Posts Tagged 'privatization'

Human rights and Economic Development

By: Jon Nordenson

Economic development is a major concern for Kuwait, as it is for any other country. But Kuwait has proclaimed some rather ambitious goals; the country is to become a “world financial hub” through new developmental projects. In addition to infrastructural renewal, the country is also looking to improve their record on human rights and corruption. But if Kuwait is to become the politically correct financial alternative of the region, some rather big changes have to occur.

In as far as Dubai (still) is the shining beacon to aim for with regards to becoming a “financial hub”, Kuwait has a long way to go. As Michael Herb shows in his article A Nation of Bureaucrats: Political Participation and Economic Diversification in Kuwait and the United Arab Emirates, Kuwait lags far behind UAE and the other Gulf countries in terms of foreign direct investment. Moreover, they have fewer tourists visiting than any other gulf state. In addition, the turbulent relationship between parliament and Government hasn’t made the job of catching up with Dubai – if that is the goal – any easier.

Yet, this relationship seems to be changing. Since the elections last year, the level of “crisis” in Kuwaiti politics have declined, and new laws have been passed. A new labor law, a five-year development plan, and even a draft of a privatization bill have all passed through parliament. Arab Times recently reported that HH The Emir have expressed his appreciation of the good relationship between the legislative and the executive powers in the country, and according to Kuwait Times, Deputy Premier for Economic Affairs Sheikh Ahmad Fahad Al-Sabah recently assured that “The development plan is on track since it was approved by the parliament”. Though much still has to be done, the development is intriguing; if the elected parliament and the government together manage to diversify Kuwait’s economy it would be ground breaking in the region. There is, however, no guarantee that this will happen. For instance, the privatization bill has been met with fierce opposition.

And then there are the issues of human rights and corruption. One should think that this is an area where Kuwait holds the upper hand towards the UAE; whereas Kuwait has an elected parliament and a history of grass roots political mobilization, the UAE has nothing the Kuwaiti democratic project. This may constitute a major Kuwaiti advantage; the parliament may give economic reforms legitimacy in the population, and a stable democracy may seem as s sound alternative to invest in. Yet, in the whole, Kuwait’s human rights record is not much better than the UAE’s.

If one compares Amnesty International’s annual reports on Kuwait and the UAE, the difference is not exactly striking:

UAE: Migrant workers were exploited and abused. Cases of torture and prolonged detention without trial were reported. Women continued to face legal and other discrimination. Access to certain websites was blocked. The authorities began to address the cases of stateless persons, or bidoun. One person was executed.

Kuwait: Migrant workers continued to experience exploitation and abuse, and to demand protection of their rights. Some were deported after participating in mass protests. The government promised to improve conditions. Several journalists were prosecuted. One case of torture was reported. At least 12 people were under sentence of death but no executions were known to have been carried out.

One may of course argue that the report on Kuwait is somewhat less condemning than that on the UAE, but it is in no way flattering for the country. And newspaper reports indicate that the authorities are still not serious enough in dealing with abuse of migrant workers. For instance, on the 25th of July, Arab Times reported of one housemaid dying when trying to escape, one being seriously injured, and another who hanged herself. In both cases, the police “registered a case and started investigations”. On the 22nd of May, the same newspaper reported of two housemaids who committed suicide. Both suicides were “surprising” to their employers, and the police “opened cases”.  There may of course be many different reasons behind such tragic events, and my intention is by no means to suggest that all Kuwaitis are in some way abusive towards their employees. Nevertheless, one need not follow Kuwaiti news for a long period before one detects a pattern. For obvious reasons, Kuwait needs to deal with these issues. And if the goal is to “improve Kuwait’s international image on human rights issue”, the authorities must step up their efforts.

As for corruption, Kuwait is ranked no 66 on Transparency International’s annual report for 2009, just behind Georgia. Dropping down from no 65 in 2008, the country came behind the other GCC countries. Just as unflattering, the country was banned from both the international football federation (FIFA) and the international Olympic committee (IOC), due to “government interference”. In other words, Kuwait has a long way to go in terms of corruption if the country is to become tempting for investors.

If Kuwait manages to institute economic reform through democratic procedures, this may give them an advantage in the region. But in order to become something of a politically correct alternative, human rights and corruption must be addressed more seriously.

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The Kuwaiti elections one year on

By: Jon Nordenson

Last May Kuwaiti voters put together a new parliament, the first in Kuwaiti history to include women. An eventful year has passed, witnessing its fair share of “political crisis”. But despite some major setbacks, there are some encouraging signs as well.

