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Globalization, Trade & Globalization, Trade & Decent Work Decent Work

Arun KumarArun Kumar

Globalization?Globalization?

Participants views…Participants views…

Why Globalisation?Why Globalisation? Capital Needs Markets…new markets for Capital Needs Markets…new markets for

profits; Also natural resourcesprofits; Also natural resources

Developing countries need to grow, need Developing countries need to grow, need capital, access to new technology, goods & capital, access to new technology, goods & services;services;

Investors need free trade, minimum or no Investors need free trade, minimum or no regulations on capital & safe guarding of their regulations on capital & safe guarding of their investments;investments;

Economic reforms, free trade & Economic reforms, free trade & Globalization!Globalization!

Forces behind GlobalizationForces behind Globalization G7 Countries (reflecting Business/Financial G7 Countries (reflecting Business/Financial

Capital Interests) - US Treasury Dept major Capital Interests) - US Treasury Dept major player player

IMFIMF World BankWorld Bank WTO – Estd on 1WTO – Estd on 1stst Jan 1995 Jan 1995

---------------------------------------------- Regional Banks like ADB and Private Banks,Regional Banks like ADB and Private Banks,

Global based Investment Funds, TNCs, UN Global based Investment Funds, TNCs, UN Organizations,Organizations,

Domestic business interests…Domestic business interests…

Estd after 2nd WW in 1944

What is Globalization Promoting?What is Globalization Promoting?

Supremacy of markets, Government - a Supremacy of markets, Government - a problem! problem!

One size fits all kind of policies:One size fits all kind of policies:Open markets for trade, investment & Open markets for trade, investment & capital flows, capital flows, FDI rather than foreign FDI rather than foreign aid, no performance requirements on aid, no performance requirements on FDI, FDI, ccut govt deficit, privatize, etc ut govt deficit, privatize, etc

Employment flexibilityEmployment flexibility

Global Labour Market Scenario, 2006Global Labour Market Scenario, 2006 Global workforce: Over 3 billion (another 430 Global workforce: Over 3 billion (another 430

million will be added by 2015 majority of who million will be added by 2015 majority of who will be from developing countries) will be from developing countries)

Women constitute 40% of the labour force Women constitute 40% of the labour force (1.22b) (1.22b)

About 1.37 billion working people earn less About 1.37 billion working people earn less than $2/day (working poor); 522 m live on than $2/day (working poor); 522 m live on less than 1 $less than 1 $ a day – majority of world’s poor a day – majority of world’s poor are in Asia and Africa.are in Asia and Africa.

Over 3/4Over 3/4thth of the working population in Africa of the working population in Africa lives on less than US$2 per person in the lives on less than US$2 per person in the household, per day (260.3 million, expected household, per day (260.3 million, expected to go up to 316.7 million by 2015).to go up to 316.7 million by 2015).

Global Labour Market Scenario, 2006Global Labour Market Scenario, 2006

No. of unemployed globally: 195.2 m; No. of unemployed globally: 195.2 m;

Women comprise about 42% of global Women comprise about 42% of global unemployed (about 82 m);unemployed (about 82 m);

44% of world’s unemployed are youth (86.3 44% of world’s unemployed are youth (86.3 million) [over 48% of these are in A-P region]; million) [over 48% of these are in A-P region];

Over 43 m new jobs to be created each year Over 43 m new jobs to be created each year in order to reduce global unemployment, says in order to reduce global unemployment, says ILO ILO

Global Background (2002, in %)Global Background (2002, in %)

Share in World Share in World Income/GDP Income/GDP

Share in World Share in World TradeTrade

Share in FDIShare in FDI

Share in Portfolio Share in Portfolio InvestmentsInvestments

HIC (80.5), MIC (11.5), LIC (2), HIC (80.5), MIC (11.5), LIC (2), China & India (6)China & India (6)

HIC (72.9), MIC (15.6), LIC (2.7), HIC (72.9), MIC (15.6), LIC (2.7), China & India (8.7)China & India (8.7)



Source: ILR, 2004/1-2, Vol 143, ILO, Geneva

Trade LiberalizationTrade Liberalization Doha Doha DevelopmentDevelopment Agenda- name given to Agenda- name given to

the agenda for multilateral trade negotiations the agenda for multilateral trade negotiations that restarted athat restarted at the Fourth Ministerial t the Fourth Ministerial Conference in Doha, Qatar, in November Conference in Doha, Qatar, in November 2001;2001;

There are about 21 items on this agenda, There are about 21 items on this agenda, covering issues connected with what was covering issues connected with what was agreed under Uruguay Round of GATT in agreed under Uruguay Round of GATT in 1994, new issues and WTO rules.1994, new issues and WTO rules.

