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Here at Expatriate Healthcare we recently reported that the Kuwaiti government was considering capping the length of residency permits for expatriates. Concerns over the both the numbers of expat workers, and the potential financial liability of these workers entering retirement in Kuwait, were primary motivators in the suggestion.
On average, as we age we need ever more state aid in the form of medical care and tax breaks due to smaller incomes. In other words, retirees can put more strain on the public purse than working-age individuals. This pressure is especially felt in countries with high levels of expat workers like Kuwait, where these individuals may expect to be kept in good health in old age, even when only part of their career has been spent in the country, funding the public healthcare pot. In this way retired expats may cost the government far more than they have paid on.
Now, it seems, the government has deemed to officially swear this suggestion into the official constitution. From now on, expats arriving in Kuwait will be limited to a maximum 5 year residency visa. This visa will be renewable, though this renewal will not occur automatically and will instead be carried out on a case-by-case basis. It seems unlikely that any but the most critical workers will be granted these renewals.
That said, there are a large number of exclusions to this new policy. As it stands, the cap will apply only to unskilled and semi-skilled workers. Skilled workers will largely be omitted. The reasoning is quite simple; another goal of the legislation is to facilitate an overall reduction in the total expat population in Kuwait. As the expat population shrinks, and native Kuwaitis are needed to fill vacant job roles, the easiest holes to plug will likely be the unskilled positions.
More highly skilled workers are far more difficult to replace, one reason why expatriate workers have been so important to the growth of Kuwait’s economy over the last few decades. In this way, killing the goose that lays the golden eggs would seem rather counter-productive.
As a result this new ruling is likely to affect mainly Bangladeshi, Pakistani and Filipino workers from the petrochemical and construction industries.
One final change worthy of note is that many of these same workers will also be banned from bringing their families with them from now on. This will help to remove a considerable number of expats, many of whom were relying on state services but rarely working.
Readers should note that EU and American residents will be excluded from this ruling and, as things stand, will still be welcome to bring their families if relocating to Kuwait as an expat.
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Expatriate Group & Expatriate Healthcare are trading styles of Strategic Insurance Services Limited who is authorised and regulated by the Financial Conduct Authority (FCA). FCA Firm reference Number is 307133. Strategic Insurance Services Limited is authorised to carry on Regulated Activities in accordance with the permissions granted by the FCA under PART IV of the Financial Services and Markets ACT 2000.