International Herald Tribune December 30, 2004 Protect Asia's women: When textile quotas disappear
Hafiz Pasha BANGKOK There will be winners and losers in Asia when the impact of one of the biggest revolutions in the garment industry - elimination of a 30-year-old trade quota system on textiles and clothing - kicks into gear on Jan. 1. In the midst of the hand-wringing about which countries will gain the most and which ones will be left furthest behind, there is one certainty: Impoverished women in the poorest countries could be most adversely affected. But there is still time to put measures in place to cushion the likely impact on the most vulnerable people - including the majority of garment workers who are women. The new year will be pivotal for the smaller Asian countries that benefited from quota restrictions on apparel exports from their larger neighbors. As all remaining quotas are eliminated following the termination of the World Trade Organization Agreement on Textiles and Clothing, the shifting trade flows will hit women workers of companies that are no longer able to compete. The countries that host the largest number of these less competitive firms need to act now. The global export of textiles and clothing exceeds $350 billion a year, and Asian economies, excluding Japan, produce half of that. Once the arrangement that governs import quotas from the developing world ends, there will most likely be winners, such as China and India that are competitive by virtue of size and ability to connect with the rest of their production chain. It is the poorest countries of Asia - the least developed - that will need to actively safeguard the welfare of their garment workers. .Women fall squarely in the mix. The textile and clothing sector employs an extremely high proportion of women when compared to other industries. Women represent more than two-thirds of the global labor force in this sector. In Bangladesh, the sector employs nearly two million people, 80 percent of whom are women. Its clothing industry, like in Nepal, Laos, Cambodia, Maldives and Sri Lanka, grew as a result of quota restraints on its larger exporting neighbors. With quotas removed, these countries could suffer the most through closure of their less efficient factories that had been sheltered by the system. In Cambodia, the industry is almost 100 percent foreign owned, but employs 230,000 people and 85 percent are women. In Nepal, garments remain a top export industry that directly employs 50,000 workers, over 60 percent of whom are women. In Vietnam, more than 1,000 companies in the sector employ close to three million people, mostly females. Aside from a likely climb in unemployment through factory closures, workers rights and protections are also at risk. Increased competition could lower prices and increase demand for shorter lead times and higher quality clothing. This could translate into lower wages and longer working hours. Adverse effects could extend well beyond the women in the factories. The United Nations Development Program will publish a paper in January that will offer specific policy options, at national and international levels, to mitigate the adverse impact of the quota shift. For a start, domestic labor restructuring programs could include job banks and mass training in alternative skills. Employment priority should be given to the displaced workers, especially women. For those who are able to keep their jobs, the promotion of decent work throughout the textile and garment industry can be enforced through labor laws that guarantee full respect for workers rights. Competitiveness should not mean lowering wages or increasing working hours, but should instead translate into improved labor productivity. This requires upgrading skills to make them more compatible with the needs of buyers in international markets. When factory closure is inevitable, national laws should ensure that social security or other social safety nets are provided to laid-off workers. National laws must allow for laid-off workers to be paid before other creditors. Credit schemes should be considered for retrenched workers to help them start up their own small businesses. Countries should set up units to track job losses through the new year in order to respond to any negative social impacts from the trade change. Likely spillover effects on the rest of the economy should also be monitored during the year. Cutting down on excessive bureaucracy, corruption and delay in customs would speed up garment shipments and reduce costs. Long-standing commitments to provide duty-free market access for all least developed country exports must be honored. It is not too late for action. The textile quota arrangement helped to lift millions out of poverty, especially women in the developing world. It offered hope and opportunity, as well as jobs. It would be a cruel irony to ignore their plight now. (Hafiz Pasha is UN assistant secretary-general, and director of UNDP regional bureau for Asia and Pacific.) Copyright © 2004 the International Herald Tribune All Rights Reserved _________________________________ Labour Notes South Asia (LNSA): An informal archive and mailing list for trade unionists and labour activists based in or working on South asia. LNSA Mailing List: Labour Notes South Asia To subscribe send a blank message to: <[EMAIL PROTECTED]> LNSA Web site: groups.yahoo.com/group/lnsa/ Run by The South Asia Citizens Web www.sacw.net _________________________________ ------------------------ Yahoo! Groups Sponsor --------------------~--> $4.98 domain names from Yahoo!. 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