Impact of Trade Liberalisaton on the
Workforce: FTA, ASEAN and Thailand
Asian Regional Workshop on FTA: inclusive trade policies n post-crisis Asia
9 December 2009
Sources articles:

Race to the Bottom: Exploitation of workers in
the global garment industry

ORGANIZING UNDER THE NEOLIBERAL TRADE
POLICY OF Special Economic Zone
Thai Labour Campaign Annual Review 2007




‘Voter’s Uprising’ that is changing perceptions
in THAILAND
ASEAN: Past, Present and Future
Labour Trafficking Business
www.timeupthailand.blogspot.com
www.thailabour.org
Junya Yimprasert
Thai Labour Campaign
Network Against Exploitation &
Trafficking of Migrant Workers - NAT
Migrant Workers Union
email: junya@thailabour.org
Who responsible for workers?
Thai Democracy!
Since 1932 the people of Thailand have had
to face more than 20 attempted or
successful military coups. The people have
had to deal with 18 constitutions and 27
Prime Ministers, most of them military
generals.
In the 77 years since 1932 only one elected
Prime Minister has managed to complete
the full 4-year term (the now self-exiled,
convicted, embattled Thaksin Shinawatra)
Thailand and FTAs
Thailand has always fully participated in the
regional and global trade.
 Look back in the history, in 1855 Thailand was
forced to sign the Bowring’s Treaty with the UK,
which was in effect for over 70 years.
 After signing with the UK, Thailand had to
conditionally sign the same kind of treaties with
14 other countries: US, France, Denmark,
Portugal, Netherlands, Germany, Sweden,
Norway, Belgium, Italy, Austria-Hungary, Spain,
Japan, and Russia.

Thailand workforces

According to the 2003 National Statistic Survey, Thailand
has 67,941
villages with 9,388,780 households, in which 5.3 million
Households are farmers, mostly small scale farmers.

