South Asian Forum of Employers || SAFE :: Summary & Draft Report of last meeting at Colombo, Sri Lanka, 2nd & 3rd October 2012
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 Subject :Report part 05 - National Development Plans in each of the countries t.. 09-01-2013 02:05:34 
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Subject :Report part 05 - National Development Plans in each of the countries to strengthen growth

Pakistan – Mr. Haji Muhammad Javed, President, Employers’ Federation of Pakistan

Mr. Javed stated that Pakistan is working through the major disadvantages threatening the private sector, however, notwithstanding the presence of such obstacles the productivity growth rate is very gradually increasing up to 3.7%. A National development plan is in place (2012-2013) targeting a growth rate of 4.3%.

Strategies to achieve objective :

  • Supporting higher education – The Government of Pakistan established a number of higher education institutions to facilitate this – 3 major universities have been established.
  • Provision of training and skills to the labour force – vocational, technical training is currently being provided.
  • Support is being extended to the agricultural and manufacturing sectors.
  • Promote the market by the elimination of stringent tariff and non tariff barriers which are in place.
  • Promotion of information technology – a software park in Lahore has been set up and an IT tower project is underway in Karachi.
  • Power and water sector reforms and to support an efficient transport system.
  • Power and water sector reforms and to support an efficient transport system.
  • Reconstruction and rehabilitation owing to floods and earthquakes.
  • Balancing out with climate change.

It was also stated that there are continuous negotiations and discussions by the EFP with the Government, to facilitate the above.

Afghanistan – Mr. Mohammad Qurban Haqj, CEO, Afghanistan Chamber of Commerce and Industries

First and foremost Mr. Haqji stated to the participants that the situation in Afghanistan was not as bad as the image projected by the media. There have been many positive changes in recent times, especially  the economic development brought about largely by private sector initiatives. There are more than 18 million subscribers to the IT and telecom industries and there are more than 50 private television channels, marking the development in mass media. The service industries are also growing rapidly. The new Constitution has also had a  positive impact on the economy.

The Chamber of Commerce in Afghanistan, established in 1931, was the leading business organization in the country. It was a Government entity until the year 2008, dealing predominantly with bureaucratic issues, and was therefore not adept in providing services to private sector employers. The establishment of the ACCI resolved this problem to a large extent. The ACCI is a non-governmental organization with more than 62,000 members. In addition to providing services to its members and lobbying on their behalf, the ACCI assists the Government in its attempts to transform the economy into a market driven one.


Membership Involvement

Building stratergic partnerships – good relations with other associations and development partners in order to initiate joint advocacy activities.

Domestic partners – Sectoral associations, unions and other private sector organizations.

Foreign partners – International chambers, regional and joint chambers

Public – private dialogs

Regular meetings with the President and the cabinet; the ACCI is in National committees and they not only study relevant policies but also put forward suggestions

ACCI’s approach to advocacy is proactive, reactive and demand driven. The National Business Agenda serves as a starting point for ACCI’s future advocacy activities. As per a survey conducted by the ACCI, the most desired services among members are advocacy services, advisory services and provision of information and holding exhibitions etc. A concern on Afghanistan’s part was that they face numerous problems when working with the Government; That when certain pertinent problems and issues are raised by the ACCI in a forum, the intentions and the tactics in handling them do tend to become political, and hence, what is the best

possible method to handle this. – in reply to this it was agreed that effective lobbying will curb this issue, and training in this area should be carried out.

A question was raised by the participants as to the nature of the 62,000 members of the ACCI; Mr. Haqjo responded that many of them were small businesses, and the membership also included large importing/exporting companies as well as investment companies. He further stated that the major sectors in the economy were mining companies and that the main sector in terms of job opportunities was the telecom sector.

India – Mr. Vijay Narayanrao Deshpande, Vice President, Employers’ Federation of India

In India, diversity is most prominent. Although this is a great asset, the same also acts as a drawback. India is projected to be one of the fastest growing economies in the region. In 2011/2012 GDP growth was 6.9%, and this is expected to increase further in 2012/2013. Yet, with regard to economic issues, India still faces some major challenges. However, it transpires that the FDI has curbed this to a minimal extent, and 51% FDI in multi-brand retail trading has been announced. The FDI will benefit the farmers and other rural producers and also make room for job creation – thereby assisting to cure the rapid-growing problem of youth unemployment.

