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Mon 22 Apr 2013 09:40 AM

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Illegal workers said to cost Saudi Arabia $169bn

New research shows remittances earned by illegal workers amount to 10% of GDP

Illegal workers said to cost Saudi Arabia $169bn
Saudi money, Saudi currency, Saudi economy, Saudi finance, GCC currencies

Remittances earned by illegal workers cost Saudi Arabia 10 percent of its GDP during the decade to 2002, according to research by a Saudi economist.

Expatriates who operated illegal businesses in the kingdom remitted SR635.7bn ($169.5bn) to their home countries between 1992 and 2002, Professor Abdul Aziz Diyab said, according to local daily Arab News.

The figure is likely to now be higher, with the number of illegal workers increasing since 2000.

Diyab estimates the earnings of illegal workers grew to SR4bn in 2009.

About 30 percent of legal expatriate workers have been involved in cover-up businesses, he claims.

Much of that is in the wholesale and retail of clothes and textiles, with expats controlling 97.5 percent of the market.

Diyab, who works at King Abdulaziz University’s Prince Mishaal bin Majed Chair for Cover-Up Businesses, which was established to research the economic and social impact of Tasatur - providing cover for expatriates to illegally run their own business activities, said the extent of illegal cover-up businesses was expanding as the country’s economy grew and it needed to be studied as a component of a hidden economy.

Underground businesses also had caused the prices of some goods and rents to rise, had impacted on the employment of nationals and flooded the kingdom with imitation and cheap goods.

Diyab said the government needed to simplifying bureaucracy in the commercial sector and regulate and monitor the growth of unplanned neighborhoods where many illegal businesses existed.

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Sam from Canada 6 years ago

Why would anybody in their right mind want to believe any of the "assumptions" and "claims" made by a guy who is funded by the beneficiary of such a prejudiced report? Its like GSK funding them publishing a Report into "Harmful affects of Long term use of GSK-manufactured Drug". What a waste!

Roue 6 years ago

I'm curious to know why the author does not weigh in on the capital spent by the expats domestically and share the contributions and benefits that exist from such a large labor force.