for building a democratic labour movement in India
International Capital Mobility, Global value chains and the Emerging Labour Movement in Asia
In the last three decades, there has been a sea change in the global political economy and the socio-economic and cultural environment of the society as well as the physical environment. The world of labour has been decisively changed, not for the better, but for the worse. This was accompanied by the downfall of many labour movements as well as social, cultural and political movements. As the socio-political and economic structures that existed up to the late 1970s and early 1980s gradually changed and were then decisively transformed in 1990s, the socio-cultural and political movements of that period were also marginalised and later were largely made irrelevant. With the restructuring of economies and industries and in this overall anti-labour environment, trade unions were by and large paralysed and their collective bargaining power declined drastically.
In some Asian countries, workers had virtually no right to organize and bargain collectively, because on the one hand, the political scene was dominated by authoritarian regimes and on the other hand, the industrial relations scene of each country was often dominated by a single official trade union. These were the painful years for the working class in Asia, as they were facing one of the most powerful aggression of global capital in a situation when they were largely disarmed.
However, in the past 10 years, labour movements have started to re-emerge all over Asia. In some countries, particularly in East and Southeast Asia, the labour movements re-emerged early, largely linked with the upsurge of democratic movements in those countries. In other countries it has taken slightly longer, and in many countries labour is still in the process of re-emerging. On the whole in the 2000s, the labour movement was rejuvenated in East and Southeast Asia, as well as in South Asia, but it is still largely scattered and struggling to take a strategic shape to effectively challenge capital in the new system of global factories. This is the greatest challenge facing the labour movement in Asia.
Organising and collective bargaining were comparatively simple when the industries were largely local, and value chains were concentrated under the same roof or at least in the same country, producing largely for the home markets, and the self-employed sectors belonged to the subsistence economies. With the emergence of the new international division of labour taking shape in global value chains, large scale informalisation of the workforce and the integration of informal sectors in industrial value chains, together with the institutionalisation of international capital mobility and the emergence of other related politico-economic dynamics, the organising and collective bargaining became more difficult and complex.
In these new situations, from day one, the labour movements have an inbuilt international dimension, such that whether they know it or not, they affect and are affected by interlinked value chains in their industries which are spread across the continent or around the globe. Moreover, it is impossible to clearly understand the root causes of the major problems that workers are facing without understanding the dynamics of global value chains, and it is almost impossible to build effective strategies of organising and collective bargaining without situating these in the value chain dynamics.
Based on this realisation, this book is written as educational material for labour activists striving tirelessly and with great sacrifice to strengthen the labour movement in Asia.
The second chapter of the book focuses on a conceptual understanding of capital accumulation, financialisation, capital mobility and the global value chains. It attempts to explain the nature of the crisis that global capital faced in the 1970s, and how the new global politico-economic regime was imposed in order to resolve the crisis, and how in turn these developments created a crisis for global labour. It briefly explains the process in which international capital mobility was institutionalised, how the international division of labour was imposed, and how it took the shape of global value chains and the implications of these value chains.
The third chapter provides a brief analysis of the integration of Asia in the global value chains, the emergence of interlinked regional value chain networks and the rise of China as a regional production hub. It attempts to explain the processes in which more and more labour intensive operations were shifted from developed to developing Asian countries. The analysis focuses on three major industries, automobile, electronics and apparel. It attempts to explain how newly industrialized countries were able to move up the value chains and how most of the developing countries are typically positioned at low value-added and highly labour intensive positions in these value chains.
The fourth chapter analyses the impact of international capital mobility and global value chains on workers. It attempts to explain how the global value chains lock most of the industries of developing countries at low value adding positions and their labour at low wage conditions, with little, if any, scope for upward mobility. It analyses how upward mobility in the value chains emerge as a strong tendency in some countries. However, what occurs is not the whole economy moving up the value chain, but only few enterprises. It also provides an analysis of the nature of development with export-led growth models.
The developing economies are largely transformed from agrarian to industrial-urban economies in terms of composition of GDP, but without any simultaneous transformation of the workforce structure. The impact of these dynamics of development combined with largescale dispossessions has led to the emergence of a huge army of reserve labour that is surviving either in various precarious informal sectors or as floating labour. A brief analysis is attempted to explain how the cumulative impact of all these developments results in a drastic decline in the collective bargaining power of labour. Employing the analysis provided in the previous chapters, the fifth chapter attempts to categorise Asian countries into four major groups on the basis of their position in the value chains and on the basis of specific industrial relations regimes and socio-political dynamics. These are South Asian underdeveloped countries, Southeast Asian underdeveloped countries, erstwhile socialist countries, and comparatively developed countries. It attempts a brief analysis of the politico-economic background of the industrial relations regimes in the various regions and provides a picture of the labour movements emerging in these regions. It highlights the issues of focus of the labour movements in all four groups and highlights the major hot spots of the labour movements.
The sixth chapter sums up the major aspects of capital mobility, the new international division of labour and global value chains, and the major areas of concern for labour, based on analysis provided in the book. It attempts to articulate the major focus areas and issues as a way forward for the Asian labour movement.