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Impact of Trade Liberalisaton on the Workforce: FTA, ASEAN and Thailand Asian Regional Workshop on FTA: inclusive trade policies n post-crisis Asia 9 December.

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Presentation on theme: "Impact of Trade Liberalisaton on the Workforce: FTA, ASEAN and Thailand Asian Regional Workshop on FTA: inclusive trade policies n post-crisis Asia 9 December."— Presentation transcript:

1 Impact of Trade Liberalisaton on the Workforce: FTA, ASEAN and Thailand Asian Regional Workshop on FTA: inclusive trade policies n post-crisis Asia 9 December 2009 Junya Yimprasert Thai Labour Campaign Network Against Exploitation & Trafficking of Migrant Workers - NAT Migrant Workers Union email: Sources articles: Race to the Bottom: Exploitation of workers in the global garment industry ORGANIZING UNDER THE NEOLIBERAL TRADE POLICY OF Special Economic Zone Thai Labour Campaign Annual Review 2007 Voters Uprising that is changing perceptions in THAILAND ASEAN: Past, Present and Future Labour Trafficking Business

2 Who responsible for workers?


4 Thai Democracy! 20 coups 18 27 Since 1932 the people of Thailand have had to face more than 20 attempted or successful military coups. The people have had to deal with 18 constitutions and 27 Prime Ministers, most of them military generals. In the 77 years since 1932 only one elected Prime Minister has managed to complete the full 4-year term (the now self-exiled, convicted, embattled Thaksin Shinawatra)

5 Thailand and FTAs Thailand has always fully participated in the regional and global trade. Look back in the history, in 1855 Thailand was forced to sign the Bowrings Treaty with the UK, which was in effect for over 70 years. After signing with the UK, Thailand had to conditionally sign the same kind of treaties with 14 other countries: US, France, Denmark, Portugal, Netherlands, Germany, Sweden, Norway, Belgium, Italy, Austria-Hungary, Spain, Japan, and Russia.

6 Thailand workforces According to the 2003 National Statistic Survey, Thailand has 67,941 villages with 9,388,780 households, in which 5.3 million Households are farmers, mostly small scale farmers. In November 2009, the Matichon Newspaper gave figures stating that 86.7% of Thai farmers are indebted: 42.8% from agricultural investments and 22.8% from household needs, with an average debt / family of 243 000 Baht (5,000 Euro), of which 44% of the debt is with private money- lenders. Thailand has 146 million acres of land, of which 60 million is farmland. The average holding per family is 10 acres, but most small-scale farmers attempt to manage with 5 acres.

7 The economic cycle of small farmers in North-East Thailand

8 ASEAN is different from the EU Thailand as an example

9 EU is totally rely on employment protection and market economy but ASEAN are rely on living on the natures and food sovereignty culture Most figure is from Eurostat, except on the civil servants, which is using estimate figure, the same as of Thailand


11 CLIMATE CHANGE CLIMATE TRADING Revolution struggle struggle fall struggle strengthening in for for of the against grass-root Russia independence democracy Berlin Wall corporate power solidarity 100 YEARS of.............. worsening poverty Foreign Direct Investment / Export Oriented Industrialisation EOI League of Nations UNITED NATIONS ILO UNIFEM GENDER MAINSTREAMING World War I World War 2 Cold War Neo-liberal capitalismWar against civilians ?? GREEN REVOLUTION deforestation, dams, forced irrigation, cash-crop mono-cultures /GMO IMF + World Bank GATT World Trade Organisation WTO EEC NAFTA & AFTA FTA gambling with other people s lives 1914-1918 1939-1945 1960ies 1970ies 1989 1992 1995 2001 2003


13 The relocation game of Transnational Corporations (TNCs) has pushed many governments in the producing countries to compete with each other and provide better incentive promotion programmes for the garment industry. Power is mostly in the hands of the many TNCs who have tried to cut costs as much as possible, and change their production chains to be more effective in achieving shorter production times, faster delivery, less risk, less overproduction or overstock, and cheaper overall production costs.

