Malaysia is one of Asia's biggest employers of foreign labour. But recently, cases of deaths, abuse and forced labour have come to light. What is going on? Who is protecting these migrant workers?
THE
Malaysian government is undertaking a series of bilateral negotiations with the
United States to conclude what would be a preferential free trade agreement (FTA)
with the world’s only superpower.
<P>From the US perspective, the US-Malaysia FTA (USMFTA) makes good business sense, as Malaysia is the US’s 10th largest trading partner and its largest trading partner in Asean. The FTA would facilitate further US trade and investment in Malaysia.</P>
<P>From the Malaysian government’s
perspective, the USMFTA is key in ensuring continued foreign direct investment
(FDI), especially from the US, and to keep pace with other Asean members. The
main challenge Malaysia faces is that its comparative advantage as an FDI destination
has eroded over the years. </P><P>In negotiating the USMFTA and weighing options
between attracting FDI and achieving development goals, the Malaysian government
must note that an FTA between a developed and developing country exacerbates existing
inequalities between and within the two countries as the FTA “levels the
playing field” among unequal partners. The developing country tends to suffer
disproportionately. </P><P>The US economy dwarfs the Malaysian economy, as do
US corporations. As an analogy, the Fortune 500 is filled with US multinationals
while Petronas is the only Malaysian multinational that has been consistently
placed in the Fortune 500. These inequalities are likely to worsen, as FTAs seldom
include protection for the losers. </P><P>In Mexico, 2 million farmers have lost
their jobs due to the North American Free Trade Agreement (Nafta) as subsidised
agricultural products from the US flooded the Mexican markets. Similarly, the
US Peru FTA has allowed subsidised US agricultural products to flood the Andean
Common Market through Peru, causing further hardship in a country where over half
of its 27 million citizens live below US$1 a day. </P><P>The US–Jordan FTA
and the Central American Free Trade Agreement (Cafta) have made Jordan and the
Central American economies locations for producing labour-intensive goods for
the US market. Singapore, a close ally of the US, saw its trade deficit with the
US increase by 200%, a rise of US$2.9bil in the first year upon signing the FTA.
The same effect occurred to Australia, too, as its trade deficit increased by
US$1.7bil in the first year of its FTA with the US. </P><P>US trade surplus with
Singapore tripled after the first year of the FTA reaching US$4.3bil. US trade
surplus with Australia grew by 31.7% and exports to Australia increased by 11.7%
in the first quarter of 2005. </P><P>The Cafta is expected to reduce the US trade
deficit with the region by US$756mil. </P><P>The US is very keen on the USMFTA.
The US government, the US Chamber of Commerce – the world’s largest business
federation with over 3 million members – and its partner, the American-Malaysian
Chamber of Commerce (Amcham) has continually affirmed the need for the USMFTA.
</P><P>The US Chamber of Commerce and Amcham know exactly what they want. They
have made a 98-page public submission on the USMFTA to the US government. They
influence the US Trade Representative to pursue certain key issues that are in
direct contention with development objectives and policies that the Malaysian
government declares it will not trade away. </P><P>The Malaysian government must
stand firm. Workers will likely suffer the most should the government not include
specific reference to implementing International Labour Organisation (ILO) Core
Labour Standards in the USMFTA. It would be wise for the Malaysian government
to discuss the USMFTA with the Malaysian Trade Union Congress (MTUC) to ensure
that Malaysian and guest workers in Malaysia benefit. </P><P>In Thailand, South
Korea, Central and South America, thousands of citizens have demonstrated against
the FTAs with the US. These citizens are against FTAs as they see the FTAs as
only meeting the interests of corporate America. </P><P>The Malaysian government
therefore must rally public support, including that of the worker movements in
favour of the USMFTA, as this will be in the interest of the nation. </P><P>Ultimately,
the Malaysian government must also explain its strategy to the Malaysian public
on how the so-called “spaghetti” of FTAs that Malaysia is getting involved
in will benefit Malaysia in the long run.</P>
<P><I>Source: http://biz.thestar.com.my/news/story.asp?file=/2007/1/29/business/16673088&sec=business</I>
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