The premise behind the argument for more free trade is that free trade
is the best way of achieving economic development and so, ultimately,
higher living standards. But history has shown that more free trade has
not brought prosperity for all. It is in their arguments against fair
trade that the double standards of free-traders are most clearly exposed.
Many of the arguments free-traders use against linking labour standards
to trade under the banner of fair trade revolve around claims that workers
in developing countries are just so happy to have any sort of job at all,
they really have no desire for improved rights. They argue that inclusion
of core labour standards in trade agreements will end up hurting the very
people they are supposed to help.
While free-traders occasionally express concern about respect for
International Labour Organisation (ILO) Conventions and the need to ensure
that poor people in developing countries benefit from trade, they apply
double standards when it comes to translating their concern into action.
The solution to the inequities raised by globalisation of the world
economy does not reside in a cocktail of good intentions combined with
even freer trade, as proposed by mainstream free-traders. The answer lies
in strengthening the capacity of the multilateral trading system to deal
with the problems that free 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 UN agencies.
With more free trade in the neo-liberal mould, unscrupulous companies
and governments are able to gain short-term competitive advantage by
abusing fundamental workers’ freedoms. This can 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 the
systematic failure of the state to apply the law in the maquiladora
free trade zones deprives over a million, mainly young women workers of
basic rights; Turkey, where free trade zone workers are denied the right
to strike; Lesotho, where workers in export estates producing goods like
textiles and garments face violation of basic working conditions, police
violence and shootings; 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 by the ILO and the
international labour movement.
The countries losing most from increasingly bitter competition for a
share of the global marketplace are not developed countries like
Australia, but those developing countries which are striving to improve
living and working conditions. Thus, the workers who are most hit by India’s
failure to address child labour in its carpet factories 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 trade unions
obtain decent wages for them. 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, competition to produce exports and to attract
direct foreign investment in traded goods sectors 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.
The conclusion that needs to be drawn from the increase in exploitation
of workers in developing country traded goods sectors is 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 those
Free-traders express concern about the allegedly 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) suggested by the proponents of Fair Trade.
The reason why these particular standards are the ones always mentioned is
not some arbitrary choice. It is because these workers’ rights are the
ones that have been endorsed explicitly time and again by all UN
member-states. These standards have been endorsed universally precisely
because they do constitute what is globally agreed to be a minimum set of
basic workers’ rights that can and must be protected.
Free-traders argue that the WTO’s design reflects the principle of
mutual-gain. It is indeed high time that the WTO incorporated the
principle into its functioning. 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 that allows
issues of the most basic protection of workers’ rights in the face of
the many problems deriving from globalisation to be raised. 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 they want to see respect for core labour standards
included within the WTO. The claim for linkage between trade and labour
standards is not a claim for equal pay, but a claim for equal rights.
Free-traders speak of letting the ILO look after the labour rights
"problem". Occasionally they even say that if it is necessary to
dampen criticism of neo-liberal free trade, the ILO should be given a
"new set of teeth" to address abuses of core labour standards.
It may be true that not all those who oppose linkage of trade and labour
standards 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. These are the parties that have the
most to gain from the perpetuation of the status quo.
Furthermore, the same interests that refuse 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 people who 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
The biggest threat to free trade will come not from creating a linkage
between trade and labour standards at the WTO, but from the double
standards of the free-traders who oppose linkage.