regional and bilateral arrangements for labor mobility: potentials and challenges?

Regional and Bilateral Arrangements for Labor Mobility: Potentials and

Challenges?

Md. Shahidul HaqueIOM Regional Representative for the Middle East

UN ESCWA – ALO Regional Workshop on “Movement of Natural Persons and its Implications on Development in

the Arab States”Cairo, 5 – 6 September 2007

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Introduction

Since the beginning of industrial civilization, people have been moving to provide services or to promote goods/services in foreign markets.

It was managed though consular and/or trade arrangements mainly between two countries/entities.

International labor mobility is a trans-national process and neither destination nor origin countries can address all related issues acting alone.

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Introduction

International labor mobility remains a highly regulated affair between or among states.

Labor mobility can be viewed from two general perspectives: Trade negotiation perspective Labor market perspective

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Migrants worldwide -- all categories

labor migrants

*ILO estimates (Sept 2006)

Temporary labor migrants

Mode 4

Overall Migration and Mode 4

191 million

86 million*

?

?

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Overall Migration and Mode 4

In financial terms:

considerable impact and potential

3% liberalization for labor mobility may lead to global economic welfare gains of US 300

billionsfor both developing and

developed countries

191 million

86 million*

?

?

Mode 4: a very small number of highly-skilled persons

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Political Economy of Labor Mobility

Migrants(rights)

Markets(liberalization/profit)

Destination Countries(sovereignty)

TransitCountries

Origin Countries(benefit)

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Arrangements for Labor Mobility

Existing arrangements on movements for employment overseas are as follows:

•Multilateral: no global arrangement for labor mobility.

•Regional: mainly trade and integration agreements with provisions for labor mobility.

• Bilateral: agreements for labor mobility and/or trade agreements with provisions for labor mobility.

•Unilateral: policies of some countries for labor mobility.

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Multilateral Arrangements

No comprehensive global system or instrument to manage labor mobility.

States jurisdiction to regulate migratory flows.

Differences exist between labor origin and destination countries.

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Regional Arrangements involving Labor Mobility

Regional Trade Agreements (RTAs) mainly aim at decreasing trade barriers between parties (not to manage labor mobility).

It treats mobility mainly in four ways: Comprehensively deals with labor mobility

including permanent and temporary mobility.

Allows free movement of labor (entry to local labor market).

Provides limited movement of labor. Provides limited movement only for service

providers (no labor mobility) - GATS

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Examples of RTAs and Labor Mobility

RTAs providing full mobility of labor: European Union Agreement on the European Economic Area

(ECA) European Free Trade Association (EFTA) Common Market for Eastern and Southern

Africa (COMESA)

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Examples RTAs…..

RTAs providing market access for certain groups: Caribbean Community (CARICOM) North American Free Trade Agreement

(NAFTA) and Canada – Chile Free Trade Agreement.

Group of Three (Colombia, Venezuela and Mexico)

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Examples RTAs….

RTAs using the GATS model with some additional elements:

ASIA Free Trade Area (AITA)

Euro-Mediterranean Association Agreements (Morocco and Tunisia)

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Examples RTAs…

Agreements using the GATS model Southern Common Market Agreement

(MERCOSUR)Agreements providing facilitated entry for

labor (no market access) Asia Pacific Economic Cooperation (APEC)

Forum. South Asian Association for Regional

Cooperation.

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Bilateral Arrangements involving Labor Mobility

BLA is an arrangement (Treaties and MOU) between states, regions and public institutions that provide for the recruitment and employment of foreign short or long term labor (OECD).

Though a common mechanism to regulate inter-state labor mobility and much more widely used than RTAs, most temporary labor mobility takes place outside bilateral state arrangements.

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Bilateral Arrangements

In post WW – II, industrial nations resolved to labor recruitment from abroad to address domestic labor shortage.

By 1900, trading nations or entities concluded bilateral arrangements under “Treaties of Friendship, Commerce and Navigation (FCN)” to provide limited right for establishment/mobility.

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Bilateral Arrangements

By end of 1960s, a number of European countries and the USA entered into bilateral agreements for employing foreign workers (most of these agreements were discontinued or replaced by the 1970’s).

By the early 1990’s: renewed interest in BLAs, faced with labor demand particularly European countries signed agreements with non European countries to facilitate entry of labor.

In Asia, by late 70s bilateral agreements have tended to address the labor mobility issues.

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Objectives of BLAs

Can bring order and predictability in the management of labor markets (recruitment, placement, integration and return).

BLAs address flow of low-skilled labor in particular.

Origin Countries:• increase access to foreign labor market.

• enhance economic development (remittance, transfer of skill/knowledge).

• higher protection for migrants.

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Objectives …

Destination Countries:

• ease labor shortage and forge commercial and economic relations with origin countries.

• assist integration of foreign workers in a host economy and society.

• Reduce irregular migration

• ensure return of migrants after end of the arrangement/labor market demands

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Categories of Bilateral Arrangements

The most common categories of BLA are as follows:

• Seasonal or guest worker agreement.

• Contract/project linked agreement.

• Agreements for trainee or other short-term training programs.

• Working and holiday schemes.

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Examples of BAs including BTAs for Labor Mobility

Canada Seasonal Agricultural Workers Program.

Australia – New Zealand Closer Economic Relations (ANZCERTA).

Japan – Singapore Free Trade Agreement.

US – Jordan Free Trade Agreement.

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Developed along parallel tracks

Governmental policies & practices

for migration

managementMode 4

Migration Management and Mode 4

Two sets of realities

Mode 4: not a migration agreement ; it’s about trade in services

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Developed along parallel tracks

Two sets of realities

; it’s about trade in servicesMode 4: not a migration agreement

Governmental policies & practices

for migration

managementMode 4

Migration Management and Mode 4

Framework governing migration

Relevant regulatory framework:

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Conclusion

Regional and bilateral arrangements concerning labor mobility have evolved rapidly through broadening its scope, implementation process and institutional framework.

Difficult to measure effectiveness of these arrangements as they often pursue several objectives.

Success of these arrangements depend on the “political” will of the states and stakeholders.

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Thank you indeed.