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More scrutiny for highly paid expatriates in Saudi Arabia

13 September 2024

Commentary
Colin Foreman
Editor

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The role of expatriates leading projects in Saudi Arabia has been a much-talked-about phenomenon in recent years. The launch of Vision 2030 in 2016 and the seemingly unrelenting series of gigaproject announcements have acted as magnets for highly paid executives relocating to the kingdom to drive projects forward.

The first trickle of appointments offered the promise of using ambitious project plans to reshape Saudi Arabia’s construction market into a world-leading industry. While those aspirations remain, the role of expatriates has been placed under greater scrutiny following a series of public relations blunders and a shift in economic forces.

The most recent negative press reports came in mid-September, with international media outlets reporting on physical altercations between executives working on a gigaproject, along with headlines alleging misogyny, racism and corruption. The reports also suggest that the rush to get projects moving has sometimes resulted in hiring people not qualified to lead projects.

Pivotal moment

The stories come at a testing time for Saudi Arabia’s gigaproject programme. With budgets pared, there is a keen focus on delivering revenue-generating assets as project companies seek to generate their own funding sources. There is also a push to attract foreign investment, which negative press reports could undermine.

Costs are also under significant pressure, and in response, projects have begun to be scaled back and rephased. There have also been headcount reductions, with several major developers leading projects in the kingdom said to have released significant numbers of employees. This move is relieving some of the inflationary pressure that has driven up salaries in recent years.

All the while, localisation remains an ambition for Saudi Arabia. One of the core tenets underpinning Vision 2030 is creating employment opportunities. From the very start, there was a clear understanding that in the future, the expatriates brought in to lead projects will eventually pass on the baton to local Saudi nationals who have developed the experience to lead projects on their own.

If questions over delivery and public relations blunders persist, then that day will come sooner rather than later.

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Colin Foreman

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