GRM 2010 GRM 2011

Abstract Details

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Labour market reforms and re-negotiation of the social contract in the GCC. The comparative case studies of Bahrain and Oman
Paper Proposal Text :

Given their limited hydrocarbon resources compared to their neighbours, the monarchies of Bahrain and Oman have been facing tremendous pressure to reconsider the rent-based welfare state model of legitimacy they have extensively relied on since the 1970s. They have been forced to do so since the beginning of the 2000s in the context of the dwindling of the "social contract" which presided over the stability of these regimes, leading to diversify their strategies of legitimization at the same time as the state revenues. This has been done through sustained liberalising reforms, including changes in the role of the state, economic diversification policies, and reforms in labour markets, health and education.

In this perspective, this paper aims at examining:

1. The labour market reform programmes implemented in Bahrain and Oman for the last five to ten years to address the structural imbalance in the existing labour market between nationals and expatriates and to reduce levels of unemployment amongst nationals.
A special emphasis will be put on the architecture of economic decision-making implemented in Bahrain in the mid-2000s, with the dismantling of the former Ministry of National Economy and the creation of an Economic Development Board, under the direct supervision of the Crown Prince, and of a Labor Market Reform Authority, a government authority with a corporate body, in charge of the regulation of the labour market. These economic structures, explicitly inspired by Singapore experience, have not been researched extensively yet.

2. The compared impact of these reforms on the social contract in these two countries, with a special attention paid to:
a. the perceptions and views of the private sector on these reforms as well as the actual effects of their actions and decisions on the reforms’ outputs;
b. the perceptions and views of the targeted population – the educated and uneducated youth entering the job market.

In its final part, this paper will pay special consideration to the socio-economic dimension of the 2011 protests in these two countries:
a) the role of the unemployed youth in the organisation and coordination of protests and demands (at Lulu Roundabout, in Manama, and Sohar, in Oman);
b) the impact of the regimes’ 2011 arbitrary gestures of goodwill and spending announcements (creation of public sector jobs, etc.), intended to buy off social peace in the short term, but that basically contradict the reforms of the last decade and the long-term ambitions of private sector-driven growth;
c) the position adopted since the Arab Spring by the Bahraini and Omani private sector, which has more than once been at the centre of popular grievances during the protests.

This paper is based on the results of a wide series of personal interviews with local political, economic and social actors in Bahrain and Oman conducted since 2007, including recent fieldworks in Bahrain in September 2011 and Oman in October 2011.