Cross-Border Labour Mobility in ASEAN- Patterns, Policies and Challenges

1. Cross-Border Labour Mobility in ASEAN- Patterns, Policies and Challenges Chia Siow Yue Singapore Institute of International Affairs SEASIA 2017, Chulalongkorn University 17 December 2017

2. Outline of Paper 1. Labour Mobility – Political-Security, Economic-Social Sensitivities 2. Labour Mobility – The International Context – GATS, EU, NAFTA 3. Cross-Border Labour Mobility in ASEAN a. ASEAN LabourMobility Patterns b. Factors in Intra-ASEAN Skilled-Labour Mobility 4. National Policies and Regulations toward Labour Mobility 5. Skilled Labour Mobility Provisions in AFAS and AEC a. Labour Mobility Provisions in AFAS b. Labour Mobility Provision in the AEC 6. Conclusion on Labour Mobility in ASEAN

3. Labour Mobility- Political-Security, Economic-Social Sensitivities • Labour mobility has become hot potato ---not only with problems of refugees and human trafficking, but also with political-security, economic-social sensitivities associated with migrant employment • In both Brexit and Trump’s “America First” policy and renegotiation of NAFTA, labour mobility is a key thorny issue. • Political-security sensitivities • Undermining native population and workforce • Terrorist threat • Economic-social sensitivities • Take away jobs from locals and undercut wages • Lead to overcrowding, competing demands for public services, undermine social-cultural-linguistic-religious cohesions • Illegal migrant workers, crime rates and ghettos

4. Relevance of Labour Mobility Provisions in GATS? • GATS Mode 4 on Movement of Natural Persons (MNP) refers to temporary movement, not settlement, of business persons in 4 categories • Business visitors ---those engage in business without seeking employment • Traders and investors ---persons carrying out specific trading and investment activities • Intra-corporate transferees --- employees of MNCs that move their managerial and professional staff across borders • Professionals --- doctors, lawyers, accountants, engineers, and other professions • A market access commitment to allow foreign professionals does not imply that the host country is obliged to accept all foreign professionals, as it also depends on meeting the requirements of the domestic regulatory framework.

5. Relevance of Labour Mobility Provisions in EU? • Every EU national has the right to move, reside and seek employment within any EU state subject to some limitations and conditions of public policy, public security or public health. Free mobility has been expanded to include EEA and EFTA countries. • EU has different labour mobility regimes: • EU15 nationals: Any EU national has the right of residence and employment in another EU country on the same basis as nationals of the host state. • Later acessioncountries’ nationals: transitional restrictions • Schengen countries: Abolished passport and immigration controls at common borders . Some re-imposed border controls following Paris 2015 attacks and 2017 migration crisis • System of qualifications recognition ---automatic and non-automatic

6. Relevance of Labour Mobility Provisions in RTAs such as NAFTA? • Not all RTAs have provisions to facilitate MNP ---often subsumed under Services and/or Investment chapters . Usually resort to GATS-type carve-outs and favouring only mobility of professional and highly skilled workers, and protecting the rights of countries to regulate entry/stay of individuals, • RTAs generally have no provisions on mutual recognition of qualifications.. Recognition typically involves either mutual agreement to accept agreed competent authorities for the mutual determination of standards, or agreements on the mutual recognition of more narrowly specified items. • NAFTA Chp16 on “Temporary Entry for Business Persons” facilitates temporary entry for citizen business persons in the 4 GATS categories. In the current re-negotiation of NAFTA, cross-border labour mobility is a thorny issue.

7. Intra-ASEAN Labour Migration Patterns …1 • Traditionally outward labour migration mostly to OECD and Middle East. • Main global out-migration from populous Philippines and Indonesia. Main global in-migration into Thailand, Malaysia and Singapore • Size of global in-migrant stock relative to total population --- Singapore 45%, Brunei 24%, Malaysia 8% and Thailand 6% in 2015 • Rise in intra-ASEAN labour migration ---stock reached 6.9 million in 2015. • Largest recipients are Thailand, Malaysia and Singapore; largest senders are Myanmar, Indonesia and Malaysia • Most migrants are low-skilled and informal – contract labour, irregulars • Skilled and professionals under GATS Mode 4 • 3 major migration corridors • Thailand corridor for migration from Cambodia, Laos and Myanmar • Singapore corridor for migration from Indonesia and Malaysia • Malaysia corridor for migration from Indonesia, Myanmar, Singapore, and Vietnam

