Enough Exploitation is Enough: A Response to the Third World Intellectuals and NGO's Statement Against Linkage (TWIN-SAL)

From International Confederation of Free Trade Unions, 29 September 1999

1. On 15 September, a group of academics and NGOs released the "TWIN-SAL" statement against any type of linkage between the WTO and labour or environmental issues. Although the authors and signatories of the statement express their strong concern about respect for core labour standards, the strengthening of the International Labour Organisation (ILO) and the need to ensure that poor people in developing countries receive some benefits from trade, the conclusions they arrive at are flawed and seriously inadequate. Their effect stands to be to perpetuate the present freedom for repressive governments and companies to continue to use repression of workers' rights as a tool for export maximisation, while continuing to leave the multilateral system powerless to take any effective measures to redress that exploitation.

2. This response has been prepared by the International Confederation of Free Trade Unions (ICFTU), representing 124 million workers in 143 developing, transition and industrialised countries. Two-thirds of the affiliates of the ICFTU are from developing countries and the ICFTU's policy proposals have been prepared on the basis of the problems identified daily by those trade union centres. While the ICFTU's developing country affiliates are as concerned as the TWIN-SAL signatories by the issues of basic workers' rights, the ILO and poverty mentioned above, the solution they see to the problems caused by the globalisation of the world economy does not reside in a cocktail of good intentions combined with even freer trade, as proposed by the TWIN-SAL statement. The ICFTU's affiliates rather see the answer in the strengthening of the capacity of the multilateral trading system to deal with the problems which trade creates - a strengthening through the incorporation of social and environmental issues, including respect for core labour standards, into the functioning of the WTO in collaboration with the ILO and other relevant UN agencies.

3. The premise behind the TWIN-SAL statement seems to be that free trade is the best way of achieving economic development and so, ultimately, higher living standards. But history over the last number of years has shown that more free trade has not brought prosperity for all. Whereas it has brought prosperity for some, it has also brought misery for many, notably the weakest members of our societies. Unscrupulous companies or governments are able to gain short-term competitive advantage by abusing fundamental workers' freedoms. This has been seen most clearly in countries like Malaysia, where workers in the electronics export sector are denied the opportunity of joining trade unions; Mexico, where a failure to apply the law in the "maquiladora" free trade zones deprives over a million, mainly young women workers of freedom of association; Turkey, where free trade zone workers are denied the right to strike; Lesotho, where the mainly women workers in export estates producing goods like textiles and garments face violation of basic working conditions, police violence and even shooting; and Egypt, where child labour is extensively employed in export sectors like commercial agriculture, textiles, leather and carpet-making. There are a myriad other examples from export sectors around the world, which have been extensively documented in the 50 reports the ICFTU has produced over the last two years on respect for core labour standards in many countries of the world.

4. The conclusion the ICFTU has drawn from the increase in exploitation of workers in traded sectors has been that these grave problems must be addressed by the multilateral trading system through the WTO. Such action would provide the surest way of achieving a transfer of the benefits of trade liberalisation to ordinary people in developing countries (which is the stated goal of the TWIN-SAL statement). That is why the proposal to tackle core labour standards at the WTO is supported by trade unions from throughout the developing world. Their members see the daily and worsening effects of international competition on core labour standards. And the countries losing out from increasingly bitter competition for a share of the global market-place are the developing countries which are striving to improve living and working conditions.

5. Thus, the workers who are most hit by India's failure to address child labour in its carpet sector are the exporters in Nepal who are striving to make carpets under good working conditions; those who are most affected by the suppression of trade union rights in Indonesia's coal mines are the coal miners in India, whose strong trade unions obtain decent wages for them which are then undercut by imports from Indonesia; and the whole developing world suffers from China's violation of all the core labour standards, enabling it to act as a magnet to persuade multinational companies to uproot their production from other developing countries in order to produce at low labour cost in China's special economic zones instead. In each of these cases, it is competition to produce exports and to attract foreign direct investment by multinational companies that is at the root of the problem. Tackling these problems, which result so demonstrably from globalisation, requires action at the global level by the WTO working together with the ILO.

