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GB.271/WP/SDL/1/2
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Working Party on the Social Dimensions of the Liberalization of International Trade |
WP/SDL |
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FIRST ITEM ON THE AGENDA
Continuation of discussions concerning the programme
of work and mandate of the Working Party
Research activities on the subject of the
social dimensions of globalization
1. At its last meeting, the Working Party examined a number of projects which dealt directly or indirectly with the issue of the social dimension of globalization.(1) The Working Party has already had an opportunity to discuss a progress report on one of these projects -- the country studies on the social impact of globalization. In an attempt to avoid overlapping, it also requested further details on other projects. These were to include the action programme on "productivity improvement, competitiveness and quality jobs in developing countries", and activities concerning the employment and labour market effects of regional blocs and core labour standards and economic development in developing countries. In more general terms, the Working Party wanted the research undertaken by the Office to form part of a strategic approach. The aim of this report is to meet this request.
Main aspects of a number of projects
of interest to the Working Party
2. These projects were designed within the framework of the programme and budget for the present biennium, at a time when the Working Party was trying to identify an overall strategy. However, the various projects were duly coordinated through close collaboration between the officials concerned within the Office, which was mutually beneficial. The description which follows below also clearly demonstrates that there is no overlapping.
(a) Productivity improvement, competitiveness and quality jobs in developing countries (ENTREPRISE)
3. The aim of this activity is to identify the policies and measures that have contributed towards improving the competitiveness of enterprises. Particular attention will be paid to human resources development, institutional innovation, investments in new technologies and changes in the legal framework, especially legislation and regulations on employment and labour. An attempt will also be made to assess the contribution made by the industrial relations system and social dialogue. This work should make it possible to define adjustment strategies "from the top down", in other words those conducive to improving the productivity of enterprises, the added value component of their products and the quality of jobs.
4. From a methodological standpoint, this project will aim at identifying the experiences of enterprises, sectors -- or perhaps even countries -- which have been successful in this area. The sectors examined will be selected on the basis of their success in improving their performance with respect to total productivity of inputs and export growth, or on the basis of progress made in diversifying products.
5. This activity should result in the publication of research documents. An attempt will also be made to draw up guiding principles for the improvement of the competitiveness of enterprises. Informal workshops might be organized during 1999. The outcome of this work will be of particular interest to the social partners and national institutes carrying out research on productivity and competitiveness.
(b) Employment and labour market effects of regional blocs (EMPFORM)
6. The creation of regional trading groups or blocs has been one of the most striking developments in international trade during the past few years. The aim of this activity is to study the effects of this process on employment and labour market policies. This work will focus not only on the partners belonging to regional blocs, but also on other countries. In fact, there is much debate about whether these blocs are undermining the multilateral liberalization of trade and international investment or whether, on the contrary, they are contributing to these processes. Finally, another Office Branch (LEG/REL) will examine the way in which the industrial relations system might help define a set of common rules in the area of employment and social protection.
7. The methodology will consist in analysing labour market trends in a number of regional blocs, especially MERCOSUR and NAFTA. Work has already been carried out on the possible impact on employment and social policies of trade agreements between the European Union and a number of countries in North Africa, such as Tunisia.
8. This activity should result in the publication of research documents. The fruits of this work will give rise to a tripartite meeting.
(c) Core labour standards and economic development in developing countries
9. A preliminary draft on this activity was presented at the March meeting(2) and the Working Party requested a more detailed description. In complying with this request, it is necessary to clarify the situation from the outset.
10. The resources earmarked for this project are extremely modest; they are, in the main, equivalent to one Professional post. However, the task is particularly complex and ambitious, even if it is only concerned with establishing a preliminary framework. The difficulties involved lie not only in the lack of empirical data, but also in the fact that there is no analytical framework that could highlight the possible links between fundamental standards and economic efficiency. There is a need to go beyond the conclusions of certain studies -- for instance the OECD(3) study which the Working Party has examined. According to that study, respect of fundamental rights is not a handicap in international competition. For its part, the ILO's project would examine to what extent and under which conditions the implementation of core standards might contribute to economic efficiency (it being understood that the aim of the study would not be to establish an economic justification of the standards in question, as if it is accepted that they are fundamental, they are their own justification).
11. In the light of these comments, the aim of this study would be, in the present biennium, to establish a framework for analysing the possible relationship between core labour standards and economic development. This framework might make it possible to conduct more detailed studies over the next few years in a more systematic fashion.
12. In order to carry out this exercise, the Director-General intends to draw on the experience acquired by the special team through the country studies on the social impact of globalization. The purpose of these studies is different, of course; but the conceptual work undertaken by the special team will help to identify the most promising methodology. He has therefore decided to defer the launching of the activity "core standards and economic development". If, as is hoped, the country studies are already very advanced -- and indeed might be finished during the summer of 1999 -- there would still be time to develop reflections on this subject and establish an analytical framework which would pave the way for more in-depth work during the next biennium.
The social dimension in the ILO:
some comments on a possible strategy
13. Generally speaking, it should be recalled that the ultimate objective of these research projects is to help the Working Party have a better grasp of the social impact of globalization so that it might help contribute towards elaborating a strategy to help attain the ILO's objectives in a globalized economy. By setting up the Working Party on the Social Dimensions of the Liberalization of Trade, following the discussion of the Director-General's Report in 1994, the ILO turned its attention to a subject which has assumed considerable importance -- and to which other organizations devote funds which are incomparable with those of the ILO. The report submitted to the Working Party in November 1997(4) on the activities of other organizations already gave an idea of this. Suffice it to say that the World Bank has considered the project sufficiently important to justify setting up a special team to deal with it.
14. In these circumstances, when faced with the challenge of selecting present and future activities, the ILO should not necessarily do what others are doing with far greater financial and human resources; but should work in areas in which it has a comparative advantage. Two aspects of this advantage seem to emerge clearly.
15. The first is the tripartite structure of the ILO. This structure enables it to discuss the social impact of globalization directly with the main parties concerned and, thereby, to go beyond theoretical debate and reach conclusions that are as practical and widely acceptable as possible, as well as to approach problems from a wider perspective. The country studies are a good example of the way in which this comparative advantage might be exploited. Indeed, they might serve as a model or provide ideas for other projects in the next few years.
16. The second aspect of this comparative advantage is the standard-setting competence of the ILO which, together with globalization, is becoming of increasing interest to the general public -- far beyond the traditional interlocutors of the ILO. With its draft Declaration on fundamental rights, the ILO has already influenced this movement and attracted attention. A document is planned for November on the work carried out on codes of conduct, "social labelling" and other initiatives from the private sector. This document should enable the Working Party and the Governing Body to examine how and by what means the Organization might intervene in an area in which the Office is often called upon to give its advice (because the ILO is immediately regarded as a source of legitimacy); however, in the absence of political guidelines, it is unable to respond to requests from the market in the area of labour standards.
17. Finally, account should be taken of the strategic dimension in the programme and budget proposals. The discussions of the Working Party on this subject should, in any case, help the Director-General prepare the next stage of these proposals. These proposals should, in turn, be seen within the framework of a strategy that reflects these aspects of the comparative advantage of our Organization.
Geneva, 13 March 1998.
1. GB.270/WP/SDL/1/2 Progress report on country studies on the social impact of globalization; and GB.270/WP/SDL/1/5.
3. Report of the Organisation for Economic Cooperation and Development (OECD) on trade, employment and labour standards, 1996. GB.267/WP/SDL/2.