The Economist Intelligence Unit addressed the current crisis between the Philippine and Kuwaiti authorities regarding Filipino domestic workers in Kuwait, noting the decision of the Philippine authorities to stop sending new domestic workers to Kuwait after the killing of a Filipino domestic worker at the hands of her employer in January.
The unit expects an exacerbation of the shortage of female workers in Kuwait with the advent of the month of Ramadan and the risk of a large gap in the labor market if the dispute is not resolved, reports Al-Rai daily.
Since the Philippines is one of the largest partners in the Kuwaiti labor market, any additional restrictions imposed by the Philippines could cause major disruptions in the domestic worker sector in Kuwait, where Filipino women constitute about 50 percent of domestic workers, in addition to its impact on other sectors such as health care and trade.
In its analysis, EIU drew attention to the ban imposed by the Philippines on sending new domestic workers to Kuwait, which could extend to a complete ban and indicated that this comes before the holy month of Ramadan in March, which usually increases the demand for domestic workers and touched on the intention of the Philippine authorities to review the work agreement with Kuwait, which ended a similar diplomatic dispute in 2018.
The sources added that hundreds of Filipino workers have left Kuwait since the killing of Jollibee Ranara, in addition to hundreds of others who have taken refuge in the Philippine embassy in Kuwait. The sources added that other countries such as Indonesia, Nepal and Ethiopia have refrained from signing labor agreements with Kuwait due to weak labor protection laws, which raises fears of a shortage of domestic workers in the future.
The sources indicated that in 2021, about 41,200 domestic workers of various nationalities left Kuwait permanently. In February, the Kuwaiti authorities allowed the recruitment of foreign workers under contracts that are expected to expire this month.
The turmoil in the domestic worker market comes amid a broad trend since the Corona pandemic in early 2020 that saw more than 300,000 expatriates leave the country as the government sought to restrict the hiring of foreigners in favor of Kuwaiti workers.
The unit believes that it is unlikely that the government will introduce labor market reforms and improve workers’ rights, as it seeks to reverse the ratio of expatriates to citizens, which stands at 70:30.
It is likely that the National Assembly will oppose any reforms in favor of expatriate workers, which raises the risk of an expansion of the Philippine ban to include sending all workers and may encourage other countries to follow suit. It expected that policies to restrict foreign labor will continue to cause a shortage of labor in many sectors, which will increase inflationary pressures in the forecast period 2023-2027.