In November 2009, the Matichon Newspaper gave figures stating
that 86.7% of Thai farmers are indebted: 42.8% from
agricultural investments and 22.8% from household needs,
with an average debt / family of 243 000 Baht (5,000
Euro) , of which 44% of the debt is with private moneylenders.
◦ Thailand has 146 million acres of land, of which 60 million
is farmland.The average holding per family is 10 acres, but
most small-scale farmers attempt to manage with 5 acres.
The economic cycle of small farmers in North-East Thailand
ASEAN is different from the EU
Thailand as an example
Thailand labour division of labour force, 36 millions
civil servants
6%
unemployed
3%
business
sector
1%
farmers
35%
unprotected
employment
31%
protected
employment
24%
EU is totally rely on employment protection and market economy but
ASEAN are rely on living on the natures and food sovereignty culture
EU labour forces, total of population of 500 millions
farmer
4%
others
9%
unemployment
9%
civil
servant
5%
employment
65%
business/SMEs
8%
Most figure is from Eurostat, except on the civil servants, which is using estimate figure , the
same as of Thailand
gambling with other people’s lives
CLIMATE CHANGE
CLIMATE
100 YEARS of . . . . . . . . . .TRADING
. . . .worsening poverty
Foreign Direct Investment / Export Oriented Industrialisation
EOI
‘GREEN REVOLUTION’
deforestation, dams, forced irrigation, cash-crop mono-cultures /GMO
EEC
FTA
IMF + World Bank
World War I
World War 2
1914-1918
1939-1945
Revolution
in
Russia
1960ies
GATT
World Trade Organisation WTO
Neo-liberal capitalism War against civilians
1970ies
1989
struggle
struggle
fall
for
for
of the
independence
democracy Berlin Wall
League of Nations
ILO
Cold War
NAFTA & AFTA
1992
1995
struggle
against
corporate power
2001
??
2003
strengthening
grass-root
solidarity
UNITED NATIONS
UNIFEM
GENDER MAINSTREAMING
THAILAND under NEO-LIBERAL FREE-TRADE
?
?
•The relocation game of Transnational Corporations (TNCs) has pushed
many governments in the producing countries to compete with each other
and provide better incentive promotion programmes for the garment
industry.
•Power is mostly in the hands of the many TNCs who have tried to cut
costs as much as possible, and change their production chains to be more
effective in achieving shorter production times, faster delivery, less risk,
less overproduction or overstock, and cheaper overall production costs.
Corporate supply Chain
Family C
Subcontract
Family - B
Family D
Family
-E
Factory A
in
Bangkok
Sub-contract
Sub-contract
Bangkok
Sub-contract
Bangkok
Sub-contract
Mae Sot
Sub-contract
Bangkok
Sub-contract
Mae Sot
Sub-contract
Bangkok
Sub-contract
Korat
Current
Outsourcing
pattern of
global
Brands!
Agents
BrandBrand
Brand
CSR – Codes of Conduct
Gov’t only to facilitate
trade & investment
Factories
GOV’Ts
Asia
GOV’Ts
Africa
GOV’Ts
Latin
America
Just in Time
production
Cheaper/ faster/ longer hours
Li&Fung Supply chain management
Li & Fung model of agents
For this kind of customer, we might have to buy fibre from a Korean factory, then
dye and weave in Taiwan; thus, we must select fiber and then send it to Taiwan.
For a Japanese company, they have the best zip and button but it’s
manufactured in China. So we go to YKK, a big zip company in Japan, to order
Fibre from Korean factory, dye and weave in Taiwan, Zip from
directlyChina,
from factories
Then,
weand
consider
thecondition].
quota system and labour
produce in
in China.
Thailand
[quota
working
situation, so we choose that final production and garment should be done in
Theso
brand
tag says
‘Made
in Thailand’
but they’re
Thailand,
we send
all the
materials
to Thailand.
Sincenot
ourThai
customers need on
products.
time delivery,
we divide orders among five Thai factories…. Within five weeks
after receiving the order, 10,000 clothes reach stores or shops in Europe. All the
clothes“We
aredo
thenot
same
the material
it’s from
wantquality
to be and
an important
partseems
of the like
factory.
Just only
30 one
factory.percent
This iscan
a new
typeusofthe
value
added.
It is a real
production
of the world
make
biggest
customer
of the
factory. Another
which aspect
we havewenever
before.so
The
‘Made
Thailand’ but
needseen
is flexibility
webrand
need tag
not says
to have
anyinfactory
they’redepend
not Thaionly
products.
on us. 80We also gain interest from the factory if it has
80 other
Supplycustomers.”
Chain Management: Hong Kong Style, Harvard Business Review,
sept October 1998
Foreign Direct Investment in Thailand
FTA = SEZs = Economic Corridor







Freedom of association – Collective Bargaining
Power
Wage floating
Majority of workers are under ‘unprotected
working environment’
Energy policies - Conflict in the local areas
Relocation of manufacturing
Make-up figures – no people in the pictures
Access and control over natural resources
Thailand/ASEAN FTA
www.thaifta.com
FDI Promotion and workers’ rights

BOI said that it has finalized its plans to support
investment in Body Fashion (Thailand) Ltd., a lingerie and
swimwear manufacturer operating under the Triumph
trademark, that now ranks of among Thailand’s most
essential productive forces.Triumph is also the biggest
manufacturer in the Asia Region.The company plans is to
increase its productive force of clothes (i.e. lingerie,
swimwear, etc.) to two million items, with a 75.5 million
THB in investment in the Nakhon Sawan Factory.
Naew Na Newspaper, World Business News Brief-July 8, 2008

