Friday, July 20, 2018

$1.8 billion bad debts for laid off expatriates

AKA "Shooting yourself in the foot."

Ok sorry, but I have to giggle....  Once again its a matter of lack of planning.  Rather than a slow, calculated transition to Kuwaitization, they decide to fire thousands of foreign workers effective immediately.  And gee - guess what happened? 


$1.8 billion bad debts for laid off expatriates
Arab Times 7/20/18

KUWAIT: Kuwait’s efforts to create more jobs for nationals by releasing foreigners working in the public sector has created a problem when thousands of laid off expatriates became unable to fulfill their financial obligations towards local banks.

Recent Central Bank of Kuwait data shows the total bad debts for expatriates during the past four year reached $1.8 billion, a sizable portion of which comprise the debts of foreigners who were laid off by the government, according to sources. Eighty five percent of those debts are owed to local banks, while the remaining 15 percent are owed to financial facilities companies.

The number of expatriate employees in state departments dropped by 70 percent in the past six months, according to official statistics released by the Central Statistical Bureau and Civil Service Commission, thanks in principle to the government’s ‘replacement policy’ that targets the complete ‘Kuwaitization’ of the public sector’s manpower by 2022. The number of expats in the public sector dropped to 80,000, compared to around 340,000 Kuwaiti employees as of the end of June.


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My thoughts:
Perhaps the Government should forgive the loans?
Aren't the lender companies (owned by Kuwaitis) pissed off?
Aren't the real estate companies (owned by Kuwaitis) pissed off?
The only businesses I can see making money off these mass terminations are travel agencies and relocation/shipping services (which are a 1-shot revenue source); rather than prolonged addition to the economy like loans might be.
I thought there were one or two economists in parliament.... hmmmm......Didn't see this one coming.

3 comments:

Jon Son said...

That news would be sad if it wasn't so funny.

Inrab70 said...

Im sure the govt will step in and help.. 1.8 billion dollars is not much..they dont have much use for the money anyway considering they have replaced said expats with efficient and lesser paid locals... plus the economy is doing great, such times call for these logical measures.. ofcourse after consultation with the best economists that is...

on a serious note, now is the time for the locals to prove a point and help a govt which has catered to all their needs... right?

Clinton Misquitta said...

Its a matter of lack of planning.Rather than a slow, calculated transition to Kuwaitization

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