Negotiations are still going on; The original Negotiations are still going on; The original deadline of 1 Jan 2005 was missed as was the deadline of 1 Jan 2005 was missed as was the next unofficial deadline of end 2006.next unofficial deadline of end 2006.

Main areas under negotiationsMain areas under negotiations NAMANAMA – Non Agricultural Market Access – – Non Agricultural Market Access –

reduce & eventually eliminate high tariffs & non-tariff reduce & eventually eliminate high tariffs & non-tariff barriers – at stake industrial development needs, barriers – at stake industrial development needs, employment & livelihoods in developing countriesemployment & livelihoods in developing countries; ;

AgricultureAgriculture sector liberalization ( sector liberalization (need for rural need for rural development & food security of developing countries, development & food security of developing countries, high tariffs, export subsidies and domestic support by high tariffs, export subsidies and domestic support by EU & US)EU & US); ;

TRIPS TRIPS ((Trade-related aspects of intellectual Trade-related aspects of intellectual property rightsproperty rights)-)-Public health & domestic Public health & domestic development issuesdevelopment issues;;

ServicesServices sector liberalization ( sector liberalization (covers almost all covers almost all sectors and movement of personnel -skilled)sectors and movement of personnel -skilled)

Related issues of concern Related issues of concern

Obligations of least developed countries, Obligations of least developed countries, special and differential treatment of LDCs, special and differential treatment of LDCs, less than full reciprocity principle, less than full reciprocity principle, development needs of developing countries; development needs of developing countries;

Environment protection policies and trade;Environment protection policies and trade; WTO rules on regional trade agreements – WTO rules on regional trade agreements –

differences of interpretation (this is also one differences of interpretation (this is also one of the pressures on ACP countries for of the pressures on ACP countries for accepting EPAs);accepting EPAs);

Anti-dumping measures & subsidies – needs Anti-dumping measures & subsidies – needs of developing countries and practices of OECD of developing countries and practices of OECD countries;countries;

A word about TRIMS & obligations already in A word about TRIMS & obligations already in force.force.

Implications of New PoliciesImplications of New Policies Shift from development cooperation to free Shift from development cooperation to free

trade;trade; More competition between More competition between unequalsunequals;;

Equality of “access” (to international trade) Equality of “access” (to international trade) does not mean equality of “opportunity”;does not mean equality of “opportunity”;[[unequal capabilities lead to unequal outcomesunequal capabilities lead to unequal outcomes]]

Adverse impact on development & Adverse impact on development & employment – both in developing countries & employment – both in developing countries & in OECD countries; in OECD countries; many developing countries many developing countries will be forced to remain providers of natural will be forced to remain providers of natural resources and low value –low technology resources and low value –low technology productsproducts;;

The policies that helped developed countries The policies that helped developed countries to develop are now considered trade to develop are now considered trade distorting and hence to be done away.distorting and hence to be done away.

Effects on LabourEffects on Labour Downsizing, increasing workloads & job Downsizing, increasing workloads & job

insecurity; insecurity;

Weakening of public transport, health care Weakening of public transport, health care systems, primary education, etc as public systems, primary education, etc as public expenditure and role of Govt in these expenditure and role of Govt in these sectors declines;sectors declines;

Growing informal economy – rural-urban Growing informal economy – rural-urban migration as agriculture becomes non-migration as agriculture becomes non-viable for small farmers;viable for small farmers;

Deterioration of labour standards & social Deterioration of labour standards & social protection provisions;protection provisions;

Effects on LabourEffects on Labour

Weakening of TUs also thru new HR policies, Weakening of TUs also thru new HR policies, outsourcing & preference for casual labour;outsourcing & preference for casual labour;