Nevertheless, I start of with “crisis”. Why do I put “crisis” in brackets? Because there is something profoundly theatrical about Kuwaiti politics from time to time; MPs, cabinet minister and the media often seem more concerned about the political game, or making (the) headlines, than the matter at hand. Thus, when Kuwait Times claims that Kuwait “has been rocked by political crises since 2006”, they are both right and wrong. On the one hand, Kuwait has witnessed seven governments and three elections since 2006, in itself a clear indication of severe problems. And there are some serious issues behind these manifestations of crisis; an unresolved power struggle between an un-elected government and an elected parliament, lack of economic development, discrimination of women, discrimination of ex-pats, far-reaching corruption and more. On the other hand, up until now, both MPs and the government has seemed little willing to deal with the actual problems, and have instead put on a show for the media. However, this seems to be changing.

Perhaps as a result of the many battles over the last three years, both MPs and the government seem more set on resolving difficult situations today. Rather than to display a never ending will to go into battle, this parliament – and government – appear to have chosen a more pragmatic approach. As a result, the government has lived through several interpellations, and new laws have been passed. The interpellations make a good example:

Every Kuwaiti MP has a constitutional right to question cabinet members over any particular issue. The questioning may be followed by a vote of no-confidence, which, if it gains a majority, leads to the automatic dismissal of the minister in question. Before, such interpellations notoriously lead to either the government resigning, or the Emir dissolving parliament. But the last year has been different. Cabinet ministers – including the PM – have chosen to face the interpellations, and to face votes of no-confidence. Even as of today, a new interpellation against the PM is in process, and the PM has declared that he will face questions in parliament. Thus, political crisis is averted, and MPs are able to hold ministers responsible for their actions without risking crisis just for doing so. In my view, this strengthens the institute of the interpellations; it is the issue in question, not the institute in itself, which determines the fate of the government.

Moreover, new laws have been passed. Though this may seem trivial – after all, it is a parliament – the past few years have witnessed more political crisis than political initiatives in Kuwait. But this parliament has approved a new five year plan, a new law on labor rights, a debt relief law, and most recently, a law on privatization. Being a controversial issue in Kuwait, different bills on privatization has circulated in parliament for many years. But this time it passed, at least in principle. Moreover, on the second of June, the parliament is expected to pass a law enhancing the rights of Kuwaiti women.

This being said, all is not well in Kuwaiti politics. All the issues mentioned above – women’s rights, privatization, the five year plan – are put forth by the government. In their quest for economic growth, Kuwait seeks to polish its image, as well as to encourage private investment. But as soon as an issue appears that does not please the government, the outcome is very different. For instance, the Kuwaiti author and activist Mohammad Abdulqader Al-Jassem is currently being detained for speaking out against the royal family. Moreover, the willingness to deal with corruption, abuse of foreign workers and not least the issue of the bedoons seems all but absent. In all, Kuwait still has a long way to go in their democratic project, and the government is moving in the right direction only when this is deemed in line with its own interests.

Nevertheless, I believe the last year has been an encouraging one in Kuwaiti politics. As argued above, both MPs and the government seem more pragmatic, and the institutions of the parliament may be strengthened. Thus, this parliament might just be able to deal with some of the difficult issues facing Kuwait’s democratic project.

Development and censorship

By: Jon Nordenson

A quick look on Kuwaiti politics since the last elections suggests a positive development; laws have been passed, and no government has resigned. But then a show on a private TV-station set the scene for an attack on the country’s freedom of expression.

Kuwait’s elections last May were the third elections in three years. Moreover, those previous three years had witnessed no less than seven governments. Paralyzed by a power struggle with the parliament, the government did not manage to deal with pressing issues, and few laws were passed in parliament. As I have written earlier, many ordinary Kuwaitis were fed up with this deadlock, and voted for change in the last elections. And indeed, this parliament – and government – seems to be different from their predecessors.

For one thing, there’s the interpellations. Previously, when Kuwaiti MPs have moved to question ministers (often referred to as “grilling” in Kuwaiti English newspapers), in particular ministers from the ruling Al-Sabah family, this often led to crisis. But this time, ministers – including the PM himself – have faced questioning in parliament, and even votes of no-confidence submitted by MPs following some of the interpellations. With even the PM facing the parliament in this way, an important taboo has been broken in Kuwaiti politics, and the parliament has proved their ability to fill their supervisory function.

Moreover, the parliament and the government have taken on difficult political issues, and laws have been passed. For instance, on the 30th of January, the new labor law was sent to the government for ratification. The law, which includes many improvements for laborers in Kuwait’s private sector, has already been passed in parliament, and will soon go into effect.

