Review of Pacific Plan Essential for an Effective Pacific Islands Forum

Between 31 July and 3 August, the Pacific Islands Forum Secretariat meetings in Fiji set a tone for the forthcoming leaders’ meetings in the Cook Islands at the end of August.  Much of the media focus surrounding the Pacific has centered on the US involvement in the dialogue as part of its rebalancing, and to a lesser extent, Australia and New Zealand’s changing relations with Fiji.  As the Secretariat meetings have indicated, however, reforming the Pacific Plan to reflect the contemporary political, economic and security conditions in the Pacific will be critical for this year.  Issues of labor mobility and trade integration within the Pacific Islands region will be critical to the continued development and success of the Pacific Plan and the Pacific as a whole. 

A product of the 2004 Auckland Declaration, the Pacific Plan is a ‘living document’ that enables initiatives to adapt with the framework. The Pacific Plan has four pillars aimed at enhancing economic growth, sustainable development, good governance and security of the Pacific through regionalism.  Securing actions at the national level has been a paramount concern given the diversity of states and disparity in wealth.

One goal in reviewing the current Pacific Plan should be to improve labor mobility in the region. This goal is steadily gaining traction, but policymakers need to take care to avoid some of the negative aspects of temporary migration and to provide more sustainability.  The Australian Pacific Seasonal Work Pilot Scheme and New Zealand Recognised Seasonal Employer Scheme have been workable models to increase remittances among the island states.  In fact, there are recruiting firms throughout the Pacific that promote workers for both New Zealand and Australian schemes (see, for example, http://www.workreadyvanuatu.com).    

However, the seasonal worker schemes create multiple dependencies on unskilled labor.  Horticulture, viticulture and other industries that have seasonal labor needs are more inclined to take on labor with less ability to make demands for rights and benefits; furthermore, migrant labor provides a pool of labor potentially unavailable or unwilling to do the grunt work required in those industries.  Migrants, on the other hand, become dependent on impermanent, unskilled and unpredictable work.  While remittances are highly valued as essential Pacific economies, the type of work created for seasonal workers is currently not the most sustainable either in terms of returning home as a skilled migrant or with a secure income.   

Such an exchange of labor could be expanded to all Forum Island Countries (FICs) in a way that encourages training and the exchange of skills. (See, for example, doctor exchanges between Venezuela and Cuba as a progressive idea; it hasn’t worked well in practice however due to strong ideological fervor among both states).  For a more skilled and sustainable Pacific economy, training is needed outside of the temporary program, and protections are needed against exploitation.  Migrants and temporary workers are typically the most disadvantaged in in terms of labor rights and the Pacific has the potential to produce a more equitable regional model.

Like the issue of labor mobility, creating a common market and pursuing free trade in the Pacific are goals that require careful attention.  Both Australian and New Zealand foreign ministries have explicitly stated that their approach to the Pacific Agreement on Closer Economic Relations (PACER) Plus negotiations differs from their traditional approach to free trade agreements; rather than focusing solely on their states’ commercial interests, Australia and New Zealand aim to promote the development and capacity of FICs.  The two regional powers additionally must maintain competitiveness with potential trade agreements that FICs make with the European Union. 

With ever-increasing collusion among trade, development and foreign policies, taking steps toward free trade agreements is a precondition for aid and greater access to NZ and Australian markets.  The goal of PACER Plus is to start with free trade within the FICs to demonstrate their abilities to cope with such policies.  One problem encountered by the region is that the principles of free trade clash with certain traditional Pacific principles (e.g. property rights).  Regionally, community development solutions such as bulk purchasing invite avenues for creativity and take into consideration the nature and interests of Pacific Island states.

Globalization and the changing international political landscape are creating an increasingly competitive environment in the Pacific.  As the region draws greater attention from China and the US for its geostrategic position and natural resources, the Pacific Islands Forum and its member states should secure a more formidable voice, particularly on issues that impact the region.  An effective review and renewal of the Pacific Plan then must include two of the most noteworthy subjects for development, improved labor mobility and closer economic relations.

Business and Labor Mobility in the Asia-Pacific

On November 12, 2011, US President Barack Obama signed a bill into law which enables US citizens to join the APEC Business Travel Card (ABTC) scheme. The US already provides a ‘fast lane’ for entry for ABTC members, and the timing of America’s entry into the system is fitting given progress toward the Trans-Pacific Partnership and the recent and upcoming multilateral meetings in the Asia-Pacific. This weekend, other complementary initiatives are being launched as part of the APEC Travel Facilitation Initiative. But what is behind these initiatives, and who will they benefit? Are they stepping stones toward greater regional integration or another advantage for businesses?