Triumph Thailand laid off 1,951 high wage/unionised /old
age workforce, while receiving BOI’s support with the
reason to give employment of 2,000 workers in the
cheaper zones/ununionised factory, 300 kms north of
Bangkok
FTA and Labour rights
The freedom of Association
HIGHEST PROFIT/
CHEAPEST COST
FLEXIBILITY
•Employment in
temporary, part-time,
contract system
Reducing risks, using fewer workers, cheapest wages, no
liability, no responsibility, no direct employment, etc.
CAPITALISTs/
•SUPPLY CHAIN
MANAGEMENT
• Increase Production
• Outsourcing,
• “Just in time”
• Informalisation home based workers
• Multi-skill
• Subcontracting,
pressure on workers/
• Target/ piece rate
system
• Investment privilege
package, EPZs
• Deregulation of
labour law for
investment WTO, FTA, regional/
bilateral trade
agreement,
• Increase speed, work
like machine, less time to
eat, to pee, or to rest.
To much OT. No
time for education
and organizing/
USING VULNERABLE WORKERS, CHILDREN, IMMIGRANTS, PRISONERS
Wage scale in Thailand, 1993 - 2009
7.5
USD
6 USD
4.5
USD
3
USD
Average wages of textile and garment workers in Thailand in difference wage systems
1 2 ,0 0 0 .0
1 0 ,0 0 0 .0
8 ,0 0 0 .0
6 ,0 0 0 .0
S e r ie s 1
4 ,0 0 0 .0
2 ,0 0 0 .0
e a r n in g s
w ages
e a r n in g s
w ages
e a r n in g s
w ages
e a r n in g s
w ages
-
b a h t/d a y
b a h t/m o n th
b a h t/m o n th
b a h t/m o n th
d a ily
m o n th y
p ie c e w o r k
A ve ra ge
Daily
Monthy
Piecework
baht/day
baht/month
baht/month
wages
earnings
160.5
188.2
wages
8,612.8
earnings
9,747.6
wages
2,930.9
earnings
3,064.2
Average
baht/month
wages
earnings
5,364.3
Source: Labour Standard Department, Ministry of Labour, Thailand
6,100.5
Building Alternative Sustainable Livelihoods!
Labour force 36 mils
State Enterprises workers
500,000 prs. = 1.6%
state employed workers
2 mils =
5%
Industrial workers- 6 mils
Company/services [hotel,
bank, department stores, etc]
4 mils = 10 mills
27%
Level of benefit & security
• Highest/ monthly wage
• welfare/benefit – family,
housing, subsidies
• pension program
• Credit to commercial bank loan
• 5 days/week/ many holiday
•Monthly wage for white collar
•mostly minimum wage
• minimum welfare and benefit,
not cover family
• mostly, no pension program
Subcontracted labour/
home-base - 10 mils = 27%
Seasonal – farmers/farm 14
mil], construction [2 mil],
drivers[1 mil] - 13 mils = 36%
Migrant workers – 2 mils =5%
Unemployed + elders –1.5+2 mils
= 4-5%
• not credit to commercial loan
paying 5-20% interest
• Daily wage –
minimum/underpaid
• irregular working hour/
• valuable for all kind of
exploitation and cheating
• no welfare & benefit
• no bargaining rights
• no credit to commercial loan
paying 5-20% interest
Set back
Privatisation
Stop pension
system
Outsourcing/
subcontracting
Forward
Looking
Welfare
State
People
Party
Democra
tisation
Right to hire &
Dismiss fully in
the hands of
employers
Social
security
system
Most attempts to
CBA are cracked
down
Regulate
labour laws
Labour
protection &
relation laws are
outdated
Not covered by
labour relation/
protection laws
No CBA rights
Protect
environment
Control
mean of food
production
Self-reliance
Agriculture
FTA &
ASEAN
Free
Trade –
SPZs o
of the
Greater
Makong
Subregion
(GMS)
ASEAN Economic
Community –
ASEAN
three
pillars
AEC
ASEAN
High level
members
gov’t
Gov’t + big
officers
economic
Business
nations
sectors
ASEAN Human Rights body
Military
generals
USA
welfare,
education??
High level
gov’t
officers
ASEAN Security
Community –
ASC
2 environment Civil society
0
Labour
protection
0
rights
ASEAN Social 3 Cultural Community ASCC
Capitalism indicator of richness
Country
Top GDP/capita
Singapore
Gross domestic
product2/
at current prices
Population
US$ million
persons
Gross domestic product
per capita
at current prices
US$2/
US$ million
2008
49,338
2007
31,550
2008
22,802
14,146.7
0.4
35,623
48,180
260
239
222,057.2
27.9
7,970
13,748
8,401
7,318
420,314.6
33.1
40,212
30,359
273,728.6
66.5
4,117
8,218
11,238
9,835
Indonesia
511,174.4
228.5
2,237
3,943
6,928
7,919
The Philippines
166,772.8
90.0
1,844
3,507
2,916
1,520
Viet Nam
90,700.8
86.0
1,053
2,817
6,739
8,050
Sub total
Low
Lao PDR
1,042,376.6
471.0
27,821
27,323
5,289.0
5,8
918
2,407
324
228
Cambodia
11,081.6
14,6
756
1,910
867
815
Myanmar
27,182.0
58,5
465
1,166
258
715
43,552.6
78.90
1,504,235.8
584.00
5,253
1,449
69,482
1,758
59,440
Sub total
ASEAN
2008
US$ million
2008
37,629
Sub total
Middle
Thailand
2008
US$ PPP 3/
Foreign direct investments
inflow
4,8
Brunei
Darussalam
Malaysia
2008
182,102.7
%
6%
81%
14%
100
2,577
Eco-economic indicator of richness
Total land area
Country
km2
Population density1/
persons per km2
2008
Lao PDR
Total population1/
2008
2008
236,800
5,8 mils
24
5,765
0.4 mil
69
Cambodia
181,035
14,6 mils
81
Malaysia
330,252
27.9 mils
84
Myanmar
676,577
58,5 mils
86
Indonesia
1,860,360
228,5 mils
123
Thailand
513,120
66,5 mils
130
Viet Nam
331,212
86 mils
260
The Philippines
300,000
90,mils
302
707
4,8 mils
6,844
4,435,827
583,651
132
Brunei
Darussalam
Singapore
ASEAN
ECONOMIC CORPORATION
Culture and information
Investment
ASEAN economic ministers
Labour
Legal cooperation
Narcotics
Finance and banking
Social welfare
Education
Agriculture and Forestry
Industry
Science and technology
Environment
Youth
Women
Health
Investment
Transport
Telecommunication/IT
ASEAN Treaties/Agreements And Ratification
No. Of meetings
9
10
42+ 6 AEM
20
6
21
13
6
42+4 ASED
29
53
12
10
5
18
8
10
6
3
First meeting/
dialogue
1969
1969
1975
1975
1975
1976
1977/2001
1977
1977
1979
1980
1980
1981
1983
1988
1980
1969
1996
2001
276 (as off Sept. 2009)
To win the support of the people the ASEAN needs to
focus on . .






