Can we dispense with expat workers?


Saudi Arabia’s Minister of Economy and Planning Muhammad Al-Tuwaijri has announced that the Kingdom will launch 10 programs within its Vision 2030 over the next few months, in addition to dispensing with the external support being extended by expatriate workers. He made these remarks in an interview with Al-Arabiya Channel on the sidelines of the World Economic Forum held recently in Davos, Switzerland. Okaz newspaper published this interview under the title “Dispensing with expatriates is the priority.”

Al-Tuwaijri said in the interview: “This year will be a year of implementation because the planning phase is over, and as such one of the priorities of the ministry is to implement projects and programs as much as possible by taking advantage of the local capabilities, in addition to dispensing with external support from expatriate workers. Likewise, the ministry will contribute to implementing the economic diversification drive away from dependence on oil.”

The minister added: “We saw in Davos a great passion on the part of foreign companies to work along with Saudi Arabia.” He also pointed out that over the coming years the Kingdom will seek to reduce the unemployment rate to seven percent as about a quarter of a million Saudi graduates enter the labor market each year. He said that the Kingdom’s statistics and figures provide more optimism than those of the International Monetary Fund.

In this article, I want to focus on two points mentioned by the minister in his interview. The first point is: How will it be possible to dispense with expatriate workers? Has the ministry carried out any studies that indicate that the country no longer needs expatriate workers and what are the areas of the economy that can rely fully on a local workforce without depending on expatriate workers?

I think that if the minister examines the five-year plans drawn up by the Ministry of Planning, he will find that those plans have not yet been fully realized. It should also be noted that expatriate workers have played a key role in materializing the major goals of these plans.

The Kingdom is still in need of expatriate workers, particularly in some sectors, such as construction, industry and maintenance. Is it possible to dispense with expatriate workers in these sectors and what is the current percentage of the contribution of the Saudi workforce in these fields? We need much more time to achieve self-reliance in these sectors. There are also several other important sectors, such as medicine, pharmacy, accounting and marketing where we still need the support of expatriates because of the lack of Saudi manpower.

I recall the order issued to implement total Saudization in the limousine sector while the late Dr. Ghazi Al-Gosaibi was the minister of labor. The minister set a deadline for enforcing the directive of banning non-Saudis from working as limousine drivers. This resulted in worsening the situation in the public taxi sector and led to an exorbitant increase in limousine fares, reaching 200-300 percent. This forced the minister to withdraw the decision and the situation was restored to its previous state in this sector.

We have still not achieved self-reliance in the limousine sector, but the situation may change or has already started changing with the launching of Uber and Careem as well as with the entry of a large number of Saudi youth to provide service in their own cars through registration in one of these two companies.

My second point pertains to the minister’s intention to reduce the unemployment rate to seven percent. He did not mention how he will be able to attain this goal with a quarter of a million Saudi graduates entering the labor market every year. I think that his assumption is that these graduates will replace expatriate workers. This is a beautiful idea in theory but will difficult to implement.

It should be noted that large numbers of expatriates and their families have decided to leave the Kingdom as a result of the fees imposed on these workers and their dependents. The unemployment rate among Saudis has not decreased but has actually increased mainly because some service companies have been negatively affected by the departure of expatriate workers and their families. Similarly, some private schools, where Saudis were working, have closed due to the exit of students and their families.

I believe that the unemployment rate will not decrease by eliminating expatriate workers. In fact, a reduction in the unemployment rate will only be made possible through the launching of mega projects that will create huge numbers of job opportunities. Expatriate workers will be required for such projects in the initial years, and gradually they will be able to be replaced by Saudis.

If there is no change in the structure of fees imposed on expatriates and their dependents, it will be impossible for them to stay in the Kingdom and will result in their departure on final exit. Subsequently, thousands of residential apartments will become vacant and this will have a negative impact on the real estate sector.

We must not forget the positive role of expatriate workers in the nation building process and in the remarkable growth and development achieved by the Kingdom.

— Dr. Ali Al-Ghamdi is a former Saudi diplomat who specializes in Southeast Asian affairs. He can be reached at