Need for a paradigm shift

Oman Debate 2011 witnessed a no-holds-barred discussion as government representatives, private sector leaders and the public talked about the most pressing issues facing the country

Excerpts from Session 1, titled ‘Development versus stability’, which saw a spirited discussion revolving around education, job creation and training

Panellist names – Session 1
HE Dr HE Salem ben Nasser
Al Ismaily
Chairman, Public Authority for Investment Promotion & Export Development
HE Ahmed Hassan Al Dheeb
Undersecretary, Ministry of Commerce and Industry
Hussain Jawad
Chairman, W J Towell
Hani Al Zubair
Executive Chairman,
Zubair Automotive Group
Adil Taqi
CEO, Muriya Tourism Company
Dr Hatem Al Shanfari
Faculty Member at the Department of Economics and Finance, Sultan Qaboos University
Tim Sebastian
Moderator
 

Tim: There is no doubt that as 2011 comes to an end, we can look at the most far reaching and momentous events in the Arab world in decades and they are still unfolding. What is the better time than this to review how Oman has reacted to its own experiences with the Arab Spring? I always think that the most important word to define a debate is to challenge perceived wisdom and the beliefs that are put around, which require us to think differently in these uncertain times. I’d like you to consider the statement or question, “Has Oman done enough this year to meet the demands of its people?” Please vote now – The results are as follows – 66 per cent say Yes, 44 per cent say No. One more question: “Should the reforms stop here?” The results – 87 per cent say no, while 13 per cent said yes. Now we go on to the panelists. Dr Salem, what do you think of the votes. There is a long way to go, isn’t there?
HE Dr Salem: I am a bit disappointed with the first vote. I don’t think we should stop here. It is a recipe for failure if you stop and think you have done enough. You should continue to evolve.

Tim: How urgent is the situation?
HE Dr Salem: It’s not a matter of urgency, it’s a matter of the need. When the people need it you give it to them.

Tim: And they certainly needed it this year…
HE Dr Salem: Yes they needed it.

Tim: Did they take you by surprise?
HE Dr Salem: Yes they did.

Tim: Should they have taken you by surprise?
HE Dr Salem: No they shouldn’t have. They took us by surprise, we were in denial

Tim: Why?
HE Dr Salem: We didn’t expect that something like this will happen in Oman. Initially, we didn’t think they were Omanis, when we discovered they were Omanis, we were still in denial. You know, over here, we live, eat and breathe conspiracy theories. So it was always somebody else doing it.

Tim: So it was all foreign inspired?
HE Dr Salem: That’s what we felt, but they were Omanis. If you look at the city where it started in Sohar, ironically it had the largest investment of $14bn and if you look at the unemployment rate for the youth it is 25 per cent. That is worse than West Bank.

Tim: So the largest investment produced the largest unemployment?
HE Dr Salem: Absolutely. Something is incredibly wrong.

Tim: That is a huge indictment.
HE Dr Salem: Indeed.

Tim: So where are you going to start?
HE Dr Salem: We started already, that was a wake-up call and I thank God that it happened.

Tim: Ahmed Al Dheeb were you shocked as much as your colleague Dr Salem?
HE Ahmed: I would agree in certain ways but let me just explain one thing. There are reforms but everything cannot happen in one year. There are plans and the results take years. There were demands and these were responded to very quickly. The orders given by His Majesty in response to the demands, were more far reaching than what was being asked for and this process will continue, but people have to realise that it is very difficult for a government which is following a plan, like a five-year plan for example, to do everything in one year. Let’s take job creation, you cannot create 70,000 or 80,000 jobs in one day or in one go.

Tim: But the challenge is to stay ahead of the people’s demands…
HE Ahmed: Of course, this is why the government is spending billions of rials. This is what HE Darwish said, in the next five year plan, we are going to spend RO43bn so that we build infrastructure, prepare for what is coming and for creating jobs. His Majesty ordered for the creation of 50,000 jobs per year and we have already started it. The Civil Services has already taken 14,000 people in 2011.

Tim: But you are talking about investment. We just heard that the biggest investments produced the greatest number of unemployment.
HE Ahmed: Sure, but there are certain issues in Sohar. Most people in that area are fishermen and the investments in that area affected them in certain ways. A number of them gave up fishing and started looking for jobs. The other issue, a number of Omanis who lost their jobs in neighbouring countries came back and all this happened during the same time and that’s why the percentage of unemployed people increased in that area.

