Dubai: Thousands of South Asian construction workers went on strike over harsh working conditions in the latest threat to a spectacular building boom already endangered by a falling currency and labour shortage.
While labourers have long complained about working conditions in this Gulf city known for its avant-garde skyscrapers, luxury dwellings and archipelagoes of artificial islands, their recent action comes as contractors are struggling to find workers to complete their ambitious projects.
Growth, driven largely by construction
Dubai is home to the world’s tallest building- the Burj Dubai, expected to be completed in 2008 and the first Armani luxury hotel. Authorities report an annual average growth rate of 12% over the past decade, largely driven by construction.
The boom has been possible due to plentiful investment from oil-rich neighbours and armies of non-unionized south Asian workers whose fear of deportation, until recently, kept them from voicing discontent over low wages.
Cost of living zooming up
“The cost of living here has increased so much in the past two years that I cannot survive with my salary,” said Rajesh Kumar, a 24-year-old worker from the south Indian state of Andhra Pradesh who earns $149 a month.
The labourers ignored the threat of deportation and refused to go to work Sunday, staging protests at a labour camp in Dubai’s Jebel Ali Industrial Zone and on a construction site in the Al Qusais residential neighborhood.
They demanded pay increases, improved housing and better transportation services to construction sites. Workers threw stones at the riot police and damaged to police cars on 28October.
Dubai authorities call protests ‘uncivilzed riots’
Emirates’ Minister of Labour Ali bin Abdullah al-Kaabi described workers’ behaviour as “uncivilized,” saying they were tampering with national security and endangering residents’ safety.
They could have registered their complaints peacefully but instead “turned themselves into rioters,” he told state news agency WAM. Those who damaged public property will be deported, the labour minister said.
Companies, however, do not want more workers to leave as they struggle to find enough to complete existing projects following an overwhelming response to a government amnesty programme to persuade illegal labourers to leave.
Workers ready to fly back home
In June, the government offered, no questions asked, free one-way plane tickets to illegal workers hoping to leave. They have since been swamped by 280,000 workers who, fed up with a rising cost of living and low wages, were ready to go home.
A booming economy in India also means that many there no longer see the need to travel to Dubai and the Gulf, said Bernard Raj, managing director of the Dubai-based Keith International, which supplies Indian workers.
“In the past, when we went for recruitment of workers we were able to choose whoever we wanted. Now the turnout of candidates is very low,” he said, estimating that at least 40% more workers were needed for the city’s projects.
With the usual labour markets like India, Pakistan, Bangladesh and Sri Lanka drying up, labour companies are turning to less traditional places like Tibet and North Korea.
Dirham’s close connection to the $US
At the root of the problem is the Emirati Dirham’s close connection to the U.S. dollar, which has seen it plummet in value, further decreasing labourers’ already low salaries.
K.V. Shamsudheen of the Pravasi Bhandu Welfare Trust, a group that helps workers, said it is the unskilled labour force that has been especially hard hit, with many no longer able to send money home.
Competitive salaries and better living conditions to retain labour
“The low exchange rate of Dirham against Indian Rupee left labourers without any savings,” he said. “The only way for the UAE to attract workers is to set competitive salaries and assure better living conditions.”
While Mohammed al-Shaiba, a UAE-based labour analyst, criticized the strikes, saying they could only harm an economy gripped by a labour shortage, he acknowledged that the government had to do something.
“Now it’s the right time to set a minimum wage,” he said, adding that the government should require companies to pay workers at least $272 a month. “If they allow a strike today, tomorrow there will be another one,” he added.