WTO Ministerial Meeting in Hongkong
Why Fair Trade, Not Free
Trade for Women Workers in the Informal Economy
Most of the employed
people in Asia are workers in the informal economy. Among them are
homebased workers, vendors, stall sellers, waste recyclers,
small transport drivers, construction workers, etc. Many of
them are women who aside from having to work to earn a pittance
to ensure survival, also shoulder the burden of housework,
child care, and community service.
In the whole
of Asia, the share of employment in the “formal economy” for
both men and women tends to be relatively low – for both men and
women, informal employment usually provides the majority (65 percent)
of non-agricultural employment. In the member countries of
Homenet Southeast Asia, the percentages are 78 percent for Indonesia,
72 percent for Philippines, and 51 percent for Thailand. (ILO
2002). In addition, women are particularly involved
in informal employment (averaging 65 percent of all women
in non-agricultural employment) , and when agriculture is added
in, women’s share of informal employment goes way up, since women
tend to be very much involved in agricultural work.
Informal Economy Growing Fast
The unprecedented growth of the informal
economy worldwide has given birth to a global movement to redefine
the concept “worker” away from very narrow notions associated
with formality, regularity, and clear employer-employee relations
which refer only to a shrinking male minority of working
people in the world. A much more inclusive definition of worker
is “anyone who lives by selling his or her capacity to work, either
for wages or for other forms of income.” (Gallin, 2002: 1).
Such a definition covers the majority of workers in the world
who work in the informal economy, or all those who have unprotected
and unregulated work. This means “all work in informal
enterprises as well as informal jobs (jobs that pay no benefits
or provide no social protection), thus including the self-employed
in informal enterprises (for example home-based workers or street
vendors) and paid workers in informal jobs (for example
casual workers without fixed employers, most domestic workers, even
factory workers in unregulated and unprotected work).” (Ibid).
The informal economy has been growing
in both North and South, due to the combined effects of liberalization,
deregulation, and privatization which altogether drove out millions
of workers from the formal economy ( 24 million, according to the
ILO, in East Asia alone in the aftermath of the Asian financial
crisis, in itself a consequence of the liberalization and deregulation
of financial markets culminating in the successive domino-like devaluation
of Asian currencies). At the same time, as exemplified by the production
or value chains spearheaded by transnational corporations particularly
in the garments industry , the informal economy serves as the bottom
end of the production ladder, providing cheap and unprotected labor
vulnerable to exploitation while management saves on costs by retaining
a small core of permanent and regular workers.
The informal economy is also highly
gendered, consisting mostly of women who were among the first to
be displaced from formal work as globalization progressed.
But women have also been the mainstay of the informal sector even
before the onslaughts of globalization since informal work (e.g.,
homebased work) is compatible with their reproductive work (child
care, domestic chores), and since their status as secondary or supplemental
earners often deprive them of opportunities to find formal employment.
Informal Workers Adversely
Affected by Trade Liberalization
Many women workers in the informal
economy have been adversely affected by trade liberalization.
Those at the bottom of the value or production chain in the
garments industry have been hit by foreign competition in both the
domestic and the export markets. In many countries in
the region , cheap imports and second-hand clothing from abroad
are flooding local outlets and streets, driving out or marginalizing
many local producers. In the Philippines, homebased workers who
used to derive their main income from subcontracted embroidery for
export products, are suffering from a drastic decline in orders
due to competition in the global market from cheaper sources
as well as the impact of labor-displacing computer-aided embroidery
machines. The same fate has befallen Indonesian homebased
workers.
A similar trend may be seen in weaving
and other handicraft. For example, in Lao PDR and other Southeast
Asian countries, there are reports of traditional weaving facing
competition from imports that duplicate the same traditional patterns
but are able to sell the cloth for less, thus threatening local
weavers (usually low-income women whose families depend on the income
from these sales). In the Philippines, indigenous women talk
about the influx of imported blankets made of synthetic fibers that
cut into their markets. Despite rising cost of raw materials,
not to mention the cost of living, their incomes and piece rates
have remained stagnant for many years. Indigenous weaving is one
of the best artistic traditions of indigenous peoples and
local communities, passed on from generation to generation.
