In a recent speech before the Shoura Council, Finance Minister Dr. Ibrahim Al-Assaf said the money remitted annually by expatriates working in the Kingdom is something like $15 billion. This means Saudi Arabia is second only to the United States in money transfers; the amount leaving the US is approaching $18 billion.
The minister was of the opinion that since we have opened the door to foreign laborers to come and work here, it is natural that they transmit money they earn back home. Indeed, that is the reason they come here in the first place.
According to the minister, it would not be in the interest of the Kingdom to set up obstacles to foreign transfers because such a step would hurt the economy. Instead, he suggested reducing the number of workers being recruited which would obviously lead to a drop in remittances.
The minister’s words were those of a wise man. His statement was rational, objective and unemotional. It does, however, clash with oft-heard demands by people on the street and the media for curbing foreign remittances by establishing obstacles to transfers.
I find myself in full agreement with the minister for several reasons. First, any foreign worker who has left his home and family and come here with a valid visa and contract to do work we Saudis do not do has every right to send money to his family back home. No one should have the right to make the workers’ lives more difficult by demanding that they stop sending money home. The money, by the way, leaves the Kingdom through proper official channels.
Second, the fact that the Kingdom ranks second after the US in terms of foreign transfers points to something. The US, according to statistics, has about 40 million foreigners employed there while we may have six million. Our figure is almost as great as the American one with the difference being that we do not allow foreigners to invest their money here. The US and other industrial nations are very keen to offer incentives to encourage foreigners, whether workers or not, to invest in those countries. This is the reason why remittances by foreign workers in the US are modest compared to the number of the workers who generate trillions of dollars. The same applies to countries in western Europe.
Had there been outlets to absorb part of the money earned by foreign workers in the Kingdom, the amounts might have stayed in country and benefited the national economy. In the absence of such programs and policies, it is natural that the money flows outward.
Third, the solution as outlined by the minister, lies in curbing the number of foreign workers being recruited every year, especially in those areas where Saudis can be trained to take over. Demands for blocking remittances should stop.