Trade Union memberships are decliningTrade Union memberships are declining

memberships range from 3% - 19%; memberships range from 3% - 19%;

Union density lowest in agriculture & Union density lowest in agriculture & informal economy dominated countries & informal economy dominated countries & declining in most countries;declining in most countries;

What else? Participants experiencesWhat else? Participants experiences

Trade Union ConcernsTrade Union Concerns Where are the jobs? Has ‘Globalization’ Where are the jobs? Has ‘Globalization’

process delivered on jobs front?process delivered on jobs front? Issues–Not only unemployment but Issues–Not only unemployment but alsoalso, ,

underemployment, low paid, exploitative & underemployment, low paid, exploitative & hazardous working conditions; hazardous working conditions;

Youth (15-24 yrs) unemployment serious; for Youth (15-24 yrs) unemployment serious; for every unemployed adult, there are about 3-5 every unemployed adult, there are about 3-5 unemployed youth;unemployed youth;

Jobs without rights – call centres, private Jobs without rights – call centres, private services sector, SMEs in informal economy, services sector, SMEs in informal economy, EPZs and so on.EPZs and so on.

Workers Rights to organize? to bargain Workers Rights to organize? to bargain collectively?collectively?

So, what are TUs saying?So, what are TUs saying?Answer does not lie in ProtectionismAnswer does not lie in Protectionism

Ensure Justice, Equity and Democracy in the Ensure Justice, Equity and Democracy in the new global order;new global order;

Need for role of State and public regulation of Need for role of State and public regulation of business and international trade; business and international trade;

Review of Free Trade – to re-focus on the Review of Free Trade – to re-focus on the objectives of Devt, Empl. & Poverty reduction – objectives of Devt, Empl. & Poverty reduction – multilateralism rather than bilateralism.multilateralism rather than bilateralism.

Respect for basic International Labour Respect for basic International Labour Standards for promotion of Decent Work;Standards for promotion of Decent Work;

Representation & Participation of TUs in Representation & Participation of TUs in economic and social policy matters;economic and social policy matters;

What is ILO saying?What is ILO saying?

ILO’s ILO’s World Commission on the Social World Commission on the Social Dimension of Globalization says – Dimension of Globalization says – Global markets need ‘governance’ i.e. a set of Global markets need ‘governance’ i.e. a set of institutions & rules for equitable functioning institutions & rules for equitable functioning to:to:

• Avoid market failures (e.g., economic Avoid market failures (e.g., economic crises);crises);

• Redress vast inequalities between & within Redress vast inequalities between & within countries;countries;

• Strengthen mechanisms for delivering Strengthen mechanisms for delivering social protection - manage change.social protection - manage change.

Decent Work!!!Decent Work!!! Aimed at achieving the following strategic Aimed at achieving the following strategic

objectives:objectives:

Creating JobsCreating Jobs – through opportunities for – through opportunities for investment, entrepreneurship, wage investment, entrepreneurship, wage employment & sustainable livelihoods;employment & sustainable livelihoods;

Guarantee Rights at WorkGuarantee Rights at Work of of AllAll workers; workers;

Provide basic social protectionProvide basic social protection – against – against declining standards of living, marginalization declining standards of living, marginalization & poverty; and& poverty; and

Promote dialogue & conflict resolutionPromote dialogue & conflict resolution – –the right to be heard, to negotiate and the right to be heard, to negotiate and dialogue is the best way to solve problems dialogue is the best way to solve problems peacefully.peacefully.

TUs support to Decent WorkTUs support to Decent Work

TUs support the integrated approachTUs support the integrated approach of ILO to of ILO to address the social impacts of globalization:address the social impacts of globalization:

Because the concept of Decent Work -Because the concept of Decent Work -

• Focuses on core rights, addresses all Focuses on core rights, addresses all workers, in all economic sectors (formal, workers, in all economic sectors (formal, informal);informal);

• Is participatory, promotes Social Dialogue & Is participatory, promotes Social Dialogue & seeks to involve all social partnersseeks to involve all social partners

• Is Dynamic – progresses as the economy Is Dynamic – progresses as the economy changeschanges

Trade Union ResponsesTrade Union Responses

Mergers of trade unions – GUFs;Mergers of trade unions – GUFs;

ITUC – merger of ICFTU, WCL & some other ITUC – merger of ICFTU, WCL & some other unions – on 1 Nov 2006, Vienna;unions – on 1 Nov 2006, Vienna;

ITUC represents 306 affiliated national trade ITUC represents 306 affiliated national trade union centres of 154 countries & territories union centres of 154 countries & territories representing some 168 million members.representing some 168 million members.

