Karim Sahibafp/ Stringer/ Getty Images

The Gulf States’ Expat Dividend

The extraordinarily high proportion of foreign labor in the Gulf states is often considered problematic, because it threatens local cultures and national identities, holds down wages, and impedes the development of domestic skills and talent. But the Gulf States’ large foreign populations aren't just workers; they're also consumers.

PARIS – How should policymakers in the Middle East’s Gulf States manage their countries’ large expatriate workforces? In Saudi Arabia, foreign nationals account for roughly one-third of the population. In Qatar and the United Arab Emirates, nine out of every ten residents is an expatriate. Should these countries’ governments continue to invest heavily in developing indigenous labor forces, with the aim of decreasing dependency on foreign workers?

The extraordinarily high proportion of foreign labor within the Gulf Cooperation Council (GCC) countries is often considered problematic, because, as some see it, it threatens local cultures and national identities, holds down wages, and impedes the development of domestic skills and talent. With so many trades and professions dominated by relatively cheap overseas labor, the indigenous population is often left with few occupational domains offering competitive wages. These tend to be predominantly in the public sector, where oil revenues are used to maintain high pay and attractive working conditions.

But an important dimension of the policy debate within the region risks being overlooked: The Gulf States’ large foreign populations are not just workers; they are also consumers. By inflating the population of the countries in which they live, expatriate workers are helping drive economic growth.

To continue reading, please log in or enter your email address.

Registration is quick and easy and requires only your email address. If you already have an account with us, please log in. Or subscribe now for unlimited access.

required

Log in

http://prosyn.org/6R1pk0J;
  1. Chris J Ratcliffe/Getty Images

    The Brexit Surrender

    European Union leaders meeting in Brussels have given the go-ahead to talks with Britain on post-Brexit trade relations. But, as European Council President Donald Tusk has said, the most difficult challenge – forging a workable deal that secures broad political support on both sides – still lies ahead.

  2. The Great US Tax Debate

    ROBERT J. BARRO vs. JASON FURMAN & LAWRENCE H. SUMMERS on the impact of the GOP tax  overhaul.


    • Congressional Republicans are finalizing a tax-reform package that will reshape the business environment by lowering the corporate-tax rate and overhauling deductions. 

    • But will the plan's far-reaching changes provide the boost to investment and growth that its backers promise?


    ROBERT J. BARRO | How US Corporate Tax Reform Will Boost Growth

    JASON FURMAN & LAWRENCE H. SUMMERS | Robert Barro's Tax Reform Advocacy: A Response

  3. Murdoch's Last Stand?

    Rupert Murdoch’s sale of 21st Century Fox’s entertainment assets to Disney for $66 billion may mark the end of the media mogul’s career, which will long be remembered for its corrosive effect on democratic discourse on both sides of the Atlantic. 

    From enabling the rise of Donald Trump to hacking the telephone of a murdered British schoolgirl, Murdoch’s media empire has staked its success on stoking populist rage.

  4. Bank of England Leon Neal/Getty Images

    The Dangerous Delusion of Price Stability

    Since the hyperinflation of the 1970s, which central banks were right to combat by whatever means necessary, maintaining positive but low inflation has become a monetary-policy obsession. But, because the world economy has changed dramatically since then, central bankers have started to miss the monetary-policy forest for the trees.

  5. Harvard’s Jeffrey Frankel Measures the GOP’s Tax Plan

    Jeffrey Frankel, a professor at Harvard University’s Kennedy School of Government and a former member of President Bill Clinton’s Council of Economic Advisers, outlines the five criteria he uses to judge the efficacy of tax reform efforts. And in his view, the US Republicans’ most recent offering fails miserably.

  6. A box containing viles of human embryonic Stem Cell cultures Sandy Huffaker/Getty Images

    The Holy Grail of Genetic Engineering

    CRISPR-Cas – a gene-editing technique that is far more precise and efficient than any that has come before it – is poised to change the world. But ensuring that those changes are positive – helping to fight tumors and mosquito-borne illnesses, for example – will require scientists to apply the utmost caution.

  7. The Year Ahead 2018

    The world’s leading thinkers and policymakers examine what’s come apart in the past year, and anticipate what will define the year ahead.

    Order now