts with small increases over many months in 2024 and 2025. But a slowdown in Chinese and global demand, and rising output outside the group, have put a dampener on that plan.

“Our longstanding base case has been that OPEC+ defers the tapering of output cuts all the way through 2025,” Citi Research analysts said in a note, adding that the tapering could start in April instead of January.

“From the producer group’s point of view, holding off the unwind could allow the market the chance to be more balanced, via supply disruptions or more resilient demand, while bringing barrels back makes lower prices a foregone conclusion.”

In the US, President-elect Donald Trump said he would impose a 25 percent tariff on all products coming into the US from Mexico and Canada. Crude oil would not be exempt from the trade penalties, sources told Reuters on Tuesday.

Meanwhile, US crude oil stocks fell while fuel inventories rose last week, market sources said, citing API figures on Tuesday.

Crude stocks fell by 5.94 million barrels in the week ended Nov. 22, exceeding analysts’ forecast of a drop of about 600,000 barrels. 


Saudi Arabia, Pakistan in talks on refinery upgrades, greenfield project: official says 

Saudi Arabia, Pakistan in talks on refinery upgrades, greenfield project: official says 
Updated 27 November 2024
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Saudi Arabia, Pakistan in talks on refinery upgrades, greenfield project: official says 

Saudi Arabia, Pakistan in talks on refinery upgrades, greenfield project: official says 

RIYADH: Saudi Arabia is set to deepen its strategic partnership with Pakistan through talks on refinery upgrades and a greenfield project for petroleum products, according to an official. 

Speaking to Arab News on the sidelines of the World Investment Conference held in Riyadh, Musadik Malik, senator and minister of state for petroleum of Pakistan, noted that the collaboration extends beyond energy projects and includes an agreement to connect power grids between the two nations. 

“We are working very closely with the Kingdom to figure out how, what are the future energy needs, particularly in the area of renewables, and jointly, we’re going to identify and scope the opportunity, and jointly we’re going to build a program to fulfill those needs,” Malik said. 

He continued: “We have two different projects which are right now under, to say, research. 

One is the upgradation of quantifier refineries, and the other is a large greenfield refinery which would not only produce petroleum products but also hydrocarbons. These are under research and negotiation, so these are not finalized.”  

Malik highlighted that the partnership goes beyond just securing investments or transferring advanced technology. Instead, it involves a joint effort to carefully analyze Pakistan’s future energy needs and map out potential scenarios for how these demands might evolve over time. 

This forward-looking approach ensures that both nations are not just reacting to immediate energy challenges but are proactively planning for the long term.   

By working together to address these evolving requirements, Saudi Arabia and Pakistan aim to guarantee Pakistan’s energy security, creating a sustainable and reliable framework that supports the country’s growth and development. 

Saudi Arabia and Pakistan are making significant strides in strengthening private-sector collaborations, with multiple agreements already yielding tangible results.  

Malik highlighted the proactive approach both nations are taking to foster business-to-business partnerships. 

“Our prime minister believes that the government should not be in the business of doing business but should facilitate it,” he said, emphasizing the central theme of the collaboration. 

“A very large part of the concept we are jointly building on is the private sector of the Kingdom working with the private sector of Pakistan.”  

The minister added that around $2.8 billion worth of memorandums of understanding have been signed between the two countries in October. 

“Out of these 28 to 30 MOUs, seven or eight have already been converted into contracts and executed within just three to four months,” Malik said.  

He continued, explaining the momentum of the partnership: “We have transacted significant deals, and contracts are in motion. Yesterday (Nov. 25), during a roadshow with the Kingdom’s private sector, we secured a non-disclosure agreement that could pave the way for a $1.8 billion investment.” 

Malik emphasized the multifaceted nature of Saudi Arabia’s involvement in Pakistan, describing it as a “360-degree view” encompassing both public and private sectors. 

“We are not only receiving investments and technology but also collaborating on long-term strategies to meet Pakistan’s growing energy demands,” he said. “The Kingdom’s Public Investment Fund and subsidiaries are actively identifying opportunities for mutual growth.” 

Pakistan is tackling the challenge of energy demand fluctuations, a longstanding issue where consumption peaks in summer and drops to a third during winter. 

This cyclicality forces the country to make capacity payments to investors, covering equity returns and debt servicing even when energy is underutilized, Malik explained. 

To address this inefficiency, Pakistan signed an MoU with Saudi Arabia to connect their power grids. 

“This grid connection will allow energy produced in the Kingdom and Pakistan to be transacted seamlessly,” Malik said. “When we connect with Saudi Arabia, it effectively means connecting with the GCC as well.” 

The initiative also aligns with regional energy strategies, as Pakistan seeks similar arrangements with Central Asian states. 

