In a bid to attract more number of overseas investors, Saudi Arabia's Capital Market Authority announced relaxation of restrictions on foreign investments in the country's securities markets, effective from 4 September 2016. As per new reforms, an asset manager holding global assets of at least USD 1bn will be eligible to be a foreign institutional investor in the Kingdom. Presently, the minimum required asset value is USD 5bn. Saudi Arabia was initially planning to introduce these relaxations by middle-2017. But concern over the economy's declining revenues and foreign reserves, falling GDP, unemployment of migrant workers, and weakening production capacity pushed the kingdom to take immediate corrective steps. Saudi Arabia has been facing economic crisis for quite some time because of low oil prices and extreme competition from other oil exporting countries. The country's stock market had opened its doors for Foreign Direct Investments in June 2015. However, it failed to attract a significant number of overseas investors. Currently, only 1.03% of the total market (worth USD 390bn) is being held by foreign investors.
‘Yes’ to Foreign Investors. ‘No’ to Foreign Workers.
Meanwhile, the Saudi government's Vision 2030 aims to fill the private sector with 4.1mn Saudis by 2030. This means employment opportunities for overseas workers will slump. The Kingdom produces 300,000 graduates annually, but Saudis account for just 16% of the total human resource in the private sector. The total number of workers in Saudi Arabia is expected to be around 6.4mn, with 1.6mn in the private sector and 4.2mn in the public. Most of these workers are foreign nationals.
Recently, thousands of foreign labourers were stuck jobless in the Kingdom because of oil crisis' impact on the construction industry. Saudi Arabia is taking efforts to settle the problems of these stranded workers and send them back to their country.
No comments:
Post a Comment