New ‘Saudization’ labor initiatives aim to encourage startups 

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RIYADH: A number of new services will be launched to encourage the development of small and medium enterprises (SMEs) in Saudi Arabia, and increase the number of Saudi nationals in the workforce.

The initiatives, part of an agreement signed by the Ministry of Labor and Social Development and the General Authority of Small and Medium Enterprises (Monshaat) will feature new rules around visas, and will also seek to reduce unemployment figures.

In future, up to nine work visas could be issued immediately to new enterprises managed by full-time entrepreneurs, while there will also be a one-year grace period for registration with the “Nitaqat Saudization” scheme. 

“Saudization” is the process through which the government plans to increase employment of Saudi nationals in the Kingdom’s private sector, using the Nitaqat system to rate companies based on the numbers they employ. 

It is currently being overseen by the Saudi Arabian Monetary Authority, which also aims to assist startups by providing easy access to all government services.

Under the initiative, new Saudi employees will be counted by the Nitaqat program immediately, improving their company’s rating faster. 

The initiative aims to create about 51,000 jobs, with 24,000 firms expected to benefit from the services it will offer. 

It is also expected to add about SR12 billion ($3.2 billion) to the nation’s gross domestic product over the next three years.

“We aim to convert job seekers into entrepreneurs,” said Labor and Social Development Minister Ahmad Al-Rajhi. 



The latest agreement follows others between the Ministry of Labor and Social Development and other ministries, including the departments for health, housing and communications, to improve the employment prospects of Saudi nationals. 

There are 68 initiatives in total, 40 of which have already been introduced. 

The rest of the initiatives are due to be launched by the end of March, he added.

Monshaat has signed a separate cooperation agreement with the General Entertainment Authority (GEA) to boost the local entertainment sector. 

Dr. Majid Al-Qassabi, trade and investment minister and chairman of Monshaat, and Turki Al-Sheikh, chairman of the GEA’s board of directors, signed it in the presence of Monshaat Gov. Saleh Al-Rasheed and GEA CEO Amr Banajh.

The agreement includes joint workshops with entrepreneurs and SMEs, and a framework for attracting investors in the entertainment sector.

Al-Rasheed said the agreement is in line with Monshaat’s desire to develop and support SMEs, and to increase their contribution to gross domestic product (GDP) to 35 percent by 2030.

The current lack of local companies in the entertainment sector presents an opportunity for entrepreneurs, and for investors to facilitate these enterprises.

The few local entertainment establishments have minimal experience, putting them at high risk in the face of entry by experienced foreign enterprises.

Under the Vision 2030 reform plan, the entertainment sector is developing rapidly, and consumers’ expectations are rising due to the organization of many renowned international shows in the Kingdom. This may pose a challenge for Saudi entrepreneurs.

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