The Government of Finland states that under the Act on Cooperation within Undertakings (i.e. those employing at least 30 persons) plans regarding staff and training must be discussed every year with the staff, prior to implementation. The Act states that with the objective of developing the operations of undertakings, improving working conditions and furthering cooperation between the employer and the staff, as well as among members of the staff, increased opportunities shall be provided for all employees to exercise influence in matters relating to their work and workplaces. The Act specifies that undertakings in Finland shall inform the relevant authorities of any changes affecting employment, and of new vacancies. A new feature in Finland is the penetration of foreign enterprises into social infrastructure services (e.g. water supply, waste collection and disposal, and the traffic sector) which were previously administered mainly by the public sector. In localities that are strongly dependent on one major (multinational) enterprise, the decisions of that particular enterprise may suddenly and strongly affect the activities and viability of the entire society. It is important that the practices of MNEs be in harmony with national requirements and that they take into account the needs of local communities. The impact of MNEs on employment in Finland was not studied during the period under review. An expert group set up by the EU Committee of the Regions has carried out a survey, as a first step towards assessing the social effects of the relocation of MNEs within the EU. The Confederation of Finnish Industry and Employers and the Employers' Confederation of Service Industries indicate that there is nothing new to report. The Central Organisation of Finnish Trade Unions (SAK), the Finnish Confederation of Salaried Employees (STTK) and the Confederation of Unions for Academic Professionals in Finland (AKAVA) state that employment opportunities and standards as well as job security do not seem to differ between domestic and foreign-owned firms. There are cases of MNEs according more generous benefits in cases of lay-offs. There is also some evidence of increased use of fixed-term contracts and a greater turnover of the labour force after acquisition by a foreign owner. At the same time, take-overs have also led to more business activity in Finland, to the benefit of subcontractors.
According to the National Council of French Employers the willingness of MNEs to contribute to employment promotion may be constrained by the shortage of suitably skilled labour, especially in traditionally agricultural regions. MNEs can only give priority to the employment of locals if they are adequately qualified. Multinationals apply the laws and relevant agreements in force, which are particularly stringent. Before setting up business, MNEs consult with authorities at the local, regional and national levels as well as with local enterprises and employers' organizations. In this way they are informed of the social development policies and particular characteristics of the host country. Once they have begun operating, they interact with workers' representatives through the works councils. Through their membership in employers' organizations MNEs can have better contacts with workers' organizations. Like national companies, MNEs are legally bound by collective agreements signed on their behalf, by organizations representing their interests. Most MNEs set up business when the economy was growing and there was a shortage of labour. The subsequent economic downturn has led to a reluctance by enterprises in certain sectors to hire more staff. In response the Government has gradually introduced different forms of assistance for maintaining and/or creating employment. These measures aim to reduce the labour costs of employees with little qualifications and to facilitate the entry of young persons into working life.
The Government of Gabon states that those MNEs which are represented on the Board of the National Employment Office (Conseil d'Administration de l'Office national de l'Emploi) have developed training structures. Before starting their operations, MNEs undertake appropriate consultations to harmonize their manpower plans with Gabon's social development policies. When requested by the Government, they prepare indigenization plans (gabonisation). Furthermore, they offer career development programmes as well as internal and external training to their staff for their professional advancement. MNEs do not usually contribute to the local development or use of employment-creating technology, nor do they use local raw material.
The Government of Grenada states that MNEs cooperate with local enterprises in promoting entrepreneurial skills and that they pool financial resources for assisting young entrepreneurs. MNEs do not undertake consultations before starting operations. They provide short-term training for staff, both locally and overseas, and also organize overseas attachment/temporary assignment programmes. MNEs contribute to the local development of appropriate technology and make maximum use of local raw material when the price is lower than the imported material.
The Government indicates that the divestment of SOEs as well as new investment have increased the involvement of MNEs in Hungary. During privatization negotiations, efforts were made to protect existing levels of employment within the enterprises concerned. However, in the initial stages of operation, these newly privatized enterprises were forced to reduce staff. At the same time, new investment by MNEs represent an important element in expanding employment. Such investment has resulted in the establishment of thriving new industries and a significant reduction in the level of unemployment, particularly in regions which had experienced economic decline. This has been attributed to the high level of cooperation between MNEs, government authorities and local council officials. Prior to commencing operations, MNEs generally consult with the competent authorities in efforts to coordinate their employment plans with national employment policy objectives. However, this approach has not yet produced satisfactory results. While a considerable number of MNEs have invested in depressed industrial areas in the western region of the country, very few have been attracted to the eastern and north-eastern regions, where unemployment levels are exceptionally high. Several initiatives have been undertaken to provide greater incentives to encourage MNEs to locate in these regions. These include major infrastructural development and the establishment of industrial parks. MNEs have greatly contributed to professional and language training for local employees. Others have provided job-specific, semi-skilled type training which is not always transferable to jobs elsewhere. Usually, foreign citizens are employed in critical positions but they are gradually replaced by local workers. MNEs have contributed to the technological and industrial development of the country and have played a decisive role in the development, at the local level, of communities such as Székesfehérvár, Esztergom and surrounding areas. Initially the use of locally processed and produced materials was minimal. In some cases, this resulted in a decline in production by local suppliers and the consequent loss of jobs. However, a number of MNEs have since established supply arrangements with local SMEs.
The Government of India indicates that information is not available on whether or not MNEs hold consultations in order to harmonize their manpower plans with national policies, nor on specific steps taken by MNEs to give priority to employment, occupational development, and the promotion and advancement of nationals. However, MNEs devote more attention to management development and training than other enterprises. They are expected to develop in a given time-frame, technologies which are suited to the needs of the country, but the record in this regard is not very encouraging. Only a few have adopted indigenous technologies. As in the case of national enterprises, MNEs are encouraged to use local raw material and manufacture parts locally.
