Saudi Arabia set to abolish sponsorship system

Riyadh: Saudi Arabia is set to announce major labor reforms that could effectively end its controversial “kafala” system for foreign workers, a news outlet close to the government reported.

New rules governing foreign labor will be unveiled next week and would be applied from the first half of 2021, the online Maaal newspaper reported, citing unidentified sources. The changes were to be disclosed earlier this year but were delayed by the pandemic, according to the portal.

The “kafala” system applied to foreign employees in Gulf Arab countries for decades has been criticized at national and international level as form of indentured servitude. Some economists also say that the system entrenches an imbalanced labor market, where private employers hire cheaper and more easily exploitable foreign workers even as Saudi unemployment rises.

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Foreign workers in Saudi Arabia currently must be tied to a sponsor whose permission they need to change jobs, open a bank account or even to leave the country on vacation.

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