TRADE AND LABOUR STANDARDS
Subject of intense debate
For several years the issue of trade and core labour standards has been the subject of intense debate among and within some World Trade Organization member governments.
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Currently, labour standards are not subject to WTO rules and disciplines. But some WTO member governments in Europe and North America believe that the issue must be taken up by the WTO in some form if public confidence in the WTO and the global trading system is to be strengthened. These member governments argue that the rights such as: the freedom to bargain collectively, freedom of association, elimination of discrimination in the workplace and the elimination workplace abuse (including forced labour and certain types of child labour), are matters for consideration in the WTO. Several member governments have suggested that the issue be brought into the WTO through the formation of a working group to study the issue of trade and core labour standards. Bringing the matter to the WTO, these member governments believe, will provide incentives for WTO member governments to improve conditions for workers around the world.
This proposal is among the most controversial currently before the WTO.
Most developing countries and many developed nations believe the issue of core labour standards does not belong in the WTO. These member governments see the issue of trade and labour standards as a guise for protectionism in developed-country markets. Developing-country officials have said that efforts to bring labour standards into the WTO represent a smokescreen for undermining the comparative advantage of lower-wage developing countries.
Many officials in developing countries argue that better working conditions and improved labour rights arise through economic growth. They say that if the issue of core labour standards became enforceable under WTO rules, any sanctions imposed against countries with lower labour standards would merely perpetuate poverty and delay improvements in workplace standards.
The issue of trade and labour standards has been with the WTO since its birth. At the Ministerial Conference of the General Agreement on Tariffs and Trade held in Marrakesh in April 1994 to sign the treaty that formed the WTO, nearly all ministers expressed a point of view on the issue. The Chairman of that conference concluded there was no consensus among member governments at the time, and thus no basis for agreement on the issue.
At the first WTO Ministerial Conference in Singapore in December 1996 the issue was taken up and addressed in the Ministerial Declaration. At Singapore, Ministers stated:
We renew our commitment to the observance of internationally recognized core labour standards. The International Labour Organization (ILO) is the competent body to set and deal with these standards, and we affirm our support for its work in promoting them. We believe that economic growth and development fostered by increased trade and further trade liberalization contribute to the promotion of these standards. We reject the use of labour standards for protectionist purposes, and agree that the comparative advantage of countries, particularly low-wage developing countries, must in no way be put into question. In this regard, we note that the WTO and ILO Secretariats will continue their existing collaboration.
Since taking office in September 1999, WTO Director-General Mike Moore, has met twice with ILO Director-General Juan Somavia. Mr Moore has said he looks forward to co-operating with Mr Somavia and other officials from the ILO. He has also been clear that the WTO will be guided by Ministers on the issue of trade and core labour standards.
Existing collaboration between the WTO and the ILO includes participation by the WTO in meetings of ILO bodies, the exchange of documentation and informal cooperation between the ILO and WTO Secretariats.
Since the Singapore Ministerial Conference, the ILO has taken two significant steps in addressing the issue of workers rights. In 1998, ILO member governments adopted the ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up. Under this declaration, ILO member governments endorsed some basic principles which are included in the core ILO Conventions. (These conventions are the fundamental workplace rights including: freedom of association and recognition of the right to collective bargaining; elimination of all forms of forced labour; the effective abolition of child labour and the elimination of discrimination in hiring and employment practices.)
ILO Member Governments agreed to respect and promote these Core Conventions even if they have not ratified all of them. As a follow-up, the ILO will issue annual reports in which ILO officials will obtain information from governments which have not ratified all of the conventions on any changes that may have taken place in national laws or regulations and which may impact these fundamental labour rights.
In 1999, ILO member governments agreed to prohibit and eliminate the worst forms of child labour. Member governments defined the worst forms of child labour as all forms of slavery, child prostitution and pornography, the use of children to traffic in drugs and work which is likely to harm the health, safety or morals of children.
ILO member governments said they recognized that child labour is largely a function of poverty and that the long-term solution to elimination of exploitative and harmful child labour is through sustained economic growth.
A recent World Bank study estimated that less than 5% of child workers in the developing world are involved in export related activities.