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TOWARDS FAIR TRADE AND SUSTAINABLE LIVELIHOOD
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Introduction
Globalization in ASEAN is simply understood as the opening up of each other’s borders to each other’s products (through the ASEAN Free Trade Area –Common Effective Preferential Tariff Treatment - AFTA-CEPT).
Obviously, not all ASEAN countries can be players in the economic integration game. The least developed are not in the export oriented loop as much as the others. In the case of ASEAN economies “integrating” under the command of transnational companies in search of easy profit, employment suffers in terms of quantity and./or quality. Growth is occurring, especially in information technology-related industries, but it is not matched by a comparable increase in jobs. And whatever jobs are created are mostly in the unprotected and unregulated informal economy.
In the eyes of its working peoples, particularly the impoverished, marginalized, and excluded, rapid ASEAN regional growth is not necessarily good news. In the first place, ASEAN countries do not have the same levels and modes of development and therefore the employment opportunities and living standards of ASEAN peoples also vary. It was not too long ago when four ASEAN countries – Malaysia, Thailand, Indonesia, and the Philippines – were hit by the 1997 -98 Asian financial crisis which, according to the ILO, resulted in the loss of 24 million jobs in East Asia alone. This crisis was itself a consequence of the liberalization and deregulation of financial markets culminating in the successive domino-like devaluation of Asian currencies. Affected countries used different strategies in addressing the crisis, with Malaysia and Thailand faring better because they fully or partly took their own course. Indonesia and the Philippines, which followed IMF and World Bank prescriptions, did not do as well and still remain highly indebted There are countries such as Cambodia, Laos, and Burma where the per capita GDP is less than a thousand dollars. Vietnam, which is an “economy in transition,” is progressing much faster than its neighbors in Indochina.
Thus when the question is asked: Who are losing in a globalizing ASEAN, the answer is quite obvious: the working people. And among their ranks, the informal workers suffer more.
________
* Ph.D., Professor and Chair, Department of Women and Development Studies, College of Social Work and Community Development, University of the Philippines, Diliman; Regional Coordinator, Homenet Southeast Asia
Growth of Workers in the Informal Economy
The trend towards informalization of work is worldwide. In the whole of Asia, informal employment provides the majority (65 percent) of non-agricultural employment. (ILO, 20O2), In China, where burgeoning export-oriented industries are now concentrated, ILO figures show a steady decline in formal sector employment by 34.1 million, accompanied by a steep rise in irregular, casual-wage or self-employment by 80 million in 1990-2002. In fast globalizing India, informal employment also increased from 80.5 percent to 83.2 percent from 1994 to 2000. ( In .Landsberg, 2OO7).
In the whole of ASEAN, informal work comprised 156 million or 63.7 percent of total employment in 2006, according to the ILO (2OO7). In the Philippines, figures based on the 2005 labor force survey show that the informal sector now comprise 76.34 percent or 24.6 million of the country’s total employed, an increase of several percentage points from previous estimates.(National Labor Force Survey, 2OO5) This rise in informal sector employment is accompanied by an alarming decrease in the ranks of formal workers. In Indonesia, the share of informal work in non-agricultural employment rose several percentage points to 70.8 percent in the period 1998 to 2003. Similar increases were recorded in Thailand and in Vietnam. (Landsberg, 2OO7).
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 ranks of unprotected informal workers in ASEAN are growing fast, even while those of regular formal workers are being depleted by the onslaughts of trade liberalization and the increasing flexibilization and contractualization of labor. Formal workers may go into self-employment when they lose their jobs. Or they may continue working in the same industry as contractual, casual, agency-hired , or subcontracted home workers under precarious and insecure conditions.In this sense, they provide cheap and unprotected labor vulnerable to exploitation at the bottom of the production ladder while firms save on costs by maintaining just a few regular, organizable workers. Formal and informal employment are often linked and the distinctions between them sometimes become blurred.
High unemployment and underemployment due to the decline or stagnation of local industries faced with ruinous competition drive displaced workers abroad in an often uncertain diaspora. Many of these migrants, especially the undocumented ones, wind up in unprotected, informal, 3D (dirty, dangerous, demanding) jobs in construction, service and other industries .
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. In their particular case, class, gender, ethnicity, and other issues often intersect.
In the current context of unbridled globalization, women informal workers exhibit strengths as well as weaknesses, and face opportunities as well as threats. Many of them have the capacity, the resilience, and the adaptability to enter many forms of employment during times of crises .because they need to seize every opportunity to earn in order to ensure family survival. However, these very same forms of employment in the informal economy are also subject to the vagaries of the global and local markets, and can be threatened by competition, instability, and lack of support. Under such circumstances, women’s overburdened state becomes a vicious cycle of having to shoulder various means of making a living while tending to domestic as well as community responsibilities. As with other informal workers, women workers have little access to education, credit, healthcare and other resources needed to meet basic needs. Informal workers generally suffer from substandard wages, poor working conditions, exposure to occupational health and safety hazards, and lack of social security.