According to the Business Mobility Group, the ABTC was originally developed “in response to the need for business people to gain streamlined entry to the economies of the Asia-Pacific region,” and “enables business people to explore new business opportunities, attend meetings and conduct trade and investment activities”. The main benefits are:

• “Fast-track entry and exit through special APEC lanes at major airports, and multiple short term entries to these economies for a minimum of 59 days stay each visit (click for details).

• No need to individually apply for visas or entry permits each time you travel to any of the participating APEC economies as the card is your visa.”

After trials in the late 1990s, countries have continued to sign onto the scheme, and the group now includes the following: Australia, Brunei Darussalam, Canada (Transitional Member), Chile, China, Hong Kong (China), Indonesia, Japan, Korea, Malaysia, Mexico, New Zealand, PNG, Peru, the Philippines, Russia (Transitional Member) Singapore, Chinese Taipei, Thailand, the United States and Vietnam.

A study by the Policy Support Unit (“an independent research unit at APEC”) found that those who participated in the scheme cut down on their transaction costs and saved time and money in their visa process. The target audience of the Mobility Initiative is explicit in its title: business. By saving time and money during repeated business travel to and within the Asia-Pacific, participants may be encouraged to travel even more frequently and create more business opportunities in the region with greater ease.

However, there has been no significant effort for greater mobility of permanent workers. There are several successful guest worker programs in the Asia-Pacific (primarily in Australia and New Zealand with Pacific Island nations), but each state maintains their own labor and immigration standards which conflict with the idea of a more mobile Asia-Pacific workforce. Oceania has the highest share of migrants than any other region, with 15 percent of residents in 2005 followed by North American with 13 percent. More specifically, 24 percent of residents in Micronesia were migrants in 2005, followed by 20 percent of residents in Australia and New Zealand.*

Despite movements toward closer economic relations through the Trans-Pacific Partnership, bilateral trade deals, and easier travel and access for business people around the Asia-Pacific, migration policies are yet to be coordinated in a way mirroring the Schengen Zone in Europe. Rather, countries prefer to create a global supply chain that links labor within their own countries, enabling them to better control the workforce and allowing the more powerful economies to dictate what industries are affected by ‘free trade’. In 2007 ASEAN states signed the Declaration on the Protection and Promotion of the Rights of Migrant Workers, but the agreement is not legally binding.

The UN Human Development Research Paper “Migration in the Asia-Pacific Region: Trends, Factors, Impacts”, by Phillip Martin, contains key points about migration in the region:

• “Most Asian nations receiving migrants have policies that aim to prevent migrants from settling, most do not consider migration essential for economic growth, and most do not want immigrants to change their culture and identity.

• Migration policies in the major Asian receiving countries can be framed by a triangle, with countries such as Singapore welcoming foreign professionals to settle and rotating less-skilled foreign workers in and out of the country, Japan allowing the employment of foreign professionals but remaining largely closed to less-skilled foreign workers, and the Gulf countries dependent on migrants to fill most private sector jobs.

• With migration restricted and considered temporary, there are few institutions developing data and long-term migration options or promoting regional dialogues to improve migration management.” (15)

The report points to factors motivating out-migration as well as the migration policies of the major labor-sending countries of the Asia-Pacific region:

• “Many Asian nations want to send more workers abroad to reduce joblessness, generate remittances, and accelerate development. Many governments have created agencies to―market their workers to foreign employers.

• Migrant-sending governments are also concerned about the rights of migrants, and many have agencies to regulate recruiters, prepare workers for overseas jobs, and look after migrants while they are abroad.

• Most governments measure the benefits of migration by the number of migrants going abroad and the amount of remittances received. These measures may not reflect progress in human or economic development that will make migration unnecessary in the future.” (34)

“Most international labor migration in Asia involves workers moving from one Asian nation to another for temporary employment” and “a culture of migration reportedly prompts many children to plan to follow their parents abroad to work”.* Moreover, remittances are an essential part of some states’ economies and provide uneven social and economic benefits. In the same way that business travel has been critical to creating avenues for state relationships and closer economic ties, real labor mobility will become critical to citizens’ ability to be lifted out of poverty, to experience unique opportunities or to create a new life for their families.

If businesses can readily have access to new markets and laborers, there should be reciprocal opportunities for laborers at different levels to have less constrained access to new employers and industries. International labor migration has accumulated a lot of baggage over the years despite its typically short-term or short-distance travel (primarily due to guest worker programs). A new generation of workers believes they are entitled to greater mobility given the ability of multinational corporations to create a base for influencing the economic and political structure of their countries. The APEC Business Travel Card scheme and others incorporated into the Business Mobility Initiatives demonstrate forward-thinking programs that move in the right direction; however for real progress to be made corresponding steps should be taken to make mobility more equitable.