Interpreting Middle East Economic News and Analyzing Market Trends

In a classic case of ‘solutions create more problems,’ Kuwait MP submits plan to control growing number of expats to ‘solve the country’s problems’

Kuwait Deports ExpatsSource: Arab Times

It’s another day in Kuwait, which means it’s another day where an MP comes up with a hair-brained idea to solve a problem.  This time, an MP has come up with a solution to solve rising unemployment, crime rates, rents and traffic jams.  The one solution to solve all of these problems; get rid of some expats.

 

MP Abdullah Al-Tamimi submitted a draft bill on controlling the number of expatriates in a bid to solve the problems of the nation. Article Two of the bill states that expatriates with low educational degrees will be granted visa valid for five years and it is not renewable. Article Three stipulates the rule is linked with the number of people in every expatriate community, which must not exceed 10 percent of the Kuwaiti population.

According to the lawmaker, the GCC nationals, Europeans and Americans are exempted from this rule. He explained the growing expatriate population made the problems more complicated; such as the rising unemployment and crime rates, rental fee hike, traffic jams and health issues, among others. He pointed out the country’s infrastructure cannot accommodate such a large number of expatriates; thereby, causing failure to governmental institutions.

Read the full story from Arab Times.

  

It’s easy to blame expats for the country’s problems because they can’t protest.  The truth is, all of the problems the country faces are directly the fault of the government.  In a country where the government takes care of all it’s citizens’ needs, from healthcare and education to guaranteed jobs and free housing, it’s difficult not to see how the current problems are not the government’s fault.

 

Kuwait Demographic from CIA World Factbook

Source: CIA World Factbook (click on image to see larger size)

 

I’m sure the government meant well when it drafted it’s constitution offering citizen’s such generous benefits, but with solutions come problems, usually unforeseen and unexpected.  Take for example traffic.  Traffic has been getting worse and worse in Kuwait for years and shows no signs of improving anytime soon.  The reason for the traffic is not because there are too many expats driving to their jobs that Kuwaitis don’t want (which is true but not the main reason for traffic problems). 

 

The two main reasons are;

1. there is been little investment on infrastructure over the past two decades, which is directly the result of the government not getting its act together.  Kuwait has not had a new highway built since the 1980s.  Where will they put another one?  Poor planning has also left residential areas congested since the government has been slow to build new suburbs away from the city.  In fact, the government has been slow to build anything.  Take a look at the airport which was opened in 1980.  Upgrading the airport has been discussed and debated for 2 decades, but government in-fighting has left the airport and other infrastructure projects on hold or delayed as is the case for the airport;

2. Kuwait, like all other GCC countries, faces a major demographic problem, which is the root cause for all their upcoming troubles.  The local population is growing at an ever increasing rate.  Every year a larger and larger number of young adults turn 18 and want to drive.  This means that every year there will be more and more new cars on the same roads from the 1980s and this number is getting bigger and bigger every year.  This means the traffic next year will be worse than this year and it will keep going like this.

The demographic problem is also to blame for other government services being under such strain, such as healthcare and education, both of which have been declining in terms of quality for years… this trend will continue too.  As for the job market, yes, there are hundreds of thousands of expats willing to do the work Kuwaitis don’t want to do, much of this is low skilled.  According to the CIA World Factbook, 60% of the labor force is non-Kuwaiti, and most of them work in the private sector (up to 90% in some cases).  Why don’t more Kuwaitis work in the private sector?  Because a government job has less hours and more benefits.  Besides, a private company will not want to high a recent Kuwaiti college graduate only to pay him/her double the rate of an expat with 10 years experience and a desire to work.

 

This brings us to the rising unemployment problem.  Every year more and more Kuwaitis enter the labor force.  According to the constitution, the government must find them jobs.  Getting rid of expats will not solve this problem either.  For solutions to this problem as well as all other problems facing the country, the government needs to look at itself and come up with real solutions, not politically correct ones.

 

For now, the more solutions they come up with, the more problems they create down the road.