JEDDAH — Around 40 percent of stores selling and servicing mobile phones and accessories have failed to apply the Ministry of Labor and Social Development’s Saudization plan in the sector, Al-Madinah newspaper reported.
The ministry aims to Saudize 50 percent of jobs in the telecommunication sector in the first phase of its plan.
“Mobile stores that could not maintain business due to the decision to hire Saudis have put their stores on sale. The rent for these stores has dropped by 60 percent to SR1,200 a month from SR3,000 before the ministry started implementing the plan,” said the source.
The source said 30 percent of mobile stores have shut down for good.
“The ministry reported 2,702 violations within two months of implementing the plan all over the Kingdom. The Eastern Province had the most number of violations with 165 cases while Najran was at the bottom of the list with 14 violations,” said the source.
He said the ministry forwarded 1,993 of the cases to the penalties committee.
“The ministry has also shut down 1,549 stores for violations and 494 of these stores were in Asir Province. The ministry has also issued 709 warnings to shut down stores if they do not rectify their status,” said the source.
The source said a total of 15,745 establishments have successfully implemented the Saudization plan.
A store owner said he supported the Saudization of the sector but it was very hard to find qualified Saudis.
“The deadline given to hire Saudis is very short and insufficient to meet the goal of 50 percent Saudization. The next phase expects to achieve 100 percent Saudization, which is unrealistic given the short period for implementation,” said the store owner.
He added the next phase is only a month and a half away.
Mohammad Al-Ghamdi, a member of the Telecommunication Committee at Jeddah Chamber of Commerce and Industry, said the decision to Saudize the sector has depleted the rent value of stores.
“Many Saudi investors backed off from the telecommunication sector due to the challenges arising from the decision. They are afraid of incurring huge losses if they remained in the business,” said Al-Ghamdi.
Investor Mohammad Bamahdi has urged pertinent authorities give the investors more time to rectify their status.
“Many businesses have shut down due to fines imposed on them for failing to implement the Saudization plan. With the unstable Saudi employees, it is hard for businesses to maintain without losing profit to the point of shutting down,” said Bamahdi.
A Saudi employee in the sector said many Saudis work for a few months and then seek to open their own business.
“Saudi employees in the sector are now demanding more support from the Ministry of Labor and Social Development to open their own businesses in the telecommunication sector. Saudi employees, especially the youth, wish to be self-dependent and that hinders the Saudization process,” he said.