MNEs in Ireland have created direct employment for 100,000 persons and the same number of indirect jobs, reports the Government. Before starting their operations, they hold consultations in order to keep their manpower plans in harmony with national social development policies. Priority is given to the employment, promotion and advancement of nationals, and these enterprises have contributed to the local development and use of appropriate technologies that have had positive effects on employment. As much as possible, use is made of local raw material and parts are made locally. Action in this regard is facilitated by the National Linkage Programme of the National Development Agency (Forbairt).
The General Confederation of Industry (Italy) states that on the whole there are no differences between multinational and national enterprises regarding employment promotion. Hence, action undertaken to increase job opportunities and cooperation with the Government and workers' organizations does not differ between national enterprises and MNEs. The same observation applies as regards consultations on manpower plans, the promotion of nationals, the local development of technology and the use of local raw material.
The Japan Federation of Employers' Associations (NIKKEIREN) refers to the Guidelines for Overseas Direct Investment (Kaigai Tshi Kd Shishin) which call on Japanese MNEs to employ local personnel and to promote those with the necessary qualifications in order to contribute to the expansion of employment opportunities in the host country. They are urged to "make as much effort as possible" to procure machinery, equipment, parts and raw materials from local sources. They are encouraged to give technical guidance to local enterprises when purchasing these inputs, in order to contribute to the improvement of the technological capabilities of local industry and to the transfer of technology, particularly in developing countries.
The Government of Jordan reports that MNEs contribute to increased employment opportunities and standards by providing jobs and training for nationals. They commence their activities only after consulting with the relevant authorities, in order to, inter alia, keep their manpower plans in line with national social development policies. They are committed to reserving a percentage of jobs for nationals. By virtue of their limited participation in the economy so far, it is difficult to assess their contribution to technological progress and the impact of their choice of technology on employment. Some have entered into joint venture arrangements with local investors, and are using and processing local raw materials. The Amman Chamber of Industry notes that MNEs, within the limits of their capabilities, are expected to contribute to job creation. It is believed that they consult with the competent authorities before commencing operations and they are constantly urged to contribute to national economic development efforts. This could be done through participation in equity arrangements, subcontracting or the manufacture of inputs, components and spare parts in Jordan. There is a growing trend of manufacturing MNEs operating under patents and franchises. A joint venture arrangement between MNEs (countries of origin named) and local investors has resulted in the manufacture of fertilizers from local phosphate deposits, while another MNE (country of origin given) is sharing in the production of phosphoric acid. Phosphate deposits and Dead Sea salt are the country's principal raw materials.
The Government of the Republic of Korea reports that no particular measures have been taken by MNEs to increase employment opportunities. However, since they recruit on the local market they contribute to job creation. MNEs take account of national vocational training policies when developing their manpower plans. No particular steps have been taken to improve employment prospects. MNEs are expected to contribute to the development of local technological capabilities. The Korea Employers' Federation reports that during the period of the survey there was full employment, and it was therefore not essential for MNEs to consider the job-creating effects of their activities. MNEs have not engaged in consultations on their manpower requirements and have had many difficulties in recruiting skilled workers. No steps have been taken by MNEs to give priority to the employment, occupational development and the advancement of local workers. Since July 1995 they have been participating in employment insurance programmes. Through the transfer of technology MNEs have contributed to the development of local technological capabilities. Decisions on the use of local raw material, and the local manufacture of parts or local processing of raw materials, depend on cost considerations.
The Government indicates that Kuwait has a free market economy which operates within limits set by the State to prevent undesirable practices. There is no unemployment in Kuwait, which relies mainly on migrant labour. The conditions of employment of foreign workers are subject to the relevant legislation in force. Institutional arrangements facilitate the placement of national and foreign workers with the suitable qualifications for a particular job. Activities relating to the technological development of the country are dealt with through national enterprises and public utility companies. MNEs do not undertake consultations to harmonize their manpower plans with national social policies before starting their operations. While they contribute to the local development of technology (e.g., electronic diffusion of information), they do not use local raw material or manufacture goods locally.
The Federation of Luxembourg Manufacturers reports that employment in MNEs has increased steadily, largely because of these enterprises' initiatives. MNEs consult very frequently with government authorities and the social partners to harmonize their manpower plans to the greatest possible extent with the country's social development policies. The Confederation of Independent Trade Unions is not aware of specific measures adopted by MNEs to give priority to employment, and has not seen any difference between the practices of MNEs and national enterprises in this respect. Contacts are made with government authorities when MNEs establish operations in the country and there is a consultative tripartite body within the Foreign Trade Ministry of Luxembourg in which trade unions are represented.
According to the Government of Malaysia, MNEs consult with the relevant authorities on their manpower plans and needs, prior to commencing operations. In order to enable them to raise pertinent issues before MNEs start operations, workers' representatives are also appointed to the tripartite bodies dealing with labour-related matters that hold consultations with MNEs. Priority is given to nationals for employment in MNEs. Through the introduction of new technologies, MNEs have helped to transform Malaysia from a mainly agricultural to an industrial economy. New technologies have been introduced (e.g. the Malaysian National Car Project) and a considerable number of indirect jobs have been generated. In general, the quality, costs and availability of materials and parts are key considerations when MNEs procure supplies locally. The Malaysian Trades Union Congress reports that even though MNEs are motivated by profit rather than social objectives, they have contributed to increased employment opportunities. However, this increase in jobs is marked by an imbalance, with large numbers of females performing low-paid jobs and men occupying mainly higher paid positions. Workers' organizations have not been party to any consultations on the manpower plans of MNEs. MNEs appear to prefer employing foreign rather than local workers. The majority of MNEs are involved only in assembly line activities, therefore the expected gains through the transfer of skills and technology have not materialized. In addition, their activities do not seem to have generated a lot of indirect employment. The 1986 Promotion of Investment Act permits the duty-free import of raw materials by MNEs for processing for export.
