Saudi Economic Woes Leave Indian, Pakistani Workers Stranded
Source: Bloomberg
By Glen Carey
August 3, 2016
Nearly 16,000 Indian and Pakistani workers have been abandoned in camps in Saudi Arabia without food and water or visas to exit the kingdom after a slowing economy forced companies to cut jobs.
A total of 7,700 Indians and 8,000 Pakistanis have been stranded, according to tallies provided Tuesday by the foreign ministries in New Delhi and Islamabad. Many were employed by construction companies battered by the downturn in oil prices that began two years ago.
As prices plummeted from more than $100 a barrel in 2014 to below $30, the Saudi government cut spending and delayed payments to contractors, who have relied on public contracts for business growth. With Brent still a relatively low $42 a barrel, growth in the Arab worlds largest economy is forecast to slow to 1.5 percent this year, the lowest level since 2009, according to data compiled by Bloomberg.
Building projects have fallen off dramatically along with the drop in oil revenue. Construction contracts shrank by about 50 percent in the first quarter from the same period a year earlier, according to data published by Jeddah-based National Commercial Bank. The government didnt award any contracts during the first quarter in 2016 or the fourth quarter of last year, the bank said.
Read more: http://www.bloomberg.com/news/articles/2016-08-03/saudi-construction-woes-leave-indian-pakistani-workers-stranded
keithbvadu2
(36,829 posts)Igel
(35,320 posts)It flopped.
The plan was to produce a highly educated, trained, motivated workforce so that when the oil ran out or otherwise didn't provide money to pay for most of their citizen's idea of dignity they'd have something else going for them.
Instead they got a lot of engineers trained abroad who brought back poor skills and a whole lot of Islamic studies students who produce grief. They removed foreigners from doing "dignified" work in a Saudization campaign in the '00s, but that was nicely Keynesian and consumed money, produced incomes, but accomplished little but produce bloated companies and government bureaucracy.
In short, they overpaid their young men for what they produced, and got more population which believes that a good standard of living is something they should be handed because it's their due.
Foreigners are there on visas. They're 2nd class citizens. 3rd class, if not Muslim. After generations of having their dignity paid for, they--at least the men--have an overblown sense of entitlement. Making matters worse, to marry you need a good job, place to raise a family, a place that's nicely outfitted. In countries where this isn't possible you get a lot of single men. Sa'udi's heading there, not because their men can't afford marriage but because they're too often... What's a good way to put this? Spoiled, self-centered, and want sex without the responsibilities, kids without the parenting.
NWCorona
(8,541 posts)Damage than they expected.
The problem is unless the laws are changed. All those dormant wells will ramp up when the prices make it feasible to do so.