14 Corporate supply Chain

15 Cheaper/ faster/ longer hours Brand Just in Time production GOVTs Asia GOVTs Africa GOVTs Latin America Control workers Current Outsourcing pattern of global Brands! Factories Govt only to facilitate trade & investment Control workers CSR – Codes of Conduct Brand Agents Supply Chain Management

16 Li&Fung Supply chain management

17 For this kind of customer, we might have to buy fibre from a Korean factory, then dye and weave in Taiwan; thus, we must select fiber and then send it to Taiwan. For a Japanese company, they have the best zip and button but its manufactured in China. So we go to YKK, a big zip company in Japan, to order directly from factories in China. Then, we consider the quota system and labour situation, so we choose that final production and garment should be done in Thailand, so we send all the materials to Thailand. Since our customers need on time delivery, we divide orders among five Thai factories…. Within five weeks after receiving the order, 10,000 clothes reach stores or shops in Europe. All the clothes are the same quality and the material seems like its from only one factory. This is a new type of value added. It is a real production of the world which we have never seen before. The brand tag says Made in Thailand but theyre not Thai products. 80 80 Supply Chain Management: Hong Kong Style, Harvard Business Review, sept October 1998 We do not want to be an important part of the factory. Just 30 percent can make us the biggest customer of the factory. Another aspect we need is flexibility so we need not to have any factory depend only on us. We also gain interest from the factory if it has other customers. Fibre from Korean factory, dye and weave in Taiwan, Zip from China, produce in Thailand [quota and working condition]. The brand tag says Made in Thailand but theyre not Thai products. Li & Fung model of agents

18 Foreign Direct Investment in Thailand


20 FTA = SEZs = Economic Corridor Freedom of association – Collective Bargaining Power Wage floating Majority of workers are under unprotected working environment Energy policies - Conflict in the local areas Relocation of manufacturing Make-up figures – no people in the pictures Access and control over natural resources

21 Thailand/ASEAN FTA

22 FDI Promotion and workers rights BOI said that it has finalized its plans to support investment in Body Fashion (Thailand) Ltd., a lingerie and swimwear manufacturer operating under the Triumph trademark, that now ranks of among Thailands most essential productive forces. Triumph is also the biggest manufacturer in the Asia Region. The company plans is to increase its productive force of clothes (i.e. lingerie, swimwear, etc.) to two million items, with a 75.5 million THB in investment in the Nakhon Sawan Factory. Naew Na Newspaper, World Business News Brief-July 8, 2008 Triumph Thailand laid off 1,951 high wage/unionised /old age workforce, while receiving BOIs support with the reason to give employment of 2,000 workers in the cheaper zones/ununionised factory, 300 kms north of Bangkok

23 FTA and Labour rights The freedom of Association

24 FLEXIBILITY Subcontracting, pressure on workers/ USING VULNERABLE WORKERS, CHILDREN, IMMIGRANTS, PRISONERS Employment in temporary, part-time, contract system Target/ piece rate system Increase speed, work like machine, less time to eat, to pee, or to rest. Deregulation of labour law for investment WTO, - FTA, regional/ bilateral trade agreement, Investment privilege package, EPZs Politician, authorities/ Legal proceeding/ Union Busting advisors/ Management, personnel HIGHEST PROFIT/ CHEAPEST COST Reducing risks, using fewer workers, cheapest wages, no liability, no responsibility, no direct employment, etc. Supervisors Mafia, gangsters/ To much OT. No time for education and organizing/ Increase Production CAPITALISTs/ SUPPLY CHAIN MANAGEMENT Informalisation - home based workers Outsourcing, Multi-skill Just in time

25 Wage scale in Thailand, 1993 - 2009 7.5 USD 3 USD 4.5 USD 6 USD

26 Source: Labour Standard Department, Ministry of Labour, Thailand Average wages of textile and garment workers in Thailand in difference wage systems Daily Monthy Piecework Average baht/day baht/month wages earnings wages earnings wages earnings wages earnings 160.5 188.2 8,612.8 9,747.6 2,930.9 3,064.2 5,364.3 6,100.5

27 Building Alternative Sustainable Livelihoods! Industrial workers- 6 mils Company/services [hotel, bank, department stores, etc] 4 mils = 10 mills 27% Seasonal – farmers/farm 14 mil], construction [2 mil], drivers[1 mil] - 13 mils = 36% state employed workers 2 mils = 5% State Enterprises workers 500,000 prs. = 1.6% Subcontracted labour/ home-base - 10 mils = 27% Migrant workers – 2 mils =5% Level of benefit & security Highest/ monthly wage welfare/benefit – family, housing, subsidies pension program Credit to commercial bank loan 5 days/week/ many holiday Monthly wage for white collar mostly minimum wage minimum welfare and benefit, not cover family mostly, no pension program not credit to commercial loan paying 5-20% interest Daily wage – minimum/underpaid irregular working hour/ valuable for all kind of exploitation and cheating no welfare & benefit no bargaining rights no credit to commercial loan paying 5-20% interest Set back Forward Looking Privatisation Right to hire & Dismiss fully in the hands of employers Most attempts to CBA are cracked down Labour protection & relation laws are outdated Not covered by labour relation/ protection laws No CBA rights Outsourcing/ subcontracting Stop pension system Welfare State People Party Self-reliance Agriculture Control mean of food production Protect environment Regulate labour laws Democra tisation Social security system Labour force 36 mils Unemployed + elders –1.5+2 mils = 4-5%