The General Confederation of Employers of Mauritania notes that MNEs have not taken any action to increase employment opportunities and standards, or to keep their manpower plans in line with national social development policies. Furthermore, MNEs have not adopted any measures to promote employment by nationals or to contribute to the development or use of technologies that generate employment. The same observation is valid concerning the use of local raw material. With regard to the absence of action on the part of MNEs to increase employment opportunities, the Free Confederation of Workers of Mauritania (CLTM) adds that MNEs do not wish to deal with the workers. They therefore resort to subcontracting which enables them to employ daily paid workers (without a clear legal status and labour contract). Whereas MNEs consult the competent authorities on manpower and national development plans, there is never an advantageous outcome to this process. MNEs give little importance to the occupational development, promotion and advancement of nationals. They contribute to a limited extent to the local use of appropriate technology and to technologies generating employment. The CLTM notes with regret that MNEs do not provide national workers with adequate training which would enhance their capacity to master the use of these technologies. MNEs in Mauritania are essentially active in the field of infrastructural development.
The Government of Mauritius states that MNEs have, since the 1980s, absorbed practically all jobseekers. There is full employment and even serious manpower shortages for highly technical jobs as well as floor-level operators in manufacturing industries. MNEs do undertake consultations, and this has enabled them to adopt the most appropriate technology. Some are quite cooperative in training local staff and by doing so they fulfil one of the conditions laid down for the issue of work permits for foreigners. However, when the time comes for the transfer of responsibilities to the local employee, there is some reluctance due to an element of mistrust. In spite of the technical skills acquired by Mauritians, there are limits to the levels of responsibility which they are given, in a number of cases. Expansions in telecommunication and air transport services have led to major developments in those sectors. Some construction enterprises execute entire projects without having recourse to local labour. At times the duration of the contract is so short that there is not ample time for the training of locals. As a result, there is no transfer of technology in such situations. Most raw materials used by MNEs are not available locally and they are therefore imported. The processing of some imported raw materials is, however, carried out. Spare parts are manufactured locally for use in certain industries (e.g. motor machines for the sugar and textile plants).
The Government of Mexico points out that its biggest challenge is to create jobs at a time of recession and amidst efforts to modernize the economy. Open unemployment rose from 2.8 per cent in 1992 to 4.7 per cent in 1995. Only the in-bond (industria maquiladora) industry did not register job losses. Between 1993 and 1994 the number of enterprises with foreign direct investment rose from 7,410 to 7,950 and the workforce in these enterprises increased from 1,333,522 to 1,414,484. Establishments with one to 100 workers accounted for 70 per cent of those enterprises (table 6 of annex to report). Under the National Development Plan 1995-2000, there are proposals to set up tripartite fora to consider new strategies and projects for combating unemployment. MNEs and other enterprises will take part in these fora. Section 7 of the Federal Labour Act states that at least 90 per cent of the workforce and all doctors in the medical services of an enterprise must be Mexican. Article 32 of the national Constitution also requires that priority be given to the recruitment of nationals. In the absence of suitably qualified local persons, foreign, technical and professional workers may be hired on a temporary basis as long as they do not exceed 10 per cent of staff in these categories. Foreign employers and staff must train locals. According to section 61 of the Regulation relating to the Act to Promote Mexican Investment and Regulate Foreign Investment (Reglamento de la Ley para Promover la Inversión Mexicana y Regular la Inversión Extranjera), MNEs must give the government authorities responsible for foreign investment, trade and industrial development, information on their proposed activities, investment and manpower plans, as well as their likely effects on the host country. The technologies they are going to use must be described and information on the appropriate training that would be given to enable workers to use the technologies, must be provided. This is intended to keep investment plans in harmony with national policies. As regards recruitment, MNEs tend to hire the best qualified workers, some of whom are recruited through the National Employment Service (Servicio Nacional de Empleo). The training, professional development and advancement of nationals depend on the policies of enterprises and the quality of the workers. The Federal Labour Act does however state that workers have a right to be given training in order to be able to improve their living standards and productivity. Proven competence as well as seniority are important criteria when filling temporary and permanent posts. Section 13(V) of the Foreign Investments Act calls for investors to create permanent jobs and contribute to training and career development programmes. In 1994 the Decree to Promote the Creation of Business Enterprises to Supply Inputs for the In-Bond Export-Oriented Industry was issued (Decreto que Promueve la Creación de Empresas Comercializadoras de Insumos para la Industria Maquiladora de Exportación). In that same year the Programme for National Suppliers to the In-Bond Export-oriented Industry was created (Programa de Proveedores Nacionales a la Industria Maquiladora de Exportación). The Mexican Confederation of Chambers of Industry reiterates that regardless of their relationship with the parent company, MNEs must comply with the national laws in force. MNEs, before deciding on where to set up operations in areas where there are maquiladoras, seek the advice of local employers' organizations. MNEs have also had a big impact on employment and economic conditions in regions other than those with maquiladoras. As regards employment, MNEs' decisions are based on considerations of the availability of qualified workers. Enterprises in the in-bond and other industries use very simple, as well as advanced production technologies. There is an increasing use of local inputs and these have attained considerable proportions in certain industries. Proposals concerning work organization and the use of different technologies, put forward by nationals employed in MNEs, are being increasingly taken into account by these enterprises. The Confederation of Mexican Workers agrees with the Government's statement.
Multinational enterprises constitute a considerable number of the medium and large enterprises in Namibia, reports the Government. These enterprises generate employment opportunities through the purchase of local goods and services when they are available at competitive prices. They consult with the relevant government ministries before investing and give priority to the employment of nationals, primarily because it is more costly to recruit expatriates. Multinationals are actively engaged in training programmes for the promotion and advancement of local staff. They have contributed to the local development of appropriate technology. Those involved in manufacturing tend to use and process local raw materials. The larger multinationals, e.g. in the mining sector, carry out some further processing of raw materials (e.g. the production of uranium yellow cake, copper bars and lead ingots).