Adverse Effects of 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. The lack of support for local producers and the increased reliance on imports has now led to a serious rice crisis, threatening the food security of many countries in ASEAN.
These negative impacts of trade liberalization are expected to get worse if the rich, industrialized countries, through the WTO, succeed in pushing for more tariff reductions in agriculture, through the Agreement on Agriculture (AoA) and in 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.) To counter some of these moves, the Group of 33 alliance of developing countries ( led by Indonesia and the Philippines) is supporting 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 had the support of civil society organizations, including informal workers’ groups.
With the stalemate in the WTO negotiations, developed countries like the US and Japan are trying to enter into bilateral free trade agreements (BTAs) with various ASEAN countries. These BTAs, like the WTO instruments mentioned above, are expected to be one-sidedly in favor of the stronger parties, and therefore do more harm than good to the ASEAN working peoples.
ASEAN itself entered into an agreement with China, and is negotiating other agreements with Korea and India, with uncertain results.
Women Workers Link the Micro and the Macro
through Fair Trade Advocacy and Practice
The growing significance of informal work, and the myriad problems of informal workers, have led to the emergence of their organizations in the last few decades. Homebased workers in Indonesia, Philippines and Thailand were the first to form their own networks, converging in Homenet Southeast Asia (and later joined by Homenet Laos) for greater visibility in national as well as regional policy advocacy.
Amidst all the challenges, organizations of 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 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. And 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.
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.
It is in this context that in the WTO meetings in Hongkong, Homenet Southeast Asia supported the positions of alliances of developing countries to get better terms and concessions from the developed market economies regarding the Agreement on Agriculture (AoA), Non-Agricultural Market Access (NAMA) , General Agreement on Trade and Services (GATS), and Trade Related Intellectual Property Rights Agreement (TRIPS). In the face of the increasingly exclusionary and undemocratic processes under which trade deals are forged, it called 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. It declared that 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.
Organizing for Cooperative Ventures and Advocacy Work
There is growing awareness among informal workers that indeed they need collective strength for better representation and advocacy. Although a significant percentage of informal workers are already organized, this is not as widespread in proportion to their continuing growth. Needless to say, the constraint is even greater among women whose multiple responsibilities leave them hardly any time to be part of an organization. Such a situation aggravates the “muting” of their voices in advancing and asserting for rights to the resources that will get them out of poverty.
What women need is an enabling strategy that will allow them to engage in cooperative ventures and participate in advocacy reforms within the community. The formation of group enterprises and cooperatives by PATAMABA women and those of other national Homenets in Southeast Asia is worth mentioning because these economic activities aimed to address the need for alternative livelihood in lieu of the dwindling resources and lack of opportunities.
The idea of a social enterprise comes to mind when women’s organizations engage in alternative forms of trading – activities that are not centrally motivated by profit yet respond to women’s desire for economic empowerment where reciprocity, trust, mutual support and community involvement reign. The women infused local and indigenous practices and time-tested experiences into the system. Indeed, efforts can be more meaningful if done in a participative fashion; a sense of ownership and belongingness will surely abound if everyone participates.
At the micro level, numerous alternative skills training in communities where traditional homeworker products and jobs are in decline in several countries in Southeast Asia were undertaken. 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.
Two of the group enterprises mentioned above had been the subject of field visitation during the 2006 Subregional Workshop on Fair Trade and Marketing held in Manila. Evaluation from the participants (from Homenets Indonesia, Thailand, Laos, PATAMABA and Fair Trade groups from Vietnam, Cambodia, Timor Leste) drew varied reactions and recommendations to further improve the working environment of both areas in order to boost productivity of workers. Since then, the Angono Chapter has undertaken Plant and Product Assessment (PPA) while the Balingasa has added capital from partner institutions to enhance product diversification in the bakery they set up.
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, an 8OO,OOO-strong organization which combines the characteristics of a trade union, cooperative, bank, and trade facilitation center.
Creating New Possibilities
Meanwhile, women homeworkers and other workers in the informal economy continue to feel the pangs of import liberalization and dumping of foreign goods in the local market. Despite all the effort, still, they face difficulties trying to neutralize the negative effects on their livelihood and income. What they need is sustainable economic activities and a fair market for their products. This will enable them to sustain their needs for social security and protection towards living a decent life.
At this point, homeworkers and informal sector workers are taking on the challenge of finding new ways that will effectively enable them to increase their income and productivity, recognize and respect their participation, while at the same time given the opportunity to avail of services that can assist in protecting their health and improving their working conditions.
They are seriously considering the possibility of adopting the concept of Solidarity Economy. In Latin America, the area where it actually originated, solidarity economy began as an attempt to connect and radicalize an already-powerful third sector of cooperative and community-based initiatives. Many of these alternative economic practices had emerged during the 1980’s and 1990’s as survival-based responses to the effects of corporate globalization. As they grew in strength and made connections, the idea of a solidarity economy began to emerge as a sensible strategy to pursue in the name of cooperative, non-capitalist development. (www.zmag.org/carolase.htm).
