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RIYADH: Economic experts have attributed the fall in remittances made by foreign workers in the Kingdom to lower economic growth and the suspension of some government projects, among other factors.
Foreigners working in the Kingdom sent home SR10.77 billion ($2.87 billion) in February 2017, 15 percent less than the same time last year, according to data released by the ¶¶Òõ¶ÌÊÓƵn Monetary Authority (SAMA).
Remittances made by Saudis fell to SR4.13 billion in February, 30 percent lower than the same period last year, the SAMA report said.
Experts said the drop of remittances made by foreign workers could be attributed to a decline in economic growth, a drop in activities of small-and medium-sized enterprise (SMEs) and the slowdown seen in several business sectors.
Such factors led to the service termination of some foreign workers, driving some to work in the black market, according to Dr. Fahd bin Jumaa, Shoura Council member and economic expert.
When foreign workers are laid off, cases of concealment increase, and a bigger proportion of salaries are remitted through unofficial means rather than banks, Jumaa told local media.
The economic expert said this hidden economy has a negative impact on the Kingdom’s gross domestic product (GDP).
Economic expert Yasir Al-Mazid attributed the decline in foreign remittances to many factors including the suspension of some government projects.
This has led to a drop in the foreign workforce, a consequent fall in the volume of regular remittances, and a boost in the amount of money sent abroad via non-official channels, he said.
The economic expert said government controls have to be activated to monitor channels undertaking remittance operations illegally and enabling foreign workers to smuggle money out of the Kingdom.