RIYADH, 13 October 2005 — As the Saudi economy moves forward, both Saudi and multinational companies face the possibility of being penalized for failing to fulfill the Saudization regulations. According to Salim J. Ghalayini, alliances and legal manager in a multinational company, the Ministry of Labor will impose a penalty on a company if its Saudi manpower falls short of the target which is 70 percent of its work force by 2007.
“What’s happening is that when companies pay the penalty, they pass the expense to the client. This automatically pushes up the cost of a project,” Ghalayini explained. He said the situation presents the private sector with a difficult choice since trained and qualified Saudis are not plentiful. Before companies reach the 70 percent target in the long term, they must attain a 50 percent Saudization goal in the short term.
One executive in a multinational construction company told Arab News that one factor obstructing Saudization is the inability of Saudis to communicate easily and fluently in English.
He said the Saudi manpower at his company is currently 11 percent when the target is 15 percent. “We have approached GOTEVOT (General Organization for Technical Education and Vocational Training) with a list of our requirements but the problem remains the inability of Saudis to speak English.”
Muhammad Abdullah Al-Babtain, chairman of the Al-Babtain Group of Companies, said the Saudization program was working even if not at the desired level. “In our case, we have succeeded in Saudizing 30 percent of our work force,” Al-Babtain said, adding “The group is in touch with GOTEVOT for its manpower needs. We also participate in seminars and coordinate with technical institutes to see how we can improve the quality of our Saudi manpower.”
The general manager of a local hypermarket pointed out that unless the government binds Saudis to contractual obligation as it does with expatriates, the supermarket business could experience difficulties.
“Last year, some labor department officials came to our shopping complex one night, rounded up six or seven of our expatriate cashiers and put them in jail for 24 hours. Later, the cashiers were all deported. The officials did not even negotiate with us, nor did they give any time limit to let the expats find other jobs. There were no charges against the cashiers.”