Assessment of labour provisions in trade and investment arrangements pdf

202 Pages·2016·10.39 MB·English

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STUDIES ON GROWTH WITH EQUITY
ASSESSmENT Of lAbOUR pROvISIONS IN TRADE
AND INvESTmENT ARRANGEmENTS

STUDIES ON GROWTH WITH EQUITY

ASSESSmENT Of lAbOUR pROvISIONS IN TRADE
AND INvESTmENT ARRANGEmENTS
INTERNATIONAL LABOUR ORGANIZATION
Copyright © International Labour Organization 2016
First published (2016)
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Assessment of labour provisions in trade and investment arrangements / International Labour
Office. – Geneva: ILO, 2016
ISBN 978-92-2-130375-6 (print)
ISBN 978-92-2-130376-3 (web pdf)
International Labour Office
social clause / trade agreement / free trade / labour policy / dispute settlement / international
labour standards / ILO standards / case study / Bangladesh / Cambodia / Canada / Chile /
EU / USA
09.05.2
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practice, and the presentation of material therein do not imply the expression of any opinion
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Code: CAD
fOREWORD
This publication is funded by the Canadian and Swiss Governments,
and is part of a larger ILO Research Department project that assesses
the impact of labour provisions based on field research, interviews and
regional seminars with social partners. It builds on previous research on
the effectiveness of labour provisions, entitled Social dimensions of free trade
agreements (ILO, 2013), which developed a typology of labour provisions
and provided an exhaustive mapping of their design.
The methodology used to assess outcomes is based on macro-analysis of
260 trade agreements reported to the WTO (including 71 with labour
provisions between 102 economies), and case study analysis of Bangladesh,
Cambodia, Central America, Dominican Republic and Republic of Korea
with respect to an institutional analysis of national laws and labour insti-
tutions. The analysis is supported by interviews with over 50 stakeholders
in more than ten countries, including regional seminars held in Toronto,
Washington, DC, Lima and New Delhi.
The report has been prepared by Jonas Aissi, Marva Corley-Coulibaly,
Elizabeth Echeverria Manrique, Marialaura Fino, Laetitia Fourcade,
Takaaki Kizu, Rafael Peels, Daniel Samaan, Pelin Sekerler Richiardi
and Christian Viegelahn with research assistance from Jens Schlechter
and Carla Chapman. Background research has been provided by Natalia
Alshakhanbeh, Elizabeth Boomer, Tequila J. Brooks, Desirée LeClercq,
Woori Lee, Carolina Lennon, Elva Lopez Mourelo, Kimberly Nolan
Garcia, Elizabeth O'Connor, Myriam Oehri, Sara Rellstab, Daniel
Sexton, and Lore Van den Putte. The report has been coordinated by
Marva Corley-Coulibaly, under the supervision of Raymond Torres,
the Director of the Research Department, and Moazam Mahmood, the
a.i. Director of the Research Department.
The report has benefitted greatly from substantial comments and sug-
gestions received from prior and current members of the Advisory
v
Assessment of lAbour provisions in trAde And investment ArrAngements
Committee Pierre Bouchard, Caiphas Chekwoti, Yon Criado, Rudi
Delarue, Guillaume Delautre, Jean-Jacques Elmiger, Karin Federer, Silvia
Formentini, Anthony Giles, Monika Hencsey, Lewis Karesh, Pablo Lazo
Grandi, Sébastien Martin, Rakesh Patry, Carol Pier, Patrick Pieroni, Evi
Roelen, Gregory Schoepfle, Rahul Sen, Jan Van Hove, Damien Vacheron,
Anil Verma, and Jeffrey Vogt.
Valuable feedback was also provided by external reviewers: Susan Aaronson
(George Washington University), Mirela Barbu, Liam Campling and
Adrian Smith (Queen Mary University of London), Kevin Kolben (Rutgers
University), Raymond Robertson (Texas A&M University), Tonia Novitz
(University of Bristol), James Harrison and Ben Richardson (University
of Warwick), officers and staff from the United States Department of
Labor and the office of the United States Trade Representative, staff of
the European Commission (DGEMP), and staff of the State Secretariat
for Economic Affairs, Economic Cooperation and Development (SECO).
Thanks also to our colleagues from the ILO who provided helpful com-
ments: Jordi Agustí-Panareda, Florence Bonnet, Matthieu Charpe, Karen
Curtis, Sean Cooney, Janelle Diller, Colin Fenwick, André Gama, Eric
Gravel, Adam Greene, Deborah Greenfield, James Howard, Tom Lavers,
Sangheon Lee, Naren Prasad, Emily Sims, Thoralf Stenvold, Steven Tobin
and Lisa Tortell.
Finally, thanks to organizers and participants from seminars held in
Brussels, Lima, New Delhi, Toronto, and Washington, DC for
insights and comments on preliminary findings of the report; also
to ILO field directors and staff for their administrative and technical
support in arranging the seminars.
vI
TAblE Of CONTENTS