8. Intra-ASEAN Labour Migration Patterns ….2

9. Intra-ASEAN Labour Migration Patterns ….3

10. Intra-ASEAN Labour Migration - Trends and Characteristics ….4

11. Factors in Intra-ASEAN Labour Mobility…1 • Large disparities in wages and in employment opportunities across countries • Geographic proximity and social-cultural-linguistic environment affect direction of inflows and outflows • Disparities in educational development creating skills surpluses and shortages • Policy factors (both inwards and outwards) • restrictive immigration visa requirements • employment passes and work permits • administrative processing costs • educational ,professional qualifications, licensing requirements • health and security clearance • national treatment limitations

12. Factors in Intra-ASEAN Labour Mobility…`2

13. National Policies-Regulations on Foreign Labour…1 • General reluctance to open-up to labour migration • Economic reasons to protect the domestic labour market; • Strategic reasons to preserve national sovereignty and ensure national security • Social reasons to preserve social cohesion and prevent excess demand on social services. • All ASEAN countries adopt policies that are more welcoming towards foreign skilled and professionals and less welcoming towards foreign unskilled/semi-skilled. • Promotion of skills mobility haveseveral benefits • Encourages ASEAN talent to remain in the region and thus help ASEAN achieve global competitiveness. • Enablesemployers ready access to a larger and more diverse regional talent pool. • ASEAN nationals gain access to more career opportunities

14. National Policies-Regulations on Foreign Labour…2 • ASEAN receiving countries • Governments have allowed/facilitated inflows of skilled and professionals to facilitate FDI by permitting entry of foreign business people and professionals to accompany the investments; meet commitments under GATS and FTAs on services liberalization; meet national skills shortages; facilitate national structural/industrial upgrading; and promote health and education services hubs • Most countries manage inflows according to sector-occupation, education- skills, age-gender through visa issuance, work permits and employment passes, foreign worker levies and quotas, labour market tests and restrictions on length of stay. Additional performance requirements include job experience, language proficiency, code of good conduct. • Some countries have constitutional/legal provisions barring foreigners from certain sectors and professions, though there could be waivers under certain conditions.

15. National Policies-Regulations on Foreign Labour…2 • ASEAN sending countries • Policies and regulations range from laissez faire to “concern” to pro-outflow policies. • Policies expressing “concerns” address why citizens wish to migrate, efforts to connect with diaspora and encourage returnees. • Policies to maximise benefits of remittances received; • Policies to encourage returnees and diasporas and help them re-integrate • Policies to lower the administrative costs of seeking foreign employment • Policies to protect the rights and welfare of its overseas workers, particularly the low-skilled

16. Labour Mobility Provisions in AFAS …1 • AFAS conforms to GATS provision on Mode 4, later formalizd in the ASEAN Agreement on the Movement of Natural Persons (MNP). • AFAS also provides for regulatory convergence and regulatory harmonization including MRAs • “ASEAN minus X” mechanism under AFAS

17. Labour Mobility Provisions in AEC…1 • Free movement of “skilled labour” under prevailing regulations of receiving country. No commitment to mobility of unskilled/semi-skilled labour. • ASEAN Agreement on Movement of Natural Persons (MNP) (2012). Facilitate temporary movement of people engaged in trade in goods, services, and investment ---business visitors, intra-corporate transferees, contractual service suppliers and categories specified in the schedules of commitments. Agreement does not apply to persons seeking market access, permanent employment, permanent residence and citizenship. • MRAs on the following professions --- engineering, nursing, architecture, surveying, medical practitioners, dental practitioners, accountancy, tourism professionals. MRAs have made limited progress. • MRAs affect less than 2% of total ASEAN employment. • Work visas, permits and passes are still necessary before commencing employment • National treatment limitations andacceptance by professional associations

18. Labour Mobility Provisions in AEC…2 • ASEAN Qualifications Reference Framework (AQRF) • Complements and supports MRAs by establishing a common reference framework to enable comparisons of national education qualifications • Methods used to link AQRF and NQF varies from country to country • ASEAN University Network (AUN) • Aims to strengthen cooperation among AUN members to increase regional mobility of staff and students

19. Conclusion on Labour Mobility in ASEAN • Need to facilitate mobility of skilled labour and professionals across ASEAN • Need to align regional commitments with national restrictive regulations and practices – reduce the barriers, hassles and costs of foreign employment • Need to keep “talent circulation” within ASEAN to encourage ASEAN community building and encourage returnees • Need to ensure various commitments and arrangements are effectively implemented • Where regional consensus has been difficult, pursue bilateral and unilateral arrangements • Is there a case for “free flow of unskilled/semi-skilled labour” in ASEAN? • Given ASEAN diversity in size and levels, some countries and labour markets might get swamped. Instead of “free movement”, advocate • Reducing the costs of migration borne by individuals • Ensuring they have opportunities for skills acquisition and upgrading • Ensuring their rights and welfare are protected

20. End of Presentation Thank You