Findings of the economic survey 2012 –

  • The agricultural and service sectors continue to perform well and there has been a 2.5% growth forecast for the agriculture sector.
  • There has been an industrial growth of 4-5%
  • Exports grown to 40.5% and imports by 30.4% in the 1st half of the year.
  • In a population of 1210 million people in India, the percentage of those within the work age of 15 – 64 years is 64.3%, up to 15 years is 30.8% and 65 and above is 4.9%.

It was also stated that the growth of economy is mainly by way of infrastructural growth, much of it by way of the public-private partnerships in place. Mr. Deshpande also stressed that India provides huge market for skilled workmen, technicians, engineers, scientists, finance wizards and competent managers.

India (continued) – Mr. Vistap Farrokh Banaji, Executive Member of the Employers Federation of India

Mr. Banaji spoke much about the problems and drawbacks in India. He stated that there was no assured process for managing closures, right sizing, layoffs or even changes in work practices. He also spoke of the ‘missed opportunity’ in that India’s reforms have not significantly touched labour, and as a result of this some employers have been compelled to manage the ‘unreformed’ system.

It was also stated that some large cities in India have seen an outward migration of manufacturing, and ‘services’ rather than ‘manufacturing’ has become the hope for the future. He also stated that there was an increased reliance on the contractor as this was means of extracting cost advantage as well as flexibility. In turn, this placed the permanent employees in the hot-seat. It is noteworthy that the public sector is the largest employer of contract workers.

It was further stressed that it is important for the government, the employers, union leaders and ER managers to work together and ensure flexibility, opportunities and capabilities in labour relations.

It was also said that labour reform must be on the advocacy agenda, as this has been a problem in the recent past and especially at a time where it is extremely important to regain trust and employee relations capabilities. Union leaders must judiciously support labour reforms which will raise employment and productivity. Having said this, it must be appreciated that there is a slight refocus on labour standards. The employers have been proactive in certain instances, pushing the government with regard to issues concerning them.

As seen above, contract labour is a current critical issue in the labour domain. Along with this the next biggest issue is that of ‘termination’. However, these are not addressed as much as they need to be by the government as they are not being brought to their notice as being priorities. This is where the Employers Organizations and Unions can act along to bring about a solution

Mr. Ravi Pieris, Director General EFC outlining the position in Sri Lanka stated that hiring labour through a contractor is not illegal, it is expressly provided for in the law of the land. It becomes objectionable  when various questionable work arrangements are resorted to -“disguised employment” to deny employment in actual employment situations. The Commissioner of Labour is empowered to look into such situations and order that they cease. Thus the remedy is not to abolish the relevant laws, but to strengthen them to prevent abuse.

Bangladesh – Mr. Kamran Tanvirur Rahman, Member of the Committee, Bangladesh Employers’ Federation

Mr. Rahman shared with the gathering that total GDP was 110-115 billion dollars and that Bangladesh was ranked between 30-35 among all countries in the world. H e went on to say the global financial crisis has lead to a global employment crisis as well, particularly for countries such as Bangladesh.

In Bangladesh it is estimated that approximately 1.8 million people are entering the labour force each year and this poses an enormous biggest challenge – in terms of generating employment - to the country. Underlying issues are the skills mismatch in the labour market and the lack of training in this regard. As a result the youth unemployment rate is rapidly increasing. This problem has to be cured by providing training and through skills development, as Bangladesh is projected in positive manner by many, for example it has been described as ‘one of the potential growth economies’ by Pricewaterhouse Cooper. Currently the GDP growth is 7-7.2% and projected to reach 8% by 2016.

It was also stated that Bangladesh’s private sector is an overwhelming driver of growth and that strong external trade growth reflects the vibrancy of the economy. Bangladesh has a rather small export basket comprising mainly of apparel, frozen food and leather goods. Low labour costs give the country its  competitive edge, even after the recent wage hike. In the post-crisis surge, exports to new markets and exports of newer items such as marine items and IT related items are gaining momentum. The foreign exchange reserves are said to be rising and exports are also projected to increase further.

It is also noteworthy that Bangladesh is among the top 10 performers in achieving gender equality and also there has been a reduction in child labour in recent times, and the latter has been recognized by the United Nations.

Mr. Kamran Rahman also observed that no prior permission is required for foreign investment in the industrial sector in Bangladesh, and that investment proposals only need to be registered with the BOI. Furthermore, capital gains are free of income tax, an added incentive to potential investors. However, he noted that infrastructure growth is currently a bottleneck.

