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Experts: increase the wages of workers resulting from the "Arab spring" risky
Friday, 02 December 2011
Reuters
Revived the "Arab spring" the hopes of millions of workers from low wage earners to get increases, and give them greater freedom to move and to demand more rights.
To reduce the risk of social tensions governments raise the salaries of its nationals working in public services and state-owned companies.
And this trend may be due on the Middle East benefit and reduce poverty and stimulate economies by increasing the purchasing power of the middle class. But economists say that with the slowing global economy and the difficult choices faced by governments in relation to the budget, this approach involves a risk.
Justified demands
And saw, chief economist at "Barclays Capital" Alia ovarian "It is likely that the demands of the wage increase positive impact in the sectors where these demands are justified, but the trend to increase wages in general, without reflecting an increase in productivity could undermine competitiveness."
Wages have remained in the Middle East and North Africa are low and at least ten years due to the high rate of unemployment and the shortage of skilled labor and low productivity.
The data shows the International Monetary Fund that the purchasing power per capita in dollars - not adjusted for inflation - rose only 52% between 2000 and 2010, below the increase of 63% in sub-Saharan Africa and 95% in emerging and developing economies in the world.
In Egypt, the average income of the average worker in factories from 5 to 7 dollars a day. Analysts estimate that the rate of strikes has doubled since the ouster of President Hosni Mubarak in February.
And under the threat of strike action this year, said Al-Nasr Clothes and Textiles Egyptian it would raise wages by 15% and increase the allowances of the workers and prove temporary employment promotion and about 1500 employees with total annual cost of about 9 million pounds (1.5 million).
Concessions and influenced greatly on the financial situation of the company declared victory amounted to a net loss of 11 million pounds in the fiscal year that ended in June. But the problems did not end labor strikes continued to disrupt shipments in pressure workers to greater demands.
Rising labor protests
In Jordan suggests Phoenix Center for Economic Studies and information that the number of labor protests in the first nine months of this year jumped to a record 607 of 140 only last year.
Saw the Moroccan port of Tangier months of labor protests this year because of the wages and working conditions, which prompted at some point in the global shipping companies to move their services to ports in Spain.
The regional secretary of the International Federation of Transport Workers in the Arab world Bilal Malkawi that "until last year we were fighting for us to have any representative of the workers in Tangier, but now we not only represent us but also our unions strong."
In Kuwait, a strike organized by the failure of 3,000 customs officers last month's oil exports and ended after the government said it would address the demands of the strikers. The strike ended last organized by Kuwait Airways staff for one day an agreement to raise wages by 30% as in reports by the local media. The staff of the Central Bank of Kuwait, the march to demand higher wages, while workers threatened to strike, but the stock exchange agreement prevented it.
With the threat of strikes increased government minimum wage in Egypt and Morocco this year has Tflha seconds with the assumption of new political parties to power after elections this year with the support of the poor sectors of society.
The Lebanese government decided last month to increase the minimum wage by 40% which is approximately twice the cumulative inflation rate over the previous three years. And now the government's decision after the business community objected to and rejected by the government office.
In September / September Qatar announced raise the basic salaries and social benefits for civilian government employees by 60%, while the increased salaries of military personnel, including up to 120%.
Buy the support of citizens
It was unclear how long will last the demands of wage increase across the Arab world. When the ebb of political unrest in the end might drop the need for governments to buy support from its citizens.
In the long term this may be due to the benefit of Arab economies and take it into a model of growth "more inclusive," says the International Monetary Fund and other experts that it is necessary to reduce feelings of social discontent and reduce unemployment. The incentive to give more purchasing power for people in less affluent sectors of consumer spending and encourage the creation of more companies in these sectors.
He says the partner in a cavalry, a company direct investment in the Middle East manages a fund regional $ 200 million, originated the Egyptian "These workers gather together gradually. And demanding better wages and working conditions. All this money re-pumped into your economy."
He adds that "some companies do not favor the concept of increasing the minimum wage, but at the same time grant the wage increase people's standard of living they can buy other products."
But the transition to the new model of growth will not be smooth. The fueling the rapid growth of wage inflation, which was repressed in most of the Arab world this year, partly due to good levels of agricultural crops in North Africa, but inflation could rise as economic difficulties prompted the governments to devalue their currencies.
It may be the biggest threat of the share of public finance. It is expected that the initial cost of an increase of 59% of the minimum wage for government employees in Egypt $ 1.5 billion, an amount that can not be borne by the government while struggling with a budget deficit equivalent to about 10% of economic output.
And can the oil-rich Gulf states to face the situation better, but even some of them feel the pinch. Oman expects to increase the budget deficit next year. In Kuwait, the finance minister warned this month that the salary increase was a "real danger" could push the budget at the end of the day to fall in the deficit.
Analysts said the biggest risk now is in the ability of economies to competition. In order to provide millions of jobs for its citizens young North African countries need to increase exports at a time when global growth slows. To provide these functions require these countries to provide a favorable environment for exporters.
She explained the ovary that increasing wages is not the only way is ideal for social justice in the Middle East Countries in the need to balance the increase in wages and other policies such as reforming their tax systems to make them more just and restructuring of public spending to reduce waste in the support and increase the efficiency of spending on social services is the task of political reforms and governments faced difficulties in implementation.
And "What worries me is the version of legislation to raise wages because of the policies to gain popular support without thinking about the repercussions on the economy. It would be a cause for great concern."
