Oman plans to shrink foreign workforce in the private sector to 33%

09 Feb 2013

(MENAFN) In its efforts to involve more Omani’s in private-sector jobs, Oman’s government plans to cut the number of foreign workers and radically increase the minimum wage, Reuters reported, citing Oman News Agency.

The new measures, which are subject to review by the government’s Shura Council, could have a major impact on the economy, though in practice authorities may implement them cautiously to avoid disruption.

According to the official news agency, a statement by the Council of Ministers said the government would aim to limit foreign workers to 33 percent of Oman’s total population.

The statement also said that the minimum monthly wage for Omanis in the private sector will jump to USD845, effective in July, from the current USD518.

The Council of Ministers outlined the main measures to be used to boost employment for Omanis, including revising the foreign investment law to stop unnecessary recruitment of foreign workers, and changing procedures for registering companies, the news agency said.

A team of government agencies will be formed to submit progress reports on moving Omanis into private sector jobs, it added.

Unemployment among Omani citizens was estimated to have exceeded 20 percent in 2010, according to the International Monetary Fund (IMF).

Government officials say that estimate was way too high, and that the number of registered unemployed was reduced by three-quarters to about 17,000 last year.

Oman’s ruler, Sultan Qaboos bin Said, has acknowledged that large numbers of foreign workers are needed for industrial development and construction of a national railway. It would be impossible to find local replacements for many of these workers in the foreseeable future.

That means that direct a mass expulsion of foreign workers looks unlikely. The Council of Ministers did not specify a deadline to reach the 33 percent target.