human face returns

8/14/2019 Human Face Returns

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THE RETURN OF

HUMAN/ASIAs Face ?

A Tale of Four FacesCarla June NatanUrban Community

MissionJakarta/Migrant

Forum in AsiaPresented at ASEAN Peoples Forum, Chulalongkorn

University Bangkok, Thailand

22 February 2009


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Migrant Forum in Asia MFA is a regional NGOassociation and trade union of migrant workersand individual advocates in Asia.

It has 290 member organizations in the 15countries in Asia.


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Global FinancialCrisis

First Face


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2008 Global Financial Crisis Chronology

2007

April

New Century Financial Housing credit company

bankrupt

28 August

Sachsen Landes Bankin Germany collapsedbecause of investmentin housing credit

3 Sept

German finance Institutionconfess that they lost1 billion dollars in subprimemortgage investment

17 Feb

Northern Rockwas Nationalistby UK

17 March

Bear stearns collapsed andbought by JP Morgan Chasewith the guarantee ofUS$ 30 billions

2008

10 Oct

Global stack market fellagain

8 Oct

UK preparedbail out find ofUS$ 87 billions

29 Sept

Brandford & Bingley wastook over by UK Govern-ment

25 Sept

Washington mutualcollapsed& bought bySP Morgan

16 Sept

Fed injected Ai6 US$85billions

15 Sept

Lehman brothersbankrupt

5 Sept

Fannie Mae & Freddie MAC wastaken by US Government

6 Oct

Germany injected68 billion dollarsto Hypo Real Estate

3 Oct

US Congressreleased700 billion bailout fund

30 Sept

France, Belgium, Luxemburgsaved Dexia

Source : Tempo Magazine (2008)


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What the Difference of1998 Crisis and 2008 Crisis

It happened at 6 countries in Asia Bankruptcy of company and financial

institution. The hittest was : big companies that

played in the global market such asforeign currency, bonds,obligation, off

shore loans; banking, stock marketand property, public sector whom hada foreign loan, importir/businness actorwho depend on the import raw material

Liquidity Crunch,market pessimismand consumption

Investment contraction, economy crisisand increasing of unemployment

For Indonesia, it is social and politicalcrisis

Crisis happened around the world startedfrom subprime mortgage in USA, Europeand Asia Pacific

- Bankrupty of bank/financial institution andcorporations

- Increasing of inflation and unemployment,economy slow down and fell of index instock market

- In Indonesia, stock market and foreigncurrency trading fell to 60%

- Rupiah was weaken from Rp.9076 Rp.13.000

- According to Kwik Kian Gie, EconomyExpert, the rich people in Indonesia are theone who lost much in this crisis for theyplayed in the global stock market. Theirwealth was decreased from Rp.1998 trillion

to 1072 trillion rupiah)- World Bank predicted the global economy

growth will decrease to 0,9% from previousprediction of 3%.

- According to World Economy Expert, Asiaeconomy growth will reach only 2 %.Theaverage growth of Asia country will set backto the year of 1980-2002, around 3.5-4% in2009.


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RESPONSES TO THE CRISIS IN ASIA PACIFIC REGION

RESPONSES COUNTRY

Increase bank rates

Decrease bank rates

Indonesia

China, Hong Kong, South Korea,Taiwan, Australia, New Zealand

Took over for recover China

Bail out Japan

Buy Back Indonesia, Thailand

Incentive for Exporter Indonesia, Thailand

Closed stock market Indonesia, Thailand

Increase deposito guarantee Indonesia, Hong Kong, New Zealand,

Australia

Prohibited short Selling Indonesia, Taiwan, Korea.Australia

Different sources


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Worker Situation ILO predicted 210 million people will be unemployed around the world in 2009.

This unemployment will happen at the developed countries OECD around 42 million people.The rest, 168 million will come from non OECD countries. OECD predicted the unemployment willraise 8 million in the coming 2 years. This is a serious increasing since the recession in 1980.

The export oriented economies in Asia Pacific such as Hong Kong, South Korea, Japan,Singapore and China will suffer heavily.

South Koreas economy shed more than 100.000 jobs in the year to January. The jobless raterose to 3.6% in January from 3.3% in previous month. The shipment in Korea down 25-30%.

Taiwans industrial production is down to to 30% in December while 15.000 Panasonic workers inJapan has been laid off.

The unemployment in Hong Kong has been increased to 4.5% from November08 January2009. 14.000 people without job.

Singapore expects that there will be about 300.000 job losses in 2010.