The Government of the Netherlands points out that its reply to the last survey is still valid. The Federation of Netherlands Industry and Employers agrees with the Government.
According to the Government, there is no information on actions taken by MNEs in New Zealand to increase employment opportunities and standards. It expresses the hope that, like domestic enterprises, MNEs' actions in this regard would be enhanced by virtue of their competitiveness and performance. Multinationals are considered to improve the quality of the workforce by providing access to foreign management practices, technology and training. Most of them take note of the Government's employment policies and objectives, and on the whole, they play an important role in creating jobs. In February 1992 there were 513 enterprises with between 25 and 49 per cent foreign equity, mainly in business and financial services (172 enterprises); wholesale and retail trades, restaurants and hotels (118), and manufacturing (105). Of those 513 enterprises, 298 were small-scale establishments with a maximum of five workers and 58 employed 100 or more persons. The workforce in those 513 enterprises comprised 7,926 part-time workers and 30,581 full-time staff. Enterprises with 50 per cent or more foreign equity numbered 2,928 in February 1992. Most of them were SMEs -- e.g., 1,558 with five workers or less, 232 with between six and nine workers, and 652 with a workforce of between ten and 49. These 2,928 firms created jobs for 28,773 part-time and 132,707 full-time staff (data drawn from tables annexed to report). MNEs are treated like local enterprises and they must respect the national laws and regulations concerning employment. Consultations on manpower plans are not held. When assessing investment applications, the Overseas Investment Commission does not currently carry out a detailed analysis of the applicant's employment policies. However it does take into account the following: potential job opportunities or the maintenance of existing jobs that would or might otherwise be lost; the introduction of new technology and business skills; the development of new export markets or increase in market access; impact on competition and productivity; and the increased processing of local primary products. Foreign workers can only be recruited if the particular skills being sought are not available in the local market. MNEs are expected to introduce the most appropriate technologies that are consistent with their concerns about competitiveness. In a number of cases they have introduced the latest technologies. This has had positive effects on direct and indirect employment, and local raw materials are being increasingly processed in the country (foreign MNE in the forestry, wood, pulp and paper industry named as example). Convention No. 122 has been ratified and Recommendation No. 122 adopted. There is a Pacific Islands Industrial Development Scheme to assist private entrepreneurs from New Zealand and the Pacific Islands in setting up ventures in the agricultural, manufacturing and tourism sectors, in the developing economies of the South Pacific Forum Island Countries. There is little involvement by the Government in what is essentially a scheme for developing the private sector, but on occasion, there are intergovernmental contacts to address specific legal questions, including those relating to the sustainability of natural resources. All entrepreneurs granted approval to operate in the country are subject to the national laws and policies. The Government's views are shared by the New Zealand Employers' Federation, which emphasizes the importance of allowing market forces and the development of successful enterprises to generate more employment opportunities and "real productive activity".
The Government reports that MNEs in Nicaragua cooperate in providing stable employment and in applying social policies which are beneficial to workers and contribute to security of employment. Surveys have shown that these enterprises respect the national labour laws in order to make their activities compatible with government policies. They provide permanent jobs, training and opportunities for occupational development. Appropriate technologies are used, thereby creating direct employment. Indirect jobs are generated through subcontracting. The goods produced by MNEs serve as inputs for production in SMEs. Some of the materials used by MNEs are procured from local sources and this contributes to the country's economic development.
The Government of Nigeria points out that since MNEs place great emphasis on commercial considerations, there is an increasing shift in emphasis from employment generation to productivity and competitiveness. The action being taken by MNEs is to protect investment and this may not necessarily increase employment. However, priority is accorded to nationals in employment matters, and adequate training programmes, career development and competitive conditions of service exist for nationals. In accordance with the National Policy on Backward Integration, MNEs have undertaken extensive research into the use of local raw materials. The Nigeria Employers' Consultative Association makes the same observations as the Government. According to the Nigeria Labour Congress, most MNEs do not employ local experts in areas they consider to be "sensitive" to their operations, even in cases where such local expertise is abundant. Most MNEs cooperate with Government in its efforts to combat unemployment, but there is no cooperation with workers' organizations in this regard, apart from collective bargaining on issues of retrenchment and redundancy. Most MNEs have no retraining facilities and before starting operations, they consult only the Government. Policies as regards the employment, occupational development, promotion and advancement of local staff differ among enterprises. There is no discussion with, or information provided to workers' organizations in this regard. Most MNEs rely on imported technologies for their operations and in spite of various government policies aimed at promoting the local sourcing of raw materials and manufacture of parts, there is still a heavy reliance on imported raw materials and semi-processed inputs. Most parts are either imported or only assembled in Nigeria.
According to the Government of Pakistan, MNEs have contributed to employment and economic growth during the period under survey. They have also played an important role in improving the economic and social conditions of their workforce by providing job opportunities with reasonable remuneration. Prior to undertaking any activity, MNEs must consult with the Government. Emphasis is placed on the occupational development of local workers. Local raw materials are used to the greatest extent possible and new technologies are used taking into account prevailing conditions. The Employers' Federation of Pakistan reports that MNEs' activities have expanded greatly during the period under survey, thereby opening up considerable employment opportunities. Prior to setting up operations, MNEs must agree to employ local workers. MNEs give priority to the occupational development of their workforce by providing all training which is beneficial to both the workers and the enterprise. Many MNEs have contributed to the development of local technological capability -- e.g. in the automobile industry, companies (named) are manufacturing and assembling vehicles, using local manpower and locally available parts. These companies expect to stop all imports shortly. All components will be made in Pakistan with the parent company being consulted only for technical expertise and quality control. MNEs use imports only when local raw materials and parts are not available.
