Nearly half of people living in Saudi Arabia do not save anything, survey finds

Updated 13 April 2018
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Nearly half of people living in Saudi Arabia do not save anything, survey finds

  • Nearly half of all people living in Saudi Arabia have no savings
  • Just 17% of people in the Kingdom have saved less than 5% of their income

JEDDAH: Some 45 per cent of people living in Saudi Arabia do not save any money at all out of their monthly income, according to a new survey of attitudes towards saving and investment among residents in the Kingdom.

The survey, conducted by the Jeddah based wealth management firm SEDCO Holdings and Dubai-based online finance group Souqamal.com, found that most respondents blamed a low level of income for their failure to put money aside.

It also found that only a further 17 percent saved less than 5 percent, while 38 percent saved more than 6 percent.

The results come as the Ministry of Housing is asking Saudis to save for a deposit on their future home. It finds a lack of a savings culture that makes this goal difficult.

Amr Banaja, a SEDCO executive, said: “Anyone should be able to achieve what they aspire for financial without resorting to borrowing or depriving themselves of what they desire. One can do this by properly managing their finances, shunning needless expense, and choosing appropriate saving and investment opportunities.”

When asked about the reason behind their failure to respond, 60 percent said their level of income prevented it. Since 2014, official statistics show that the average levels of income have risen by 13 percent in the private sector, and 6 percent in government employment, the survey compilers said.

The survey raises the question of whether the cost of living in the Kingdom has risen faster than salaries. According to official figures inflation rose by 7.6 percent between 2014 and 2016. It fell to near zero last year, but jumped again at the beginning of this year, with the introduction of value added tax.

The last official figures showed consumer prices rose 2.7 percent in February, marginally down from the 3 percent of January.

The survey also found that 83 percent of respondents have no long term investment plans, showing a lack of awareness of investment techniques and practices.

Ambareen Musa, founder and CEO of Souqamal, said: “Saving and investment should go hand in hand. Start with a monthly budget and figure out what your basic necessities are that you can save every month.”

SEDCO has launched the Riyali financial literacy program to make people aware of the basics of investment.

The survey was conducted among 2,000 respondents, which included Saudi citizens and expatriates, in line with the Kingdom’s demographics.


Etihad to loan pilots to competing UAE airline Emirates

Updated 37 min 36 sec ago
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Etihad to loan pilots to competing UAE airline Emirates

  • Etihad Airways has told its pilots they can join rival Emirates on a temporary basis for two years
  • The agreement is also likely to help Emirates, where a pilot shortage forced it to cancel some flights this summer

DUBAI: Etihad Airways has told its pilots they can join rival Emirates on a temporary basis for two years, according to an internal Etihad email seen by Reuters, as the downsizing of the Abu Dhabi carrier’s operations helps fill a pilot shortage for Dubai’s Emirates.
Etihad, which last week reported a $1.5 billion annual loss, has been overhauling its business since 2016, replacing its top executive, dropping unprofitable routes and shrinking its fleet.
The agreement is also likely to help Emirates, where a pilot shortage forced it to cancel some flights this summer. Management had said the shortage was a short-term issue.
In the email, Etihad said pilots who join Emirates on a two-year secondment would be placed on a leave of absence, retain seniority at Etihad, and receive their salary and full benefits from the Dubai airline.
Pilots were asked in the email to register a non-binding expression of interest and told that Emirates’ recruitment team would meet with pilots at Etihad’s offices.
Two sources separately told Reuters that Etihad had emailed staff announcing the agreement with Emirates.
An Etihad spokesman told Reuters secondment programs were common practice among airlines, enabling the effective management of pilot resources.
“This is something Etihad Airways has done for several years with partner airlines around the world,” the spokesman said.
An Emirates spokeswoman told Reuters the airline was “working with Etihad on a secondment program for some of their pilots.”
It was not immediately clear how many pilots would be offered temporary employment at Emirates and the email stated that any pilots applying for the secondment would need to complete Emirates’ training program.
Etihad employs 2,200 pilots, according to the airline spokesman. Reuters reported in January that Etihad had offered up to 18 months unpaid leave to pilots.
Emirates and Etihad have been exploring closer ties and signed a security pact in January, the first agreement between the United Arab Emirates (UAE) based airlines. Emirates has since said that a closer relationship was not about a merger.
Emirates and Etihad, backed by their state owners, have competed developing global networks from their respective hubs in Dubai and Abu Dhabi that are just 128 kilometers apart.
Emirates is owned by the government of Dubai, and Etihad is owned by the government of Abu Dhabi.