[stop-imf] ICFTU: World Bank and IMF must change labour policies to achieve poverty reduction

[robert weissman]

October 1, 2004

INTERNATIONAL CONFEDERATION OF FREE TRADE UNIONS

ICFTU OnLine...
153/011004

World Bank and IMF must change labour policies to achieve poverty
reduction


Brussels, 1 October 2004, (ICFTU Online): Unless the IFIs (World Bank
and International Monetary Fund) reposition themselves to work more in
concert with other international organisations - particularly the
International Labour Organisation and other UN bodies - and drop their
unswerving support for market liberalisation and labour market
flexibility, current attempts to fulfil the Millennium Development Goals
will fail, said the international trade union movement.

Speaking ahead of the International Monetary Fund (IMF) and World Bank's
annual meetings (2nd - 3rd October in Washington), the International
Confederation of Free Trade Unions (ICFTU) appealed to the financial
institutions to properly incorporate labour and employment issues into
their work, for example into Poverty Reduction Strategy Papers.  All too
often, the World Bank and IMF's policy advice and loan conditions
actually serve to counteract the trade union movement's contribution to
the Millennium Development Goals.

The international labour movement is committed to playing its part in
ensuring that the Millennium Development Goals are reached by 2015. At
the heart of this is the goal to eradicate extreme poverty. This aim
will remain nothing more than utopian if living wages cannot be attained
- and clearly trade unions are the best placed to ensure that this
objective becomes a reality.

"The imposition of unrestrained free market policies is not the avenue
to reducing poverty. Even rapid growth - where it can be attained - will
not make the difference that the world wants to see: an end to extreme
poverty. Growth alone does not ensure that every citizen survives on a
living wage or even survives at all. One only has to look at the
experience of Argentina over the past 15 years and the recent slowdown
of poverty reduction in China as examples of this," said the ICFTU.

The ICFTU is also urging the IFIs to reconsider their onslaught on
privatise public services as a conditionality of their loans, which
often ends with greater cost and less access to fundamental services
like water for low- income households.

The World Bank's own papers state "the recent slowing of poverty
reduction and increasing inequality show that growth - even rapid growth
is not enough". The report of the World Commission on the Social
Dimension of Globalisation underlines the fact that if insufficient
attention is paid to the level of employment, wages and social
protection, the goal of halving poverty rates will not be achieved.

In contrast, the IMF and World Bank are frequently in favour of a one-
sided approach of labour law reforms which have the overriding intention
of promoting labour market flexibility - often through the approach of
easing dismissal rules and dramatically dismantling worker protection.
A more balanced approach such as that followed by the International
Labour Organisation is a more viable long-term approach with the
potential to enfranchise the many rather than the few.  The IFIs must
also ensure that all of their operations and policy advice are
consistent with the core labour standards.

The international trade union movement therefore is appealing to the
IFIs to withdraw from the simplistic view that labour regulation is bad
for business and will therefore have a negative effect on development.
"The World Bank and IMF would be wiser to listen to the calls for full
debt cancellation for those low- income indebted countries which respect
human rights if they wish to see true poverty reduction" said the
world's largest trade union organisation.

The ICFTU will drive home its arguments for the IFIs to properly
incorporate labour and employment issues into their work during a series
of meetings from 6th- 8th October when a high- level trade union
delegation, comprising some 80 participants and led by ICFTU General
Secretary Guy Ryder, will hold discussions in Washington with World Bank
President James Wolfensohn and IMF Managing Director Rodrigo de Rato.


The ICFTU represents 148 million workers in 234 affiliated organisations
in 152 countries and territories. ICFTU is also a member of Global
Unions: http://www.global-unions.org

For more information, please contact the ICFTU Press Department on +32 2
224 0232 or +32 476 621 018.