Iraqi Unions Condemn Move to Give Oil Production to Foreign Multinationals

by Tula Connell, Dec 19, 2006

The AFL-CIO Solidarity Center sends us word that Iraqi trade unions are alerting the public they fear the Iraqi government is handing over the nation’s oil production to foreign multinationals.

Leaders of Iraq’s five trade union federations are condemning plans by the Iraqi government to hand over control to what they say is most of their nation’s oil production to foreign multinational corporations.

A new law being considered by the Iraqi government could turn over up to two-thirds of Iraq’s known oil reserves to foreign companies under contracts that could last upward of 20 years.

According to Adnan Saffar, a member of the Executive Committee of the General Federal of Iraqi Workers, the proposed law benefits foreign investors more than it benefits Iraqi workers and will negatively impact Iraq’s sovereignty and national independence.
 
The law was prepared by an Iraqi cabinet committee and will likely be presented to the Iraqi parliament for ratification in the coming weeks.
 
Iraq’s abundant oil and gas reserves, one of the nation’s most profitable industries, have historically been publicly owned. The moves of the Iraqi government to open the nation’s natural resources to foreign investment and control of profits represents a radical break in normal practice for most Middle Eastern, oil rich nations. In a joint statement issued by the five trade union federations, the unions criticize what they see as

the handing of control over oil to foreign companies, whose aim is to make big profits at the expense of the Iraqi people, and to rob the national wealth, according to long-term, unfair contracts, that undermine the sovereignty of the state and the dignity of the Iraqi people. 

The issue of control over natural resources in Iraq is sensitive. It was a major point of contention during the British occupation in the mid-20th century, when British and American companies dominated the oil sector. To many Iraqi citizens, Iraq’s oil is a precious resource and represents their hope for rebuilding Iraq’s infrastructure, which has been devastated by years of war and economic sanctions.  According to the trade unions’ statement:

Iraqi public opinion strictly opposes the handing of authority and control over the oil to foreign companies that aim to make big profits at the expense of the people and to rob Iraq’s national wealth. 

Iraqi trade unionists also are saying lawmakers failed to consult with the public or the trade union federations, including the large Federation of Oil Workers. The statement states:

Even the media and the press have not viewed [the bill]. The Iraqi people refuse that the destiny of their oil be decided behind closed doors.

Hasan Jum’a, president of the Iraqi Federation of Oil Workers, condemned the law, saying:

It was prepared without consulting Iraqi experts, civil society or trade unions. 

According to analysts for the Iraqi trade unions who have studied the draft law, the handover of the oil and gas industry to foreign corporations likely will result in wage cuts and possible layoffs in the oil industry as well as a sharp increase in consumer energy prices.

Denouncing moves to privatize Iraq’s most valuable resource, the leaders of the five Iraqi trade union federations have called on Parliament to delay action on the bill until there is full consultation and discussion over the future of the oil industry with trade unions, civic organizations and academics experts. Iraqi unions are also asking for “the support of international and Arab labor unions to stand with us in solidarity” in order to pressure the Iraqi parliament to stop the bill before it is voted into law.

Click here to read the joint statement of the five Iraqi trade union federations on the draft oil law.

And get more information at the General Union of Oil Employees in Basra website here, the International Federation of Trade Unions here and the Federation of Workers Councils and Unions in Iraq here.

More information on the AFL-CIO Solidarity Center is available here. 

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