From North-South to South-South: The True Face of Global Competition

Robert J. S. Ross and Anita Chan

From Foreign Affairs, September/October 2002

Article preview: first 500 of 2,701 words total.

Summary:  Competition in the production of export goods is depressing workers' wages in the countries of the South. Future trade deals must give labor rights their due.

Robert J.S. Ross is Professor of Sociology and Director of the International Studies Stream at Clark University. He is the author of the forthcoming Hearts Starve: The New Sweatshops in Global Context. Anita Chan is Senior Research Fellow at the China and Korea Centre at Australian National University, editor of The China Journal, and author of China's Workers Under Assault.

As protesters battled the police in the streets of Seattle in 1999, calling on the World Trade Organization to include environmental and labor issues in its trade negotiations, government representatives in conference rooms were carrying on a battle of another sort. Many developing nations, particularly the Asian countries, were strongly resisting a U.S.-led proposal by developed countries to link trade to environmental and labor standards through a new "social clause" in WTO agreements. The clause, its opponents argued, was a protectionist ploy that rich nations would use to shelter their own workers' jobs from the competition in developing countries. This stance reflected a commonly held perception that the main competition in the production of goods is between the North and the South. But in truth, this competition -- particularly in labor-intensive commodities -- is not so much North versus South but South versus South. The absence of a mechanism establishing international labor standards is propelling the economies of the South in a race to the bottom in wages and labor conditions.

The social clause, in brief, refers to the proposed insertion of five core labor standards into trade agreements: freedom of association, freedom to organize and to bargain collectively, and freedom from forced labor, child labor, and job discrimination. Many poorer countries either lack the laws to protect these rights, which are enshrined in the conventions of the International Labor Organization (ILO), or they simply do not bother to enforce those laws in their export industries.

TRADE UNIONS DIVIDED

Governments do not necessarily reflect the interests of their country's workers, but labor unions are supposed to. So how do unions line up on the social-clause question? Although the issue at Seattle had united the government leaders of the South in opposition, the international trade-union movement holds diverse views. The International Confederation of Free Trade Unions, composed of 221 affiliated unions that represent 150 million workers in 148 countries, supports the social clause. But African backing for the clause has not always been uniform: trade unions in some countries, such as South Africa, are in favor, whereas those in others, such as Zimbabwe and Zambia, are opposed.

In Latin America, unions are more amenable to linking trade and labor rights, thanks in part to their strong relationships with their North American counterparts. Struggling unions in Guatemala, Honduras, El Salvador, and Nicaragua have strategically used the U.S. threat of trade sanctions (specifically, in response to violations of labor rights) to secure their own rights to organize. For example, Guatemalan workers formed an unrecognized union at a factory owned by the U.S. clothing giant Phillips-Van Heusen in the early 1990s. In a long and bitter campaign, their North American allies -- including UNITE, the U.S. apparel-workers union -- filed a lawsuit in the United States at their behest, alleging that Guatemala was ineligible for trade concessions because it denied workers the right to organize. This pressure finally led the firm and the Guatemalan government to recognize the union.

Other Latin American confederations ...

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