“In Central Asia, energy demand is high in winter and negligible in summer. With this connectivity, deficits will no longer remain deficits, and surpluses will clear in real-time,” he added, highlighting plans for a unified energy market facilitated by a shared grid. 

Malik concluded the interview by praising Saudi Arabia’s unwavering support for Pakistan, describing the Kingdom as a true and steadfast ally. 

“In good times and bad, we have always found the Kingdom by our side. This is the hallmark of true friendship,” he said. 


Saudi Arabia reveals 33.8% annual spending boost on Vision 2030 projects

Saudi Arabia reveals 33.8% annual spending boost on Vision 2030 projects
Updated 27 November 2024
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Saudi Arabia reveals 33.8% annual spending boost on Vision 2030 projects

Saudi Arabia reveals 33.8% annual spending boost on Vision 2030 projects

RIYADH: Spending on Vision 2030 programs by Saudi Arabia has increased by an annual rate of 33.8 percent since the launch of the Kingdom’s economic development initiative.

The announcement was made by Finance Minister Mohammed Al-Jadaan following the budget’s approval.

Al-Jadaan explained that the 2025 budget is designed to continue strategic investments in developmental projects, aligning with sectoral strategies and programs under Saudi Vision 2030.

On Tuesday, Saudi Arabia approved its state budget for the fiscal year 2025, with projected revenues of SR1.18 trillion ($315.73 billion) and expenditures of SR1.28 trillion, resulting in a deficit of SR101 billion.

The minister emphasized that the government remains dedicated to projects that promote sustainable economic, social, and environmental benefits. These include improving the business environment, boosting the trade balance, and increasing both local and foreign investments.

“We identified that the nominal GDP has achieved greater growth from 2015 to 2023,” Al-Jadaan said during a press conference on the budget.

He also highlighted the growing contribution of non-oil sectors to the country’s GDP. “The contribution of non-oil activities to the gross domestic product increased from approximately 47 percent in 2016 to around 52 percent by the end of the first half of 2024,” Al-Jadaan noted, adding that such a shift was “extremely challenging to achieve within six years, as structural economic transformation does not occur in one or two years.”

The finance minister reaffirmed that the government continues to prioritize citizens' basic needs, with a focus on education, health, and social services. “There is a continued approach of planned expansion by the government to improve services provided to citizens and enhance the quality of these services. This expansion focuses on accelerating strategies with significant economic impact on jobs, business opportunities, and the sustainability of the Saudi economy,” he said.

He also reiterated the government’s commitment to completing ongoing projects, integrating technology and infrastructure into the broader economic system.

Al-Jadaan expressed optimism regarding the Kingdom’s economic indicators. “Economic indicators call for optimism, and non-oil GDP helped (overall) GDP continue to grow,” he remarked.

The minister clarified that the projected deficit in the 2025 budget aligns with the government’s financial planning framework, stating that Saudi Arabia plans to continue both local and international financing operations to cover the deficit and meet its debt obligations.

He also noted that the Kingdom is focusing on alternative financing methods to bolster economic growth, particularly through strategic spending on Vision 2030 programs. “The 2025 budget aims to maintain the Kingdom’s financial position and achieve fiscal sustainability by preserving manageable public debt levels and substantial government reserves,” Al-Jadaan explained.

“Debt levels in Saudi Arabia remain lower than those of most countries in the G20,” he added.

Al-Jadaan confirmed that government reserves are expected to remain stable at around SR390 billion by the end of 2025.

The finance minister also discussed the role of various sectors in driving economic growth. “The industrial sector is extremely important for several reasons, the foremost being national security. Having a robust industrial base means reducing exposure to external risks,” he said.

He further emphasized that exports and job creation within the industrial sector enhance the country’s balance of payments and support the broader economy.

Al-Jadaan highlighted tourism as another key sector contributing to job creation and economic stability. “Tourism, both in Saudi Arabia and globally, is one of the largest sectors contributing to job creation in the economy. It is also among the key sectors that significantly support the balance of payments,” he said. He noted that investments are being directed towards tourism projects and services across the Kingdom.

The transportation and logistics sectors were also emphasized as essential to the Kingdom's economic future. Al-Jadaan pointed out that a robust logistics infrastructure is crucial for the success of the industrial sector. “The transportation and logistics sector also has direct benefits, including the creation of logistics hubs that capitalize on Saudi Arabia’s central location, connecting three continents and serving as a strategic global crossroads,” he stated.

Turning to the energy sector, Al-Jadaan clarified that Saudi Arabia’s energy strategy encompasses much more than oil. “When discussing the energy sector, I am not referring solely to oil. I am speaking about the broader concept of energy, including renewable energy, gas, gas networks, and their delivery to industrial zones across the Kingdom,” he said.

He also discussed progress in the military sector, noting that the Ministry of Defense has completed its 10-year plan, with implementation already underway.

