Saudi Economic Woes Leave Indian, Pakistani Workers Stranded
“Nearly 16,000 Indian and Pakistani workers have been abandoned in camps in Saudi Arabia without food and water or visas to exit the kingdom after a slowing economy forced companies to cut jobs.
A total of 7,700 Indians and 8,000 Pakistanis have been stranded, according to tallies provided Tuesday by the foreign ministries in New Delhi and Islamabad. Many were employed by construction companies battered by the downturn in oil prices that began two years ago.
As prices plummeted from more than $100 a barrel in 2014 to below $30, the Saudi government cut spending and delayed payments to contractors, who have relied on public contracts for business growth. With Brent still a relatively low $42 a barrel, growth in the Arab world’s largest economy is forecast to slow to 1.5 percent this year, the lowest level since 2009, according to data compiled by Bloomberg.
….Continue reading @ Bloomberg
Saudi Arabia Admits To A Full-Blown Liquidity Crisis: Will Pay Government Contractors With IOUs, Debt
“Previously we documented that as a result of the still low oil prices, largely a result of Saudi Arabian strategy to put high cost producers out of business and to remove excess supply, none other than Saudi Arabia has been substantially impacted, with the result being dramatic state budget, a sharp economic slowdown and mass worker layoffs.
Just three weeks ago we reported that the biggest construction conglomerate in the middle east, the Saudi Binladin Group had announced it would layoff 50,000 workers ot a quarter of its workforce, slammed by the weak economy.
Now, Saudi Arabia has admitted that in addition to acute economic problems, which will manifest themselves most directly in a soaring Saudi debt load…
… Saudi Arabia can also add liquidity worries which just spilled out into the open, because Bloomberg reported moments ago, Saudi Arabia has told banks it is considering paying some outstanding bills to contractors with government-issued bonds, citing people with knowledge of matter say.
Contractors would be able to hold bond-like instruments until maturity.”
…Continue reading more @ ZeroHedge