MUBARAK USES LABOR DAY SPEECH TO CRITICIZE STRIKERS

C O N F I D E N T I A L SECTION 01 OF 02 CAIRO 000775 SIPDIS DRL/ILCSR FOR DANG E.O. 12958: DECL: 05/06/2029 TAGS: ELAB ECON EFIN PGOV KISL EG SUBJECT: MUBARAK USES LABOR DAY SPEECH TO CRITICIZE STRIKERS Classified By: Counselor for Economic and Political Affairs Catherine Hill-Herndon for reason 1.4 (d). 1, Key Points: -- (U) In his annual Labor Day speech, delivered on April 29, President Mubarak discussed an on-going wave of wildcat strikes by cautioning workers that "illegal" strikes are especially damaging as Egypt deals with the impact of the global economic slowdown. -- (C) Despite Mubarak's warning, strikes continue, with a local labor activist reporting at least seven labor actions currently underway. Activists suggested that the true audience for Mubarak's warning is the Muslim Brotherhood (MB). MB Deputy Supreme Guide Mohamed Habib, in a recent interview, called on strikers to "coordinate" with the MB, an organization not generally considered supportive of workers' rights. -- (U) Deviating from his usual Labor Day practice, Mubarak did not announce the amount of the annual wage increase for government workers - an increase generally followed by private-sector employers - and instead announced that Egypt's Parliament would decide the amount. -------------- Comment -------------- ¶2. (C) Mubarak traditionally uses his Labor Day speech to announce a wage hike for public sector workers, an increase many private sector employers also follow. In his April 29 speech, Mubarak said that he would leave the decision to Egypt's Parliament, thereby shifting responsibility for the inevitable deficit impact of the increase to Parliament. There was little else of note in the speech other than the message regarding strikes. The suggestion by a local activist that Mubarak's comment on strikes was intended to warn the MB away from the labor movement seems plausible, given the GoE's relative silence of late in the face of almost continuos strikes. -------------- Mubarak on Strikes -------------- ¶3. (C) Egypt's 2003 Labor Law, while granting workers the right to "strike peacefully," contains a strike approval and notification mechanism that is so cumbersome that it is never used. Moreover, workers in a long list of "strategic or vital establishments" are prohibited from striking. Nonetheless, despite these legal restrictions, each year since 2006, there have been hundreds of strikes and work stoppages in Egypt's private and public sectors. According to Kamal Abbas, director of the Center for Trade Union and Worker Solidarity, the GoE's attitude towards strikes changed drastically in 2006 when it negotiated successfully with striking workers at the large, government-owned Helwan Cement Company. Since then, in what Abbas describes as a major breakthrough for the Egyptian labor movement, the GoE has generally not interfered with strikes, provided that workers' demands are focused on economic and not political issues. ¶4. (C) In his April 29th Labor Day speech, Mubarak called on "workers who are not aware of the repercussions of this crisis, to (adhere) to a code of conduct that seeks to meet demands through constructive dialogue, and not through strikes that do not adhere to the statutes of the law and hinder productivity." According to Adel William, director of the Sons of Land labor rights NGO, workers have so far ignored Mubarak's call and there are currently seven strikes and labor actions under way. ¶5. (C) William believes that Mubarak's comments were not focused on striking workers but were instead intended as a warning to the MB to stay away from Egypt's labor movement. In an April 21 interview with an international journalist, MB Deputy Supreme Guide Mohamed Habib said, in apparent reference to Egypt's wave of strikes, "(s)ocial protest movements are strong and growing and are full of simmering anger. If we can achieve some sort of coordination among the social protest movements... we will have laid our feet at the beginning of the path." According to William, the MB has traditionally stayed away from the Egyptian labor movement, viewing it as "leftist" or "socialist,' and incompatible with the MB's ideals. William also noted that MB leadership is drawn primarily from middle-class businessmen and professionals and is ambivalent about workers' rights. For example, before the April 2008 strike at state-owned Misr CAIRO 00000775 002 OF 002 Spinning and Weaving in Mahalla, Saad Husseini an MB-affiliated member of Parliament from Mahalla, and a textile factory owner, announced his opposition to the strike. SCOBEY