The Government reports that MNEs endeavour to harmonize their manpower plans with Poland's social development policies, by concluding "social agreements" with workers' organizations, which guarantee that certain workers' rights and privileges will be maintained. These include the preservation of current employment levels for between one and a half and two years after the change of ownership, and similar commitments with respect to wages and social security entitlements. The Ministry of Industry and Trade and foreign investors sign agreements containing provisions which ensure that future business activities will be in line with the State's general industrial policy guidelines. The Independent Self-Governing Trade Union "Solidarno" (Poland) reports that MNEs' policies and practices as regards employment-related matters, the development of local technological capabilities and local sourcing, tend to be in line with the prescribed national and international standards if the enterprises are large, because they are found to attach great importance to their reputation (two examples cited by name). The obligation to hire nationals is set out in agreements between the Government and MNEs before they begin their operations.
Foreign enterprises in Portugal must respect national goals with regard to employment and training, states the Government. MNEs contribute to local and regional development, the introduction of new technologies and job creation. Local raw materials are generally used and such linkages have stimulated the development of local enterprises. In the course of fulfilling their manpower requirements, MNEs play a key role in the field of training, which is partly designed to promote an "enterprise culture" and enable workers to use new technologies. The Institute of Foreign Trade informs foreign investors of labour costs, labour legislation, sector-specific laws and regulations and other business-related laws. The General Union of Workers concurs with the Government's statement about the positive social and economic contribution of MNEs in Portugal, adding that this is particularly evident during the initial stages of their activities. It is of the view that "in many cases" vocational training programmes run by MNEs have "exploited national resources" intended for vocational training in general.
The Government of Romania is not aware of actions undertaken by MNEs to increase employment opportunities and standards or to reduce unemployment. MNEs do not, before starting their operations, engage in the type of consultations referred to. They have however promoted job creation, including through the use of local technologies, and contributed to the creation of a distribution network. On the whole MNEs import rather than use local material or components.
According to the St. Vincent Employers' Federation, since government policy is to have some degree of participation in foreign enterprises, it is represented on the boards of these companies where it can make known its views, including on the question of employment. Its policy is to increase employment. There is generally less confrontation in those contexts where collective bargaining takes place. MNEs discuss their manpower plans with the Government and the importance of training and retraining is emphasized. With the exception of senior management positions, all jobs should be held by locals. In special cases work permits may be issued to foreign workers. MNEs have contributed to technological development. For example, local water resources are now used to generate some of the electricity needs whereas in the past all electricity was generated using imported gas. Several local engineers have been trained as a result of these developments. Moreover, the greater supply of electricity has stimulated industrial activity -- e.g., a local brewery has been established and it uses water supplied by the local company. These two establishments are in fact the biggest employers in the country. The local manufacture of parts is not widespread.
The Government reports that the rate of unemployment in Slovakia reached 12.9 per cent in December 1995. MNEs have contributed significantly to a decrease in the level of unemployment, the creation of new job opportunities, and the introduction of new technologies and production techniques. The operations of MNEs require a highly qualified, experienced and knowledgeable workforce. Consequently, these enterprises have provided suitable training courses to meet their manpower requirements and in order to ensure high levels of productivity. The economic restructuring process involves the participation of foreign enterprises, including MNEs.
The Government of Slovenia has no information to reply to the first three questions. It notes that MNEs play a positive role in promoting the development of appropriate technology because their demand for high quality components puts pressure on local producers to meet the required standards. Policies and practices with regard to the use of local raw materials differ between MNEs. Certain MNEs (one named) mainly import the components and assemble them in the country, while others (one named) cooperate with local suppliers.
The Government of Spain reports that the job creation policies applied by MNEs are in line with the principles and objectives of Act 22/1992 of 30 July 1992 and Act 10/94 of 19 May 1994. The Government's employment programme was set up in accordance with section 44 of Act 42/94 of 30 December. Under this programme, fiscal incentives are granted and administrative measures taken to encourage the recruitment of persons for full-time work for indefinite periods and to enable the labour market entry and re-entry for youths, persons over 45 years of age and women. The employment policies of MNEs, like other enterprises, are consonant with this programme. The Government provides extensive details of the steps being taken to improve public employment services, the role of non-profit institutions engaged in activities relating to job placement and with which there can be collaboration, the functions of temporary work enterprises, and other action for creating jobs. The General Union of Workers states that there is no cooperation to deal with unemployment in Spain. MNEs, with the exception of having training programmes for the most qualified workers, generally have employment policies that respond to their own interests. These policies generally comprise the restructuring of enterprises with early retirement for older workers, the cancellation of contracts (with granting of economic incentives) in order to get rid of less qualified staff, and the granting of new contracts, either temporary or indefinite, which often tend to be on an individual basis. The ultimate objective is to adapt to changing circumstances without incurring large social costs. MNEs do not usually harmonize their own interests with national social development policies, nor do they engage in consultations in this regard, before beginning their operations. It is not possible to identify specific steps taken by MNEs to give priority to employment, occupational development, and the promotion and advancement of nationals. However, there have been a few programmes for training and promoting the most qualified workers, who generally have special contracts. Once an enterprise has been set up it does create direct and indirect employment and contribute to the development of the place in which it is located. However, it cannot be said that this local development is a result of the use and choice of specific technologies. The use of technologies and products from the host country varies considerably across sectors and among enterprises. MNEs do not usually use local raw materials and components, nor do they process raw materials locally. Imports can be as high as 90 per cent of total requirements and originate from companies within the group, which may in some cases also be in Spain.