The crisis hit Thailands 8.5 million people in tourism and export dependent emplyoment. Since1997 financial crisis, Thai economy has generated more than 2.5 million new jobs in tourism andmanufacture.


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Ban Ki Moon, UN General Secretary predicted 20 million people out of 200 millionforeign workers will lost their job in construction and tourism.

Human rights groups say many of the world's estimated 100 million migrant workersare in dire predicaments as economic woes in the Gulf, Singapore and Taiwan leadto mass layoffs of laborers from countries such as Bangladesh, China, India,

Pakistan, the Philippines and Sri Lanka. MFA data showed that 53 milllion migrant workers from Asia work worldwide mainly

in Gulf countries and Middle East. A high percentage of them are low and middleskilled workers.There are 15-20 million undocumented intra region migrant workers inSoutheast Asia and East Asia.

In Persian Gulf, half of 13 million foreign workers could lose their job in majorconstruction projects in Saudi Arabia, UAE, Kuwait, Bahran, Qatar and Oman. Any

slow down in the construction sector would affect thousands of migrant workers fromBangladesh, India, Myanmar, Thailand and China.

Layoffs of these migrant workers may raise unemployment and poverty in their homecountries as they return without jobs and often with hefty debts. It could also sloweconomic growth in countries such as Indonesia, Bangladesh, Philippines and SriLanka which are deeply reliant on remittances sent home.

10% out of 90 million Filiipino people work overseas. In 2008, they sent 14.4 billionUSD equivalent to 10% of Sautheast Asia nations gross domestic product. 50.000filipino will lost job in USA only at financial sector. There are 2 miilion of them in USA.Remittance of Filipino went to consumption private one reach 70%.

As a result of the economic slowdown, the World Bank said it expects remittances,the lifeblood for millions in the developing world, to moderate significantly over thenext two years and that remittances in 2009 will fall almost 1 percent. Globalremittance flows stood at US$283 billion last year. But as their economic health

declines, the social well-being of migrant workers is also under threat.


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MIGRANT WORKERS ARE THE LASTHIRE.......AND......FIRST FIRE

The 1997, Asian financial crisis demonstrated that

migration is not a sustainable economic developmentagenda. By early 1998, the anti migrant sentiment wasalready peaking. Governments throughout Asia wereexpelling migrant workers.Thailand announces a plan

to expel a million migrants while Malaysia indicatedthat hundreds of thousands of migrant workers, ithwork permints and not, would be deported (AMC,

1999). However, governments soon were besieged bycomplaints from business that did not have enoughworkers as locals refused to take those jobs left bymigrants.


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The impact of global crisis to migrant workers(IOM Policy Brief Paper 2009)

Job losses, especially in construction, manufacturing, finance, services, retail and

tourism.Possible reductions in wages and poorer conditions in the workplace as companies

and employers seek to make savings, as well as cuts in social services provision,

impacting on migrants quality of life and health.The risk of discrimination and xenophobia as migrants - migrants took local job

particularly in low-skilled.Returning or deportation of migrant to countries of origin. Possibility of increasing

poverty and unemployment - could affect economic and social stability.A decline of remittance. Migrants may also be more reluctant to send money

through formal channels due to a lack of confidence in the stability of banking

systems.More restrictive immigration policies to protect the local labour market and in

response to a demand for fewer foreign workers.A reduction in labour migration flows as potential migrants choose to stay home.An increase in irregular migration and the strengthening of the informal labour

market. An increase in trafficking in human beings is also a possibility.The crisis is expected to impact differently on male and female migrant workers

especially in affected sectors of the economy dominated by one gender (e.g.

construction in which male migrant workers predominate).


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CapitalismFace


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MaximizeProfit MinimizeCostand

Risk!


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China

After China

Return to SEZs condition,

facilitate by FTA?

1980s FDI EPZs

Export promotion Zones

1974s - MFA

Relocation; North/NICs to South

1960- 1970s

Expanding shipped production/ manufacturing

toNICs - Korea, Taiwan, Hong Kong

1995 China

US/EU

Central

America

Africa

SouthAsia

NICS

Taiwan,Hong Kong,

Korea

Southeast

Asia

Mexico

Eastern

EU

India?

Factories relocationfrom North to South.Facilitate by TradeSubsidy/ promotion

and agreement


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FLEXIBILITY

Multi skills/less workers

Subcontracting,push pressure toworkers

Using vulnerableworkers, children,immigrant,prisoners

Employment intemporary, part-time,contract system

Target/ piece ratesystem, home baseworkers

In crease speed,

work like robot,no time to eat, topee, to rest.

