ACFTU-ILO/ACTRAV Seminar on Emerging Trends in Collective Bargaining in the Asia and the Pacific Region: Opening Address by Dan Cunniah, Director of ACTRAV

Address by Dan Cunniah at the ACFTU-ILO ACTRAV Seminar on Emerging Trends in Collective Bargaining in the Asia and the Pacific Region: In Times of Crisis; 24-26 September 2012; Beijing, China.

Statement | Pekin, China | 24 September 2012

Bro. Jiang Gaoping, National Secretary, ACFTU and ILO GB Member,

Friends and Trade Union leaders from the Asia and the Pacific Region,

Ms. Ann Herbert, Director, IL Office for China and Mongolia,

Distinguished members of the ILO GB members

My Colleagues from the ILO

Invited guests;

It is indeed a pleasure for me to be once again in Beijing and have the opportunity to address this seminar.

Greetings to you all and welcome to Beijing!

I would like to recognize the presence of GB members Sam Gurney from the UK, Rekson Silaban from Indonesia, Adyanthaya from India and Bheki from South Africa.

I also bring greetings from the Director General, Juan Somavia and the Director General elect, Guy Ryder

I thank the ACFTU for the cooperation and assistance in organizing this important regional event. This is also a part of our longer term cooperation for support to trade union development in the Asia and the Pacific region.

The seminar is about collective bargaining. It is probably the most fundamental concern and the everyday work of any trade union. The reason to select such a topic was that this fundamental work of the unions is facing increasing challenges. It is becoming more and more difficult to engage with employers and Governments in collective bargaining. At the same time we see in the region the growth and development of unions. We wanted to get together to share our experiences on the recent trends in collective bargaining and discuss what we could do together to meet some of these challenges.

However, before getting into in-depth discussion on the topic let me take the opportunity to reflect on the region; the socio economic environment and the functioning of unions and the practice of collective bargaining within this environment of the financial and economic crisis.

A recent report of ESCAP presents us with a forecast on the economy for 2012. Let me quote from the recent report.

Asia and the Pacific will remain the fastest growing region globally and an anchor of stability in the world economy. The region’s growth engines are projected to continue to grow at robust rates. China is forecast to grow at 8.6% in 2012. India, on the other hand, is expected to improve its growth performance from 6.9% to 7.5% in 2012.

With its continued dynamism, the Asia-Pacific region has begun to act as a growth pole for other developing regions, such as Latin America and Africa, helping them to reduce their dependence on low-growth developed economies as South-South trade becomes an important trend.

However, growth slowdown will be felt across different sub-regions depending upon the extent of their global integration. The growth rate in East and North-East Asia is forecast to slow to 7.1% in 2012 (from 7.6%). North and Central Asia is forecast to experience relatively moderate slowdown, to 4.3%, in 2012, benefiting from the high prices for energy. The Pacific island developing economies are forecast to experience lower aggregate growth in 2012 of 5.7%, due mainly to lower growth in Papua New Guinea, although a number of other countries are likely to maintain fairly stable performance.

The South and South-West Asia sub-region is forecast to see a slowdown to 5.8% in 2012 from 6.7% in 2011, although this will be more on account of monetary tightening than the global slowdown. Although South-East Asia, is an open sub-region with many of its economies affected severely by the state of the global economy, it is forecast to see a slight increase in growth in the sub-region as a whole, to 5.2% in 2012, due to the strong recovery of growth in Thailand following the floods in 2011.

With the growth slowdown, inflation in Asia and the Pacific is forecast to moderate from 6.0% in 2011 to 4.8% in 2012.

The unemployment rate in Asia and the Pacific has fallen only slightly, from 4.3% in 2010 to 4.2% in 2011. The region continues to face the problem of jobless growth, with developing countries failing to generate sufficient opportunities in the formal sector. The problems are greatest for young people, who are three times more likely to be unemployed than adults. The youth unemployment rate for Asia and the Pacific is projected to remain at 10.2% in 2012. Moreover, in 2010, some 1.1 billion workers in the region remained in vulnerable employment. It is important to ensure that wages increase in line with better productivity gains. This would allow domestic consumption to act as an enhanced engine of growth and sustain a virtuous circle of improved productivity, better working conditions, reduced inequality and sustainable and inclusive development. Policy options should also be devised to boost entrepreneurship and rural employment. Such policies would help countries avoid falling into the “middle-income trap”, in which productivity fails to keep pace with economic growth. A post-crisis macroeconomic framework should seek full employment for men and women as a core policy goal apart from economic growth targets, inflation and sustainable public finances. Improved social protection can support countries in their efforts to rebalance the sources of growth as well as reducing income insecurity for the poor. The crisis has prompted some countries in the region, such as Malaysia and the Philippines, to consider establishing unemployment insurance schemes, while India has expanded its national rural employment guarantee scheme.