Ensuring that the ‘economy first strategies’ of the last 40 years
are replaced by ‘Democracy First Development Strategies’;
Promoting education in the principles, tasks and objectives of
democracy, with special attention to empowerment of women;
Leading the way in helping people overcome violent, intraregional conflict;
Supporting the working-class movement for human rights with
programmes of re-employment that are aimed at returning
dignity to the lives of all workers
Facilitating a major shift from mass-manufacturing of cheap
industrial artefacts based on exploitation of the poorest-of-thepoor to making South-East Asia one of the world’s ‘Organic
Food Banks’;
Assisting the tens of millions of small-farmer families and
dislodged farming families, who still represent the majority of
the population, in developing organic markets and building
intra-regional solidarity around increased organic productivity.
100 years of Capitalism
UNIFEM
CSR
IWC
1886
1919
Farmers
Capitalism
1948-49
1960’s
1975
1990
1998 2000 2015
ORGANIC FOOD FOR THE WORLD
BIODIVERSITY
PEOPLE’S DEMOCRACY
GENDER EQUALITY
Pro-Poor policies
Freedom of Assembly
Social welfare
ASEAN
Cross-Cultural Institute
Cross-cultural
education
SOLIDARITY
Land reforms
Subsidies for organic farming
ASEAN
International Women’s Day
2011
Gender
education
MOBILISATION