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ILO chief warns about: Diversification fatigue

Thursday, April 21, 2016
Director-General of the International Labour Organisation (ILO) Guy Ryder

Director-General of the International Labour Organisation (ILO) Guy Ryder sees diversification as the best way out of what he views as the “asymmetrical impact” of economic crises in the Caribbean. 

Ryder spoke exclusively with T&T Guardian following several rounds of discussions with government, employers’ and labour representatives this week. He said Caribbean countries are faced with “asymmetric impacts” which raise “the fundamental question about the capacity of national economies to demonstrate resilience and adaptability to external shocks.” 

According to the ILO head, who took office in 2012, “any economy that remains overly dependent on a single product, a single commodity, a single activity is always going to find itself vulnerable to external and its resilience and its capacity to absorb those shocks will be correspondingly debilitated.” 

Ryder, however, noted that use of the word diversification appeared to be “omnipresent” and there seemed to be a level of “diversification fatigue already in place.” 

He advised that a strategy of economic diversification is the best way of addressing the vulnerabilities of small countries in particular and suggested that as a means of addressing the accompanying human capital needs it was important to promote social dialogue, social protection systems, skills education, and placement and public employment services. 

Ryder said institutions of social dialogue in the Caribbean were a “historical asset” with well-established organisations “that have their ups and downs” engaged in a process he sees as not always having “produced the results.” 

“I talk about social dialogue with consequences,” he said. “People will judge social dialogue on the results it produces. Its legitimacy will be judged on the results it produces.” 

In T&T, tripartite mechanisms involving the state, employers and labour are well-established and the Keith Rowley administration in March initiated the establishment of a National Tripartite Advisory Council. However, Ryder said “where the social actors do not succeed in making social dialogue work productively…the legitimacy of these processes will suffer.” 

He referred to ongoing concerns regarding the fate of laid off ArcelorMittal employees saying that “one of the dramas of the current circumstances in Trinidad and Tobago is that people losing their jobs in the steel industry, for example, have no access to unemployment benefits, severance pay and the rest…” 

“All of the experience shows that where workers who have been displaced are able to have full back-up on at least minimum social assistance or social protection, they find it easy to move from one place to the next,” Ryder said. “If you know that if you lose your job tomorrow, you are on the street, you are on the breadline, you will cling to what you have…and it’s a rational reaction.” He said good governance issues were also an area that required attention. 

“It is indisputable that good government behaviour is fundamentally important and the Caribbean is not the only part of the world where issues of corruption, issues of waste and inefficiency figure very prominently in the discussions,” Ryder said. 

He said while the state as major employer was not necessarily a problem, it was important that “the interface between the public sector and the private sector is not detrimental to the latter…so you have to get that mix right.” 


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