The parliament also passed the so called “debt relief law”, intended to help Kuwaiti citizens manage their private debts. According to Kuwait Times, the law requires the state to buy approximately $ 16 billion (!) worth of private debts, spend $ 6 billion to pay off interests, and reschedule the payments so that no citizen must pay more than 35% of their monthly income in their monthly payments. One may of course discuss how wise it would be to spend such enormous amounts in such a way, and many have criticized the law. The critics include the cabinet, which refuses to accept it. But populism is undeniably a part of politics, and it shows a parliament determined to make political decisions.

In addition, the cabinet and the parliament is currently debating a five year development plan, the privatization of Kuwait Airways, and a new bill concerning the rights of disabled people. As for difficult matters, the parliament held a special session on the issue of the Beedons – stateless inhabitants of Kuwait – and their social and political rights. The question of the Beedons has for a long time been a difficult matter for Kuwaiti authorities, and a source for much international criticism.

In all, since the last elections, the cabinet and the parliament has managed to break the deadlock, pass bills, face pressing issues, and for the government; face questioning in parliament as well. Though one should be careful to deem something “good” or “bad” politics, it does seem that Kuwaiti politics has entered a more constructive path since the last elections, with focus on politics rather than on crisis.

But then came the comments of Mohammed al-Juwaihel on his own private TV-station, al-Sur (“The Wall”). Just before Christmas, al-Juwaihel said on air that Bedouins are not really Kuwaitis, and that only city-dwellers are real citizens of the country. Naturally, this sparked an outrage from tribal MPs and others, demanding action from the government. Al-Juwaihel was arrested, and now amendments to the media laws are discussed, which critics say will limit the freedom of expression in Kuwait. According to Reporters Sans Frontiers, the new amendments stipulate harsh penalties for anyone insulting members of the royal family, who makes blasphemous statements, or who incite sectarianism in the country. In addition, censorship will be imposed on Kuwait’s active blogosphere. Although the comments made by al-Juwaihel was what sparked these amendments, critics claim the government have been planning them for a long time, waiting for the right time to launch them.

The question then, is, where are Kuwaiti politics going? On the one hand, the cabinet and the parliament seem more able to create development and make political decisions, on the other, they seem less concerned about the basic democratic right of freedom of expression. It may be tempting to point to Dubai, where democratic rights are sacrificed in favor of rapid, economic development. And indeed, some of the points in the governments five year development plan does lead one’s thoughts to Dubai, such as the construction of the “world’s largest tower”. However, Kuwait and Dubai are two very different places; Kuwaitis are proud of their democratic project, and the government will probably face many difficulties if it should try to implement the above mentioned amendments. Still, these last few weeks have highlighted what might be a difficult question in Kuwait in the years to come; development vs. democracy.

Privatization looming in Kuwait?

By: Jon Nordenson

In a recent article in Kuwait Times, the headline read «KAC to be privatized by the end of the year». According to the article, KAC – the Kuwaiti Airways Corporation – would be privatized before we write 2010, in line with the time limit for the privatization process set by the cabinet. Two studies has been conducted to establish the value of the company, and a decree from the minister of commerce is set to establish a new company with «an estimated capital of KD 300 million». Sounds easy.

But it is not. Privatization and economic diversification is – and many would call this an understatement – a controversial issue in Kuwait. In a country where a vast majority of the population rely on a government funded by abundant oil incomes for their salary, status quo is the preferred alternative, a view also reflected in Parliament. And, as Micheal Herb points out in his brilliant article on the subject in The International Journal of Middle East Studies, «(..) the structure of the Kuwaiti political system tend to encourage political deadlock». Previous attempts by the government on privatization, encouraging foreign investments in Kuwait, investing in other countries etc have notoriously been met with hostility in Parliament, as for instance the infamous Dow Deal.

So what about the KAC? Of course, Kuwait Times may have reasons I do not know about to believe this time it will be different. Still, a well informed source in Kuwait told me that this issue has been going on for ten years, and that «it is all about politics and some unions wouldn`t allow it so they don`t get fired».

In a different article from the same newspaper, published six days later, we could read quite a different story on the issue of economic diversification, this time the view of the private sector in Kuwait: « (…) sources revealed that the private sector was growing less confident in working with the government for reasons that range from the government’s lack of seriousness in executing these projects to their recent action of withdrawing or cancelling projects without providing proper justifications».

In other words, with the prospects of economic diversification in Kuwait being rather slim, the privatization of the KAC may very well meet the same fate as other, previous projects. Nevertheless, the case will be interesting to follow as the struggle to meet the cabinet`s deadline goes on.


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