Emerging CSR definition: "Corporate Social Responsibility starts where all existing laws and regulations end; it is an organic link between enterprising, profit-making and social development that is conducted as a win-win solution in areas where a company requires something from society that cannot be bought and requires investment through a DOUBLE business plan: one for the company and one for society."

Press Release: Oman Leads Gulf States to New SME Jobs; Ad Melkert Advises on New Labor Law (02/2013)


Press Release 02/2013

Oman Leads Gulf States to New SME Jobs

Ad Melkert advises on new labor law

“Oil or gas-rich Gulf States have neglected the development of Small and Medium-sized Enterprises. That is the biggest difference with Western economies. Enormous bureaucracies have arisen. But now Sultan Qaboos has given the green light for a massive switch of the economy that has always been oriented towards large companies. It allows the common people to get a job via their own small companies. All efforts and regulations are now aimed at that”, says Ad Melkert who last month addressed an SME market in the Omani port town Sohar. As top advisor on Corporate Social Responsibility with the international consultancy PA CSR he and the American Professor Bill Valentino support among others Oman Oil Company and the Ministry of Manpower. This Omani Minsitry is now using international knowledge and experience to amend the labor law.


“In Europe, SMEs account for 80% of available employment opportunities. In Oman, this percentage currently translates to around 12%. Thousands of jobs can be created, through implementing an enhanced set of training programmes, dynamically adapting to the market and creating incentives by introducing amendments to current tender and other processes and regulations. As the CEO of one of the largest organisations in Oman, I aim to implement sustainable Corporate Social Responsibility (CSR) initiatives to help fulfill the new policy set out by His Majesty Sultan Qaboos”, states Ahmed Al Wahaibi, who, for years has been working with a multitude of international entities including Dutch companies and institutions.


"If we are considering to bring down the number of young Omani job-seekers, we will need to encourage them to roll up their sleeves and join the private sector. To bring about this change, we will require continuous engagement with all stakeholders, employers as well as employees, to create sustainable opportunities and ensure a win-win situation for all.


Furthermore, I truly believe that use of innovative technology can play a pivotal role in enhancing our economy as it will allow an increase in productivity and, as a consequence, this will support further enhancement of employment opportunities and employee remuneration."


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Ahmed Al Wahaibi, CEO of Oman Oil Company


Oman has thus taken the lead in answering the question how the Arab world can deal with street protests of, particularly, unemployed youth. Two years ago also Oman, and especially Sohar, was the scene of some riots – albeit on a modest scale. A Dutch state visit was therefore postponed. Sultan Qaboos reacted initially with the replacement of a large number of Ministers. But now, he directly addressed his people in the old fortress town of Bahla. During a unique direct TV broadcast he stated that a new era had begun. Massive investments – but this time not in the traditional oil and gas fields, but in things like ICT and agriculture and fisheries – will make starting a small company at least as attractive as becoming a civil servant. With a coastline that stretches more than 3.000km, fishing opportunities remain currently significantly underutilized. The fish production of 160,000 tons in 2012 is bound to be increased to 460,000 tons in 2020. Expertise is required on both natural and aquaculture fishing methods.


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Sultan Qaboos meets the people (Photo Oman News Agency)


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Sultan Qaboos of Oman addresses his people in Bahla (Photo Oman News Agency)


At the end of January more than 1,000 entrepreneurs including hundreds of women went to a large and completely open symposium in Bahla to, prior to the consultation with Sultan Qaboos, sometimes loudly give vent to their problems and grievances. "The government’s red tape is stifling us". "We have to compete with much cheaper labor from neighboring countries." "The current tender procedures always lead to the same winners." The Sultan appeared perfectly aware of this. His government took immediate decisions. One is the creation of a new independent authority that maps all SME possibilities and turns them into direct and practical SME projects.


"That also requires a change in attitude," says Sheikh Khalfan Al Esry. The Sultan appointed him recently in the State Council, similar to the Dutch Senate. Sheikh Khalfan was a top manager trained by Shell in The Netherlands before he decided to give spiritual content and inspiration to a new generation of young people who still have to find a path between traditionalism and modernity and to balance between the worldly and spiritual life, pragmatism and wisdom. He founded the successful company 'Prosper'. Together with PA Group Managing Partner Rio Praaning Prawira Adiningrat he develops programs and plans to align government, industry and society. The European and Asian experience of PA CSR with Public-Private Partnership (PPP) and Corporate Social Responsibility (CSR) is thus linked to the Omani reality. It especially requires effective education and training. The American former CEO of the German pharmaceutical company Bayer China is the internationally recognized expert of PA CSR in that area.


In the margins of the plans to stimulate Omani entrepreneurship and SME employment, the Government is also working on a complete revision of the labor law. Laws on working hours, severance and compensation, employee organizations, consultation between workers and employers, equal rights, foreign workers, labor, etc. will thus be tackled. The Omani government can count on the support of Oman Oil Company which has urged its consultants to make international comparisons and integrate the conclusions into the Omani labor law. "We take the bull by the horns. The country realizes that a thorough reform of its labor market is necessary to be sustainable in the longer term. A new labor law is an essential part of that. There should be a bigger difference between unemployment benefits and the minimum wage without pricing ourselves from the international market. The difference between civil servants and SME workers should disappear. We need to grow towards a merit-based personal income with an equal start for everyone," says President Yahya Al Jabri of the new growth region Duqm. This new port will soon harbor one of the world's most strategic energy storage facilities outside the traditionally dangerous Gulf. Around 40% of all oil and gas comes from the Gulf region.



PA CSR is part of the PA Group with offices in several world regions. In The Netherlands the PA office is located at Lange Voorhout 100, 2514 EJ The Hague, tel. +31 70 345 6210..