Labor Law Matters: Trade Liberalization in Oman

By Lalji, Nadira | Harvard International Review, Fall 2006 | Go to article overview

Labor Law Matters: Trade Liberalization in Oman


Lalji, Nadira, Harvard International Review


Oman's economy is liberalizing. After accession to the World Trade Organization in 2000, the government shifted toward free market values, courted foreign trade and investment, and introduced industrial regulations and labor laws. The signing of the Free Trade Agreement (FTA) on January 19 suggests there will be continued development in this area. While some economic benefits of Free Trade Agreements in the Middle East have been demonstrated by precedent, namely that of the US-Jordan FTA, the same example demonstrates that success has not been total. Jordan, like other Middle Eastern countries, still disregards the International Labor Organization (ILO) standards that the FTA requires it to meet--the same standards that Oman now must meet despite its rampant abuses of it. If the US-Oman FTA is to be successful on all counts, Oman must get serious about strengthening labor law, and the United States must hold Oman to its obligation.

Theoretically, the FTA requires Oman to adopt standards supportive of trade and investment, including ILO labor protections. The ILO's Declaration on Fundamental Principle and Rights at Work stipulates that workers are entitled to "freedom of association and the right to collective bargaining, the elimination of forced and compulsory labour, the abolition of child labour and the elimination of discrimination in the workplace."

That is the theory. The case of Jordan suggests that the reality may be different. Six years after the Jordan-US FTA was signed in 2000, Jordan has failed to reach its pledge to meet ILO standards. The apparel industry in Jordan boomed after the consolidation of the US-Jordan FTA; estimates from May 2006 indicate that Jordanian clothing exports grew by 2,000 percent over the past six years. But countless foreign workers have been exploited, primarily from Bangladesh and China. The National Labor Committee (NLC) contends that both apparel makers and contractors providing an influx of foreign workers are involved in human trafficking. Bengali workers claim that on their arrival in Jordan, their passports and forms of identification were appropriated by employers. They were made helpless, unable to leave the country, and incapable of seeking legal protection against mistreatment from employers. Without identification, they cannot even venture onto the streets, where they can be detained and even deported. "These are the worst conditions I've ever seen," said Charles Kernaghan, executive director of the NLC. The NLC estimates that such substandard conditions exist in more than 25 of approximately 100 garment factories in Jordan, a confirmation that exploitative practices have been sustained under a banner of US-backed free-market economics.

Oman's recent history also fails to inspire confidence. …

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