ILO is a specialized agency of the United Nations

268th Session
Geneva, March 1997

Working Party on the Social Dimensions of the Liberalization
of International Trade

Statement by the Chairperson of the Working Party on the
Social Dimensions of the Liberalization of International Trade

I will as usual make a rather full oral report on the Working Party's meeting since there is no written report available for the Governing Body's perusal. However I am sure that delegates would be extremely grateful if the Office could manage to reproduce what I am about to say in written form for them to take home with them before the end of the session.

The Working Party had a very full agenda. We began by considering an updated analysis by the Office of replies to a questionnaire which had been circulated to constituents in ILO member States about the impact of globalization and trade liberalization on the attainment of ILO social objectives. We had discussed an earlier version of this paper at our previous meeting, but we agreed to leave time for more replies to come in and for the Office to amplify its analysis accordingly. Working Party members continued to have many concerns about the reliability of the results, both because of the rather subjective nature of some of the questions, and because even with the additional replies the overall response rate was still only 35 per cent. Generally the Working Party felt, therefore, that the analysis could not be regarded as in any sense scientific or statistically reliable, and many points would need further refinement to yield really useful data. Nevertheless, it was felt that the exercise had served the function we had originally assigned to it of a stepping-stone to considering what further work we might usefully do and in generating thought-provoking debate about some of the key issues in this difficult terrain.

The Working Party therefore agreed, first, to take note of the paper and retain it as an interesting internal reference document; secondly, that if we were to want to embark upon a similar exercise at some point in the future, to ask the Office to try to devise a simpler format which would encourage more constituents to reply, and to involve those tripartite constituents actively in designing the questions so as to ensure maximum commitment to the project; thirdly, we agreed to pick up one specific idea from the paper for future work by asking the Office to prepare for our next meeting a short factual document on voluntary codes of conduct and labelling schemes. This could then be the subject of a very open debate, taking account of all the very different views and sensitivities of different parties concerning these issues.

Finally, the Working Party highlighted two considerations which might be particularly important in any future work the Office might carry out, whether in specific country studies or in wider research. One consideration was that the impact of globalization differed greatly between countries and sectors -- some were far more effective than others and some felt very positive effects, while others might feel negative effects. Any analysis should take account of this variety of experience and take a balanced approach considering the whole picture. Linked to this, the second consideration was the desirability, if possible, of developing a methodology and criteria for judging objectively on the basis of national and enterprise-level data both the extent and the social impact of globalization.

The next item on the Working Party's agenda was a paper on the implications of foreign direct investment for employment and social policy. This was a paper that had been tabled at the previous meeting but which we had not had time to discuss. On this occasion, however, the Office pointed out that this whole issue had been overtaken by the interest expressed by one of the groups in seeing an agenda item for the 1999 Conference on investment and employment. As a separate paper concerning this was going to be discussed by the Governing Body, it was agreed to remit consideration of that item to the Governing Body discussion. I should note that that discussion took place yesterday, and that although the item was not selected for the 1999 Conference it commanded very considerable interest among a number of Governing Body members. No doubt the Office will wish to bear that in mind in considering how any further work on the issue might be taken forward.

The Working Party then considered a short interim report on the progress that the Office had made in identifying countries that would be willing to be the subject of special studies on the social implications of globalization and trade liberalization. The Working Party was pleased to note that six countries -- Chile, Jamaica, Jordan, the Republic of Korea, Poland and Switzerland -- had volunteered. A seventh country, Mauritius, volunteered during the meeting. The Working Party encouraged the Office to continue its contacts with member States to see whether a few more countries, perhaps particularly from Africa and from among the developing countries, could be identified. I am glad to say that since the meeting a further country has contacted me and indicated interest in participating.

The Working Party also noticed that there seemed to be rather a proliferation of different kinds of country studies going on in different parts of the house. Although we recognized that these had been suggested at different times and for different reasons, and while we did not want to disrupt existing work, we felt that it would be desirable in the future to try to streamline such work to avoid both confusion and duplication wherever possible. The Working Party finally agreed to seek a further progress report on country studies for its next meeting.