The Government of Sri Lanka reports that MNEs have created more employment opportunities through new investment and the expansion of existing projects. The provisions of the Factories Ordinance regulate their consultations with the Labour Department. MNEs also consult with the Board of Investment. The aims of national social development policies are not of major concern to MNEs. The training and development of workers, which constitute an integral part of MNEs' activities, are provided either in-house or through courses at national training institutions. A few workers are sent abroad for specialized training. MNEs (named) contribute, to a certain degree, to the development of national technological capabilities. They not only have a long tradition of using local raw materials and parts, but are also involved in the local manufacture of parts and the processing of raw materials. As a result there has been a growth in the number of enterprises that supply inputs to MNEs. According to the Lanka Jathika Estate Workers' Union, the main benefit of MNEs to workers in Sri Lanka is the creation of employment opportunities. However, most MNEs do not provide favourable terms of employment and working conditions.
The Government of Swaziland states that it is working with MNEs in developing certain policies (e.g. regarding industrial location) and expects that this will reduce unemployment and underemployment. MNEs do hold appropriate consultations, especially with the relevant government agencies, before starting operations, and in addition to creating employment, they help to develop skills and provide opportunities for the advancement of nationals. MNEs contribute to the local development of appropriate technology capable of generating both direct and indirect employment. There are small-scale projects, e.g. water projects, agriculture and farming, being introduced especially in rural areas, to benefit the community. There are limits to the amount of local raw material that MNEs can use, since most of Swaziland's raw material is exported.
The Government of Sweden notes that because of the growth of foreign acquisitions since the 1980s, the percentage of majority foreign-owned enterprises in Swedish manufacturing rose from 6.3 per cent in 1980 to 16 and 14 per cent in 1992 and 1993 respectively. Between 1993 and 1994 the number of foreign MNEs rose from 2,719 to 3,074. Small enterprises (i.e., up to 49 workers) comprised 75 per cent of the 2,719 foreign-owned enterprises in Sweden in 1993, but as a single group, the 87 large MNEs (i.e., 500 or more workers) absorbed almost half of the 210,252 workers. Companies from the Netherlands, Switzerland, and increasingly, those from the UK and Germany, were the largest employers. During the period under review, the size of the workforce in foreign-owned MNEs in Sweden fluctuated from 222,062 in 1992 to 210,252 in 1993, and 214,014 in 1994. As regards the sectoral distribution of the workforce, in 1993, the most recent year for which data are available, 51 per cent were in manufacturing, 45 per cent in services and 4 per cent in construction. The metal trades employed just over half (52 per cent) of the 108,138 workers in manufacturing MNEs, while 13 per cent of them were in the chemical, rubber and plastics industries and 12 per cent were in the food industry. In the services sector there were 1,936 majority foreign-owned MNEs in Sweden employing 94,379 persons. The wholesale and retail trades accounted for 47 per cent of those workers. Seventeen per cent were in research and development and other business services, while 11 per cent worked in land, water and air transport companies. MNEs played, and still play, a key role in the domestic economy. In 1993, they employed 26 per cent of all workers in the machinery and electrical industries, the same percentage in the chemical industry and one-fifth of all those in the food industry. In the services sector, one-quarter of the workforce in the wholesale and retail trades were in foreign MNEs. According to data supplied by the National Board for Industrial and Technical Development (NUTEK), employment in Swedish-owned MNEs both at home and abroad generally declined during the period under review, mainly as a result of restructuring of large firms. Significant recruitment in the CEECs, and to a lesser extent, in India, was none the less reported. In 1993, there were 754 Swedish MNEs which employed 611,267 persons at home and 535,147 overseas. Ninety-seven per cent of the foreign-based workforce were in large companies (i.e., more than 500 workers), and most of these workers (86 per cent) were in manufacturing. The metal trades employed over half (60 per cent) of the 458,257 workers in manufacturing, while 12 per cent were in the pulp and paper industry and 10 per cent in chemicals. Swedish MNEs in the services sector employed 67,957 persons in foreign countries, of whom 30 per cent were in the wholesale and retail trades and 9 per cent in hotels and restaurants. The services sector accounts for the largest share of employment in Swedish MNEs at home (data extracted, and percentages calculated from tables in the Government's reply).
The Swedish Employers' Confederation and the Federation of Swedish Industries state that they have nothing new to add to the Government's report.
The Government of Switzerland indicates that in principle, MNEs are subject to the same regulatory framework applicable to national enterprises and that they must therefore cooperate with the local or regional labour authorities responsible for combating unemployment. Due to the international character of their activities MNEs may be granted preferential treatment by being allowed to recruit staff unavailable in the country, e.g., highly qualified managerial personnel, or certain staff undergoing professional training. As the result of the very strict conditions for the entry of expatriates, MNEs have to undertake consultations to harmonize their manpower plans. All enterprises must try to employ locally available labour to the greatest extent possible. The Central Union of Swiss Employers' Associations reports that MNEs contribute significantly to different sectors of the Swiss economy. In 1993 FDI inward stock amounted to Sw.frs.57,277 million, with the EU accounting for Sw.frs.34,925 million of the total (data in extract of report annexed to reply). By virtue of the size of their investments, MNEs play an important role with regard to employment. The Federation of Commerce, Transport and Food Industries Workers' Union reports that there is no difference between national and multinational enterprises in Switzerland when it comes to policies concerning labour. However, as opposed to national enterprises, MNEs affect employment in that their location and investment decisions are less bound by national frontiers.
The Government of the Syrian Arab Republic is not informed about action taken by MNEs to increase job opportunities and standards. The Government cooperates with employers' organizations to reduce unemployment, and in this regard, Investment Law No. 10 was promulgated in 1991, with the aim of promoting investment projects that would create jobs. MNEs discuss feasibility studies concerning their projects with the competent authorities which must approve them. This ensures that the manpower plans of these enterprises are in line with national development policies. New development and investment projects are approved if they lead to the transfer of technology and contribute to the training of nationals. Through their local manufacturing activities, some MNEs in the petroleum sector (unnamed), and a multinational in the food and drink industry (name given), contribute to the local development and use of technology. This practice is enhanced by the Government's policy of giving priority to projects which either use local raw material or manufacture goods locally. The Chamber of Industry makes the same observations as the Government of the Syrian Arab Republic, but does not indicate whether it has any knowledge of action taken by MNEs to increase job opportunities.
