VIETNAM COUNTRY REPORT

Dignity in Labour

Based on conference presentations
by Hoang Thi Lich
(Center for Family and Women's Studies)
Pham Gia Thieu Vietnam
(General Confederation of labour)
Bui Thi Kim Quy
(Center for Women's Studies
Institute of Social Sciences In Ho Chi Minh City)

VIETNAM'S first EPZ was established in 1991. There are now six zones: Tan Thuan and Linh Trung (in Ho Chi Minh City), Doson (in Haiphong City), Da Nang,Can Tho, and Ha Noi. But all of them, with the exception of Tan Thuan, are nothing more than bate land with fences.

The EPZ programme is one of the new economic policies introduced in 1986 to transform Vietnam's state-planned economy into a multi-sectoral one.

The government has been trying to promote industrial growth by attracting foreign investment. It is offering many incentives, including tax holidays and quick processing of papers. Investors are rushing in to take advantage of these inducements plus the low labour costs.

The EPZ workforce is very small. There are only 1,200 EPZ workers right now. Of that total, 1,131 workers, all women, are employed in Tan Thuan.

The factory owners look foryoung, healthy and unskilled workers to whom they can pay the lowest wages. Some factories do not allow workers to marry or to have children. Most of the workers are from the urban areas.

Most factories are joint ventures with Vietnamese participants. Under Vietnam's Regulations on Labour for Enterprises with Foreign-Owned Capital (released in 1991), foreign-invested enterprises must respect workers' rights to form unions. But collective bargaining is new for the workers and for the Vietnam General Confederation of Labour (VGCL). The union is trying to leam from the mistakes and successes of other Southeast Asian countries with foreign enterprises.

Under Vietnamese law, the government cannot make any labour decisions without the 3 million member VGCL. The VGCL recognises the leading role of the Communist Party and some of the union's leaders are members of the Party. However, when the govemment decided recently to reduce the minimum monthly wage from US $50 to $35, the union fiercely debated the move. While party policies on labour issues and investment often reflects the VGCL's interests, the situation for workers in EPZs is difficult.

The factories are dusty, hot, and humid. Foreign companies often offer higher wages, but, according to a recent surveybytheMinistry of labour,workers find that the work in these companies is more demanding. They are sometimes required to work two seven hour shifts back to back and are al10wed to use the toilet only three times a day for no more than five minutes each time. Some workers also complain that they do not receive legally entitled overtime pay.
  The minimum wages at foreign invested enterprises (US$35/month) were established by the Decision on Minimum Wage for Labour in Enterprises with Foreign Invested Capital, issued by the Ministry of Labour in 1992.

Foreign companies have threatened the govemment and the unions that they will pull out if workers demand too much and disrupt production. Nonetheless, wildcat strikes are common. Since 1989, there have been 70 strikes in enter prises with foreign invested capital. Only 20% of those factories had unions.

(Additional source: Vietnam Economic Times, May 1994, p.24)

AT A GLANCE

EXPORT PROCESSING ZONES

Tan Thuan Linh Trung
Hai Phong
Danang
Can Tho
Hanoi
Industrial estates planned for Sai Dong and Dong Anh
Growth Areas: Greater Mekong
Subregion, ASEAN (newmember), ASEAN Free Trade Area (AFTA)

WAGES

• Average wage in the clothing sector: US 20 cents/hour
  (Source: ITGLWF Newsletter, No 2, 1994, p. 3)
• Estimated average wage of skilled factory workers: US$50/month.
  (Source: Asian Wall Street Journal, 17 March 1995, p.l)

UNEMPLOYMENT

• 2.8 million workers are unemployed, representing one-quarter of the country's city dwellers and one-third of those living in rural areas.
• Many public-sector jobs are being cut as the govemments lashes subsidies to loss making state-run companies and trims its payrolls. Real wages for people still working in the public sector have fallen by 35 percent since 1985.
• The return to Vietnam of 250,000 people who lived in the formerly communist countries of eastem Europe and the repatriation of others who had fled their homeland as "boat people" have exacerbated the unemployment situation.
• Vietnam's economy must grow by 10 percent annually just to keep the unemployment rate from increasing.
  (Source: Straits Times, 14 May 1995)

POPULATION

74.0 million

ECONOMIC GROWTH

8.8% (1994); 9.0% (1995 forecast)

PER CAPITA GDP (PPP)

US$ 1,263

INFLATION RATE (CPI)

14.4% (1994); 11% (June 1995)

UNIONISATION IN FIES 20%