Saudi Arabia Is Abolishing The Sponsorship System

Saudi Arabia is moving at a faster pace towards abolishing the sponsorship (kafeel) system with the unveiling of the “Special Privilege Iqama” system, which was approved by the Shoura Council on Wednesday.

The “Special Privilege Iqama” system will grant expatriates special privileges in terms of freedom of movement to and from Saudi Arabia without the need for consent from the sponsor.

Saudi Arabia has set up a center — “Center of Distinguished Iqama” — that will be concerned with the affairs of this type of residency.

There will be two types of Iqamas — a permanent residence permit and a temporary residence permit with specific fees. They will grant the holder a number of privileges including practicing business, according to specific conditions.

According to al-arabiya.net, several economic experts have welcomed the “Special Privilege Iqama” system.

On his Twitter account, economic expert Fadl Abulaynain said the “Special Privilege Iqama” system combats commercial cover-up (tasattur) in the Kingdom.

It also grants the expatriate along with his family privileges, including obtaining visas for relatives, recruitment of domestic workers, owning real estate and means of transport, among others.

The system requires payment of certain fees to be specified by the executive bylaw.

The “Special Privilege Iqama” is in line with what was announced by Crown Prince Muhammad Bin Salman, deputy premier and minister of defense, on the Saudi Green Card during an interview with Al-Arabiya satellite channel in 2016.

The Crown Prince confirmed that the proposed Green Card system would enable Arabs and Muslims to live for long periods of time in the Kingdom. It will be one of the sources of investment in the Kingdom. He had also said that it would be implemented within the coming five years.

Speaking to Al-Eqtisadiah, Saudi economist and Shoura Council member Fahd Bin Juma said this project is meant to attract investments from affluent expatriates. They will be granted “Special Privilege Iqama”, as is implemented in many countries of the world.

He added: “This means that these expatriates will invest within the country. It will enable them to employ Saudis. This is another goal and an economic added value with regard to investment or employment.”

Bin Juma said that the Shoura Council approval of this project was necessary in order to convert expatriates’ activities from an illegal economic activity in the form of control of the supply shops and supermarkets to a legal economy in which they pay taxes. It will also enable the state to know the remittances and the financial details of this category of residents.

Meanwhile, Dr. Ihsan Buhlaiqah, former member of the Shoura Council, said that the “Special Privilege Iqama” system in Saudi Arabia has many positives, as it will attract financiers, people with high financial capability and long experience and leading figures. This is not only in the field of investments, but also in coming up with ideas leading to contributing to diversifying the Saudi economy.

Buhlaiqah mentioned that the new system will solve a number of cases in which investors resort to tasattur, causing great harm to the Saudi economy as a result of disorganized work and the existence of an owner just in name whereas the actual owner of these investments is someone else.

This investor might even be practicing undeclared activities. He said this system would leave no room for resorting to tasattur. It will also attract people to live in the Kingdom and invest in it. — al-arabiya.net

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