I thank the RCEP TNC for providing the opportunity to put forward our concerns. We are deeply concerned over lack of transparency and democratic process in the RCEP negotiations. Secrecy maintained by the governments impedes nuanced debate on the issue. The benefit of RCEP should be measured based on employment and developmental outcomes.
Through leaked texts we understand that we understand that countries are proposing to eliminate tariffs on 92% of goods and reduce tariffs to 5% in five percent of goods. Some countries also demanding elimination of export taxes, which are used by developing countries to discourage export of raw materials, to protect employment and enable domestic value addition.
Elimination of such policy tools effectively leaves no room for the government to protect small and medium enterprises and emerging domestic industries particularly in areas like manufacturing information technology and environmental goods.
The experience of Information Technology Agreement (ITA) under WTO which was signed in 1996, led many developing countries including India to lose their manufacturing capacity of IT and telecom products. It almost wiped out its hardware industry. Lessons from ITA experiences shows that tariff elimination have deep impact on workers rights and employment generation potential.
In case of India every year 10 million workers enter the labour market, but in the year 2016, India generated only 236 thousands jobs only. The proposed tariff reductions do not offer solutions to such employment crisis being faced by developing countries. The impact of employment has not taken into account in RCEP. The pressure on global labour market through increased competition will lead to further restructuring, outsourcing and subcontracting. It will severely limit job security, worsen conditions of employment and achieving living wage.
Further in the investment chapter some countries are proposing to ban performance requirement on foreign investor. It includes performance conditions like local employment generation, local content requirements and indigenization and technology transfer. Such policy tools enable governments to tailor investments, across the sectors including manufacturing, mining and across the sectors, suitable to the local employment and developmental needs. Elimination of performance requirement will limit policy space.
We are deeply concerned over investor state dispute settlement (ISDS) provisions proposed in RCEP. It undermines national sovereignty, challenges, social and environmental legislations, reverses domestic policies and impose heavy penalties on governments. ISDS shifts the rules of global economic in favour of corporation and against workers.
We call for transparency, genuine democratic and broad based consultation RCEP process.
(Views expressed here not necessarily the official position of IndustriALL global Union. These are also not exhaustive as the speaker was given only 4 minutes time to present the views)