Organize! Organize!

Trade Union ResponsesTrade Union Responses Campaign for core ILO labour standards, particularly Campaign for core ILO labour standards, particularly

– C 87 & 98;– C 87 & 98;

Global Collective Bargaining (GUFs have signed Global Collective Bargaining (GUFs have signed Codes of Conduct OR Framework Agreements with Codes of Conduct OR Framework Agreements with about 54 MNCs till now, covering over 4 million about 54 MNCs till now, covering over 4 million workers world wide);workers world wide);

Build alliances with other social partners on mutually Build alliances with other social partners on mutually agreed agenda – links with world TU bodies, agreed agenda – links with world TU bodies, Women’s movement, NGOs where necessary, Women’s movement, NGOs where necessary, Consumer movement – role of international labour Consumer movement – role of international labour solidarity.solidarity.

Using Workers Capital to promote Union Rights & Using Workers Capital to promote Union Rights & other labour standards (not tried so far);other labour standards (not tried so far);

Negotiating Change at National Negotiating Change at National level …level …

Ensure Right to Organize & Right to Collective Ensure Right to Organize & Right to Collective Bargaining!Bargaining!

Adopt policies Adopt policies that apply to all workersthat apply to all workers & prevent & prevent further divisions of workers in the labour market –put further divisions of workers in the labour market –put all workers in one boat. all workers in one boat.

Set nationwide Set nationwide floorfloor labour standards –that apply to labour standards –that apply to

all workers & employers (de-link labour standards all workers & employers (de-link labour standards from permanency of employment); from permanency of employment); RoofRoof to be to be attained thru Collective Bargaining – the right to attained thru Collective Bargaining – the right to which should be ensured.which should be ensured.

Negotiating Change…Negotiating Change… What is the floor that employers should respect?What is the floor that employers should respect?

Core labour standards of the ILOCore labour standards of the ILO

Freedom of Association –the right to form unions, the Freedom of Association –the right to form unions, the right to recognitionright to recognition

Right to Collective BargainingRight to Collective Bargaining

Basic social security contributionBasic social security contribution

Access to skills trainingAccess to skills training

No discrimination, No child labourNo discrimination, No child labour

Why Labour Standards?Why Labour Standards?

Labour Standards are Labour Standards are not just a question not just a question of workers rightsof workers rights BUT are BUT are also means to also means to promote economic growth!promote economic growth!

Labour standards create conditions for Labour standards create conditions for growth of domestic markets since they growth of domestic markets since they enable sharing in gains of growth & spread enable sharing in gains of growth & spread of purchasing powers – this makes domestic of purchasing powers – this makes domestic economic growth more sustainable.economic growth more sustainable.

Getting back to basicsGetting back to basics 　　Trade unions must strengthen

their organizing and bargaining power.

HOW?

Challenge 1:

Creating an“Enabling Environment”

for Trade UnionActivities

Challenge 2:

Building Capacity ofUnions in Organizing

and CollectiveBargaining

Group WorkGroup Work How has Globalisation affected workers & trade How has Globalisation affected workers & trade

unions in your country? unions in your country? [List the major changes in economic & labour [List the major changes in economic & labour policies that have affected (positively or negatively) policies that have affected (positively or negatively) the employment & Trade Unions]the employment & Trade Unions]

What actions has your trade union taken or can take What actions has your trade union taken or can take to meet challenges of Globalization & free trade?to meet challenges of Globalization & free trade?

What role can the International Trade Union What role can the International Trade Union Movement play in assisting national unions to meet Movement play in assisting national unions to meet the challenges of Globalization?the challenges of Globalization?

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