Labour And Social Issues Relating To Export Processing Zones

One of the most remarkable structural changes which took place in the world economy in the 1970s and the first half of the 1980s is undoubtedly the growth of export processing zones (EPZs) in the developing countries and areas: employment in these zones grew from around 50,000 in 1970 to over 1.3 million by 1986. Judging from the current plans for new EPZs in over a dozen countries and the expansion plans for existing zones, it would seem that employment in EPZs could continue to grow rapidly in the next few years. The phenomenon of EPZs and the role of multinational enterprises in them have been the subject of heated debate. This monograph sheds light on the multinationals' contribution to employment generation, export earnings, technology transfer and the development of linkages with the local economy. These are measured against the initial cost of the incentive package for establishing and maintaining the zones. Questions related to working conditions and labour relations are also highlighted. The book confronts a number of widely held assumptions with the available facts and figures, and points to the possible evolution of EPZs in the economies of newly industrializing countries. It envisages the emergence of the "export processing country" and a more open and competitive approach to industrial development.

Export processing zones (EPZs) have become one of the major features of labour markets in South Asia. Foreign investments have become a crucial component in investments within these zones and South Asian governments are increasingly competing with each other in offering generous incentives and privileges to attract investments and entrepreneurs. This paper emphasize that social dialogue will help in promoting not only employment opportunities in the EPZs, but also decent work conditions for all concerned. It also suggest that the foundation for comparative and competitive advantage should be built not on cheap labour but on value addition.

As instruments for encouraging economic development, export processing zones have only limited usefulness. A better policy choice is general liberalization of a country's economy.