ICFTU ONLINE...

266/981203/DD

Brussels. December 3 1998 (ICFTU Info): The World Trade Organisation's assertion that the world's multilateral trading system has ridden out the financial and economic crises currently affecting some of the world's major economies is much too premature, said ICFTU, commenting on the WTO's Annual Report out today (December 3).

The ICFTU says that while it supports the WTO's premise that free trade has the potential to bring benefits to working people world-wide, and can help to address current difficulties facing the world economy, it is far too early to say that fall-out from the current crisis is over.

While the ICFTU agrees that at present the world trading system has stood up to the economic pressures caused by the crisis, the worst may still be yet to come. Venezuela, Brazil and other Latin American countries narrowly avoided a financial crash in September and October, but are still on the brink of a financial crisis. Russia also continues to teeter on the brink.

The ICFTU is also concerned that, as the report points out, in many Asian countries there is now a huge imbalance between the level of exports and imports, so that imports in Indonesia, Korea, Malaysia, Philippines and Thailand have fallen precipitously at the same time as those countries strive to increase their exports, causing immense strains on the world trading system.

The ICFTU says that one of the most important effects of the financial crisis has been the way in which it has revealed the short-comings of the headlong pursuit of economic development at the expense of broadly-based social development targeted to reducing poverty.

During the last two years, the ICFTU has been producing parallel studies to match the WTO's own trade policy reviews, which have indicated how many countries, including Malaysia, Indonesia, Mexico, Turkey and some African countries have deliberately been increasing exports, with the violation of workers’ rights to obtain low-cost exports one of the planks in their export policies.

Indonesia is a case in point, says the ICFTU, as its forthcoming report on Indonesia's labour standards will show. Until last year Indonesia was hailed as one of the most successful of the Asian tigers, a country where the pursuit of economic development resulted in a dismissal of human and trade union rights.

This country literally came apart at the seams, as demonstrations protesting at the government's inability to deal with the economic crisis, where thousands of people were killed, finally led to the overthrow of the dictator of the growth system, General Soeharto.

"In a country which was heralded as a successful economic model, where half the population are now living below the poverty line, the blind pursuit of free trade has a lot to answer for" says the ICFTU.

The ICFTU says that it believes that the report should include reference to the relationship between trade and labour standards, as including the notion of human and trade union rights in trade could help to lessen some of the worst pressures of the world financial crisis which are the main theme of the report.

This was strongly supported at the WTO Ministerial Meeting in Geneva in May 1998. At that meeting leading political figures such as President Clinton and the President of the European Commission Jacques Santer supported using the WTO as a forum for linking trade and labour standards.

The ICFTU will be working with governments in the lead up to the next WTO Ministerial Summit in the USA in 1999 to ensure that the linkage between trade and labour standards is fully discussed.

International Confederation of Free Trade Unions (ICFTU)
Boulevard Emile Jacqmain 155, B - 1210 Brussels, Belgium. For more information
please contact: Luc Demaret on: 00 322 224 0212 - press@icftu.org

ICFTU OnLine