Flexible labourlaw forinvestment - ATC,Free Trade

Investmentprivilege package,

EPZs

Politicia

n,auth

oritie

sLe

galpro

ceedin

g

Busting

advis

orsManagement,

personnel

Highest profit/cheapest cost

Reducing risks, used less workers, cheapestwages, no liability, no responsibility, no direct

employment, etc.

superv

isors Ma

fia,

gangst

ers

workers are suppressed -- no time to eat [nothing to eat], to rest, to have family life, etc.

Too many OT,no time toparticipate inunion

INCREASEPRODUCTION

CAPITALISTs

Supply ChainManagement


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The Curse of Capitalism

Greediness

Spending higher than saving

Material is more important than human

Development emphasize more in physicaldevelopment than human being

Man is an object and production machine

Focus on economy only of human being Wider gap between the have and haves

not


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Economy

Law

Politic

Social

Culture

Education

SpiritualBiology

Neoliberalism Vs. Man


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Neoliberalism Vs Man

Man is a garden of diversity. He haspolitic, social, legal, cultural, spiritual,economy and spiritual dimension. It

means that a man is a homooeconomicus, but homo oeconomicusnotentirely man. Man is for sure a homopoliticus, but homo politicusnot entirelyhuman being. Decreasing man to be onlyeconomy actor is denial of the thoughtand facts. (B. Herry-Priyono, 2008)


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IndonesiaFace!


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Based on Industry Department of Indonesia, the fragileindustry hit by global downturn is garment and textile, pulpand paper, plantation especially crude palm oil -CPO, timberindustry, steel and electonic industry, handicraft andfurniture.

The World Bank predicted Indonesia economy grow this yearwill be 4,4% , The Economist : 3,7% from last year of 6,2%

While the Indonesia government optimism to reach 5-5.5%

The unemployment in 2008 is reaching 9,39 million people.According to International Labour Organization (ILO), theunemployment will increase in Indonesia in 2009 will be170.000 to 650.000 people or increase around 9%.

According to Tempo Magazine Jan09, from the insideinformation from government, January-February will be 1,6million people.

ex e an armen n us ry n


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ex e an armen n us ry nIndonesia

Textile and garment industry is the largest Industry in Indonesia outsidegas and oil with employee 1,8 million workers.

From that number, 63% worked at the big and medium enterprises and 37%

by small and medium. The center of textile production is in Java (57%),Jakarta (17%) and Central Java (14%).

Indonesia is the seventh world fiber production, produce 1,5 million ton in2004 with the revenue of 672 million US dollar.

Indonesia has a capacity of world fourth largest spinning produce 2.64billion US dollar in 2004.

Lastly, Indonesia has a capacity of third largest woven in the world with theearning of 3,89 billion US $ in 2004.


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Indonesia textile industry is one of the major in thecountry macro economies. In 2005, the clothing salesreached 4,27 billion US $, with 71% was from export(3,07 billion US $) and 29% from local market (1,2 billionUS$)


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In 2001-2005, the export clothing increased10%, from 2,78% billion US$ in 2001 became

3,07 billion US$ in 2007


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The biggest textile and apparel export of Indonesia is to USA(31%), European Union (21%) and ASEAN countries (7%). In

2004, Indonesia is the ninth largest export to the world.

Impact of the Global Crisis to the


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Impact of the Global Crisis to theTextile and Garment Industry in

Indonesia

The Indonesia Sport Shoes index fell to 50%, lost 50% exportmarket. The penetration to the global market declined to 5.8percent in 2000 became half of it in 2007 and thus impact to thedecline of competitiveness.

Decreasing of the orders (contract from USA and Europe) 30 40percent, increasing of smuggling of goods especially from China.

Around 100 thousands from 1.2 million textile workers will be lay

off. According to Djimanto, Vice Chair of Indonesia Businessman

Association, in 2009, around 50% workers or around 45,5 millionworkers threaten to lost their job. The Chairman of IndonesianBusiness Association said that they already ended the contractlabor while for the permanent workers will be employed until April2009. The rest will be depend on the situation of global and

national situation. Chairman of Indonesia Textile Association said that, the potential

dismissal in textile sector in 2009 will reach 70.000- 80.000workers. In 2008, they already dismissed 30.000 worker.

Chairman of Indonesia Sportshoes Association stated that,thedismissal on this sector this year will be 40.000 people, while in theend of last year reached 10.000 people. The income in this sector

will decline to 15-20%. NIKE says, it may cut 1,400 jobs to cope with global economy


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Indonesian MigrantWorkers

Malaysia will deported 300.000foreign migrant workers 300.000.100.000 of them will be Indonesianmigrant worker will be send backthis year.

