The Kingdom is planning to introduce a Green card system giving permanent residency to some categories of expatriates in order to attract investment and highly talented workers. The system is quite similar to the American green card, which provides expats permanent residency and job mobility. Implementation of a similar system in the Kingdom is likely to support the country's Saudization system, in addition to boosting the national economy. I will discuss in this article whether the green card goes in line with the Saudization program or against it? Every new system will have its merits and demerits and we will be able to overcome the demerits through experience. We know that the green card system has not caused any unemployment problem in the US. I am talking about the situation now, not before a century or two. On the other hand, the Saudi residency and sponsorship system is one of the main reasons for unemployment in the Kingdom. Why is it creating unemployment? When we pay riyals for a product or service we seek the best product and service. Each one of us is concerned with realizing our own interest before others. This is natural behavior, irrespective of whether one is an employer or employee. The iqama and sponsorship system in the Kingdom puts various restrictions and burdens on expats. The system favors employment of expats compared to Saudis as it requires same qualifications and capabilities from both for employment. In other words, the employer who takes all aspects into consideration finds employing an expat is lucrative compared to a Saudi. If that was not the situation, we would not have seen the current big demand for foreign workers. If the employer acts contrary to what is commonsense, it means he is foolish and does not know his own interest. I am talking about employment in general, not individual cases. The main reason for making the cost of employing expats lower than that of Saudis is the iqama and sponsorship system, which gives employers wide powers to deal with foreign workers. They don't have such power, even closer to it, to control Saudi workers. It is very important to clarify the cost of employment. Some people restrict the cost to a worker's entitlements such as salary, air ticket, health insurance and the fees for resident permit. But this is because of a limited understanding of the full picture. We cannot talk about costs without referring to productivity, which is the benefit an employer receives in return for paying salary and meeting other expenses. Generally, the cost is determined by factors other than salary and benefits, such as actual working hours, training advantage, job continuity, performance, discipline and punctuality. It will also be influenced by government policies and systems. For example, a non-Saudi will not be able to switch jobs without his sponsor's permission. Due to space constraints I cannot give other examples to substantiate this point. The sponsorship system has also created new issues such as tasattur (foreigners running businesses in the name of Saudis in return for a fixed fee), increased foreign recruitment and the flooding of the job market with unskilled workers. This has ultimately resulted in a drop in the Kingdom's gross domestic product. Some people think the cancellation of the sponsorship system was required because of the pressure from international human rights organizations. Actually, it is essential to increase the employment of Saudis. Economic analysis of the job market shows that Saudization should focus on the private sector, especially small and medium enterprises, introducing a market-based wage system and allowing labor mobility. I would like to give the following recommendations to improve conditions in the job market: Strictly control issuance of new work visas and the number of new visas should not exceed one-fourth or one-fifth of new jobs created. Provide permanent residency to expats based on certain conditions including training of Saudis in important professions. Expatriate workers should be given the freedom to switch jobs or labor mobility. A special authority should be set up to look after the recruitment and expat affairs and visas should not be given to companies and establishments. Of course, the implementation of the above recommendations would increase salaries, especially for Saudis and increase their training opportunities.