The Office next made a short oral presentation to the Working Party about the research item which had been approved by the PFA for the 1998-99 Programme and Budget, concerning the positive economic impact of implementing core labour standards in developing countries. The Working Party noted that a certain amount of research had already been done in the industrialized countries, but that there was a paucity of data available on developing countries, which was why they should form the main focus of this research. The Working Party encouraged the Office to keep it fully informed and consulted on the shape of this proposed research, and asked for a more detailed outline of what was proposed to be available for its next meeting.

The final item before the Working Party was a report on the Ministerial Conference of the World Trade Organization in Singapore. This report contained all the references made by the different delegations at Singapore to the role of the ILO and the importance of labour standards, and it provoked a long and rich debate on how the ILO should now move forward and further develop its means of action for the future. There were perhaps almost as many different views on exactly what the WTO outcome meant as there were speakers in that debate. What all were agreed upon, however, was the fact that the role of the ILO had been further reaffirmed, as had the importance and urgency of its making constructive progress on those issues. Many speakers also recalled that it was not just the WTO in Singapore, but also the World Summit in Copenhagen, which had given fresh momentum to the ILO.

The debate concentrated on three issues. The first was the question of how to improve and strengthen the ILO's supervisory system and normative action more generally. Many speakers reaffirmed positions they had already expressed when discussing the Office paper in the LILS Committee. Among other additional suggestions made were the idea of regional monitoring mechanisms, of peer reviews, and of country policy reviews. The role of technical cooperation in promoting core labour standards, and the question of how to focus technical cooperation more effectively on such core standards, was also stressed by many speakers. The Working Party hoped that the Office would take note of all these comments in finalizing the report on standards for the Conference, that the Conference debate itself would further enrich the process, and that further work on this could be taken forward at the Governing Body directly after Conference and in the LILS Committee in November.

The second issue was how to improve the research capacity and knowledge base of the ILO on those issues. It was suggested that the Office needed to put forward a comprehensive programme for analysis of the issues and options concerning the social implications of globalization, and it was agreed that overall a more strategic approach was needed. Such an approach could incorporate and be informed by the country studies and the research proposal for the 1998-99 budget and other relevant proposals in that budget, and could also pick up on the two questions of developing criteria and methodology and ensuring a balanced approach, which had been raised earlier in the discussion.

The Working Party therefore agreed to ask the Office to prepare for its next meeting a discussion of the full range of research going on in the house on related issues, so that it could get a clearer idea of what was being done, what gaps needed filling, and could start to develop an overall research strategy.

Thirdly, a number of governments, particularly from the Asia and Pacific region, commented on the future role, mandate and work programme of the Working Party itself. The Working Party took note of these comments. It agreed that some of these issues might be clearer after the Conference debate on standards had taken place, and that they could certainly be re-examined later if delegations had specific suggestions to make.

If I may just then summarize once more that for our next meeting we would expect to see: first, a further progress report on country studies; secondly, a more detailed outline on the research proposal for the 1998-99 budget linked to a more general descriptive paper on all the research going on in the house on relevant issues which could enable us to move towards an overall research strategy; thirdly, a factual paper on voluntary codes of conduct and labelling schemes which could be the subject of open debate. The Working Party expressed a strong desire to receive all these papers as early as possible, and certainly several weeks before the beginning of the Governing Body session in November.

Finally, the Employers' group raised a question, which Mr. Oechslin referred to again this morning, about the possibility of cutting back future Working Party meetings to half a day. There was some enthusiasm for this idea from the Chairperson, but more caution was expressed by the Workers' group on the grounds that so far we had always required a full day for our discussions. I think Mr. Brett again referred in more detail to this earlier today, and to the problem that if many governments wish to intervene it does create a certain difficulty in reducing the time available for meetings.

I think, therefore, that for the moment we need to ask the Governing Body to schedule a full day's meeting for us in November, on the understanding that if in the future we can make it shorter we certainly will. I am sure Mr. Oechslin's wider point about not assuming that the Working Party will continue in perpetuity is well taken by all of us.

It only remains for me to thank all the members of the Working Party, my colleagues on the Government benches for their many thoughtful contributions, my Employer colleagues -- so ably and subtly lead by Mr. Tabani -- and my Worker colleagues, and their leader Mr. Brett, who made their usual constructive and vigorous input.

Geneva, 26 March 1997.

Updated by VC. Approved by NdW. Last update: 26 January 2000.