Tim: Does that explain how the biggest investment produced the greatest unemployment?
HE Dr Salem: It could be one of the justifications but the real reason is that we started with capital intensive basic industries and they don’t generate jobs and it takes time. Jobs creation happens once you start going into downstream industries.

Tim: So are there conditions for this phenomenon to be repeated?
HE Dr Salem: As long as the expectations of the people are high, it will be repeated. Not everybody understands our programmes.

Tim: Hani Al Zubair, is there enough dialogue in the society?
Hani: I think there is a lot of dialogue happening between the concerned authorities and business leaders and everybody else except the most important part of the society which is basically the youth. I think the issue is that we take it for granted that we know what the youth want. We know in our household what our children want or what they are aspire for.

Tim: Do you mean the ordinary people of Oman or the government?
Hani: The government and the people who have the ability to make the changes.

Tim: The government is saying we know best?
Hani: Absolutely. I am saying as parents we know what is best for our children. We do know for sure when it comes to ensure their safety and security, but do we know what their aspirations are? Or do we actually sit with them and find out what do they want?

Tim: But the kids these days tell you what they want without waiting for you to ask, don’t they.
Hani: (laughing) Times are changing, but I think we do need to listen to them a little bit more. It’s no longer acceptable for us to say to them, go away, sit together, decide what you think you want and have a nice weekend. There has to be a forum in which they sit with us and they tell us, face to face, what they want. What their aspirations are.

Tim: You have had youth summits here, haven’t you
Hani: We have had (emphasis) youth summits here. But the youth summits were for youth speaking to youth within Oman, outside Oman, talking about entrepreneurship or whatever. But it’s not them telling us what they want, what do they need, what do they aspire to going forward? We think we know what they want because we are the business leaders, because we are the government so we know what’s best for the country. Yes we know, I think we heard some fantastic figures from His Excellency the minister, that the business scenario is good, everything is fine but underneath there is this boiling pot. And we need to find out what’s going on, when is it going to erupt? You asked the question earlier ‘were we surprised?’ Yes we were surprised. Was it inevitable? Yes it was, but it is timing, we need to talk to them and come up with plans that please them at the end of the day.

Tim: The government then has not done a very good job of listening to its people. Is it going to do a better job?
HE Ahmed: I would say, not a very good job, but it did a good job to a certain extent. Do we need to improve it, yes we need to improve it. I think the government consists of the citizens… we are fathers also, we have sons, we are aware, we are really caring about the future of our sons.

Tim: But clearly there is a reason why the people went to the streets because they weren’t being listened to?
HE Ahmed: That I see. I say we need more, yes we do in a certain way. From the people who went to the streets there are lessons we have to learn. We cannot say they are totally wrong and we cannot say they are totally right.

Tim: By and large, you think they were justified otherwise you wouldn’t have taken a number of very quick measures that you did take?
HE Ahmed: As I said there were certain issues in which they were right, that’s why the government took decisions very quickly to meet their demands. That’s why we said ok, 50,000 jobs were announced by His Majesty, that was a very quick order. There are other issues being agreed upon and I think everybody knows about the issues which happened in the last 6-8 months. But still there are issues that are being worked upon and they have to wait till they are implemented. Things cannot be changed just like a miracle. When you talk about the mega projects in Sohar, the gas based industries, now we are talking about the secondary projects. These downstream projects will come but not in one year. It will take 2-3 years to create jobs for them after that. I think the important thing is education, to educate our children, we have to train them. Even the job seekers need to be trained for loyalty, how to honour their jobs. Education here has to emphasise on such issues.

Tim: Adil Taqi, are you comforted by what you heard from HE Ahmed?
Adil Taqi: I think the sense of urgency stems from two things. One, the consequences of not doing something are very negative. So if for example, the government had not met the demands the way it did, it could have got out of control. So, that was a driver of the sense of urgency…

Tim: It did get out of control.
Adil: It could have got out of control more, let us say. The other driver of the sense of urgency are the lost opportunities. Every minute gone by is gone forever. And I think, the world will not wait for us. And that cuts across everything. We just got to move three notches faster, whether there is a reason or not. Acting quickly is the way of life. And I think that mindset needs to come into play. And it is an important driver. If you take that to a macro level, if we had made decisions in the years gone by when we had fantastic growth, we would have achieved 60 years of growth in 41 years. And that is why speed is very important.

