BAHRAIN: SURVEY OF LABOR PROGRAMMING NEEDS

UNCLAS MANAMA 000089 SIPDIS SIPDIS DEPT FOR DRL/IL: AL ANZALDUA, NEA/PI DEPT PASS USTR/JBUNTIN E.O. 12958: N/A TAGS: ELAB EAID ECON EIND ETRD BA ECTRD SUBJECT: BAHRAIN: SURVEY OF LABOR PROGRAMMING NEEDS REF: A. 2006 STATE 200668 ¶B. 2006 MANAMA 2013 ¶C. 2006 MANAMA 1979 -------------- Bahrain Trade, Labor Scene -------------- ¶1. (SBU) Bahrain,s economy is growing at a healthy pace. The IMF credits Bahrain with GDP growth of 7.1 percent for 2006 and forecasts an increase of 6.3 percent for 2007. Bahrain,s 2006 purchasing power parity GDP was $17.7 billion and per capita GDP stood at $25,300. The GOB makes efforts to keep inflation low and its currency stable (the dinar is pegged to the dollar at $1 = 0.377 BD). Despite Bahrain,s modest oil reserves, its refineries process local oil and oil from Saudi Arabia, allowing Bahrain,s economy to realize a significant benefit from high oil prices. The US-Bahrain FTA was implemented August 1, 2006, furthering Bahrain,s already solid economic growth prospects. Bilateral trade for 2006 through November reached over one billion dollars for the first time, a growth rate of 45% over the same period in 2005. ¶2. (SBU) Bahrain's economy depends on foreign laborers from South Asia and Southeast Asia. Expatriate workers and their families make up approximately 38 percent of the total population and 57 percent of the labor force, which totals approximately 325,000. Most foreign workers are unskilled laborers working in manual jobs, but there are also skilled foreign workers in the public sector and in white collar private sector jobs. A labor reform project championed by Crown Prince Shaikh Salman Bin Hamad Al Khalifa established the Labor Market Regulatory Authority and a Labor Fund that will be used to fund training for Bahraini workers to improve their skills to make them more marketable. The new legislation contains components that will modify the sponsorship system, making it easier for workers to move legally from one employer to another, and in turn encourage employers to improve working conditions in order to satisfy workers. The legislation also imposes an annual fee on businesses employing foreign workers, an attempt to diminish the cost differential between foreign workers and relatively more expensive Bahraini workers. -------------- Priority Programming Needs -------------- ¶3. (SBU) A Bahrain Petroleum Company (Bapco) trade union official spoke highly of the cooperation between the Federation, workers, media, and Bapco mid-management during the salary talks in October and November 2006. He said that pressure from both the inside and outside was effective in raising the profile of the issue, leading to a favorable outcome. He said that a new executive order (62) issued by the Prime Minister in November 2006 seems to prohibit strikes in the oil and gas sector, thereby taking away one of his union's tools (Refs B and C). In light of their inability to strike, he asked for advanced training in collective bargaining to strengthen the union's hand to protect the rights of all workers. ¶4. (SBU) A Bahrain Telecommunications Company (Batelco) trade union leader stated that he and his colleagues were very satisfied that legislation was passed by the Bahraini parliament prohibiting the firing of a union employee solely for his union activities, which he attributed to pressure related to FTA ratification. He said that support is needed to strengthen collective bargaining skills. He also inquired about the collective bargaining tools available to hospital emergency unit employees in the U.S. ¶5. (SBU) A General Federation of Bahrain Trade Unions official recognized that Bahrain is a pioneer in the region in granting workers rights and passing legislation to protect these rights. He said that although there has been much union activity in the four years since unions were legalized, stakeholders still lack much expertise in understanding and practicing their rights and responsibilities. The federation and individual unions need to establish an annual event to raise awareness about labor issues and to highlight mechanisms available to negotiate with management. He also proposed activities to promote core labor standards. ¶6. (SBU) A labor specialist at the Ministry of Labor, who previously was a federation member, complimented the federation and trade unions for their active agendas leading the way in the Gulf. Regarding possible programming needs, he said that the Ministry could benefit from best practices in educating expatriate workers about their rights under Bahraini law. He also expressed a need for continued training of workplace safety and labor audit inspectors as the economy, and the need for expatriate workers, continues to grow. ********************************************* ******** Visit Embassy Manama's Classified Website: http://www.state.sgov.gov/p/nea/manama/ ********************************************* ******** ZIADEH