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Sun 29 Dec 2013 01:45 PM

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Saudi Arabia loses $59bn due to remittances

Illegal worker amnesty sees remittances from kingdom rise 17% as expatriates take money home with them

Saudi Arabia loses $59bn due to remittances

Nearly $162m was remitted by residents in Saudi Arabia every day this year, totalling a whopping $59bn, according to new statistics published in the kingdom.

The figure easily surpassed last year despite the kingdom’s amnesty on illegal workers, which saw more than 1m leave the country and several hundred thousand deported.

Many are believed to have taken any cash they had in the kingdom home with them or sent it abroad in anticipation of possible deportation.

According to a report published by Saudi Arabic daily Al-Eqtisadiah, remittances from expatriates increased 17 percent compared to last year and accounted for almost three-quarters of the total amount. Expatriates make up two-thirds of the kingdom’s population of 28m.

Saudi citizens had remitted nearly SR70bn ($18.7bn) by the end of November, up 10 percent.

More than SR700bn has been remitted from the kingdom in the past 10 years, according to economists.

The amount of money flowing out of the country is expected to fall by up to 20 percent following the illegal worker amnesty.

Remittances are calculated based on Saudi banks’ sales of hard currencies, imports, personal transfers, travel expenses abroad, investments in foreign countries and sales to government agencies.

The World Bank ranks Saudi Arabia, and the entire Gulf, as one of the cheapest places in the world from which to send remittances.

It also is one of the largest source countries, with foreign workers flocking from developing countries such as India, Pakistan, Bangladesh, Nepal and Ethiopia.

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Raj 6 years ago

It's wrong to say that Saudi Arabia lost $59 billion due to remittances. That's the money the workers sent home from their earnings or savings. So, technically, it is not a loss to the country. This kind of irresponsible reporting (the headline alone) will send a wrong message to the authorities who will explore means to put a ceiling on remittances by the poor workers.

SA1 6 years ago

How is that a loss, when that money does not belong to KSA? It was a salary meant to be remitted. It is akeen to saying KSA looses $XXX billion on import of luxury items/cars, etc.

That is a cost a country has to pay for not having its own Skilled labor workforce, and instead rely so heavily on outside labor and import.

Amjad 6 years ago

The headline statement is cruel and inhuman, the author and the publisher have not even considered the perspectives of those who earn and send their money abroad. What choice do they have, if they were given permanent residence, pension, and chance to own a house and do business legally ! would they have send their money out. Try to find the other side of the coin, it is just a matter of flipping it !

Zeeshan 6 years ago

The statistics for the remittance will not decrease drastically, as the labor will try to send off maximum amount of money they earn in a fear to become victim of "Illegals".

Further, Saudi is recruiting new labor from foreign market on higher pays and better facilities. This will increase the cost of everything in Saudi and continue to increase foreign remittance "Loss" lolz.......