Tim: Do you think that the demands will keep coming now that you have opened the flood gates? Is there a fear now that all that they need to do is to go on the streets and you will back down and do what they want?
Adil: No I think this is in a sense a natural process and we have to evolve to find a new point of equilibrium. But I think Hani was making an important point – it’s about engagement and dialogue. We as government and citizens as HE Dheeb said, the government are citizens quite rightly and I agree with that. We were all surprised. The fact that we were all surprised suggested that we were not in touch with the street as business leaders, government officials etc. And we need to understand and not become too complacent too quickly by thinking that we have done enough. We also need brutal honesty, we have to be honest with ourselves, face reality, take decisions and make mistakes in the process. Everybody makes them. People who don’t make mistakes don’t work hard enough and don’t stretch the envelope far enough.

Tim: How far has Oman gone in placating the people’s demands? Do you think the people will go back on the streets?
Dr Hatem: The possibility is always there. But I think the quick reaction has been quite assuring. It is necessary but it’s not sufficient for getting us out of the mood that we are in at the moment.

Tim: Was it a knee-jerk reaction, actually?
Dr Hatem: It is and there will be consequences of some of the decisions that we have taken to put people in jobs that are not productive. It will have negative consequences. We are just starting to see that almost every year we will have 50,000 job seekers. We have to find jobs for them and the government cannot take all of them on board. The private sector does not have that much capacity either. We have a dilemma, we have been able to accumulate wealth, have achieved excellent growth but that growth has not been inclusive. And 50 per cent of the Omani population is between the age of 15 and 29. There are about one million Omanis in that age group. This is an immediate challenge for the government. And the public and the youth have to be assured that the government is in tune with their demands and able to meet their aspirations.

Tim: The government is passing the pressure primarily on to the private sector
Dr Hatem: Private sector has very limited capacity and if you keep pushing them, they will crack and this has to be well balanced. The government has more responsibility to handle this challenge.
 
Tim: How much more can the private sector take in terms of pressure?
Hussain: Well I think there is still a lot of opportunities for the private sector to grow. I think the bureaucracy and the lack of coordination in the government ministries is putting brakes on the private to go ahead. Today we have more than 220,000 Omanis working in the private sector, more than the government, which has only 140,000. So there are so many opportunities.

Tim: You are saying that the private sector is willing but it’s just the bureaucracy which is blocking it.
Hussain: Yes the bureaucracy and the lack of coordination…

Tim: Ahmed Al Dheeb, what do you have to say?
HE Ahmed: Well I don’t buy that the government has to do everything.

Tim: But you do buy that the government is asking the private sector to step up to the plate but it is blocking it with bureaucracy…
HE Ahmed: Let me put it this way. There is a role for the government and another role for the private sector. When we say the role of the government, its role is to prepare the legislation, the policies for the country and the private sector in terms of incentives. The role of the private sector is to utilise these services and run the businesses and create jobs. When we say creating jobs, the government alone cannot create 50,000 jobs per year.

Tim: What about bureaucracy?
HE Ahmed: Well, I don’t know where Hussain had this experience but I agree that the government is not having dialogue. In all the government plans and policies there are committees and the private sector participates in this.

Tim: So you are saying there is no bureaucracy?
HE Ahmed: In a certain way yes.

Tim: How do you react to that Hussain? As a first exercise in dialogue, it’s not very hopeful.
Hussain: In Oman we are always known to be really polite and diplomatic. I think we have to be diplomatic and say yes but in fact, it is a time when everybody’s eyes are open to see that we are in a very beautiful country and there are opportunities but we need more coordination and less bureaucracy.

Tim: The private sector has done pretty well, it’s had some very good years. Now the government wants its assistance. But the private sector is complaining about bureaucracy and making excuses. Now isn’t it time the private sector stood up and did its duty
Hani: Absolutely. I don’t think it’s a one sided debate or a one sided argument. The private sector does have to play its role and I think the private sector in the past has not been active in employing local people. We paid a lot of lip service to it and we tried to find different methods and ways of doing things. I will give a small example. We used to have these sectoral committees to look after employment in certain sectors that are now being revived which I think is a great idea. And I was on the panel of two of these committees. One was in the automotive sector and the other was the accounting sector.

