The sponsorship system has disturbed the Kingdom’s labor market, created a huge black market in visas, aided massive currency outflows and undermined the country’s image internationally, according to local experts.
Jamal Bannon, a business columnist for a local newspaper, recently wrote an article “Without a sponsor,” reflecting on the sponsorship system in Saudi Arabia over the past five years and its effect on the labor market.
He criticized the system, saying it has resulted in “human trafficking, flooding of the market with a cheap and illiterate labor force, workers running away from their sponsors and working elsewhere and cover-up businesses becoming prevalent.” He added that “a black market in visas has flourished, there has been corruption of the labor market” and increasing incidences of bribes being paid to those “willing to move or renew visas illegally.”
Bannon asked why “we still cling to the sponsorship system when it has ruined our reputation among human rights organizations, putting us in the same class as human traders and destroying our economy.”
He added that it has contributed to huge outflows of currency and said officials have been trying to prove the system works rather than identifying and dealing with problems.
Ahmad Al-Mazroui, a labor expert, said the problems in the Saudi labor market have been caused by the sponsorship system. He said there are no real controls over the system. For instance, there are no rules and regulations governing the work permit system.
Al-Mazroui argued that these problems could not be solved in the near future. The first step is to stop approving visas for all migrant workers until the situation of current workers is rectified, he said. These workers should then be employed in sectors where they are needed. The authorities should also address the cover-up system, he added.
According to the Ministry of Commerce and Industry, huge fortunes are being made and transferred outside the country, exceeding SAR 140 billion ($ 30 billion) a year. The withdrawal of this much cash from the market has caused huge economic problems and harmed internal trade.
The sponsorship system has also resulted in an international website, focusing on rights issues, launching a questionnaire asking whether expatriates should be given residency permits without having sponsors. Voting is still underway, but the subject has been mentioned 70 times on Twitter so far.
Sponsorship undermines economy: Experts