Speaking on the Bangladesh economy and trade policy, the vision for 2012 is as follows:

  • Attain the middle income country status
  • Attain and sustain 10% inclusive economic growth
  • Unleash creative talents of the broad population
  • To gear up digitally

Bangladesh (continued)  – Mr. Fazlul  Hoque, President Bangladesh Employers Federation

Speaking on the lobbying and advocacy agenda in Bangladesh, Mr. Hoque stated that the need for a separate Employers Organization - as a distinct entity, and not part of a Chamber of Commerce (unlike in Afghanistan). It is absolutely essential as Employers Organizations can exert influence to make the overall business environment friendly and flexible.

The Bangladesh Employers Federation has played an active role in formulation and advocacy of labour related major policies such as:

  • National Women’s Development Policy 2008
  • National Skills Development Policy 2012-2015
  • National Child Policy 2010
  • Review of Bangladesh Labour Act 2006
  • National Occupational Safety and Health Policy 2012
  • Policy on Domestic Workers
  • Elimination of Child Labour in the formal sector

Recent achievements of the Bangladesh Employers’ Federation were also discussed. They are as follows:

  • Recently published a bilingual handbook on Occupational Safety and Health
  • Prepared draft guidelines for employers to promote gender equality in organizations
  • Ratified 33 ILO conventions including 7 out of 8 core conventions
  • Trained over 800 representatives of employers on HIV/Aids issues at the workplace during 2009-2011

Ongoing activities include:

  • BEF is the ILO country partner for the ‘Decent work’ campaign
  • Introduced ILO’s ‘Green Jobs’ initiative
  • Promoting CSR and is about to sign a MOU with a CSR organization in the capacity of strategic partner.
  • Negotiated with GIZ to receive necessary technical support to promote Bangladesh’s image in Europe – this was appreciated by the participants as a step by the BEF engaging in brand building of the country.
  • Initiated ILO’s ‘Better Work Programmes in Bangladesh

Future agenda includes the following:

  • Seek support from development partners to undertake promotional activities etc
  • Strengthen internal capacity
  • Greater involvement in influencing the government on policy issues

It was reiterated that BEF would like to use this forum to learn from the best practices of other EOs in the sub region, and to adopt such practices to fill the voids wherever necessary.

Nepal – Mr. Manish Kumar Agrawal, Executive Committee member/Vice Chairman, FNCCI

Mr. Agrawal commenced by stating that the economic growth rate in the past 5-6 years has decreased and this situation will worsen if the political situation does not improve. Hence the major constraints to economic growth in Nepal are as follows:

  • Political instability and poor governance
  • Frequent changes in policies and laws as a result of the above
  • The energy crisis
  • Inadequate and weak infrastructure
  • Poor industrial relations

It was further stated that the current political situation has a negative impact on the country’s economy and as a result of this there prevails an unhealthy competition among politically driven trade unions resulting in frequent industrial unrest. It was also noted that every year approximately 400,000 people are entering the labour market and a large percentage are youth. Lack of skills results in the rapid increase in youth unemployment. Despite these realities on ground, the following policies are in place in Nepal:

  • Industrial Policy
  • Youth employment Policy
  • Industrial enterprise Act
  • FDI Policy and Act

The FNCCI is the most representative Trade/Employer Organization in Nepal, with a strong membership base. It has a professionally managed Secretariat, and is experienced in representing business at all levels with various stakeholders. It participates regularly in policy debates at national level, and has maintained a continuing dialog with its social partners. The challenges faced by the FNCCI at present include

  • Prioritization of policies
  • Influencing and effective lobbying
  • More vigorous information sharing and corporation with other  organizations
  • Experience sharing on regional and global practices

Sri Lanka – Mr. Ravi Peiris, Director General, Employers Federation of Ceylon

Commencing his intervention with a brief description of the economy of the country, Mr. Peiris stated that in a labour force of 8,236,000 (2011) 7, 894,000 persons were in employment, while 342,000 persons were unemployed. Statistics of 2011 show that 48.8 % of the labour force is generally male. When looking at the unemployed, most persons fall under the age category of 15-64, males making up 11.6% and females make up 27.1% of a total of 17% (2011 Q3).