When we looked at the numbers we found that 50 per cent of all registered foreign accountants in Oman were illiterate. Everybody around the table was shocked. For me, it wasn’t such a shock because our sector also played its role in those numbers. The Ministry of Manpower says that you can’t have expatriate car washers but we know that trying to get Omanis at that early stage to wash cars all day long, 8-9 hours a day is very difficult. However we could have as many accountants as possible because there weren’t any in Oman and nobody was really checking as to what they were doing. So there were a lot of accountants washing cars.

So people find ways to get around a system that is not working for them. Has the private sector done enough? No. Are we taking our part in the creation of the 50,000 jobs? Yes. But there is also a limitation. Has every company that has committed itself been able to fulfill its quota? I don’t think so. Not to that extent that anybody would wish because you can’t find the right people for the right job. We need to do more but we need to have the right people at the same time. It’s no good saying you need to take 20,000 more. But I need engineers or people who are at a certain level. But I can only have school leavers.

Audience: Good morning I am Salman Hussain Al Lawati. I am an industrial engineer. I want to see more commitment towards education. I think the government speaks about education as being the most important thing currently, however, there is a missing link between all the ministries. For example, we had thousands of posts in the army and people left their schools and colleges to join the army. So where is the priority for education?

HE Dr Salem: I don’t think education is only the priority of the government. This is God’s priority. If you are a Muslim, the first word that God said was Ikhra, read, recite, learn. So investment in people is extremely important. If you have a population that is not educated or trained it cannot be effectively engaged in production and therefore it is very important to educate people. Equally important and as I say, one of the most important human rights, is the right to employment. Employment is what is going to generate your livelihood. Therefore the private and the public sectors have got that responsibility. I think it is high time that corporate Oman realised that the society in which you operate is your most important stakeholder.
Dr Hatem: Education is the passion of the community everywhere and without proper education it is difficult to go forward. Education is an enabler, it does not solve the problem. Obviously there are a lot of questions on the quality of education. We had been channeling a huge amount of money in the education sector, but its impact has not been equally effective as we have been trying to address the quantity side of education in the past – the amount or number of Omanis who were able to enroll in higher education was proportionately very low in the past. This year we had an exceptional time as about 64 per cent of the high school graduates have been taken by higher education institutes inside and outside Oman. The quality is another challenge. We have tried to address this issue by revising the curriculum and preparing the teachers better in the future but it has been a challenge. And practically, no matter how good the plan that we have for improving education, without committing more resources into education and trying to check the quality, we will not be able to realise the objectives.
 
Tim: So is there a political will to do that?
Dr Hatem: Officially yes

Tim: And in practice?
Dr Hatem: In practice you have to go beyond the commitment verbally and commit resources. Education everywhere is the top priority of the government. In England, for example, Tony Blair has said, education, education, education. We have not even got close to that. Every country in the world which want to be competitive has to address the issue of education. This is an important prerequisite to be able to compete internationally. We have still a way to go.
 
Audience: My name is Sridhar and I have been living here for the past 30 years. In a country which has hundreds of thousands of expatriates, finding jobs for about 50,000 people each year should not be a difficult issue. I think, two issues have come to me from the panel. One is Hani’s point. He said, I am willing to take people provided I get the right talent and experience. And the other point is about education. I think we need to look at it in two manners. How do I solve the present problem? The present problem is that we have hundreds of thousands of Omanis requiring jobs. At the same time, I have hundreds and thousands of expatriates who have not even qualified from school. So how do we match this demand-supply situation which is available within the country. We don’t want this problem to recur five years from today, so what are we going to do about the education where we equip our Omani nationals to take up positions in future that is demanded by the private sector?
HE Ahmed: I totally agree about the importance of education. Do we need to increase the quality of education? Yes I agree we need to.

Tim: Is there a political will now to do it?
HE Ahmed: There is, there is a will. I think we all heard about how the ministry of education is working on modifying the curriculum and trying to improve the level of education. And we have done it several years ago, when we started with basic schools, which changed the old way of education.

Tim: But it wasn’t enough
HE Ahmed: Yes it wasn’t enough. But the world is changing fast. We have to go with the changes. A few years ago, we were not online, now we are on Twitter and Facebook live. So there is a change and we have to go with the change. We have to go very quickly I agree. The government has a lot of responsibility but it is not just the government’s responsibility, we need the participation of the private sector to provide good private schools. Regarding the balance between unemployment and the employed, there are a lot of expatriates who are below secondary schools, but when it comes to Omanis business houses want qualified Omanis. Why do we ask for a qualified Omani and not the same from an expatriate worker? I think the reason is the financial difference. The government is working on providing quality education to Omanis through training institutions, technical colleges and scholarships.