“The military sector has seen significant progress, with the Ministry of Defense completing its 10-year plan and the military sector now moving forward with its implementation,” Al-Jadaan explained.

Addressing the broader global economic landscape, Al-Jadaan assured that the Kingdom is maintaining stability despite external challenges. “Inflation in the Kingdom is under control despite its rise globally,” he said.

On public finances, the finance minister highlighted the role of Saudi Aramco in supporting government revenue. “Public finances in Saudi Arabia receive main sources of revenue, one of which comes from oil through the Aramco company. The first source is called the ‘royalty,’ which is a well-established concept with international standards. In Saudi Arabia, the royalty rate is set at 15 percent of Aramco’s oil sales,” he said. He also pointed out that Aramco is required to remit 50 percent of its profits to the government.

Al-Jadaan also touched on government efforts to control fuel prices, stating that billions are being spent to prevent price hikes. “When the Saudi government listed Aramco shares on the financial market, it had several objectives, all of which have been achieved. These included enhancing transparency, monetizing some of these assets, and utilizing the proceeds to support ongoing economic initiatives,” he said.

Finally, when discussing major infrastructure projects such as NEOM, Qiddiya, Diriyah Gate, and the Red Sea Project, Al-Jadaan emphasized that these initiatives have dedicated companies with their own budgets. “These companies have budgets allocated from the sovereign fund, not from the public treasury. They spend based on these budgets and they’re held accountable accordingly,” he stated.

Addressing inflation, Al-Jadaan clarified: “There is no officially targeted inflation rate in Saudi Arabia. However, globally, an inflation rate of 2 percent or 3 percent is considered acceptable.”

In conclusion, Al-Jadaan reaffirmed that the Saudi economy remains on a positive trajectory thanks to the government’s proactive policies and long-term planning, positioning the Kingdom to navigate both local and global challenges effectively.


Saudi Arabia’s Diriyah Co. set to attract new wave of investors with $500m ticket sizes

Saudi Arabia’s Diriyah Co. set to attract new wave of investors with $500m ticket sizes
Updated 27 November 2024
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Saudi Arabia’s Diriyah Co. set to attract new wave of investors with $500m ticket sizes

Saudi Arabia’s Diriyah Co. set to attract new wave of investors with $500m ticket sizes

RIYADH: Saudi Arabia’s Diriyah Co. is attracting a new wave of global investors with potential ticket sizes of $500 million or more, according to the company’s investment head. 

Speaking to Arab News during the World Investment Conference in Riyadh, Chief Investment Officer Jonathan Robinson revealed ongoing discussions with international investors spanning Asia, Europe, the Americas, and the Middle East, signaling an unprecedented level of global interest in the company’s projects. 

“How many investors? We have dozens of live conversations, dozens, so we’re not talking one or two and we’re not talking one or two in any particular jurisdiction. We have conversations going across all these jurisdictions,” Robinson revealed.  

“What’s the size? I think look, you know, we’re probably talking about investments, certainly in the $500 million and up. So it’s a good size, with international investors across multiple continents to come in, in a way, as a co-investor that I don’t think we’ve really seen in terms of breadth and depth or scale so far in the giga-project. So this is an exciting time. It is very real. And I think you will see those kinds of announcements coming out of Diriyah in the coming months,” he added. 

“We have live conversations today, with investors in Asia, with investors in Europe, with investors in the Americas, as well as the many conversations that are ongoing across the region and including, of course, in Saudi Arabia,” Robinson said. 

“I think in the coming months, you will see us make some pretty exciting announcements about partnerships with that global investor space. And that’s going to be groundbreaking in some respects. Not just for Diriyah, but potentially even for the Kingdom of Saudi Arabia, where you’re going to see a real level of participation joining us as partners and joint ventures in funds, through sole developer, co-developer models, where you’re going to see us partnering with some pretty new names,” Robinson said. 

He elaborated on the breadth of investor engagement, highlighting that these partnerships will involve new and established players in Saudi Arabia. 

“Some of them will be new names to the Kingdom. Some of them will be existing investors in the Kingdom but looking to step up that game. We’re moving our execution model now to one that’s really engaging with the private sector on this global scale, and those are very live conversations today,” Robinson explained. 

“I think you will see coming out of Diriyah in the coming months, certainly into the first quarter of next year, we’ll be in a position to make some pretty big announcements. And those will include investors coming from all three continents,” he added. 

Robinson described the initiative as a groundbreaking development for Saudi Arabia’s giga-projects. “I think it’s groundbreaking, first and foremost, that we’re bringing foreign investors in to co-invest in some of our giga-projects. That is groundbreaking. It’s been done at some level through operating companies and what have you, but as investors to co-invest in the development, ownership, operation, that will be groundbreaking,” he said.