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Friday, 02 December 2011
Reuters
Revived the "Arab spring" the hopes of millions of workers from low wage earners to get increases, and give them greater freedom to move and to demand more rights.
To reduce the risk of social tensions governments raise the salaries of its nationals working in public services and state-owned companies.
And this trend may be due on the Middle East benefit and reduce poverty and stimulate economies by increasing the purchasing power of the middle class. But economists say that with the slowing global economy and the difficult choices faced by governments in relation to the budget, this approach involves a risk.
Justified demands
And saw, chief economist at "Barclays Capital" Alia ovarian "It is likely that the demands of the wage increase positive impact in the sectors where these demands are justified, but the trend to increase wages in general, without reflecting an increase in productivity could undermine competitiveness."
Wages have remained in the Middle East and North Africa are low and at least ten years due to the high rate of unemployment and the shortage of skilled labor and low productivity.
The data shows the International Monetary Fund that the purchasing power per capita in dollars - not adjusted for inflation - rose only 52% between 2000 and 2010, below the increase of 63% in sub-Saharan Africa and 95% in emerging and developing economies in the world.
In Egypt, the average income of the average worker in factories from 5 to 7 dollars a day. Analysts estimate that the rate of strikes has doubled since the ouster of President Hosni Mubarak in February.
And under the threat of strike action this year, said Al-Nasr Clothes and Textiles Egyptian it would raise wages by 15% and increase the allowances of the workers and prove temporary employment promotion and about 1500 employees with total annual cost of about 9 million pounds (1.5 million).
Concessions and influenced greatly on the financial situation of the company declared victory amounted to a net loss of 11 million pounds in the fiscal year that ended in June. But the problems did not end labor strikes continued to disrupt shipments in pressure workers to greater demands.
Rising labor protests
In Jordan suggests Phoenix Center for Economic Studies and information that the number of labor protests in the first nine months of this year jumped to a record 607 of 140 only last year.
Saw the Moroccan port of Tangier months of labor protests this year because of the wages and working conditions, which prompted at some point in the global shipping companies to move their services to ports in Spain.
The regional secretary of the International Federation of Transport Workers in the Arab world Bilal Malkawi that "until last year we were fighting for us to have any representative of the workers in Tangier, but now we not only represent us but also our unions strong."
In Kuwait, a strike organized by the failure of 3,000 customs officers last month's oil exports and ended after the government said it would address the demands of the strikers. The strike ended last organized by Kuwait Airways staff for one day an agreement to raise wages by 30% as in reports by the local media. The staff of the Central Bank of Kuwait, the march to demand higher wages, while workers threatened to strike, but the stock exchange agreement prevented it.
With the threat of strikes increased government minimum wage in Egypt and Morocco this year has Tflha seconds with the assumption of new political parties to power after elections this year with the support of the poor sectors of society.
The Lebanese government decided last month to increase the minimum wage by 40% which is approximately twice the cumulative inflation rate over the previous three years. And now the government's decision after the business community objected to and rejected by the government office.
In September / September Qatar announced raise the basic salaries and social benefits for civilian government employees by 60%, while the increased salaries of military personnel, including up to 120%.
Buy the support of citizens
It was unclear how long will last the demands of wage increase across the Arab world. When the ebb of political unrest in the end might drop the need for governments to buy support from its citizens.
In the long term this may be due to the benefit of Arab economies and take it into a model of growth "more inclusive," says the International Monetary Fund and other experts that it is necessary to reduce feelings of social discontent and reduce unemployment. The incentive to give more purchasing power for people in less affluent sectors of consumer spending and encourage the creation of more companies in these sectors.
He says the partner in a cavalry, a company direct investment in the Middle East manages a fund regional $ 200 million, originated the Egyptian "These workers gather together gradually. And demanding better wages and working conditions. All this money re-pumped into your economy."
He adds that "some companies do not favor the concept of increasing the minimum wage, but at the same time grant the wage increase people's standard of living they can buy other products."
But the transition to the new model of growth will not be smooth. The fueling the rapid growth of wage inflation, which was repressed in most of the Arab world this year, partly due to good levels of agricultural crops in North Africa, but inflation could rise as economic difficulties prompted the governments to devalue their currencies.
It may be the biggest threat of the share of public finance. It is expected that the initial cost of an increase of 59% of the minimum wage for government employees in Egypt $ 1.5 billion, an amount that can not be borne by the government while struggling with a budget deficit equivalent to about 10% of economic output.
And can the oil-rich Gulf states to face the situation better, but even some of them feel the pinch. Oman expects to increase the budget deficit next year. In Kuwait, the finance minister warned this month that the salary increase was a "real danger" could push the budget at the end of the day to fall in the deficit.
Analysts said the biggest risk now is in the ability of economies to competition. In order to provide millions of jobs for its citizens young North African countries need to increase exports at a time when global growth slows. To provide these functions require these countries to provide a favorable environment for exporters.
She explained the ovary that increasing wages is not the only way is ideal for social justice in the Middle East Countries in the need to balance the increase in wages and other policies such as reforming their tax systems to make them more just and restructuring of public spending to reduce waste in the support and increase the efficiency of spending on social services is the task of political reforms and governments faced difficulties in implementation.
And "What worries me is the version of legislation to raise wages because of the policies to gain popular support without thinking about the repercussions on the economy. It would be a cause for great concern."
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