Saudi Arabia moves to allow foreign workers to gain permanent residency

In a move possibly related to reining in the religious police, Saudi Arabia’s Deputy Crown Prince Muhammad Bin Salman announced that the Kingdom is proposing a permanent residency program for expatriate workers similar to the US Green Card system.

“The Green Card-like program and a plan to allow employers to hire more foreign workers above their official quotas for a fee could generate $10 billion a year each,” the deputy crown prince told Bloomberg in an exclusive interview.

The obvious benefit to the country is more revenue in these times of low oil prices.  Not only would the system generate $10 billion, but another $10 billion would be generated from fees imposed on companies which exceed foreign worker quotas.  The proposed residency program is part of a larger package, which is expected to pull in an additional $100 billion in revenue.  Also, non-Saudi residents will pay what the Saudis pay including Zakat, a mandated Islamic tax, a value added tax and insurance premiums.  But “Green Card” holders will be allowed to own real estate and run trade, industry, and service firms.

The other, unstated motive is facing up to the realities of the Saudi labor market.  The Saudi labor nationalization program, which mandated increasing percentages of Saudi nationals in jobs in the Kingdom, has never lived up to expectations.  It’s difficult to train and motivate sufficient numbers of young Saudis to get and hold a job, especially if an expatriate is the manager.  This is what happens when the leadership tries to wean a substantial portion of trust fund babies off of the Kingdom’s declining oil revenue.  Zulqarnain Ali Khan, a Pakistani national who is chairman and CEO of Zultec Group, reads in between the lines:

“…and this move is part of his vision to integrate expatriates to make them part of the Kingdom and utilize their expertise for the development of the Kingdom.  This gesture will motivate expatriates to work even harder and contribute in the welfare of the Kingdom.…”

In other words, Indians, Bangladeshis, Pakistanis, US (currently at 100,000 in the Kingdom), Brits, etc. have provided the core of Saudi labor and management; therefore, it’s time to recognize their indispensable contributions.  Without them, any effort to diversify Saudi Arabia’s economy is problematic at best.

John Smith is the pen name of a veteran intelligence officer.