Date: Thu, 4 Feb 1999 23:13:16 -0600 (CST)
From: email@example.com (Rich Winkel)
Subject: ASIA: Labouring under the Crisis
/** ips.english: 452.0 **/
** Topic: DEVELOPMENT-ASIA: Labouring under the Crisis **
** Written 3:16 PM Feb 3, 1999 by newsdesk in cdp:ips.english **
Copyright 1999 InterPress Service, all rights reserved.
Worldwide distribution via the APC networks.
Labouring under the Crisis
By Boonthan Sakanond, IPS
31 January 1999
BANGKOK, Jan 30 (IPS) - The unprecedented job losses and social
havoc caused by Asia's economic crisis is prompting international
bodies and trade union groups to call for a radical rethink of
labour policies throughout the region.
Excessive reliance on poorly paid and trained workers,
restricted union activities and the absence of social safety nets,
these bodies say, are key factors responsible for both the crisis
as well as the inability of affected countries to deal with its
"The crisis has revealed serious shortcomings in Asian labour
market institutions and practices," says a new International
Labour Organisation (ILO) report called 'Towards Full Employment:
Prospects and Problems in Asia and the Pacific'.
These "need to be dealt with urgently if the affected
countries are to avoid backsliding into problems of unemployment,
underemployment and poverty that economic growth and
industrialisation had done so much to reduce," the report adds.
The International Confederation of Free Trade Unions (ICFTU),
meanwhile, says governments, employers and international
institutions must formulate laws and set up the bodies to ensure
proper social partnership between labour and capital.
Such moves, argues the trade union body, are crucial if the
region is to recover from the crisis and prevent future ones.
For decades, fast-growing East Asian economies have practised
'flexible labour' policies that benefit employers but have meant
easy dismissal and low wages for workers. The policies often
excluded workers' rights to form unions.
Prior to the economic turmoil that began July 1997, most
countries in the region had not been signatories to even basic ILO
conventions, including those on the Right to Organise and
Collective Bargaining (1949), Against Discrimination of
Employment and Occupation (1958), Equal Remuneration (1951) and
Minimum Age (1973).
But in recent months nations such as Indonesia, Malaysia, the
Philippines, Singapore and Thailand have selectively ratified,
under domestic and international pressure, some of these
Still, South Korea and Thailand, along with China and Vietnam,
have yet to sign the Conventions on Freedom of Association and
Protection of the Right to Organise.
The ILO acknowledges improvements in labour-management
relations, but "the stark reality remains that in no country in
the region is collective bargaining a vehicle for social dialogue
for the majority of workers."
The ICFTU, for its part, says in a statement on the Asian
crisis: "There is a key role for social dialogue and collective
bargaining in efforts to overcome the effects of the financial
It says the recent riots in Indonesia demonstrate what may
happen when such factors are missing. For the ICFTU, the unrest
there can be traced back to the inability of the authoritarian
Suharto government to develop institutions, particularly trade
unions, to reconcile economic and social pressures and build a
Political analysts expect social tensions in the region to
worsen in 1999 as enterprises attempt to regain profitability by
The trend toward higher unemployment is hounding all Asia-
Pacific countries, regardless of their level of industrial
In Japan, the largest economy in the region, the rate of open
unemployment topped four percent in 1998. The advanced economies
of Australia and New Zealand have not been spared unemployment
rates of nearly eight percent last year.
Among South-east Asian countries, Indonesia lost nearly eight
million jobs (the equivalent of one in every five modern-sector
jobs) last year, forcing hundreds of thousands of migrant workers
to return home -- to more unemployment.
In Thailand, unemployment levels have reached more than five
percent, which is more than double the pre-crisis figure.
In South Korea, unemployment surged to more than seven percent
of the workforce by the end of 1998, compared to less than three
percent in 1997.
Real wages are also falling by as much as 30 percent in
Indonesia, eight percent in Thailand and five to 10 percent in
The ILO says all these mean that the long-term goals of any
post-crisis economic policy should include the establishment of
sound labour market institutions and social safety nets. Says the
ILO report: "The need to make employment growth the core
objective of development strategies has never been greater."
The ILO is now pushing Asian governments to introduce
unemployment insurance and benefit schemes and training systems
for retrenched workers.
Among the crisis-struck countries, only South Korea provides
"Severance pay, the most prevalent form of social protection
for the region's laid-off workers, is largely inadequate," notes
a senior ILO official here in Bangkok.
She says the system suffers from serious problems of
enforcement since, in times of economic difficulty, employers
often fail to make payments. And when they do pay, says the ILO
official, the amounts they fork over are generally insufficient.
Whether governments will have a change in attitude toward
labour depends largely on how and if workers can win the sympathy
and support of the rest of their countrymen, forcing authorities
to pay attention to them.
In Indonesia and South Korea, workers' groups have been able to
assert their rights following the downward spiral of their
Thus, despite job losses there, workers have been able to win
important concessions at the level of greater government
recognition of their role in the economy.
Contrast this to Thailand, Singapore, China, Vietnam and
Malaysia, where no demonstrations against anti-labour policies
have taken place as yet.
Analysts say workers in these countries who expect to be handed
their rights on a silver platter are in for a very long wait.
[c] 1999, InterPress Third World News Agency (IPS)
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