There is general movement in Arab states towards liberating their economies and opening up their markets to encourage an effective and just capitalist climate that could pave the way to economic growth and increased revenues.
Various states have succeeded in developing their systems and legislation that had once posed obstacles for investors. However, despite this optimistic and improving climate; the problem with the ‘inflexible’ labor systems still remains. Such systems tend to side with employees at the expense of enterprise owners or governmental administration in a manner that entails gross injustice to employers in many cases.
It is both strange and unreasonable that Shariah law and legislation would allow a man to divorce his wife very easily and yet not allow employers to dismiss their employees. As such, the role played by labor ministries has become an impossible one since there is a difference between the demands of employing cadres, which is an undisputable requirement and a critical ethical requirement, and the imposition of barriers on the institutions that are required to do so.
Alan Greenspan, former Chairman of the Board of Governors of the US Federal Reserve, once said that the secret behind the success of the American economy lies in the ability to fire people. This means that companies have no shortage of new blood which ensures the flow of ideas and better performance. Many businessmen believe that the policies adopted by labor ministries impede progress and advancement.
It is outright injustice to corner the private sector into dealing with the issue of employment and unemployment in light of the dismal failure of the exploitation of the economic position in other effective and influential sectors. The wage system cannot continue to operate opaquely and a clear and highly efficient policy for minimum wages must be adopted. Moreover, policies for the nationalization of jobs cannot be strictly applied or adhered to so long as the ‘lowest price’ mentality and policy are still operative.
What applies to the private sector also applies to the public sector and its circles as well. With the change of ministers, governors and other officials; there are optimistic expectations that the newly-appointed officials will improve conditions only to be confronted by a bitter reality: these figures still cannot ‘get rid’ of those who continue to deliver bad performances. Consequently, no real change can take place in the work and business environment and this sad reality has thus become the norm.
Labor and employment systems require serious consideration because if things remain as they are, it will be one of the primary factors that lead to capital flight and it will also have a negative impact on the business environment. This would inevitably reduce the competency and competitiveness of Arab societies and economies.
All the proposals that have been suggested conform to labor policies and ethics and follow the principle of ‘no harm afflicted or received’, in addition to taking justice and equality into account. However, if no change were to take place, then labor ministries will continue to be infamous for their ‘antics’ and for expelling ambitious investors.