It is the opinion of the Government of Thailand that certain foreign MNEs have improved working conditions and provided welfare benefits in excess of those required by national policies and legislation. Many MNEs, especially those from OECD countries (origin given), have implemented on-the-job training schemes designed to enhance employees' occupational skills and promote their career advancement. This in turn contributes to increases in productivity.
Referring to MNEs in the energy sector, the Government of Trinidad and Tobago states that a number of initiatives have been taken to increase job opportunities in the areas of exploration, drilling and refinery operations. There has been a significant amount of contracting-out of work in the petroleum industry. A number of firms in this industry have adopted the specifications of the ISO 9000 with a view to improving safety standards for workers. A tripartite committee has been established with the specific objective of developing comprehensive plans as regards policies on wages and benefits, and methods of increasing employment opportunities. Most MNEs operate in the energy sector which is largely capital-intensive, but some employment is generated in spin-off industries, e.g. services. Because of the nature of their activities, MNEs utilize local oil and gas reserves. The Employers' Consultative Association of Trinidad and Tobago replies that MNEs have been training apprentices as part of efforts to increase employment. MNEs rarely engage in consultations with a view to keeping their manpower plans in harmony with national social development policies. The Association is not aware of steps taken by MNEs to give priority to the employment, occupational development, promotion and advancement of local staff. MNEs have contributed to the local development of appropriate technology and employment-creating technology. They have a policy of using, to the extent available, local raw material of good quality.
The Government of Tunisia notes that within the framework of the 1993 Code for Promoting Investments, different forms of financial incentives are given with the aim of promoting regional development (e.g. coverage of part of the cost of investment projects, including feasibility studies) and new investment. The State assumes the employers' social security contributions in the following cases: enterprises in manufacturing, tourism and services which are setting up operations in areas earmarked for regional development; new and small establishments; craftsmen; enterprises employing new teams of workers; and enterprises in the agricultural, fishing and manufacturing industries which hire qualified nationals and help to promote technological development and productivity. In the latter cases, the State may defray all or part of the training costs. When setting up their operations, MNEs are fully informed of the legal framework, and the economic and social conditions in Tunisia. The situation with respect to skill levels is also made known, thereby enabling them to define their investment priorities. Certain MNEs have concluded agreements with the Tunisian Vocational Training Office for the setting up of alternating training programmes. Alternating training and continuing training are among the main measures taken by MNEs to enhance the skills and professional advancement of local workers. The State provides different forms of assistance: tax relief; total financing of training in enterprises with less than 100 workers; and the financing of further training for jobseekers. MNEs contribute to the use of appropriate technologies which generate direct and indirect employment. They give an impetus to the development of micro-enterprises through subcontracting. According to the Tunisian Confederation of Industry, Trade and Handicrafts, MNEs have contributed to an increase in job opportunities, better working conditions and economic development.
The Government of Turkey states that MNEs take into account the objectives, principles and policies outlined in its Seventh Five-Year Development Plan. The basic objective of the Plan is to increase productive employment through the realization of higher growth based on a stable and competitive economic environment that is attractive to investment. Priority will be given to increasing the technological capability of the industrial sector and the value added component in the services sector. Legislation on employment-related issues will be reviewed and workers will be given suitable training in order to function in a changed economic environment. MNEs contribute to job creation, but there is no precise quantitative or qualitative information in this regard. The acquisition of large SOEs by MNEs through privatization could result in a decrease in jobs. MNEs, like national enterprises, have held general consultations both prior to and after commencing operations. MNEs have acted in accordance with the law and the collective agreement regarding the recruitment and advancement of nationals. They are careful not to deviate from local practice and seek to comply with legislation in the social and labour fields. MNEs use technologies that are necessary for their operations. Depending on the circumstances, some import technology to manufacture certain components. SMEs employing up to 49 workers comprise 98 per cent of enterprises in the manufacturing sector and the technology imported by MNEs should contribute to indirect employment in these SMEs. There are no data on which to assess the MNEs' contribution to the creation of new employment opportunities or their impact on employment, based on the choice of technology. It is recognized, however, that they usually opt for labour-intensive technologies if they suit the strategies of the enterprise and not because of the host country's needs. The technology choice of these enterprises merits examination in order to determine the direct and indirect employment effects and linkages to local suppliers and consumers. The Turkish Confederation of Employer Associations reports that, since MNEs tend to have a positive effect on employment, their presence could improve employment opportunities and generate indirect employment in SMEs. The Confederation of Turkish Trade Unions (TÜRK-IS) is not aware of any action taken by MNEs to increase employment opportunities or to combat unemployment. MNEs do not consult with the Government prior to commencing operations in order to keep their manpower plans in harmony with national development policies. As far as the TÜRK-IS is aware, no steps have been taken by MNEs to give priority to the employment and occupational development of nationals. MNEs have not contributed to the local development and use of appropriate technology capable of generating both direct and indirect employment. The policy and practice of these enterprises are to use or process local raw materials and manufacture parts locally, as long as it is cost-effective.
