As Gulf countries try to diversify their economies away from oil dependency, attracting qualified foreigners to take part in this objective is becoming an important objective in their policies. But the problem faced to date is the rapid turnover of qualified expatriates, leading to large overhead costs to replace them with new entrants to the labor market.
For highly qualified expatriates, there is a need for longer term job and residency security to enable them to fulfill innovative research and developmental projects, especially in newly emerging Artificial Intelligence (AI) and robotics fields. Given the global competition for talent, it was no surprise that the UAE took the initiative to issue long-term residency visas under various categories starting February 3. Other Gulf countries, especially Saudi Arabia, will be watching the results of this initiative and possibly following suit, given the Kingdom’s diverse range of ongoing projects, especially in renewable energy, tourism and AI, as well as the $500 billion NEOM project, which stands out as one of the most ambitious developmental projects anywhere in the Gulf.
The mega project being built on the Red Sea coast was unveiled by Crown Prince Mohammed bin Salman last year, comprising of a 26,500 square kilometer area northwest of Saudi Arabia. It aims to create a global model in various spheres by focusing on advanced industries and technology, with robots being used for many services, and power being generated solely from wind and solar energy.
To ensure that bureaucracy for foreign investors and international partners is kept at a minimum, NEOM, according to its senior officials, is planned to operate independently from the “existing governmental framework” with its own tax and labor laws and an “autonomous judicial system.”
Granting long-term residency visas is a logical step to follow this bold initiative. While the Gulf seems to be opening up to welcoming long-term expatriate workers, some countries are now imposing restrictions over granting new work visas, the latest being the ban on non-immigrant temporary worker programs for Filipino workers in the US. Effective since January, the Philippines has advised that the country may seek other host countries where its citizens can work should the US Department of Homeland Security pursue this ban.
By comparison, some Gulf officials have even recommended a more radical long-term scheme to retain skilled expatriate labor, and offer permanent residency or citizenship. There has also been a recommendation that expatriate workers who have been living in Gulf countries for 25 years or more should be granted free iqamas or permanent resident status outside the sponsorship system, according to Abdullah Sadiq Dahlan, Saudi Arabia’s representative to the International Labour Organisation (ILO). Dahlan also suggested that the Kingdom should reform its citizenship system to make way for long-term legal residents to acquire naturalization. The reason was both economic and from a feeling that long term expatriates often cannot adjust when going back to their countries of origin as they become deeply rooted in Gulf society.
The issue of granting expatriates citizenship is indeed a bold one, possibly something that will be carried out on a selective sovereign recommendation basis, but again, the UAE has taken the initiative by announcing in late 2018 that it will allow foreigners to obtain long-term residencies in the country after they retire. The move is seen as part of the UAE’s policy reforms that seek to boost economic growth, but it has also come with certain qualifying conditions for expat retirees over the age of 55 years. The retirees are required to have an investment in a property worth AED2 million, or have financial savings of no less than AED1 million, or an active income of no less than AED20,000 per month. For those who have become accustomed to a certain lifestyle in the UAE, it is an attractive proposition.
The planned non-retiree residency move by the UAE has targeted not only the usual long-term foreign investors in real estate, which has been the Gulf model to date, but expanded it to include outstanding foreign students, and foreign nationals with exceptional talents, especially in the scientific field. Some categories will be given five-year residence permits, but the ten-year residency carrot is to be offered to specialist scientists, educationalists and even those with reputed skills in the creative world of culture and arts, as well as inventors.
The fact that various Gulf countries have opened up to international cultural and arts events will necessitate that top class international talent is recruited in this field to nurture homegrown talent. To ensure that families are also welcome on a long-term basis, bearing in mind the educational needs of some expatriate children, and to ensure settled family surroundings, the spouses of these long-term visa residency recipients and their children as well as their domestic helpers will be granted long-term visas as well.
Implementing these Gulf decisions and the mechanism adopted to ensure that the process flows smoothly is as important, if not more so, than the intention. The UAE has also decided to set up a so-called adjudication process to screen the granting of the two different categories of long-term residency, whereby a newly formed Investors Committee will screen applications for the five-year investor category while the ten-year residency applications will be dealt with through an Entrepreneur and Specialized Talent Committee.
In conclusion, whatever modalities and forms of granting long-term residencies is chosen, the renewed interest in attracting and retaining world class talent is sending a clear message that the Gulf is now open for business in a different way that is more welcoming to those that want to be part of its exciting new changes- on a long-term basis.
Dr. Mohamed Ramady is an energy economist and geo political expert on the GCC and former Professor at King Fahd University of Petroleum and Minerals, Dhahran , Saudi Arabia and co-author of ‘ OPEC in a Post Shale world – where to next ?’ His latest book is on ‘Saudi Aramco 2030: Post IPO challenges.’