A recent Labor Ministry decision to reduce the stay of expats working in companies that are in the yellow zone of the nationalization scheme from six to four years will also be applicable to foreigners born in the country, ministry sources have said.

“The law will be applicable to foreigners from the date they begin work,” sources said.

Firms with an insufficient Saudi-to-expat ratio will be subject to these rules from Oct. 25, with the residency duration decreasing to two years by May 2015 in a bid to ensure that companies adhere to nationalization initiatives and move up the Nitaqat grid.

Several businessmen on the board of the Jeddah Chamber of Commerce and Industry (JCCI), however, have said the decision is very difficult to implement in the industrial, construction and service sectors, which depend mainly on trained and experienced workers from abroad.

The decision is bound to create labor shortages in the market and is sure to harm the nationalization process in the long run, said JCCI member Ahmad Al-Marbaie.

“There are sectors that cannot move to the green zone because they depend totally on skilled and specialized workers,” he explained. “Another problem is that the Saudi labor market recruits untrained workers who cannot operate modern machinery.”

He said factories cannot simply sack workers they have spent so much time and money training and replace them with locals who are reluctant to do such jobs anyway.

“This will be our own loss since trained workers are hard to come by and are highly valued in other countries. Such a decision will affect our productivity, profitability and performance. We need these workers to stay in the Kingdom for at least 10 years,” Al-Marbaie said.

The Ministry of Labor should hold workshops with Saudi commerce chambers before taking any big decisions so that the business sector is better-equipped to face these challenges, he said.

Ibrahim Batterjee, deputy chairman of the industrial committee at the JCCI and a member of the National Industrial Committee, agreed with Al-Marbaie. “We also hope to fully nationalize the industrial sector, but this must be a gradual process until we have enough trained Saudis on board. We simply cannot train foreign workers for four years and then dismiss them. This is unfeasible and costly,” he said.

 
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