While we see the economic development progressing well in the region it is also important to reflect on what has been achieved in terms of the Millennium Development Goals (MDGs) established by the UN. A report tracking the progress on the MDGs in the Asia and Pacific region says that while the region has achieved the goal of halving poverty, it is witness to over three million children dying before their fifth birthday. At the present rate of progress, the region as a whole is unlikely to meet MDGs related to eradicating hunger, reducing child mortality and improving maternal health, among others.

According to the report, high levels of hunger as well as child and maternal mortality have taken the sheen away from the region’s other achievements on the MDGs.

The question we ask ourselves is what is the relation between MDGs and collective bargaining? Collective bargaining is about wages, working conditions, medical benefits, education and no child labour and respect for gender equality and non discrimination. These are also the issues prioritized in the MDGs. Organising unions and collective bargaining result in achieving MDG goals.

As we are in China, let me say something about its latest revolution: Basic healthcare for all. On 6 April 2009, China unveiled an action plan for a radical and ambitious healthcare reform. Three years later, the country has almost reached this goal. In a little over just three years, China has managed to extend basic healthcare access to more than 95% of its 1.35 billion population. What is the secret behind this success? Political will? Where there is a will, there is a way!

Let me now reflect on the seminar topic.

The past decade has brought drastic changes in the world of work with an increase in atypical forms of work and unprotected and precarious jobs, with far-reaching implications for collective bargaining. Throughout the world, labour has become more diversified and the average size of enterprises has been reduced by restructuring. This has placed greater pressure on traditional collective bargaining by eroding the power and the base of trade union organisations. In some countries, the effect of such pressure may be that, where it used to take place, collective bargaining as such becomes more difficult and or more decentralized and sometimes transforms into concession bargaining. The erosion of the link between productivity, profits and wages is part of this development. In other countries, collective bargaining has not yet been implemented effectively.

The liberalization of trade, deregulation, and privatization, which are often associated with economic globalization have significantly curtailed governments’ room for maneuver while allowing enterprises much greater autonomy. Similarly, the growing mobility of capital has triggered competition among countries to raise their employment levels and encourage investments, with certain negative spin-offs for traditional collective bargaining. Financialisation, mergers and acquisitions, relocation and supply chain management, have put pressure on collective bargaining. Therefore in recent years, the right to organise and to bargain collectively has faced the challenges stemming from falling trade union membership, increasing individualization of labour relations and the difficult quest for greater competitiveness and flexibility in the context of globalization. In the circumstances the capacity of trade unions need to be strengthened in order to face these challenges and enhance the right to organise and collective bargaining.

Trade unions continue to face challenges. After some 18 years of continued pressure the Burmese Government has just given some opportunities for unions to organize themselves. The recent factory fire in Pakistan where around 300 workers perished is a stark example of a lack of safety and health provisions. The Fiji Trades Union Congress continue to be denied the right to organize and to bargain collectively.

Collective bargaining is a fundamental right.

At a recent international symposium organised by ACTRAV on the occasion of the 60th anniversary of the adoption of Convention 98 the participants adopted some conclusions as follows. Collective bargaining, especially at national, sectoral and inter-professional levels, is the key element of an overall strategy to reduce inequalities, raise the wage share in societies and improve working and living conditions. Collective bargaining is essential for an effective and fair response to the current crisis. The promotion of the extension of collective bargaining coverage is an essential tool to achieve wage-led recovery out of the crisis. Statutory or negotiated minimum wages are important elements of this strategy. Quality public services and comprehensive social security - including a basic social protection floor - are complementary to collective bargaining and best achieved where trade unions are strong. Public procurement should be used as a tool to promote decent work, respect for fundamental human rights at work, international labour standards and strengthen collective bargaining by upholding, as a minimum, prevailing wages and working conditions. The financial system has to serve workers and the real economy. Financial institutions, particularly multilateral and international ones should adopt similar policies.

With this background this seminar will examine the problems facing collective bargaining from the international standpoint and from that of the relevant international labour standards. The main points discussed below include representation of workers by trade unions and their recognition by employers, workers and the branches of activity covered, state intervention (issues covered by collective agreements, stabilization policies, prior approval by the authorities, compulsory arbitration), changes in the structure of collective bargaining (fragmentation of collective bargaining, competition between individual contracts and collective agreements, changing labour relationships) and internationalization of collective bargaining.

I look forward to the seminar discussions and your conclusions.

Thank you!