More than 97 percent of small-scale enterprises come under tasattur which is posing a challenge as these businesses are a breeding ground for illegal expatriate workers in the Kingdom.
Only a fraction of tasattur businesses involved expatriates who had fallen out with their sponsors and who left during the correction period extending from July to November. The rest continue to flourish unabated.
The vegetable market sector, which was dominated by expatriates, mostly illegal workers, is the only business which is constantly monitored by multiple government committees and the governorate’s representatives. As a result, several Saudis have taken up the vacant positions and are now doing business in the fresh vegetable market.
Afghan nationals who are mostly involved in food business, especially in “foul tamiz” and Bukhari restaurants, are facing problems due to inspection campaigns. Many of the restaurants have been reduced to a single employee while others have closed shop. This sector is not attractive to Saudis workers because of the hard work and long hours required.
But other sectors are largely unaffected and functioning smoothly as the expatriates running the businesses have managed to rectify the status of their employees.
Various mechanical workshops, welding, carpentry, appliance and automobile repair shops, clothes and fancy dress shops, drivers of water trucks all remain largely managed by expatriates who are using coverup practices or tasattur.
There are thousands of workshops being operated by expatriates in Kilo 5, 7, 2 in South Jeddah and Nuzha in the north which fall under Tasttur. Most of the business houses in Batha and Hera in Riyadh and King Abdulaziz Street commonly known as Seiko building in Dammam also come in this category.
The manpower supply businesses in the Eastern province were totally run by expatriates under tasattur. Although some of the activities drew to a halt owing to the inspection campaigns, it is still business as usual for many of them.
Other medium and large enterprises involved in the education, health, consultancy and building construction sectors remain unaffected, according to sources.
“Coverup business is posing a grave challenge to the Kingdom’s economy and prosperity. It is eliminating employment prospects for genuine aspirants and draining the economic resources of the country,” said professor Khalid Al-Bassam of King Abdul Aziz University. Al-Bassam is also a consultant at the Jeddah Chamber of Commerce and Industry (JCCI).
He said that expatriates involved in coverup businesses sent home almost SR130 billion in 2011-12. “It is a hidden economy and more should be done to unearth it,” he added.
He said that coverup businesses or tasattur made room for illegal workers because foreigners preferred to hire their own ethnic community in their businesses.
Prominent businessman and director of JCCI Abdullah Bin Mahfouz was equally concerned about the harmful effects of tasattur on the economy. “More needs to be done to eliminate the phenomenon of coverup businesses from Jeddah city. It’s a dangerous disease which has to be dealt with firmly through a proper mechanism,” he said.
Professor Abdulaziz Diyab of King Abdulaziz University, who has done research on coverup businesses, said that approximately 30 percent of expatriate employees are working in coverup businesses in the Kingdom.
Expatriates involved in tasattur are under their sponsors but are running businesses in the name of a Saudi citizen. Most of these businesses are small and medium scale enterprises with an income of between SR50,000 and SR1 million on average a month.
“I am working as a salesman under my sponsor. How can you say that I am running the business,” asked an Indian business executive who has had a business in downtown Jeddah for 34 years.
Officially, it is not possible to prove the existence of tasattur because of the support it receives from Saudi individuals who work closely with the expatriates. According to a study by the Riyadh Chamber of Commerce and Industry, there are an estimated 200,000 such business units in the Kingdom. Most of these business entities are engaged largely in the business sector and fall in the small and medium enterprises category.
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