New Saudi visa rules will struggle to spur investment

Subject

New residency rules in Saudi Arabia.

Significance

The government began rolling out in June a scheme that will enable expatriates to acquire privileged residency status, on payment of a fee. The scheme is aimed at high-grade professionals and business people, with a view to providing them with greater incentives to invest in property and business ventures.

Impacts

• The move will have a marginally positive impact on perceptions of the ease of doing business, but much will depend on how it is implemented.
• The measure will reinforce the trend towards reducing the predominance of non-Saudis at the lower end of the labour market.
• If the residency permits do stimulate the housing market, it might also drive up prices for middle-income Saudi home-seekers.