29 Free Trade – SPZs o of the Greater Makong Sub- region (GMS)

30 ASEAN Security Community – ASC ASEAN Economic Community – AEC ASEAN Social - Cultural Community - ASCC environment Labour protection rights Civil society welfare, education?? High level govt officers ASEAN members Govt + big economic nations Business sectors High level govt officers Military generals USA ASEAN three pillars 1945 1967 20032003 36 years ASEAN Human Rights body

31 Country Gross domestic product2/ at current prices Population % Gross domestic product per capita at current prices Foreign direct investments inflow US$ million persons US$2/ US$ PPP 3/ US$ million Top GDP/capita 2008 20072008 Singapore 182,102.7 4,8 37,62949,338 31,55022,802 Brunei Darussalam 14,146.7 0.4 35,62348,180 260239 Malaysia222,057.2 27.9 7,97013,748 8,4017,318 Sub total420,314.6 33.16% 40,21230,359 Middle Thailand273,728.6 66.5 4,1178,218 11,2389,835 Indonesia511,174.4 228.5 2,2373,943 6,9287,919 The Philippines166,772.8 90.0 1,8443,507 2,9161,520 Viet Nam90,700.8 86.0 1,0532,817 6,739 8,050 Sub total 1,042,376.6 471.081% 27,82127,323 Low Lao PDR5,289.0 5,8 9182,407 324228 Cambodia 11,081.6 14,6 7561,910 867815 Myanmar 27,182.0 58,5 4651,166 258715 Sub total 43,552.6 78.9014% 1,4491,758 ASEAN 1,504,235.8 584.00 100 2,577 5,253 69,482 59,440 Capitalism indicator of richness

32 Country Total land areaTotal population 1/ Population density 1/ km 2 persons per km 2 2008 Lao PDR236,8005,8 mils24 Brunei Darussalam 5,7650.4 mil69 Cambodia181,03514,6 mils81 Malaysia330,25227.9 mils84 Myanmar676,57758,5 mils86 Indonesia1,860,360228,5 mils123 Thailand513,12066,5 mils130 Viet Nam331,21286 mils260 The Philippines300,00090,mils302 Singapore7074,8 mils6,844 ASEAN4,435,827583,651132 Eco-economic indicator of richness

33 ECONOMIC CORPORATIONNo. Of meetings First meeting/ dialogue Culture and information91969 Investment101969 ASEAN economic ministers42+ 6 AEM1975 Labour201975 Legal cooperation61975 Narcotics211976 Finance and banking131977/2001 Social welfare61977 Education42+4 ASED1977 Agriculture and Forestry291979 Industry531980 Science and technology121980 Environment101981 Youth51983 Women181988 Health81980 Investment101969 Transport61996 Telecommunication/IT32001 ASEAN Treaties/Agreements And Ratification276 (as off Sept. 2009)

34 To win the support of the people the ASEAN needs to focus on.. Ensuring that the economy first strategies of the last 40 years are replaced by Democracy First Development Strategies; Promoting education in the principles, tasks and objectives of democracy, with special attention to empowerment of women; Leading the way in helping people overcome violent, intra- regional conflict; Supporting the working-class movement for human rights with programmes of re-employment that are aimed at returning dignity to the lives of all workers Facilitating a major shift from mass-manufacturing of cheap industrial artefacts based on exploitation of the poorest-of-the- poor to making South-East Asia one of the worlds Organic Food Banks; Assisting the tens of millions of small-farmer families and dislodged farming families, who still represent the majority of the population, in developing organic markets and building intra-regional solidarity around increased organic productivity.

35 1886 2000 19191948-491960s19751990 1998 2015 100 years of Capitalism ILD ILO conventions UDHR GATT IWC UNIFEM CEDAW CoC Global Compact ESCR MDG Farmers Capitalism CSR

36 ASEAN Cross-Cultural Institute BIODIVERSITY ORGANIC FOOD FOR THE WORLD Cross-cultural education Gender education Pro-Poor policies Freedom of Assembly Social welfare GENDER E QUALITY Land reforms Subsidies for organic farming ASEAN International Womens Day 2011 SOLIDARITYMOBILISATION PEOPLES DEMOCRACY


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