Tim: Maybe the government is not reacting fast enough to change the education or maybe the right people aren’t in government?
HE Ahmed: Well I would say we have to move fast and increase our speed a little bit…

Tim: Maybe we need new faces as the priorities are changing.
HE Ahmed: If I said yes, I would be replaced (audience laugh and clap)

HE Dr Salem: I don’t want to go on an overkill on the education. While it is important, it’s not everything. I know many countries which have invested in education and they have lot of people who are educated but are unemployed. What’s important is the creation of opportunities.
 
Tim: Is that an argument against education?
HE Dr Salem: No its not. It is an argument for creating an environment that is conducive to do business. And that is important. Equal opportunity is important. Suppose what will happen if we want to marginalise people because of their gender. Or if we say, women cannot work in our country. We are only working on 50 per cent of the installed capacity. The gentleman who has been here for the past 30 years has played a very important role in the development of our economy. And I believe that any person who lives in Oman, whether Omani or non-Omani, has the potential to contribute to economic development. And therefore, should have an equal opportunity to participate in the development of the economy.

Tim: You mentioned women. Are there enough opportunities for women?
HE Dr Salem: If not, we have to create them. Let me give you an example, I don’t know if you know about a guy named Abdul Fatah. He was from Homs in Syria. Because he didn’t have an equal opportunity in his country, he emigrated to California in the US. He found a nice American lady and had a baby. Unfortunately, the parents didn’t want an Arab Muslim to marry their daughter. So the child was adopted. That child did not finish formal education but was one of the most important innovator in our time and his name was Steve Jobs. I wonder how many Steve Jobs are waiting to be still discovered in Homs, Syria today because of the lack of opportunity (audience claps)

Adil: Very often you hear on debates and you hear it elsewhere that there is mindset of a private public sector that you need to work on. Most businessmen will tell you that their employees are their most important resource. And I think it is way beyond lip service. Any sensible businessman would say, my good employees are my real assets. These are the guys who create opportunities and create value. The private sector will always be under countless pressure. They will have shareholders who will demand to make money. But I think self interest is the wider objective. Recruiting the right sort of people is what the business needs. And I think we need to, in the short term, have the quota systems and the percentages of Omanisation. In the long term, I think if the Omani workforce is competitive as any other, the employer will pick the right employee and the right value creator for him. And in my view it is the competitiveness that we should focus on.

Tim: The best person for the job or the best Omani
Adil: I think the best person for the job because…

Tim: Despite the quotas…
Adil: I think despite the quotas, because I think if you have the right competitiveness, the quotas would become irrelevant.

Audience question: Good morning, my name is Lubna Al Kharusi. I think we all understand what the issues are, education, encouraging entrepreneurship, transparency. But my question is about whether we have clear vision, plan, targets on how to address these issues. If there are no measurable targets we will keep talking for the next 20 years and nothing will happen. (Audience claps).

Dr Hatem: Well the intention is always there. And the ministry has been very vocal, especially the young minister of education has been trying extremely hard and I think she has what it takes to move the education and to improve it significantly in the future. She needs a lot of support. As I said, support from the government in order to provide the financial resources, support from the community to understand where we are heading, and as far as measuring the education performance, it is very clear, there is always high or international standards and there are competitions across the globe where nations compete to see how their education system is faring. And when there is a lack of progress in some countries, they raise a national alarm.
 
Tim: Dr Salem can you help the question on clear vision?
HE Dr Salem: I believe that the vision is probably slightly blurred for the time being but it has been tuned in and I totally agree with the lady’s suggestions for cleaning up procedures by creating institutions, because these institutions coordinate and interact with individuals, firms and the government. And they have to be well functioning in terms of its enforcement. However we have to slowly move from the dependence on an individual to the dependence on systems. Because if we empower a person, that person inherits a seat or position that he has and the worst thing that could happen is that somebody in public places utilises it for private benefit. If we eliminate the person, we go back to transparency, good corporate governance and depend upon a system rather than an individual. It means you can get your services, whereever you are, whenever you need them, without the need to see a person. That will be the day the people can say we can relax a bit.

 

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