If it loses its market, this will be a loss to the richness and
diversity of culture.
In many parts of Southeast Asia
where bamboo craft is a long-standing tradition, bamboo-made
furniture is being sidelined by cheap monobloc chairs and
other products from abroad. Women who used to produce bags made
of indigenous fiber no longer get orders from local outlets
since there are cheaper bags from other countries now on sale. Baskets,
cooking utensils, traditional mats and carpets made of local
fibers are also taking a beating.
In insular Southeast Asia, those who are in food
production and processing also feel the negative effects of unfair
trade. Vegetable raisers find their markets contracting with
the influx of cheap and often smuggled vegetable items from abroad.
Poultry and hog producers are disadvantaged by imported chicken
parts and pork dumped at unbelievably low prices in the local markets.
The prevalence of chemical-based agriculture and animal husbandry,
which is propagated by transnational suppliers of farm inputs and
feeds, also does irreparable harm to the environment as well as
to the health of consumers.
Informal Workers for Changes at
Macro and Micro Levels
In the face of all these challenges,
informal workers have attempted to be involved in both the macro
and micro levels. They have issued position papers and joined demonstrations
on trade-related issues. They have been active in various
forms of fair trade advocacy in collaboration with trade unions,
business groups, and civil society organizations.
Through this exposure and their own
discussions, informal worker leaders in several Southeast Asian
countries have evolved their own conception of fair trade
– taking it to mean changes in macro-economic policies (including
tariff reform, stopping smuggling and dumping of cheap foreign products)
to give an even chance to local producers to have their rightful
share of the domestic market; enhancing sustainability of
production by making use of locally available resources, catering
to basic community needs, and safeguarding the environment;
ensuring workers’ rights to just remuneration, job security, social
protection, and safe working conditions; and promoting gender equity
through recognition of women’s work, greater equality in the division
of labor, and stronger participation of women in decision-making.
In relation to larger trade advocacy
groups, informal workers have asked to be assured representation
and participation in decision-making and implementing bodies.
They have suggested that a strong gender perspective
be infused in information, education, and communication materials
and campaigns, given that it is the productive labor of women
which brings in the most dollar earnings (through the
export mainly of domestic workers and entertainers, of electronics
products assembled locally, of garments, home décor, and other handicraft
items) and it is their unpaid reproductive labor at home which keep
families alive and functioning.
In addition, they have suggested that
value chain as well as gender analysis be employed in
researches on various industries, in order to better understand
the roles, issues, and problems of producers and workers
at every level of the chain based on their gender and resource status
, and to devise realistic strategies that could best serve the interests
of various stakeholders in the chain. They have also asserted that
the interests not only of industry survival but also those of workers
in terms of ensuring just remuneration, social protection, decent
working conditions, occupational health and safety, gender equity,
etc., be emphasized in fair trade advocacy. They have
heeded the call of “tangkilikan” and other mutual support
movements, whereby fair trade groups are motivated and mobilized
to patronize each other’s products. And they have done a lot of
community work and advocacy on fair and sustainable trade, employing
theater and other popular forms of education involving women workers
and youth groups.
At the micro level, informal sector
trainers have promoted the concept of social enterprise.
They have conducted numerous alternative skills training in communities
where traditional homeworker products and jobs are in decline in
several countries in Southeast Asia. In the Philippines, for example,
garments and embroidery workers have been trained in the making
of slippers, rugs, candles, lace, Christmas balls, and soap,
and these are already being produced and marketed by them, although
still on a limited scale. Given their concern for food security
and the environment, they are also going into
organic vegetable and chicken raising, herbal gardening and solid
waste management. Knowing that food is a basic need that will
always have a market, informal sector community leaders have also
gone into the making and selling of dried vegetable toppings (Budbod
Sustansya) . dried fish, boneless milkfish(bangus) , pork or
chicken-based dumplings, sweet and sour pork (tocino)
and sausages (longganisa), milk-based snack items (polvoron),
pickled vegetables (atchara), young coconut (buko)
salad, crispy sweetened pili nuts, and chocolates.
What they feel they need to develop
right now is a strong marketing network . To really
make a difference, they have to promote trade among themselves,
and between themselves and other consumer groups locally, nationally,
regionally, and globally. Homenet Indonesia is exploring production
of new products, including modern batik drawing, food crackers,
and artistic household articles made of rattan and pandan.
