The Special Economic Zone Temptation

A couple of months ago, I read Naomi Klein’s ‘No Logo’ a book on the evils of big multi-national corporations and their drive to brand every space while ruthlessly exploiting their consumers and workers, both in the West and the Developing World. The book came out in 1999 so I was about 13 years late and perhaps in view of the last four years of global economic slowdown, the whole discussion on globalisation is more muted than it once was. Not to say that it is no longer topical, the WTO reports, for example, that protectionism is on the rise once again [a topic for another day].Just to be clear, my economic views are more to the right of those expressed by the author in No Logo. Globalisation is a good thing even if Rwanda, like many developing nations, is not yet in a position to take full advantage of it and the shift of manufacturing from the more developed world to countries with cheap labour and plenty of investor incentive is a good thing in the long run providing employment, increased tax revenues, transfer of technology and the creation of an industrial system and infrastructure. You will never find me waving the anti-globalisation flag or denouncing multi-nationals. That is except when it comes to treatment of the labour force in one of the host countries of outsourced industry. The book’s description of the conditions for workers in export processing zones in the Philippines and Indonesia was truly harrowing. No Logo tells of how workers in these countries work outside of their own labour laws [which were not the most stringent to begin with], get paid barely enough to subsist on while their governments see very little tax revenue [the companies take advantage of tax breaks and holidays to the maximum] and almost no technological transfers are being made. In short, the governments of these workers sacrificed their workers at the altar of pure unalloyed capitalism and have very little to show for it. Of course, this was 13 years back, perhaps things have changed since. Naomi Klein’s book came to mind recently as I looked through the Law regulating Special Economic Zones in Rwanda, particularly in the last paragraph of Article 37 that leaves the determination of labour conditions to a ministerial order. On the face of it, this sounds reasonable. Until one reads the French and Kinyarwanda versions of the same article that clearly state that the order prioritises the economic objectives of the zone i.e. the investors’ profit motive outrank the workers’ rights. This is bad news for any future worker at the upcoming Kigali Export Processing Zone. The discussion on any labour conditions has been taken away from the Peoples’ representatives at Parliament to a single political appointee [with any luck s/he will have intra-ministerial panel discussions prior to the decision] who may be swayed more by the need to attract investors rather than the conditions of workers. There are some who subscribe to the notion that maintaining high standards of working conditions drives up the cost of production and may make a country unattractive to investors. I say let’s try to counter this cost with cheap power and transportation.In any event, there is little to be gained by investors who would employ Rwandans and turn them in the 21st century versions of Oliver Twist [no, not the D’Banj song] and it is within our government’s mandate to protect them from this eventuality no matter how tempting the prospected tax revenues and improved balance of trade.