April 30, 1999
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| April 30, 1999 | atimes.com | |
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| Southeast Asia Flitting capital angers Thais By Teena Gill BANGKOK - Every time Nangnuth, a 38-year-old unemployed Thai, sees Mickey Mouse or Donald Duck on a poster or on television, she sees red. This has nothing to do with the lovable cartoon charactersthemselves. It's just that her ex-employer - the Austrian-ownedEden Group - manufactured a range of children's fashion productsfor the American multinational corporation, Disney. In mid-1996 Eden sacked Nangnuth and 700 others after theyprotested against its strategy of cutting jobs and sub-contractingto cheaper workers in rural Thailand and abroad. They were alsodemanding better working conditions. When the Thai authorities tried to intervene the company simplypacked up and left the country, leaving a debt of millions ofdollars to former employees and local raw material suppliers. ''I worked there for ten years and somehow never believed thata foreign company would cheat us so blatantly,'' Nangnuthcomplains, sitting in her sparsely-furnished home near the now-deserted factory site on the Vibhavadi-Rangsit highway north ofBangkok. ''The Eden Group's behaviour is a classic example of how littlerespect the process of globalization has for the rights of workingpeople,'' says Chin Thaplee, chairman of the National EmployeesCouncil, a federation of Thai private sector trade unions. Many commentators blame Thailand's current high unemployment onthe Asian financial crisis. They say the roots of the financialcrisis lay in the path of global integration followed byThailand. ''Foreign investors first poured money into Thailand to takeadvantage of its cheap labor - and when countries like China andVietnam opened up with even cheaper labor, they started moving outin droves, creating conditions for an overall loss ofinternational confidence and the subsequent financial crisis,''says Lae Dilokvidyarat, a labor economist with Bangkok'sChulalangkorn University. According to the World Bank, since the start of the crisis inmid-1997 unemployment has risen by over 50 percent. By the end of1998 there were an estimated two million jobless Thais out of atotal workforce of 30 million. Using cheap labor worked well for several years for foreigninvestors, especially in the labor-intensive garments, footwearand toy manufacturing industries. Investors from Europe, NorthAmerica and other Asian ''tiger'' economies queued up, drooling at Thailand's low wages, tax incentives, and tight controls ontrade union organizing. But by the mid-90s the steady value of the Thai baht againstthe U.S. dollar and rising minimum wages meant Thai labor hadbecome too expensive for global operators. A 1995-96 study by Bangkok Bank estimated that wages in theThai garment manufacturing industry averaged 63 cents anhour, compared with 16 cents in Indonesia, 24 cents in SriLanka, 26 cents in China, 33 cents in India and 46 cents in the Philippines. As a result, many manufacturers moved shop: some to China, Laosor Vietnam, others to home-based workers and rural sweatshopsand yet others to migrant Burmese labour working along Thailand'swestern border. Among them was the Eden Group. It employed more than 4,500workers at the peak, in 1987. By 1996, just before it closeddown, it had fewer than 1,000 workers. Most of the jobs had alreadybeen subcontracted out. Such labor policies can have a long-term effect. According to a recent International Labor Organization report, excessive reliance on poorlypaid and poorly trained workers, restricted union activities andthe absence of social safety nets have meant that Asian countrieshave been unable to deal with the social fallout of the financialcrisis. ''The crisis has revealed serious shortcomings in Asian labormarket institutions and practices,'' says the report. In Thailand, the loss of regular employment has also had acascading effect on the informal labor market - particularly amongmigrant workers, with several hundred thousand workers sent back totheir homes in neighboring Burma, Laos and Cambodia. The ILO report points out that before the Asian crisis mostcountries in the region had not signed up to even basic ILOconventions, such as the Right to Organize and CollectiveBargaining (1949), Against Discrimination of Employment andOccupation (1958), Equal Remuneration (1951) and Minimum Age(1973). The ILO is now pushing Asian governments to introduceunemployment insurance, coupled with benefit schemes and trainingsystems for retrenched workers. The International Confederation of Free Trade Unions (ICFTU)says one of the key lessons of the crisis is that governments,employers and international institutions must formulate laws andset up the bodies to ensure proper social partnership between labor and capital. ''The recent riots in Indonesia demonstrate what may happenwhen such factors are missing,'' says an ICFTU report. The trade union body warns that in 1999, as enterprises attemptto regain profitability by slashing workforces, social tensionseven in relatively stable countries like Thailand are bound toworsen. In Thailand, as in Indonesia, less than ten percent of thetotal workforce is unionized, which makes consensus hard to reach. ''Economic policy makers have been the chief culprits inunleashing globalization on unsuspecting workforces,'' says anICFTU official in Bangkok. ''It may finally take the wrath of the unemployed massesbringing down smug governments to change the direction ofindustrialization,'' the unionist adds, saying change is needed to make the economy more sympatheticto the long-term needs of domestic populations - not just foreigninvestors. (Panos Features) | |||||||||
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