At present, Asia is host to new economic practices that have flourished in the contemporary era. There is a growing interest in them especially among those who are looking for alternative to the current global economic system which has deepened the wedge between the haves and the have-nots, and further alienated those who are already marginalized.
Just recently (October 2007), the Philippines was venue of the Asian Forum for Solidarity Economy Conference attended by foreign delegates from twenty six countries in Europe, Latin America, Africa and Asia. By way of promoting the concept to the Philippines, solidarity economy was believed to be one of the solutions to uplift the quality of life of Filipinos because it assures that each person will be benefited as it is people-oriented, unlike the present market economy which is centrally focused on profits.
Examples of solidarity economy organizations already exist:
Fair trade organizations form part of the solidarity economy as their aim is to express practical solidarity with farmers in the developing world by paying them fair prices for their produce. Self-help organizations also form part of the solidarity economy as members support each other in dealing with their problems as a practical form of solidarity. Trade unions are often considered a key part of the solidarity economy as they are based on the principle of solidarity between workers. Cooperatives form part of the solidarity economy if their aims include a commitment to solidarity in some form. (en.wikipedia.org/wiki/Solidarity_economy)
And as explained by another source:
Solidarity economy is a strong tool of empowerment and social change that starts from the initiatives of responsible citizens that want to keep control of the way they are producing, consuming, saving, investing, exchanging. It is a model of community-based and locally-based people’s economy. It constructs a sustainable development from civil society taking State policies and resources only as complementary to their own actions and resources. It makes economy accountable with ethical standards. (www.zmag.org/carolase.htm).
Solidarity economy may even be called grassroots economy -- an economy built from the ground up by those who actually sustain life and create livelihood by working together and in harmony with the environment.
REFERENCES
Asper, Tony (2007). Power Point presentation on contractualization discussed during the Labor Agenda meeting convened by the FES, Manila, Nov. 7, 2007.
Betonio, Jr., E.R. (2004): Labor Flexibility and Representation in the Philippines.
Doane, Donna L., Rosalinda Pineda Ofreneo and Daonoi Srikajon (2002): Social Protection for Workers in the Informal Economy: A Case Study of the Garments Industry, a research report presented during the Technical Consultative Workshop on Social Protection for Workers in the Informal Economy held by WIEGO in collaboration with ILO-STEP and the World Bank, 11-12 April, 2002, Chamonix, France. This study was later published in Francie Lund and Jillian Nicholson, eds., Chains of Production, Ladders of Protection, published by the School of Development Studies, University of Natal, South Africa, in 2003
Doane, Donna L, Rosalinda Pineda Ofreneo, Benja Jirapatpimol and the Research Teams of PATAMA and Homenet Thailand. Social Protection for Homebased Workers in Thailand and the Philippines. Quezon City, Ford Foundation, 2006.
Gallin, Dan (2002): “Organising in the Informal Economy.” http://www. wiego.org/papers.lab_ed.pdf.
Globalisation and Women in the Informal Economy SEWA’s Responses at www.sewa.org/globalisation
Homenet Southeast Asia News Magazine. Vol 1, No 1 (November 2003) .Focus on Mapping Homeworkers.
Homenet Southeast Asia News Magazine. Vol 1, No 2 (June 2004). Policy Advocacy for Informal Workers.
Homenet Southeast Asia News Magazine. Vol 3, No 2 (December 2005). Human Security and Empowerment for Homeworkers.
Homenet Southeast Asia News Magazine. Vol 4, No 1 (August 2006) Fair Trade and Social Marketing. (Focus on ILO Convention 177 on Home Work).
Homenet Southeast Asia News Magazine. Vol 5, No 1 (December 2007) Occupational Safety and Health (OSH) and Fair Trade to Strengthen Membership-Based Organizing.
Homenet Southeast Asia website at www.homenetseasia.org
ILO (2002), Women and Men in the Informal Economy: A Statistical Picture, p. 20 (Table 2.2). Geneva: Employment Sector, ILO – based on data prepared by Jacques Charmes from official national statistics, 1994/2000.
Landsberg, Martin (2OO7). Paper presented during the 3Oth anniversary celebration of the Asia Monitor Resource Center on Labour Resurgence under Globalization, August 27-29, Hongkong.
National Labor Force Survey of Business and Industry, 2OO5.. Table IV. Comparative Sizes of Formal and Informal Sectors 1999 and 2OO5
Reintjas, Carola. “What is a Solidarity Economy?” . (www.zmag.org/carolase.htm).
Why Fair Trade, Not Free Trade for Women Workers in the Informal Economy. Homenet Southeast Asia document published in the Review of Women’s Studies (Gender, Globalization, Culture and the Economy).. Volume XV Number 2. July-December 2005.