Homenet Thailand has always been strong in traditional woven products,
clothing, bags, and other accessories. This is where Homenet Southeast
Asia thinks it can play an important role, in cooperation with
its sister network, Homenet South Asia, which has done a lot on
marketing and trade facilitation following the lead
of the Self-Employed Women’s Association (SEWA) of India.
In the light of ongoing efforts
by social movements and civil society groups to recast international
trade policies to defend the interests and promote the welfare of
the most vulnerable and marginalized, organizations of homebased
workers and other women workers in the informal economy now
also feel the need to focus on global advocacy for better terms
of trade.
Focusing on the Global
Trade policies, programs and mechanisms
should result not only in profit and prosperity for those who have
the means to maximize their benefits through global commerce.
These should also promote sustainable human development as well
as the economic and social advancement of women and men. These should
also strengthen, not weaken social policies, programs and mechanisms
that defend, protect, and fulfill the human rights of all people,
especially the most vulnerable and marginalized. These
should also recognize and support processes which aim to empower
the disempowered, by eliminating barriers and disadvantages
based on gender, race, employment status and other inequalities.
(Hernandez, 2005:4).
Predominantly women organizations such as Homenet
Southeast Asia are also guided by international mandates such as
the Beijing Platform of Action (BPA) of 1995
which binds governments “ to ensure that national policies related
to international and regional trade agreements do not have an adverse
impact on women's new and traditional economic activities.” The
BPA also urges governments to "Analyze, from a gender
perspective, policies and programmes - including those related to
macroeconomic stability, structural adjustment, external debt problems,
taxation, investments, employment, markets and all sectors of the
economy - with respect their impact on poverty, inequality and particularly
on women; assess their impact on family well-being and conditions
and adjust them, as appropriate, to promote more equitable distribution
of productive assets, wealth, opportunities, income and services.-
BPFA Government Commitment 58 (b)
The trade regime which ensued after
the establishment of the World Trade Organization (WTO) in 1994
has led to many adverse effects on majority of the world’s women,
prompting a re-examination of current conditions based on the strategies
laid out by the BPA. Ten years after, many researches have
shown that trade and other forms of liberalization have
done more harm than good for most developing countries; in fact,
these have led to more poverty, more inequality, more displacement,
and insecurity. (WEDO, 2005). These affect women more than
men, and result in greater suffering of the working people,
particularly those in the informal economy. As earlier explained,
the latter has expanded by leaps and bounds due to massive
displacement of workers in formal employment, and the need
to work in unprotected jobs or create self-employment activities
in order to survive. Women comprise a large section of informal
workers because they are more likely to accept marginal occupations
due to lack of other economic opportunities and the need to
fulfill their domestic responsibilities at the same time.
Yet, the developed countries, through
the WTO, are pushing for more tariff reductions in
agriculture (through the AoA or Agreement on Agriculture)
and industrial goods (through NAMA or Non-Agricultural
Market Access), the opening up of services (through the GATS
or the General Agreement on Trade and Services) as well as
more control over intellectual property (through TRIPS or
Trade-Related Intellectual Property Rights Agreement.)
What will be the impact on women?
On homebased workers and other workers in the informal economy?
Agreement on Agriculture
The main issue here is that rich countries
protect their markets subsidize their agriculture by as much as
$70-80 billion while preaching to developing countries that
they should not do the same. Thus, they are able to
dump their produce on less developing countries whose unprotected
and unsubsidized farm producers cannot survive the competition.
Rural homebased and other workers in the informal economy are dependent
on agriculture for food, raw materials, and livelihood
(many of them are simultaneously small livestock and vegetable raisers).
What happens to agriculture in their countries affects them
deeply . In the Philippine case, for example, trade liberalization
in agriculture and the concomitant smuggling of food commodities
(i.e., rice, chicken, onions) has had a very damaging impact on
rice, corn, poultry, hog and vegetable producers. Overall,
food prices continue to go up, not down, as promised by those who
say liberalization is a good thing. Food security is endangered
as countries like the Philippines continue to import staples like
rice while their own farmers are increasingly ruined by high
cost of farm inputs, low farm gate prices for their products, and
shrinking domestic market due to cheap foreign competition.
