Saudi Arabia allocates $3.1bn to help private sector with expat fees

Zaynab Khojji
Sat, 2019-02-09 19:35

RIYADH: Saudi Arabia has approved a scheme to reimburse some of
the companies that struggled to pay steadily increasing fees for
expatriate work permits in 2017 and 2018 and waive the fee hikes
for some who weren’t able to pay, the labor minister said.
The government has allocated 11.5 billion riyals ($3.1 billion) for
reimbursements under the decision.
“This initiative will support private sector companies, help them
overcome the obstacles and achieve their goals and encourage them
to expand employment of Saudi citizens,” Labour Minister Ahmed
bin Suleiman Al-Rajhi tweeted on Friday.
Only companies that had a higher or equal number of Saudi employees
versus expats will be eligible for the reimbursement or waiver of
fees, according to the decree. Companies with a lower number of
Saudis compared to expats will benefit from the initiative only
after they hire more locals, it said.
“The decision will have a huge positive impact on the Saudi
economy and especially the manpower intensive construction sector,
which was the worst hit by the collective invoice,” Osama
Al-Afaliq, head of the Saudi Contractors Association, told
In its fiscal balance program announced in 2016 and implemented in
2017, Saudi Arabia said it would gradually increase the fees for
hiring expatriates and obtaining visas for their dependents to
encourage companies to hire more Saudi nationals.
It also changed the system of payment from an annual work permit
renewal to a one-time lump sum payment at the beginning of the year
accounting for each foreign worker employed by the company — a
so-called collective invoice.
The annual fee hikes, rising gradually to 2020, were seen as
crucial to Riyadh’s plan to create more jobs and cut the
unemployment rate.
Some 10 million foreigners are working in Saudi Arabia.

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Source: FS – All-News-Economy
Saudi Arabia allocates .1bn to help private sector with expat fees