6. The TWIN-SAL statement further expresses concern about the supposedly selective nature of the core labour standards (freedom of association, the right to collective bargaining, a minimum age for employment, non-discrimination and prohibition of forced labour) contained in the proposals to be raised at the WTO. Yet the reason why these particular standards are the ones always mentioned is not some arbitrary choice of the ICFTU's or any other organisation, but because these workers' rights are the ones which have been endorsed explicitly time and again by all UN member-states in global conferences held over the past several years (from the Copenhagen World Social Summit Commitments, to the Beijing 4th World Women's Conference Platform of Action, to the ILO Fundamental Declaration of Principles and Rights at Work). Those particular standards have been endorsed universally precisely because they do constitute what is globally agreed to be a basic minimum set of basic workers' rights that can and must be protected. They are standards negotiated over a number of years through the International Labour Conference of the ILO, made up of governments, employers and unions from all industrialised and developing countries, in order to be applicable universally in all member states of the ILO whatever their level of development.

7. Therefore the view of the TWIN-SAL signatories that violations of core labour standards in industrialised countries would not be addressed by any workers' rights discussion at the WTO is based on a misinterpretation of the nature of those standards. In fact, violation of basic rights to freedom of association in textiles sweatshops, and the rights of migrants working in agricultural production to non-discrimination in employment (to take the two examples raised in the TWIN-SAL statement), are very much part and parcel of the areas which would need to be addressed in the discussion of core labour standards at the WTO; there has never been any suggestion by the proponents of introducing core labour standards to the WTO that any sector or country should be exempt from that discussion.

8. The comment in the TWIN-SAL statement that proponents of labour standards at the WTO do not encourage better commitments to labour rights in industrialised countries is seriously inaccurate. In fact, trade unions have been striving to improve labour standards to their best possible level whenever and wherever they can. That includes work at national level to improve workers' rights, as well as through the use of fora such as the OECD and in regional integration arrangements like the European Union (efforts which bore fruit with the adoption of the European Community Charter of the Fundamental Social Rights of Workers). But there is a need to separate what can be achieved in regional fora, with their more limited membership, and what needs to be done at a global level through the WTO where it is necessary to refer to global standards applicable to all workers worldwide.

It should further be noted that the ILO has been used by trade unions in recent years to bring complaints against industrialised country governments such as Canada, the UK, the USA, Australia, New Zealand, and Japan, in almost all of which the ILO has sided with trade unions in agreeing that the countries have to change their legislation and/or their practices.

However, as the TWIN-SAL statement emphasises, the ILO needs stronger "teeth" in order to get its findings implemented - teeth which could be provided through new international machinery.

9. The TWIN-SAL authors are misinformed to suggest that the ILO core labour standard for child labour (ILO Convention No. 138, concluded in 1973, on the Minimum Age for Employment) could be used as a tool for rapid-fire trade retaliation through the WTO. In fact, ILO Convention 138 merely says that countries must implement a policy to bring about the effective abolition of child labour. It even says that countries can, if necessary, exclude certain branches or activities, provided that they submit regular reports on their programmes to apply the Convention there. This emphasis on policies and action programmes to eliminate child labour is about as far as you could get from any requirement for the overnight disappearance of what is universally agreed to be a deep-rooted problem in many countries.

Rather, the Convention is geared to the encouragement of countries to implement carefully designed and multi-faceted policies to bring about the eradication of child labour (an objective shared by virtually all UN member states, since they have signed up to the UN Convention on the Rights of the Child).

Furthermore, the ILO's International Programme for the Elimination of Child Labour (IPEC) is a multi-faceted programme providing comprehensive and practical support to the urgent priority of tackling child labour.

Convention 138 is therefore immensely ratifiable, flexible and universally applicable, as proven by the fact that it is now being ratified at an accelerating pace by an increasing number of developing countries - over 60 at the last count including many developing countries such as Malaysia, Zambia, Niger and Uruguay. Furthermore, of the roughly half of the ILO's member states which have not yet ratified C138, the legislation of the vast majority is nevertheless completely or substantially compliant with C138.