In contrast, Philippine tuna and banana exports could not freely
enter the US, European and Australian markets which imposed restrictions
despite the WTO rules forbidding these.
In this regard, the Group of 20 (which
includes Indonesia, the Philippines and Thailand) has been pushing
for the reduction of agricultural subsidies in Europe, the US, and
other developed countries. The Group of 33 alliance
of developing countries ( led by Indonesia and the Philippines)
is pushing for special differential treatment (SDT) of special
products (SPs) and Special Safeguard Mechanisms (SSMs) . These are
meant to defend local producers and markets from dumping and
other trade distorting practices , and to foster the right of governments
to advance food sovereignty, thereby ensuring food security, defense
of livelihood, and rural development. Such initiatives
should have the support of civil society organizations, including
informal workers’ groups.
Non-Agricultural Market Access
(NAMA)
NAMA negotiations aim to lower tariffs
for a host of products not classified as agricultural, which includes
natural resources (fisheries, forests, minerals) as well as industrial
goods not earlier covered by tariff reduction.
The inclusion of fisheries has caused an uproar among small
artisanal fisherfolk throughout Southeast Asia because they fear
that they would be inundated by cheap fish imports originating from
big foreign commercial interests. Even now, they say they
are facing near collapse. There will be more pressure
on the environment as fishery, forest and mineral resources are
increasingly commercialized for foreign trade. More
open pit mining, pollution, flooding, coral reef and mangrove destruction
will mean less fish, less food, more displacement of indigenous
people from their ancestral domain, more migration, more poverty
and vulnerability especially for the women. The indiscriminate
lowering of tariffs for industrial goods also opens the market to
a flood of cheap goods that is likely to drive local producers to
ruin, as they already have in the case of the garments industry.
This will lead to the collapse of domestic industries and
therefore, to further de-industrialization in the developing countries,
making it more difficult for them to equal the productive capacities
of the rich countries. Among those that would be displaced in large
numbers are women workers in the informal economy.
There is need therefore to push for
a comprehensive exemption from NAMA and then to recalibrate
tariffs for the survival of local producers.
GATS
The General Agreement on Trade and Service (GATS)
will further increase women’s burdens in the care economy
as they are traditionally the ones in charge of providing
food, sourcing water and energy (firewood,etc.) ,
maintaining and managing the household, caring for children,
the aged and the sick, participating in activities
which sustain the family, communities, societies. (Jubilee South,
2005). It is setting the stage towards
increasing privatization of water, power, health, education
services .Such basic services will no longer be freely provided
by governments; women who are in charge of household expenses
will have to shoulder higher costs, they will have to work more
to take care of the sick, who can no longer be attended to
by state-run health care facilities. Those who work at home, such
as the homeworkers and other workers in the informal economy, will
be burdened by skyrocketing costs of utilities which eat a
lot into their wages and profit margins.
A taste of things to come has already
been provided by the experience regarding the privatization of water,
which meant turning over what used to be state-run water facilities
to European and US multinationals partnering with local big business
interests. (WEDO, 2003). In many (and perhaps most)
cases, this resulted in the overriding quest for profit, higher
rates to implement cost recovery measures, poor service especially
in “commercially unviable areas,” and unsafe, contaminated
water in some instances. Women with little or irregular income,
such as those in the informal economy, become more burdened financially
and time-wise. As WEDO so very well put it:
Water is a vital natural resource and a human right. But access
to potable water is becoming increasingly difficult. When
water is scarce, polluted, or unaffordable, women suffer most acutely.
As economic providers, caregivers, and household managers, women
are responsible for ensuring that their families have water for
daily living. (WEDO, 2003: 2).
Aside from basic social services and
utilities, GATS also covers services to business, communications,
construction and engineering, distribution, environment, financial
services, tourism, sports, culture and entertainment, transport,
postal services, and a host of “others.”
There are four
modes of supplying services under GATS.
1) cross border
supply - when such services flow from one territory to
another. An example is when women engaged in “telehomework” (a more
“modern” form of informal work at home) do encoding
or transcribing and merely email their output to their employers
abroad.
