[OPE-L] Interview with Kari Tapiola, Executive Director, ILO.

From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Sun Feb 18 2007 - 21:55:44 EST

Vol:24 Iss:03 URL:


`We run the risk of polarisation'


Interview with Kari Tapiola, Executive Director, ILO.

Kari Tapiola. He says "one can question the framework in which"
globalisation operates.

IN the second week of December, the International Labour Organization
(ILO) organised a high-level roundtable on labour market reforms in New
Delhi. The context was globalisation and the emphasis was on decent work
standards and equitable growth in a highly globalised world. Kari Tapiola,
Executive Director of the organisation at its headquarters in Geneva,
spoke to Frontline on globalisation and related concerns. Excerpts:

What does the term globalisation essentially mean to the ILO?

It is difficult to crystallise this in a few words as we have published so
much as an answer to this question. Globalisation is a process that all
economies and societies throughout the world are going through and it is
changing the technology, the productive potential, the growth potential of
societies and changing the way economic decisions are made. For the ILO,
the important issue is how the social dimension is addressed. If it is not
addressed, then globalisation becomes a process, which benefits those who
are economically strong and becomes a big problem for those who are the
weakest. We are concerned that if this is not properly managed and does
not work for the benefit of the majority of people, then it will become a
negative force and provoke tensions and negative reactions.

What has been the experience of the ILO as far as globalisation is concerned?

Globalisation, after all, is nothing new. There were times when there were
strong and traditional globalising elements, such as multinational
enterprises. This was much before the World Wars, when much of the economy
was run by colonial powers. Globalisation is a continuous process, it has
occurred in different forms, but the new issue is that it disconnects
decisions of production from where production is actually carried out. So
relations between capital and labour or employers and workers occur in a
new situation. We have subcontracting and outsourcing. We do not have the
employer-worker or employer-trade union link that used to be there earlier
and were in one form part of the labour markets in society. Much of that
has to be rethought and rebuilt in a new way. Globalisation is the result
of processes that have developed owing to technology. Because it has not
been designed to factor in the consequences, we are facing problems.

Globalisation presupposes an unrestrained movement of capital but places
restrictions on the movement of labour. How does the ILO view this

Capital is mobile and whether it is feasible to move to a world where both
capital and labour ought to be mobile, I don't know. We are looking at a
world today where there is a need to channel better the mobility of both
capital and labour and with a clearer understanding of our aims and what
we want to achieve so that the benefit would be as broad as possible.

One of the things that the ILO has been concerned about is the social
impact of globalisation. You have also separately worked on labour
standards and globalisation.

All these things appear in a certain sequence. The first impact of
globalisation was, of course, the mobility of capital, which greatly
increased after the Cold War ended. Market economies were divided into
various blocs. It took jobs along. The first losers were the workers in
the industrialised countries. They reacted to globalisation. At least part
of them, those who have had negative reactions were by and large those who
did not have alternatives, safety nets and were not able to benefit from
social protection measures or alternative means of employment. This
continued till the mid-1990s. One conclusion was that globalisation was
benefiting only the developing countries, particularly those which had big
growth sectors, such as India or China. It was seen as a new divide in a
way between industrialised and developing countries. The reaction against
globalisation in the industrialised countries was because people felt that
they were being denied the benefits of globalisation, which they thought
they were entitled to.

If you look at the situation today, it is clear that globalisation does
not benefit countries as a whole; neither does it affect countries as a
whole. There are parts in all economies, which benefit from globalisation
- the export-oriented parts that are dynamic and growing whether the
countries are industrialised, developing or in transition. Then there are
large sections where globalisation has either not benefited or made the
situation even worse. This takes us to the question of the balance and
benefits of globalisation. If globalisation benefits a small group both in
the North and the South, and if it does not benefit the majority, we run
the risk of polarisation and of countries snapping in two, as it were.

If there is no mechanism to bridge the growing and the not-so-growing
sectors and no system to deal with the consequences, there can be tension,
conflict and no economic growth. If eight, nine, ten per cent growth rates
do not increase decent productive employment that in turn generates demand
and income and growth, the system will cease to function.

Do you think the time has come to question globalisation as it were or is
it just a question of adjusting to something that is now taken as a given?

One cannot question globalisation because one cannot question objective
trends but we can definitely question the framework in which it operates.
It has very obvious limits. One of them is the environment. There is a
realisation that if we go on this way, the planet will not be livable
anymore. Then there are the ethical limits of technological growth. Then
there is this question: what does it do to our societies, to labour, to
employment relations, or to the way in which we decide matters in our
society? And what does it do to democracy itself?

There has been a lot of pressure on countries, including India, to
"liberalise" their labour laws. How can the rights of workers be protected
in such a context?

Maybe the management of globalisation calls for more flexibility. Maybe
that is true. Maybe one has to review labour laws. I think we have to
review the whole notion of regulation not to do away with regulation but
to find the appropriate form of regulation. The trend in labour laws has
been very much to set numerical or quantitative limits in terms of
quantitative benefits - to say that in enterprises of such and such size,
such benefits should exist. Maybe we have to review this quantitative
approach. But the logic of labour laws is to protect the maximum number of
people. It may also be that we need to have a process where decisions on
closures, re-location or employment take everybody into confidence. We
essentially have to have a process through which this would take place and
the requisite guarantees if people lose their jobs. We are talking about
an economy where jobs are both created and lost. Hence we have to see what
is the alternative. How can the benefit that employers get be translated
into opportunities for workers who are otherwise disadvantaged? We cannot
say, get rid of people and leave them at the roadside. We have to look at
the benefits to the economy as a whole and that will come about only
through a more balanced and fairer pattern of growth in an economy.

You have worked on the social problems of countries in transition. What
exactly has been the social impact of globalisation in these economies,
especially after the end of the Cold War?

The transition economies and the former Communist bloc provided social
protection to their people. The system was limited, but it existed. When
the change came about, it was not replaced effectively by another system
of social protection. When property was privatised in what was earlier an
essentially state-run economy, social protection should have been
nationalised. But that did not happen. The social protection that existed
in the Communist systems was an essential part - it was carried out at the
factory level. When the form of ownership of property changed, social
protection disappeared and it was not replaced by another form of social
protection that was universal or efficient. There is still nostalgia for
the Communist times and the old protection that we had. That is because
the new system of the market as it emerged did not guarantee protection to
people in the same way. This showed the danger of simply looking at the
economy and only economic performance that was promoting wealth creation
at the upper end, without looking at what happened to the retired, the old
people and the workers in non-efficient, non-profitable industrial
activities. This is why there is a country like China which has truly two
faces - one, the face of the growing economy, investment and modern
development and the other, there is a lot of conflict because jobs are
lost in the unprofitable activities which are not easy to restructure.

There has been a lot of reaction to the way globalisation has affected the
lives of people in the Latin American countries. What do you think is
happening out there?

I see people demanding more control over their lives. One of the things
that is happening is the legitimacy of elected leaders being questioned.
The democratic process as it functions is not very strong. There is a high
level of expectation. The expectation is not so much in the political
field but more in the field of employment and social protection. There is
a need to engage the actors in the economy, including, the trade unions,
in creating a dynamic.

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