x Abu Dhabi, UAEFriday 21 July 2017

Kuwaiti MPs and trade union leaders threaten strikes over privatisation law

The battle over a law to privatise some state services and industries heats up with talk of strikes at a protest held before the bill's second reading in parliament.

KUWAIT CITY // The battle over a law to privatise some state services and industries began to heat up on Sunday with talk of strikes at a protest held before the bill's second reading in parliament. About 500 Kuwaitis listened to fiery speeches from trade union leaders and MPs for nearly three hours at a gathering entitled "I won't sell my country" in Demonstration Square, a popular venue for political discontent located between the National Assembly and the Arabian Gulf.

"Privatisation threatens the jobs of 7,000 Kuwaitis who work in refineries and another 1,000 in the petrochemical industry," said one of the speakers at the protest, Mohammed al Hamlan, the deputy president of the Kuwait National Petroleum Company Workers' Union. "The law would give them a blind future," he said. "Privatisation is a huge project. It needs steps over four or five years," the trade unionist said. "We need laws relating to tax, corruption and consumer protection first, and universities need time to prepare the students."

Parliamentarians have said that the oil production sector, along with health and education, will not be included in the bill, and services such as electricity, water and the postal delivery will be privatised first. The protesters believe that selling off state assets will put thousands of jobs at risk as companies slim down in order to become competitive, and prices will increase as generous government subsidies are phased out.

The law is an attempt by the government to reduce its huge public sector wage bill. The second reading will probably take place this week. Some union leaders threatened strikes if the law is passed. Faisal al Muslim, one of about 10 MPs who addressed the crowd, said "we support them". He said the country is not heading for a general strike yet, but that depends on the outcome of the session in parliament.

Kuwait University's student union helped organise the demonstration, and about 30 of its members paraded toward the crowd, chanting "no to privatisation" and "we won't sell out country". "This is our country, our savings, the oil money is ours," said Abdulaziz al Shamari, a production engineering student at Kuwait University's College of Technological Studies. "If they privatise our country, we won't have work. Indians will work for 400 Kuwaiti dinars [Dh5,056] every month, but Kuwaitis need 1,200."

"If they stop foreigners coming here to take our jobs, then they can privatise," Mr al Shamari said. Parliamentarians from the country's tribal districts and trade unions, dominated by tribesmen, are among the new law's staunchest opponents, and earlier this week, 23 lawyers from Kuwait University voiced their discontent. The lawyers released a statement saying the law violates several articles of the constitution.

Yousuf al Sellili, a professor of private law at Kuwait University, said the constitution states that Kuwait should be owned by the government and people. He said the law does not protect workers and "it will destroy a number of families". Mr al Sellili said the public sector was held to account by parliament but laws to regulate the private sector were not in place, so privatisation could lead to increased levels of corruption. "I'm not against privatisation, but you need the legal framework first, so it's not a priority now."

Parliamentarians will also introduce so many amendments to the bill in its next reading that it will be rendered virtually useless, he said. Abdulrahman al Anjari, an MP, recently spoke in support of the law after it was passed in the first round of voting. He said the law would protect the salaries and benefits of Kuwaitis in the new privatised companies for four to five years and the companies will have to maintain number of Kuwaiti employees.

A council would be created to oversee the transformation of state-owned companies to private enterprises and intervene if it detects irregular financial activities, Mr al Anjari said. Khalid al Khalid, a board member of the chamber of commerce and industry, questioned the practice of protecting Kuwaiti employees for so long. "I have to take care of you for five years whether you perform or not - I have to pay your salary?" he asked.

"The whole law, it is nonsense. It's not privatisation, it's demolition," Mr al Khalid said. He said the law will create private companies and a portion of the shares will be distributed among the Kuwaiti employees, whether they are productive or not. He said the European method is preferable, where workers are allocated shares every year based on their performance. "It's a corrupt law; it has not been studied correctly. It's not protecting the workers, it's going to make them lazy," Mr al Khalid said.

@Email:jcalderwood@thenational.ae