Interesting ways Saudi Arabia is reducing its reliance on expats
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Moving to Saudi Arabia
With approximately nine million expats currently residing in the country, Saudi Arabia is looking to wean themselves from their reliance, in order to help tackle long-standing national unemployment rates, and help to promote diversification amongst the country’s economy. Here, we’re taking a look at some of the most interesting ways Saudi Arabia is reducing is reliance on expats.
Validity Of Expat Work Visas
Traditionally, expat work visas in Saudi Arabia were available for up to two years, but it was announced in January that the Ministry of Labour was to reduce the duration of work visas for expats working in private sector firms. While there were some areas such as the cost of visa insurance and renewal which remain unclear currently, the move is set to be a permanent one. This has been introduced in a bid to improve employment rates amongst young Saudi nationals and made on basis of Article II of the Labour Law.
Expat Taxes
While this was introduced in July 1st 2017, almost as a trial run, the levy has remained consistent, and impacts expatriates and their dependents. The fee is charged on an annual basis, when residence visas are sent for renewal, or alternatively a new visa is issued to an individual or family. While the annual tax currently sits at a manageable monthly figure of SAR100 for each individual within a household, this rate is expected to gradually increase year-on-year until 2020. Some expats already believe that the tax is unaffordable, and as it continues to increase, it could see more expatriates relocate away from the country to neighbouring countries and emirates such as Dubai, where taxes are limited.
Full Saudisation By 2020
The Saudi government is mandating 100% saudisation in certain sectors, meaning no foreign nationals can be employed in certain fields.
A very abrupt and extensive plan implemented by the Ministry of Civil Service has seen ministries and government departments in the country expected to terminate all contracts with expats within three years. With approximately 70,000 expatriates working in this sector, this is expected to have a huge impact on the number of expatriates living in the country. The idea behind this is to help improve the numbers of Saudis working in public sector professions, as this is currently very limited. The job nationalisation is set to be implemented in full by 2020 and is set to be a key factor in the country’s Vision 2030.
Improvements In Domestic Training Courses
One of the key ways Saudi Arabia is looking to reduce its reliance on expatriates is by providing further training to help nationals develop the skillsets that expats currently have. As of 2017, Saudi Arabia began to offer short courses in technical skills such as household electronics, automotive, computing and more, in order improve education and vocational training to local men and women. Not only are these classes offered annually to nationals, but they are also free-of-charge and have already proved to be popular.
As you can see, there are number of ways in which Saudi Arabia is reducing its reliance on expatriates, however that doesn’t mean that the demand for expats in specialist areas will reduce. If you’re considering moving to Saudi Arabia, the United Arab Emirates, or another country around the world, and you’re in need of advice, get in touchwith a member of our team.
