Global Policy Forum

One of the most sweeping acts of global liberalisation is about to be unleashed on some of the world's poorest workers, with devastating consequences for the millions, mostly women, who are expected to lose their jobs.

At midnight on 31 December 2004, the World Trade Organisation will scrap the quota system that governs the global clothing and textile trade, ending at a stroke 30 years of protection for one of the developing world's staple industries. From New Year's Day 2005, the Multi Fiber Agreement (MFA) will go and the new rule will then be – survival of the fittest. A recent World Trade Organisation (WTO) study stated that 27 million workers world-wide could lose their jobs.

In a hard hitting new report, Rags to riches to rags, Christian Aid warns that unless urgent action is taken, millions of garment workers will lose their jobs – plunging them yet further into poverty and debt. With few employment alternatives, there are growing fears that the sacked garment workers will end up in far worse jobs, with some ending up in the sex trade. There will also be increasing pressure to lower labour standards for those factories that do survive.

‘The losers in this new trade landscape will be some of the most vulnerable workers in countries such as Bangladesh, Cambodia, Sri Lanka and Nepal. They will be hard-pressed to cope when garment industries there lose their protection,' said Andrew Pendleton, Christian Aid's Head of Trade Policy. ‘We are deeply concerned that the new year will spell misery for huge numbers of garment workers. In Bangladesh alone, it is predicted a million jobs will go. Most of these are women, who have used the work to help haul themselves out of poverty,' he added.

‘The scrapping of the MFA was undertaken without proper weight being given to the impact on those people most likely to be affected. Changes in global trade policies, especially those as seismic as the MFA phase-out, should put the interests of poor people first - rather than simply aiming to liberalise markets at any cost,' said Pendleton. ‘The MFA was by no means perfect, but it did provide the opportunity for countries like Bangladesh to get onto the first rung of industrial development.'

Advocates of scrapping the MFA suggest it will lead to greater efficiencies, lower costs to Western consumers and more jobs in China and India. But the Christian Aid report, that focuses on the plight of Bangladeshi women garment workers, argues that the cost of this liberalisation is too high and must be halted.

‘International trade must not be governed by a ‘race to the bottom' that pitches one set of poor people against another,' said Mr Pendleton. ‘Furthermore, the cost of the expected savings on the price of a shirt or trousers here is likely to be minimal, while the impact in places such as Bangladesh will be huge.' He added that the ending of the MFA is a tragic example of the cost of ‘one size fits all' liberalisation. ‘Remove protection by diktat and the vulnerable get hurt,' he said.

Christian Aid hopes that while Western consumers do their Christmas shopping they will give some thought to the workers from poor countries who made them, said Mr Pendleton. ‘Rich retailers especially have a real obligation to ensure they look after their workforces. They must not succumb to the lure of a quick profit by cutting and running from countries such as Bangladesh.They make large profits from the efforts of these workers, especially at Christmas, and they must live up to their social responsibilities

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