The State Bank of Pakistan, in an announcement last week, reported a fall in remittances during the first seven months of the fiscal year (July 2016 to January 2017). The drop of 2% in remittance amounts was due to the economic slowdown in the Gulf States as a result of various economic and political issues.
The war in Yemen and an excessive supply of petrochemicals in the global market have resulted in an attempt by the GCC (Gulf Cooperation Council) to hit back at the economy with an economic and political boost at the same time for maximum impact. This maneuver is expected to work this year with the GCC economies experiencing some sort of recovery soon.
Bad News for Pakistan Government
The Pakistani government is very eager for this turnaround in Gulf fortunes to happen since about 65% of the economy’s remittances are from the Gulf States, most importantly Saudi Arabia and the United Arab Emirates. However, with the former having reduced oil extraction in their territory and prices having gone up to $50 per barrel, the World Bank estimates that economic growth will be slow – less than 2% to be exact. Jobs are also dependent on the state of affairs prevailing with Yemen.
This development is particularly bad for the millions of migrant workers that make up at least 75% of the population in the area. Thousands of these workers had to go back to their respective homelands without payment for their work and with only a bad experience.
Temporary Non-Payment
Further, the Gulf States have also resorted to “temporary non-payment” to contractors coupled with price hikes and tax impositions, the likes of which Gulf State citizens have never experienced before.
Pakistani workers in Saudi Arabia are comparatively safer in their current jobs because of the mix of white and blue collar workers as compared to those in the tertiary sector, infrastructure development, or domestic jobs. The workers who have come back to Pakistan have mostly been from the construction industry so far which has been hit the worst as governments of Gulf States halted public sector projects.
Declining Oil and Gas Resources in The Gulf
Gulf States have also obviously seen a decline in their natural gas and oil resources and thus have attempted to shift away from being dependent solely on these markets for their revenues. Dubai already has a booming tourist industry. This will result in a gradual move away from workers for extraction of these resources to other industries.
Another reason for the decline in demand for migrant workers will be the shift from labor-intensive firms to capital-intensive firms and countries like Pakistan, Bangladesh, India, Philippines and others will see their remittances fall too. These machines will obviously be preferred over migrant workers who have to be paid for health and family visits and other necessities.
Saudi Vision 2030
The Saudi Vision 2030, a future economic plan, holds many instructions for the Pakistani government on how and for what industries they should train their manpower in the future. This also holds for the other Gulf States as they are looking to Saudi Arabia’s plan to make their own.
The Gulf States are very important for Pakistan where migrant laborers are concerned. These states are of significant importance in deciding the future skills of the average laborer in Pakistan. The most important step of course would be to improve the language skills of these workers. Fluency in at least English will greatly improve their job prospects.
Requires an Attitude Adjustment
However, it is not just the skills of the workers that have to change but also the attitude of the government in Islamabad. Cheaper, better-trained workers must be made available but nepotism and lethargy of the officers in Islamabad needs to be checked as well. If this continues, Pakistan is in danger of having its workers banned by these Gulf States the way Kuwait has already done.
Pakistan relies greatly on its labor export for vital foreign exchange reserves. Without this, Pakistan loses out significantly on many opportunities as well as risks the inevitable growth in the unemployment rate.
I don’t see anything related to subject inside the article, did I miss anything?
Me too :
Garmi Start Honi Wali Hai Asar Abhi Se Ho Gaya Heat Stroke ka Editor ko :
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hahaha
Recently a news item appeared in a Saudi paper saying 39000 Pakistanis expelled because of links to terrorism. KSA has started labeling Pakitanis as terrorists. You can check the news item in Saudi Gazette publication. I think they are building a narrative about Pakistanis in general like linking them to terrorism so they can conveniently ban Pakistanis when they deem fit. (example of building narrative is just like in pakistan we started labeling all Madaris/ refugess as terrorist factories and terrorists). Other GCC may follow suit. The reason in my humble opinion is the failure of Pakistani foreign diplomacy on so many levels. I won’t go into its details. Perhaps propk can write up something.
Title and article are running away from each other in two completely different directions :)
buddy title ki wajah se hi tu click mil rahe hain, beshak jhoot hi likha ho us main.
And the writer should replace his title as well. Since the topic discussed in the body of article is not what described in title.
ClickBait sir..
Nothing in the article as per the title, was it just for sensation? should we stop calling this ProPK and rather start calling it ProClickBait?
Stupid Clickbait.
Seriously thinking of getting away from this ProPakistani. This article is just to get more clicks. False information is being spread. Kuwait has not banned Pakistani labor. They condemned this news. The article included important information like Saudi Vision 2030 and what our government needs to do, but due to the greed of the writer for more clicks, people are not paying any attention to it.
Have you recently tired applying for a job in Middle East?
Please do not claim anything unless you have yourself experienced it — if not talk to people living there and you will know the reality of what is happening to Pakistanis
The title of the article is quite correct and ProPakistani has a very accurate picture of what is actually happening in the Middle East — but some of the readers here are too blind in “brotherly love” to see the reality until it is our brother or father who returns, replaced by a far less qualified and incompetent Indian.
I am telling you from personal experience, and I know hundreds of Pakistanis myself who have returned just in the last 6 months — the only number that is inaccurate is how many have been kicked out which are estimated to be over 100,000 across all countries.
Its actually a PAKISTANI PURGE
the artical is very true. I live in Kuwait and we are facing this Problem Already (Pakistan is in danger of having its workers banned by these Gulf States the way Kuwait has already done.)
I hope our Gov will take stand on it because yes now the are not preffering Pakistanis.
Kuwait has already banned pakistanis from last 7 years and we are not getting any family Visas or getting any Facilities, So many of us leaving from here (Kuwait)
“CPEC” is the only reason for replacement of Pakistani labor.
Yassir you are 100% right — all the gulf countries are scared out of their wits — just as many of these cities were built on the blood of Pakistanis starting from Bhoree Bazaar bomb blasts till last week, they are now fearful that Pakistan will ruin most giant cities and economies of the middle east by a huge margin. . .
There have been incidents reported at borders where Pakistani drivers’ passports were stamped with exit and they were told to got to CPEC!
Poor journalism. Very bad job. Accept some shame. Title is X contents are Y.