page
FOREWORD V
TABLE OF CONTENTS VII
LIST OF ABBREVIATIONS X
Executive Summary 1
Introduction 11
References 17
Chapter 1: Evolution of labour provisions in trade and investment arrangements 19
Key findings 19
Introduction 20
A Labour provisions in trade and investment arrangements: An overview of trends 21
Labour provision trends in trade agreements 22
Labour provisions trends in unilateral trade arrangements 22
Labour provisions trends in international investment arrangements 26
B Evolution of labour provisions in EU and US unilateral trade arrangements 30
The United States: “Internationally recognized worker rights” 31
The EU: Linking labour requirements to the fundamental ILO Conventions 33
C Trade agreements 35
Design of labour provisions: Different generations of trade agreements 38
EU: Sustainable development 39
Obligations 39
Dispute settlement mechanism 41
The United States: Effective enforcement of domestic laws 42
Obligations 42
Dispute settlement mechanism 44
Canada: Progressive extension of labour rights protection 47
Obligations 48
Dispute settlement mechanism 49
Chile: Country-based approaches 52
Obligations 53
Dispute settlement mechanism 55
D Conclusions 57
References 59
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Assessment of lAbour provisions in trAde And investment ArrAngements
Chapter 2: linking labour provisions and working conditions 65
Key findings 65
Introduction 66
A The links between trade and labour: An overview of the evidence 68
Employment creation 68
Quality of jobs 69
B Assessing the impact of labour provisions 72
C Assessment of labour provisions: Cross-country macro-impacts? 76
Labour provisions, ratifications of ILO Conventions and labour market outcomes 76
Labour provisions and trade 85
D Lessons from country case studies 89
CAFTA–DR: Addressing the gap between law and enforcement 90
Pre-ratification changes to improve law enforcement, with respect to discrimination,
freedom of association and collective bargaining 91
Development and application from implementation mechanisms of the agreement 92
Challenges in achieving broad-based improvements 95
Cambodia: Monitoring at the firm level 95
Bangladesh: Unilateral trade arrangements, benefits suspension and capacity-building 98
Policy levers of unilateral trade arrangements in Bangladesh 99
Working conditions’ evolution between 1999 and 2010 101
E Conclusions 104
Appendix I: Ratification of ILO Conventions 106
Appendix II: The relation of labour provisions with labour market indicators 107
Appendix III: The trade impact of labour provisions: Estimation methodology 112
References 115
Chapter 3: Effective stakeholder involvement in the negotiation
and implementation of trade agreements 126
Key findings 126
Introduction 127
A Assessing the institutional mechanisms for stakeholder involvement 131
Institutional mechanisms 133
Permanent stakeholder committees dominate the US approach 134
The EU makes use of agreement-specific advisory committees 135
Involving broader segments of civil society 136
EU trade agreements obligate parties to involve stakeholders and establish transnational mechanisms 136
vIII
Mandate 137
Towards increased transparency 137
Conducting dialogue with stakeholders 138
Commitments to consider stakeholders’ input exist; accountability remains limited in practice 139
B Effectiveness of stakeholders’ involvement 141
Methodological considerations 143
CAFTA–DR 143
Pre-CAFTA–DR: Sustained pressure and economic leverage 144
The negotiation of CAFTA–DR: heightened political pressure 144
Implementation of CAFTA–DR: Enhanced dispute settlement and monitoring 145
EU–Republic of Korea trade agreement 147
Canada, EU and US trade agreements with Colombia and Peru 148
Public attention during negotiations 149
Monitoring during implementation 151
C Conclusions 154
References 157
Chapter 4: Towards enhanced coherence? 166
Key findings 166
Introduction 167
A Coherence with ILO’s standards and supervisory system 169
Direct requests by member States for advice 169
Design of labour provisions 171
Implementation stage 171
Dispute settlement and application of sanctions 172
Trade partners rely on the comments of the ILO’s supervisory system 173
Design of labour provisions 173
Implementation stage 175
Dispute settlement and application of sanctions 175
Public dialogue at the CAS 176
B Coherence through the ILO’s development cooperation 178
Coherence of development cooperation programmes:
Bilateral support of ILO priorities 178
Coherence of development cooperation programmes: With support of the ILO 181
C Concluding remarks 184
References 186
IX