2) consumption abroad - when consumers , say
tourists, buy what they need in a foreign country, which can easily
lead to more prostitution-related tourism (as is happening now in
Thailand, the Philippines, and to a certain extent, Indonesia)
3) commercial presence - when foreigners establish
a business providing services in another country, which means the
opening of more sectors of the local economy to foreign investments,
to the detriment of the locals who may not have the same amount
of resources to invest or whose businesses may just
be taken over by foreigners. In the case of Thailand, transnational
retailers like Carrefour have driven out traditional retailers out
of business.
4) presence of natural persons - movement of persons
to another country, but as of now this encourages professionals
from developing countries to transfer to the richer countries, thereby
strengthening the “brain drain”. Ordinary migrant workers, usually
women in menial jobs, are not being encouraged by a liberalized
job market yet their numbers are going up by leaps and bounds
because of increasing joblessness and decreasing incomes caused
in turn by liberalization. Many informal workers who cannot
survive under local conditions also become migrants in order to
secure a future for their families.
Because GATS is so one-sidedly in
favor of the rich and the powerful, its negative implications should
be exposed. Developing countries must resist the pressure exerted
by the rich countries for the wholesale opening up of a broad range
of economic activities falling under the category “services”
to transnational business at the expense of local providers should
be opposed.
For women workers in the informal
economy, the current situation presents a challenge to social security
and protection which they sorely lack and which they assert should
be provided by formal government-run or –regulated systems.
Such systems barely covered women workers in the informal
economy before the Asian crisis, since most could not establish
clear employer-employee relations, and the self-employed did not
have the information or the means to join. The situation is
expected to worsen as formal social and health security systems
are now under much pressure, stress, and increasingly suffering
from a credibility gap. Long-standing campaigns by homeworkers’
and other informal sector networks have led to some gains in terms
of gaining access to the formal systems but what if these systems
are no longer effective and sustainable? What if even
community-based health and social assistance can no longer be provided
by the state? What has happened to Indonesia due to the prolonged
economic crisis can be portentous of things to come for other countries.
There, the health security system was severely strained. (Wijaya,
2005).
TRIPS
The Trade-Related Intellectual Property Rights
Agreement (TRIPS) enshrines the control over knowledge
and technology by the rich countries through their ownership
of patents. This is particularly a problem in
seed production in agriculture, patenting of materials
produced or planted in developing countries, and the domination
of transnational pharmaceutical companies in the manufacture of
drugs. In effect, TRIPS aimed to prevent developing
countries from making cheap medicines on their own. However,
the latter succeeded in pushing for an interpretation of TRIPS –
in the form of a waiver -- that would allow governments to use patents,
compulsory licensing, parallel importing and exceptions to
patent rights to ensure public health and access to affordable medicines.
( Oh, 2003:3). In fact, Thailand was able to take advantage
of this waiver by passing a compulsory licensing law. This
flexible interpretation is now what the rich countries seek
to overturn; they also want to introduce their version of TRIPS
into bilateral and regional trade talks. Such moves should be opposed.
Developing countries should press their right and duty to provide
access to medicines for all their citizens, especially for vulnerable
groups, through an amendment to TRIPS. Local producers
, including women workers in the informal economy, should also be
encouraged to go into herbal medicines, and upscale production for
widespread use.
Standing with the World's Majority
It is in this context that we
in Homenet Southeast Asia align ourselves with the global
movement seeking to correct imbalances and injustices in international
trading systems. We support the positions of alliances of
developing countries to get better terms and concessions from the
developed market economies regarding the AoA, NAMA, GATS,
and TRIPS. In the face of the increasingly exclusionary
and undemocratic processes under which trade deals are forged, we
call for openness and transparency in negotiations within
the WTO so that all stakeholders are properly informed of what is
going on and can ventilate their reactions and agendas through their
representatives. The interests of women and working people,
especially those in the informal economy need to be articulated,
recognized, and carried forward in trade policies, programs, and
mechanisms locally, nationally, regionally, and globally
The dogma of “free trade” has been
used far too long to fetter the majority of the world’s countries
and peoples to the interests of a wealthy few. Fair trade
will help set us free.
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___________________________________________________ (2003): Diverting
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