Akbar Ponani | Nov 26, 2011, 07.05PM IST
Most of the money is remitted by lower-paid workers, mostly from south and southeast Asia, who frequently carry cash with them on trips home rather than making formal bank transfers. Higher-paid workers tend to spend more of their income inside Saudi Arabia because they are more likely to bring their families with them, but they often have their salaries paid directly into foreign bank accounts.
Labour minister Adel al-Fakieh said in an Oct 22 television interview that the labour ministry was “preparing a monitoring programme aimed at reducing the huge quantity of transfers of foreign workers”. However, in the real world, it would be difficult to develop practical measures to limit remittances, partly because money can be taken out of the kingdom in many different ways.
At the same time, foreign workers are needed to keep the economy running. “Foreign workers are producing more than they consume, making a net contribution to the economy. The only way to avoid this is to have Saudi workers instead of foreigners”, said an economist in the capital city of Riyadh.
Economists also point to a perception among private companies that a substantial proportion of Saudis are unwilling to work hard, lack the skills to replace foreign workers and are protected by a legal framework that makes them hard to sack.