The Government of the United Kingdom believes that it is unrealistic to attempt to persuade MNEs to choose technologies which generate employment, and adds that MNEs will create jobs if it is in their commercial interest to do so. In its view, an important challenge for governments is to create conditions favourable to job creation. As regards the giving of priority to the employment and promotion of nationals of host countries, it thinks that this may be discriminatory and therefore in conflict with the provisions of paragraph 21 of the Declaration. As regards local subcontracting and the use of local raw materials, it believes that such action "could be interpreted as encouraging governments to impose local content conditions", which is contrary to the agreement on Trade Related Investment Measures (TRIMs) within the WTO. The United Kingdom has a liberal investment policy and FDI is seen as improving competitiveness and benefiting the domestic economy in various ways. Since the principles of non-discrimination and national treatment are central to this policy, domestic enterprises and MNEs in the United Kingdom are treated in the same way. MNEs make a significant contribution to increasing employment opportunities and standards, reports the Confederation of British Industry (CBI). They participate in CBI surveys on industrial trends and skill shortages, thereby providing an indication of their manpower plans. They place particular emphasis on the development of human resources and seek to apply the same standards used in the United Kingdom to their overseas operations. Local sourcing is based on considerations of competitiveness.
The Government of the United States refers to the 1978 Full Employment and Balanced Growth Act which outlines the policy and responsibility of the Government to promote, inter alia, full employment and production, with the assistance and cooperation of small and large enterprises (including in the agricultural sector), labour, state and local governments. MNEs in the US have played a significant role in increasing employment in accordance with federal law, government policies and regulations. Between 1988 and 1993 the number of persons working in US affiliates of foreign-owned enterprises rose from 3.8 million to over 4.7 million -- 5 per cent of the workforce in the non-banking sector. It would be economically unproductive to interfere with the manpower plans of individual enterprises. Consequently, there is no legal obligation for enterprises to consult with either local, state or federal officials, or national employers' and workers' organizations on manpower plans before starting operations. However at the state and/or local level, enterprises sometimes voluntarily provide information or hold such consultations with the authorities of such jurisdictions or local unions. The information provided and the consultations held are not for the purpose of achieving implicit or explicit approval of enterprises' manpower plans; rather they are "informational and facilitative in nature". MNEs' practices in this regard do not differ significantly from those of comparable domestic enterprises. MNEs in the United States generally employ US citizens or permanent residents of foreign origin. However, no data are available on the number of US nationals and foreign nationals employed by such enterprises. The Government provides details of procedures for employers to request work permits under the US Immigration and Nationality Act (INA), for different categories of workers and the quotas of visas available. Under the INA the employer must provide notice of labour certification for foreign workers to the appropriate union, or employees at the workplace, if there is no union. The union and/or employees have the right to challenge the employer's application for certification or challenge the wages and working conditions which the employer intends to offer foreign workers.
The Government of Venezuela says that no employment policy in line with the aims of the Tripartite Declaration has been drawn up within the framework of its FDI policy. The Venezuelan Federation of Chambers of Commerce and Manufacturers' Associations (FEDECAMARAS) states that certain MNEs hold consultations at the sectoral and national levels, to find out the areas of possible collaboration with regard to job creation. They contribute to efforts to improve the quality of jobs, and to set up programmes for training and skill formation. To a certain degree, they assume responsibilities that are rightly those of governments. Both the MNEs and host country gain from the training that is given to enable workers to utilize new technologies. In many cases, efforts to adapt technologies to local circumstances and needs would retard progress and not be in the host country's interest. While in the majority of cases there are consultations with respect to the local development and use of appropriate technology, FEDECAMARAS believes that it is the responsibility of host countries to adapt their institutions to modern technological requirements. There are specific examples of companies training staff to use new technologies in assembly operations, including through overseas training. MNEs have a policy of using to the maximum, local raw materials in the iron and steel, aluminium, petroleum and related industries.
The Government of Zambia is currently implementing a Structural Adjustment Programme (SAP) with the aim of revitalizing the economy and raising living standards. The privatization of SOEs is one of the components of the SAP, which has reached a very advanced stage. This, together with the removal of subsidies, have in the short term, led to retrenchment in both the public and private sectors. The streamlining and rationalization of national enterprises in the interest of achieving greater efficiency, coupled with other economic factors, have aggravated unemployment. As regards MNEs, they tend to use capital-intensive technologies as opposed to hiring more workers. The Government is promoting labour-intensive programmes (e.g. public works) with the aim of increasing job opportunities. MNEs in different sectors contribute to the occupational development and advancement of nationals. Moreover, because of the policy of "Zambianization", many nationals occupy senior positions. They can influence policies and take decisions that lead to the development and use of appropriate local technologies that generate both direct and indirect employment.
The Government of Zimbabwe states that MNEs are informed about national employment policy during discussions with the competent authorities regarding investment prospects in the country. In particular, MNEs are advised of the requirement that nationals should be given preference in these enterprises, and that expatriates may only be considered for employment in positions where local skills are not available. MNEs undertake consultations with the competent authorities before commencing operations. They are involved in labour-intensive activities. They promote the advancement of local employees by sending them abroad for training. Some MNEs have "actually adopted" appropriate technology which has directly and indirectly contributed to the generation of employment. One enterprise (name given) utilizes mechanized labour-intensive technology in its operations. The company creates employment-generating linkages by subcontracting certain tasks to local enterprises. Most MNEs use local raw materials depending on the availability, as well as local processing facilities. The Employers' Confederation of Zimbabwe states that MNEs have increased employment opportunities, raised standards and cooperated with the Government and workers' organizations in reducing unemployment by investing in large-scale operations in sectors such as mining, construction, metal trades and the food and drink industries. MNEs respect the laws relating to the termination of employment. They undertake appropriate consultations with the competent authorities, as required, in order to keep their manpower plans in harmony with national social development policies. MNEs have "improved their performance" as regards their contribution to the development, promotion and advancement of nationals. Consequently, they are acting in accordance with the labour code which prohibits discrimination on the basis of race. MNEs have contributed to the local development and use of appropriate technology capable of generating both direct and indirect employment. One MNE in the mining sector (name given) has generated employment for thousands of nationals because of its use of sophisticated technology. MNEs, wherever possible, utilize and process local raw material.