Question

“Saudi Government support for the private sector employees during COVID-19 pandemic has resulted in reduced layoffs”.  Discuss

Answer 1

On march 14,Saudi arabia annoounced a support package worth 50 billion SAR focusing mainly on small and mediumm scaled businesses in private sector.Th support package consists of various measures such as exemptions and postponments from governmnet dues,paying 60% salaraies of the private sector employees,support to banks($13.3 billion) to hepl the small and medium scaed businesses,and so on. This was a nice initiative by the kingdom of saudi arabia as it not only protected the ineterests of general public only but ensured that the economy didn't come to a standstill immediateky due to the global crisis as a result of world-wide pandemic. the initaitive ensured that economy was not hit badly like other countries of the world as there was no circulation of money in the economy. The initiative ensured that there was cash/money in the hands of general public so that they continue to buy and sell in the economy itself like in a closed economy. The support provided to the small and medium industries in terms of banking support ensured taht they didn't ran out of fund in the pandemic. This ensured that the monetory cycle in the economy was working continuosly( even at a lower level) and not coming to a standstill sue to shortage of funds with the citizens.However, some businesses and citizens have still been impacted by the global crisis and has led to some companies shutting their barnch offices in the country but the saudi goverenmnet was able to reduce the impact to some extent.the support package insured that the governmnet limited the impact on the GDP by an average of 2.5% which can be considered a good average in these tough times too.