Social protection for the informal sector is a fair trade issue*

Wigberto Tañada, Lead Convenor

We, at the Fair Trade Alliance, are happy to be part of this conference-workshop on social protection for the informal sector. The informals are indeed the most numerous and yet they are the least protected. No minimum wage. No overtime pay. No night differential. No collective bargaining. No health insurance. No pension system. No death and accident benefits. Mahirap mabuhay, mahirap ding mamatay.

According to the ILO, the informals constitute 65 per cent of the work force. If I may borrow from one old folk wisdom, God so loves the informals, He made so many of them.

The army of the informals is large and keeps growing. Every city and town in the Philippines today is teeming with the informals. Inpormal sa kalunsuran, inpormal sa kanayunan. In fact, you easily see them in the proliferation of cardboard villages all over the country.

Why are the informals multiplying? Why is the informal economy large and growing?

The answer is not difficult to find. Because the formal economy is not growing fast enough. Because the creation of good, quality and protected jobs is not moving fast enough. Because the Philippines has failed to industrialize – despite five decades of IMF’s so-called assistance and despite three and a half decades of World Bank’s ‘structural adjustment’ program for the country.

In short, the large and growing informal economy is a giant testimony to the grand failure of the economic technocrats to build a modern and progressive economy based on their narrow concept of development — That growth automatically happens when the market is liberalized and opened up. This is exactly what the government did. In the l980s and l990s, the industrial and agricultural sectors were opened up. In fact, we cut our tariffs way below those of other countries and way below our own commitments to the WTO. And look what happened. Natimbuwang parang mga cardboard boxes ang ating mga pabrika. Maraming na-lay-off. Ang ating agrikultura ay di na umusad. From a net agricultural exporter up to l994, the Philippines, starting in 1995, has become a net agricultural importer. This year we are headed towards the importation of two (2) million tons of rice, the highest in the country’s history. And yet, our agricultural officials are even thinking of setting aside 1.24 million hectares for Chinese investors, to allow them to grow hybrid rice, hybrid corn and hybrid sorghum. For whom? Of course, for the Chinese, not for the hungry Filipinos.

Kaya po mga kaibigan, ang usapin ng informals ay usapin ng ekonomiya. Usapin din ito ng patakaran, mga maling patakaran na hanggang ngayon ay ipinatutupad ng mga baliw na teknokrat. The growth of the informal economy is symptomatic of a larger problem — wrong economic and development policies. When the Philippines joined the WTO in 1995 and AFTA in 1992, the technocrats at NEDA and DTI promised us everything – every sector of the economy will become a winner, new jobs will be created, more investment will flow to the country, exports will rise, revenue will go up, and productivity will increase. But as we already know, all of these did not materialize. Liberalization, mindless and without a readiness program in place, has wrought havoc on the economy and has decimated jobs and farms.

Kaya po kami, tayo, ay nagtayo ng Fair Trade Alliance. Nais nating ipaglaban ang makatuwirang mga patakaran sa kabuhayan. Fair not free trade. Calibrated not mindless liberalization. And calibrated protection where needed.

This is why we support the idea of social protection for the informals. The Constitution is very clear – the State is mandated under Section 3, Article XIII, to provide “full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all”. Di sinabing bigyan lang ng proteksyon ang mga may trabaho sa pormal at organisadong sector. Ang sabi ay proteksyon para sa lahat, organized and unorganized.

But how will the State do that? This is what this Conference-Workshop is all about. I am sure you will be able to come up with a long list of doables. I also understand a Magna Carta for the Informals is going to be discussed.

However, one thing is clear in my mind: as long as our technocrats and our leaders continue to subscribe to a narrow view of development, to a neo-liberal framework of development, there is no way we can reverse the growth of the informal economy and meet the social protection requirements of the informal sector. Panahon na para itumba ang mga maling patakaran sa ekonomiya at ipalit ang mga progresibo at maka-Pilipinong patakaran. Sumuporta po tayo sa mga adhikaing ipinaglalaban ng Fair Trade Alliance.

* Speech delivered at the Conference-Workshop on Social Protection for the Informal Sector: “Advancing Occupational Safety and Health and Other forms of Social Protection for the Informal Sector” organized by the Fair Trade Alliance, along with the Alliance of Construction and Informal Workers of the Philippines, Homenet Southeast Asia, Asia Monitor Resource Center (AMRC), ESCR-Asia, School of Labor and Industrial Relations, University of the Philippines (UP SOLAIR) and LO-FTF of Denmark at the School of Labor and Industrial Relations, University of the Philippines, Diliman, July 13, 2007.

Conference-Workshop on social protection for the informal sector
To download a copy of this speech in .pdf file, click here.


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