BWI delegation finds World Bank unclear on labour rights

A delegation of representatives from BWI affiliates attended the 2018 World Bank-IMF Annual Meetings that took place in Nusa Dua, Indonesia, from 12-14 October.

While the 2019 World Development Report – which recommends labour market deregulation as the appropriate method for adapting to the digital economy – has angered trade unions throughout the world, the implementation of new rules to protect workers in all World Bank-funded projects demonstrate that the Bank’s position on labour rights are completely unclear.

“The World Bank is one of the world’s largest international financial institutions, and we have long pushed them to adopt and implement rules on worker and trade union rights”, said BWI General Secretary Ambet Yuson.

He continued, “Broad entrenchment of these norms will help the World Bank live up to its anti-poverty rhetoric and strengthen workers’ bargaining power throughout the globe.”

BWI Asia Pacific Regional Representative noted further, “We applaud the steps taken by the Bank to develop these badly-needed rules, and we look forward to testing the mechanisms on Bank-funded projects in the near future. At the same time, we remain skeptical, having recently received a report from an independent World Bank investigation noting that the Bank’s International Financing Corporation (IFC) violated its obligations at each stage in financing Sabah Forest Industries.”

The meeting provided the BWI the opportunity to present the investigation’s findings in various fora, both inside the World Bank’s Civil Society Policy Forum and at alternative civil society gatherings. At a session organised by BWI alongside PSI, UNI and ITUC, it was argued that while the Bank’s newly implemented “Environmental and Social Safeguard 2” on labour rights would need strong compliance mechanisms at the project level to be effectively safeguard working and living standards for workers on Bank-funded projects.

The session also highlighted how these advances in accountability are at odds with the World Development Report 2019, which gives little support for the ‘decent work’ framework or the rights to freedom of association and collective bargaining. The Bank defended this position by saying that’s its focus was on the most vulnerable individuals in society – mostly informal workers without the protection of collective bargaining. Here it is noted that trade unions represent workers in both the formal and informal sectors, and, has often served as a mechanism to bring workers into the formal sector.

The meeting took place amidst a critical time for Indonesia. While tsunamis and earthquakes have ravaged the islands of Lombok and Sulawesi, the Indonesian Government was busy offering investors a slice of 79 infrastructure projects worth US$42 billion. Days before the meeting begun Indonesian SOEs signed deals worth $13.6 billion for financing planned infrastructure projects. Indonesia also remains in talks with the Bank regarding financing for six transport projects, including three light rail projects (in Surabaya, Medan and Bandung), two airport expansions (Medan and Lombok) and the Kuala Tanjung Seaport in North Sumatra.