With dwindling oil reserves, the island state of Bahrain has become more concerned that the large number of foreigners is taking jobs away from its own citizens. Political cleavages specific to Bahraini society have exacerbated the concerns. Tensions have been simmering in the Sunni-ruled country as its Shia majority population complains about job discrimination, a claim government officials deny. “In Bahrain, there’s been quite some political pressure … from those Shi’ite villages, of people who can’t make it into the networks that provide jobs and education,” said Paul Dyer, research associate at the Dubai School of Government.
UAE SAYS TO EASE RULES
In the UAE, the desire to create modern cities at breakneck speed and hire foreigners to build and populate them has made Emirati nationals a small minority of no more than 15 percent of the 4.5 million population. There have been some moves towards liberalising the labour market but not to ending the sponsorship system altogether. Last month the authorities said labourers will be able to find other jobs if their employer delays wages by more than two months and visas could also be extended for foreigners who are made redundant to find other work in the country. But there were no details on when this could come into effect.
The government, which reaps huge revenues as the world’s third largest oil exporter, has had little success in getting Emirati nationals into the private sector but says Emiratis now account for more than 50 percent of government jobs.
Saudi Arabia, the Arab’s world largest economy, is also worried about the large number of foreigners – some 7 million of its 25 million population – but there is still resistance among businesses to rejecting the kafala system that in effect creates a higher pay scale for Saudis. Like the UAE, authorities have preferred national hiring drives, with “Saudisation” of the government bureaucracy, where 900,000 Saudis now work. Qatar has also talked of fine-tuning rather than overhauling the kafala system.
“Saudi Arabia is observing what is happening in the other Gulf states but nothing has been decided yet,” said John Sfakianakis, chief economist at SABB Bank. Yet, a Gulf pioneer in the use of migrant labour, Saudi Arabia has many experts and policymakers who rue the day they handed over overnight construction of a modern nation to outsiders because of the culture of dependence it has produced. Some have raised fears that one day foreigners could demand political rights or there could be international pressure to raise the status of long-term foreign residents.
“Economic reforms take a long time in Saudi Arabia,” said a Western diplomat. “Even if there are intentions from the top, it is not clear whether they will be implemented by the bureaucracy.” Neighbouring Kuwait has introduced a minimum wage for some low-wage jobs such as cleaners after violent protests by Bangladeshi workers but analysts say the rules are not always implemented.
OMAN COULD RETHINK
Some analysts think Oman could be the first Gulf country to follow Bahrain, driven by the desire to reduce foreign labour dependence and find nationals jobs as the oil wells thin out.
“Oman and Bahrain have for some time shown themselves to be more determined than the other, comparatively energy-rich, Gulf states, to get more of their nationals working in the private sector,” said Neil Partrick, an international relations professor at Sharjah University in the UAE. But traditional thinking focuses on the controls on foreigners’ movements that the kafala system provides, and many argue this in fact protects some jobs from the expats and also provides a security benefit.“There’s a trade-off between short-term profit maximisation at the level of state-owned corporations and long-term benefits through a more efficient economy and possibly a better integration of nationals in the workforce,” said Eckart Woertz, economist at Dubai’s Gulf Research Center. Well-placed nationals can also make a healthy income through the visa charges they receive from every foreigner hired under their sponsorship and businesses fear high costs if forced to hire nationals.