10. The TWIN-SAL statement states that "The WTO's design must reflect the principle of mutual-gain". The principle of mutual gain is one which forms part of the founding principles of trade unionism, for it is implicit in trade unions' function of collective representation of the workforce in negotiation with the employer to seek a win-win situation which provides workers with higher wages and employers with better production and a more highly-motivated workforce. We strongly agree with the principle of mutual-gain and we consider it high time that the WTO, too, incorporate the principle into its functioning. But it is this principle which has been absent from the WTO's design to date - while the WTO's strengthened trade dispute system was planned to make it easy for governments to interpret the WTO's articles of agreement to further the interests of their companies in areas such as anti-dumping, subsidies, technical barriers to trade and so on, there is so far nothing in the WTO's design which allows trade unions to raise issues of the most basic protection of workers' rights in the face of the many problems deriving from globalisation. How can it be considered protectionist to say that people deserve the same protection as companies?

That is all that the proponents of labour rights at the WTO are asking for and why we want to see respect for core labour standards included within the WTO.

11. The TWIN-SAL statement speaks of giving the ILO a "new set of teeth"

to address abuses of core labour standards effectively. Yet in practice, what the statement proposes is a process of annual review reports on respect of core labour standards which is already envisaged in the ILO Declaration of Fundamental Principles and Rights at Work. While trade unions fully support the ILO's effective follow-up to the Declaration, the experience of the international trade union movement over many years has made it clear that some countries will persistently disregard recommendations from the ILO concerning their respect for core labour standards. As noted above, the 50 country reports on core labour standards produced by the ICFTU in the last 2 years have provided substantial evidence of governments that have been deliberately keeping labour standards low, with a view to reducing export costs and winning a head start over their competitors on international markets. The international trading community needs to face the question of devising strong and effective procedures which would provide some real "teeth" to tackle the countries which are, in effect, free riders on a world trading system where the majority of countries do respect core labour standards.

12. It may be true that, as the TWIN-SAL statement says, not all those who oppose linkage are corporate interests and malign governments. But there are far too many such interests and governments opposing core labour standards at the WTO for it to be a coincidence. It is those parties which have most to gain from the perpetuation of a status quo which enables them to continue their exploitation of workers without any constraints.

Furthermore, these same governments which refused to countenance any discussion of core labour standards at the WTO are those which were the obstacles all the way through the debates on the 1998 ILO Declaration on Fundamental Principles and Rights at Work. There is little sign of good faith from governments which claim at the WTO that core labour standards are best dealt with by the ILO, but then at the ILO do their utmost to block any strengthening of the ILO's capacity to deal with the issue effectively.

And from the opposite side of the debate, it is significant that the proposal to discuss core labour standards at the WTO is supported by the government of South Africa, whose credentials to uphold the principles of socially just, equitable and non-discriminatory patterns of trade and development are unquestionable.

13. Like the TWIN-SAL statement itself, this response has concentrated on the issue of core labour standards, rather than the environment.

However the ICFTU would state that, for many of the same arguments as those advanced above concerning core labour standards, environmental concerns also need to be incorporated effectively into the WTO's work. Again, this is an issue of concern for all people of the world from both developing and industrialised countries; an area where there are obvious negative repercussions arising from free trade; a problem of creating a mutual-gain situation which will enable increased trade to be compatible with sustainable trade and growth; and a further area where the WTO rules are at present deficient and urgently need to have some clear priorities in order to incorporate multilaterally-agreed standards and agreements into the functioning of the WTO system.

14. The arguments above have demonstrated that, far from being a "non-trade" issue as suggested by the TWIN-SAL authors, core labour standards are actually intimately affected by and related to the present system of international trade and investment. The challenge today for the international community is to come up with an effective and enforceable way of getting the ILO's core labour standards respected by all the world's trading partners. In the light of all the above arguments, the ICFTU strongly considers that the governments meeting at Seattle need to:

• include core labour standards on the agenda of future WTO negotiations;
• start an examination of how to incorporate the issue of labour standards and trade into WTO mechanisms and processes. Such a work programme should enhance ILO-WTO collaboration, on an equal basis, in areas such as WTO trade policy reviews and disputes settlement procedures and oversee the incorporation into the WTO's existing mechanisms of core labour standards.

It should examine the role which could be played by ILO technical assistance in helping countries to achieve implementation of all the core labour standards. It should consider issues such as the gender implications of trade liberalisation. A monitoring committee should meet at regular intervals to review the results of the process and make recommendations to ensure its success.