Of the total employed population, it is estimated that 42.8% belong to the service sector, 33% to the agriculture sector and 24.1% belong to the industry sector.

The Services sector composition is as follows:

  • Transport and Communication 24%
  • Import and Export trade 21%
  • Domestic trade 19%
  • Banking and Finance 15%
  • Government services 12%
  • Private services 4%
  • Ownership of dwellings 4%
  • Hotels and Restaurants 1%

Key Policies in place are as follows:

  • The Government’s development policy called ‘Mahinda Chinthana’ seeking to establish Sri Lanka as one of Asia’s foremost commercial centers in the field of commercial services, international banking and international investment.
  • The government strategy with regard to the Industry sector is that by 2020 the sector would be a high value added, knowledge based, international competitive and diversified sector comprising of a well skilled workforce.
  • Environmental aspects are also being looked into and great importance is placed on environmental sustainability and green technology in industrial activities.
  • The socio economic development strategy for the next decade based on the above mentioned ‘Mahinda Chinthana’ is set out in the 2010 Presidential Manifesto.

Some of the existing challenges in terms of growth and development  include Stabilization of the macro economy to support the growth process, creating more and better employment to spur inclusive growth (Female participation on the labour force is 32%, and this is a low ratio) and to accelerate reconciliation and rehabilitation in the North/ East.

Chapter  11 of the policy document of the government is on labour policy and contains the following policy derivatives:

  • Employment generation
  • Flexible labour laws
  • Strengthen employer-employee relations
  • Enhancing skills and productivity

The EFC places great importance in the concept of decent work and believes that such will pave way for and promote,

  • Employment generation
  • Equal opportunities in employment
  • Enhancing efficiency and productivity, both within the organization and within the membership

Elaborating on each of the above :

  • Employment generation – The EFC published a monograph ‘Operationalizing decent work: employers perspective’, and a publication entitled ‘Guide to Investors on Industrial Relations Practices and Labour Laws in Sri Lanka’, and also conducted a survey among the membership to ascertain skills and competencies that employers require in working at an entry level in the private sector.
  • Promoting equal opportunities in employment –
    • Conducted a training for undergraduates (in partnership with Unilever) on soft skills
    • EFC’s Employers network on disability – Training programme for visually handicapped was conducted in the North in 2011
    • Conducted a survey among members to obtain information on workplace policy and procedures aimed at gender equality and also identifying good workplace practices
    • Programmes on addressing gender based violence
  • Enhancing efficiency and productivity, both within the organization and within the membership includes capacity building of the EFC and the Green Jobs project

Day 2:

Roy John Chacko – ILO ACT / EPM (Geneva) addressing the forum at the commencement of the second day of the Workshop, stated that the objective of ACT/ EMP is to be the best source of knowledge of business associations. A survey was conducted by ACT/ EMP among employer organizations across the world and the following questions, among others, were put forward to the employers organizations:

  • What is the current value proposition of national employers organizations?
  • How are these organizations re3sponding/ not responding to a changing business environment?
  • What kinds of organizations do business need?
  • What needs to be changed in terms of visions and approach?

The employers organizations in general responded that the current value proposition was strong and improving. The demand for industrial relations and labor law remains important, especially for small and medium enterprises, while the large enterprises value lobbying and advocacy.

In consultation with the IOC, ACT/EMP addressed the following issues, namely external context, innovation, changing member needs, representational services.

The following issues also transpired during the survey.

  • What do members want?
    • Business associations should address issues that enterprises cannot solve by themselves.
    • Know your customers
    • Different companies need different things
    • Showing leadership on the larger issues can help win the confidence of businesses
    • Sell success
    • It is important to get the larger enterprises on board
    • The importance of industrial relations is diminishing and employers organizations will need to broaden their mandate.
    • There is a need for a comprehensive international voice for business
  • Influencing policies
    • The current global economic situation has expanded opportunities for business associations to form an agenda
    • Associations needs to be visible
    • Credibility requires evidence
    • Definite trend towards globalization
  • Innovating
    • Constant innovation drives value for membership
    • The capacity of business associations to adopt and innovate depends on internal and external factors
    • Innovation gives rise to new ways to increase revenue
    • Benefits to expanding mandates and consolidating representation

Mr. Chacko stated that some of the major knowledge gap of the survey was that most studies had focused on OECD countries and the need is for other parts of the world to be covered and also that there is a need for innovation to cover the weaker data in future research.


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