AEC: Business expedited amid workers’ rights red lines

Kazi Mahmood / Khmer Times No Comments Share:
Local workers at a construction site in Phonm Penh. KT/Chor Sokunthea

With the rules guiding the Asean Economic Community (AEC) seemingly favourable to the business community, what should the Asean workforce expect in return for their movements within the community?

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There are fears the unsuspecting public might fall victim to their own obscurity on their rights within the AEC framework.

To begin with, the business community is well served under the Asean Free Trade Agreement (AFTA). But the workforce is subjected to conditions and faces opposition from Asean member states on their movements within the AEC.

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The following will give a clearer example of how the business community is given greater access to the Asean marketplace.

During a CIMB Asean Research Institute (CARI) briefing in Kuala Lumpur, Dr Aladdin D. Rillo, deputy secretary-general of the Asean Economic Community (AEC) showed how the AEC has evolved since its inception.

The AEC’s end goals, he said, include eliminating tariff barriers, reducing costs and enhancing competitiveness among Asean member states, adding that it has achieved substantial targets to date.

He praised the Asean for tariff elimination which he said was on track through the AFTA, Trade facilitation has become more flexible, and the investment regime is much more open.

Mr Rillo spoke at the second edition of CARI Briefings titled, “Progress, priorities and challenges of the Asean Economic Community (AEC)” in Kuala Lumpur last month.

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These briefings give a clear picture of how much care is given to the business community in the region, as they are guaranteed all the facilities they need to expand their operations within the Asean.

However, the sad truth is that all these will be futile if it did not include the free movement of the workforce within the region.

The Asean wants to see a rapid rise in its gross domestic product, and it believes the openness towards the business community and community of investors is the way to go. They will bring the foreign direct investment (FDI) and will add value to the countries where they establish their businesses.

They are half-way right though, since, without a freer workforce that can move around the region without hindrances, only a type of workers will benefit. The rest, unskilled, low skilled, not skilled enough workers, will remain behind, stuck in time. And this might impact the gross domestic product growth targets.

The obvious disparity in the freedom of movement of the businesses and of the workers is a unique situation indeed because if you are a business person you can move around the Asean, and establish your business with a certain ease.

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But if you are a worker, whether you are a blue collar or a white-collar worker, there are rules and conditions that make it almost impossible for you to move around.

The AEC is called a community for a good reason, but with the smooth progression of the business protocol and the deliberate abandonment of the rights of the regional workforce, something is not right.

For example, the Asean is also setting the stage for the movement of services. Additionally, the existing Asean Solutions for Investments, Services and Trade will further include trade in services with the soft launch which is expected to be held at the Asean Business and Investment Summit in November 2018.

The business community is moving forward with big plans to conquer new markets and they will have the ability to use the local workforce to their advantage.

The question is how much such progress benefits the local workforce in Asean countries. Those within the Cambodia, Laos, Myanmar and Vietnam (CLMV) are struggling with the rapid rise in wages amid fears of a decline in productivity.

Intense debates involving governments and unions are seen in some of the CLMV nations. While these fears are genuine, it is also true that a massive influx of capital is expected to cause imbalances that are corrected by higher wage claims from the workforce.

The Asean seems at a loss on these issues.

What about the workforce in Thailand, Indonesia and even in the Philippines? Do they really benefit from businesses that move around freely, offering jobs at local rates?

On the contrary, the businesses have greater leverages. Tariffs will be lowered or simply eliminated, the ease of doing business will be improved and in some case, they will benefit from double-taxation deals.

The Asean will have the free movement of goods, with an Asean-wide self-certification scheme in place.

The Asean Single Window which was created to expedite cargo clearance and promote Asean economic integration by enabling the electronic exchange of border documents is now operating in Indonesia, Malaysia, Singapore, Thailand and Vietnam while other countries are expected to come on board by end-2018 or early 2019.

The businesses will also benefit from the Asean agreement on e-Commerce and the Asean Digital Integration Framework.

The AEC crafted to some extent on the European Community model is possibly in a stronger position to avert the negative elements that have arisen from the Eurozone at the turn of this century.

In the same breath, the Asean Eminent Persons Group which carried out several discussions with European leaders in an attempt to learn about the workings of the European Union (EU) and its community should step in the debate.

But they have been silent since the formation of the AEC.

Perhaps the Asean should start adopting what the EU has done, that is getting parliamentarians involved in the process of community building.

Otherwise, while it is cosying to the needs of the investors’ and manufacturers, the entire affair will turn into a huge white elephant. Because ignoring the needs of the people and that of the workers will not work for the business community.

The Greek crisis is an eye opener for the EU, but the very fact that it is being discussed and a resolution or attempts at resolving the crisis could be found through the EU Parliament should serve as an example.

The point is that more stakeholders should be engaged within the Asean when it comes to decision making on investment, FDI within the region and the role of the local workforce in all these schemes.

This should be part of the community building process but it is missing in the AEC framework, however, it is not too late for the Asean movement to rectify this.

The AEC clearly does have provisions for the easing of the movement of labour within the region. This only caters to professionals.

And it does not have any provisions for the respect of labour rights and offers limited consideration for human rights.

The AEC does not cover the crucial issues of unskilled and illegal migration which is much more pressing than the free flow of skilled labour.

The community will also not deal with the issues of workers’ rights and migratory movements as these were not covered during the rounds of talks.

Human rights, workers’ rights and salaries are not addressed under the AEC but partially covered by the other two community blueprints: political-security and the socio-cultural framework.

These are separate debates which are not really linked and connected with each other.

Besides the AEC, Asean also has the Triangle project, which is designed to strengthen regional policies on the governance of labour migration between the member states.

But have anyone heard of this ‘triangle’? It is not music to anyone’s ears, it seems.

To address the weaknesses discussed above, the AEC has the moral obligation to open up to the ideas that have made the EU stronger today.

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