Malaysia still employed foreignmigrant workers at the sector ofplantation and construction andnot any longer factory workers.

Ministry of Manpower and Transmigration announced that250.000 Indonesian migrantworkers has returned home lastyear.

South Korea will not receive

Indonesian migrant workers inFebruary 2009. South Koreaseconomy shed more than 100.000

jobs in the year to January. Taiwan has dismissed several

thousands foreign migrantworkers.

Several migrant workers have

been trafficked to the conflictareas such as Palestina and Israel.


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1. Indonesian migrant workers are the biggestcontributor to the country revenue outsidetax. In 2006-2008, the remittance countryreceived was 11,49 billion USD. In 2009, it istargeted USD 21 billion.

2. The irony of remittances of migrant workersis :

Not necessary increasing the economywelfare in their village.

Not reduce the poverty in the community.

There is no government plan to improve orstrengthening the migrant workerseconomy back home. Migration is only aforce to escape from poverty and not fromthe plan to reduce poverty.

There is no or difficult to access togovernment fund to improve their economy

D. Hero of Remittances orCommodity ?


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Will Human/Asia FaceReturns?


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I d i G t


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Indonesia GovernmentResponses

1. Law enforcement and investment guarantee;

2. Monetary stabilization through policies

3. Strengthening Real Sector including TextileProduct,Sportshoes and Electronic.

4. Sustainability of small and medium enterprises : credit facility

5. Social Safety Net Program. The government targeted toreduce poor people 12-14% in 2009 by providing 17 trillionrupiah through free health care, free school, rice subsidy,

cash money (BLT), Housing subsidy, National PeopleStrengthening program, credit for the people

6. For the workers, social insurance office, provide credits forenterprises after dismissal, cash money of 350.000 fordismissal workers.

7 E P i it A d


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7 Economy Priority Agendaof 2009

Limited unemployment

Manage inflation at the certain level

Policies to ensure the real sector must be

move including fiscal incentive Maintain people power buying

Protect the poor by given direct assistance,

etc. Maintain enough food and energy

Maintain the development growth above 4,5%


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What the workers can befighting for

1. For the worker who still work:

- Retraining:sewing, stitching, embroider, English andComputer Course,etc

- Increase the capacity of negotiation, lobby,communication (internet)

- Information information information on whathappen in the factories and companies

- Consolidation and Network

S lid it !


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Solidarity !Dignity

Returns

Factory from, byand for the worker.

Sub Contractwith decent wage

EthicEnforcement

InternationalLaw, Procedure

and mechanism

Decent Wage


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Workers

Living wage

Bonus

Pension

Subsidy

Food allowance

Transportation, etc.

Leaves- holiday, annual

Familybenefit

Sick leaves

Maternitybenefit

Activities leaves

Learning/Education

Union office/facilities

Political Rights

Union is a tool to good lifeand Security

Legal Rights

Workers party

Compensation,

Provident fund

OS&H --Safe andHealthy work

Democratic laws

SocialWelfare

UnemploymentSecurity

Economic Rights

CBA

Strike

Organizing

Social Rights


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Global Supply Chain!

The impact to workers

Freedom

Of

Association

Western TUS/NGOs

pressuring brand

names and retailers

Asian TUs/

ATNC monitoring groups

pressuring manufacturers

workers trying

to organise

against exploitation

AMRC& TLC

proposal

Tri-angular

Solidarity tosupport

workers

rights to

Freedom of

Association

Freedom

Of

Association

Western TUS/NGOs

pressuring brand

names and retailers

Asian TUs/



workers trying

to organise


Freedom

Of

Association

Western TUS/NGOs

pressuring brand

names and retailers

Asian TUs/



workers trying

to organise


AMRC& TLC

proposal

Tri-angular

Solidarity tosupport

workers

rights to

Freedom of

Association


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For the potential dismissal

worker and migrant workers

Compensation and severance payment

Reintegration program: Training/upgradingskill :salon, machine, sewing, cake,recycle,

shop, farming Planning, implementing and market access

Access to the governments fund

Return to the village = provincial autonomy Coalition with other sectors :farmer,

fishermen, women, etc.


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Kisah Perjuangan


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Asia can indeed turn this challenge into anopportunity to rebalance the sources ofgrowth by revitalizing domestic investmentand consumption and maintaining steadyeconomic growth at this difficult time,thereby contributing significantly to theglobal recovery

human face returns

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