(Caribbean Basin Initiative). Since that time, the number of port and docks) to a situation where it is necessary to find a new point of equilibri-
Free Trade Zones in this region has almost doubled to more um, centered on industry, with a largely than 60. They employed less than 100,000 people in 1984, half female workforce. The brutal transformaof them in Haiti - in 1989 they employed nearly 200,000, less tion effected by capitalism combines with a slow and difficult reconstruction of the working class organizations.
The FIZs solve none of the problems of local development. The creation of jobs and the improvement of qualifications rapidly provokes an inevitable pressure on wages. They have to be increased to stabilize a part of the workforce and to avoid labour unrest. Then some of the employers look elsewhere, to another FTZ, to lower their costs of production. After ten years of existence, the FTZs in Mauritius are experiencing this and employers speak of
"delocalizing" some of the factories and production to Madagascar.
The British magazine International
Labour Reports has reported on the long saga of the Californian firm Mattel, which produces Barbie dolls; installing themselves first in Mexico at the end of the
1960s, they moved to South Korea, after two victorious strikes. In the middle of the
1970s, the same process took place in
Korea and Mattel moved production to the
FTZ of Bataan in the Philippines! Such is the inevitable contradiction of a "delocalized" and segmented production, in search than a fifth of them in Haiti. ROBERT HELDER
HIS spectacular growth is essen-
T
tially due to the success of the Free Trade Zones (FTZs) in the Dominican Republic. Between 1984 to 1989, their number has passed from four to seventeen and the number of people employed has grown from 25,000 to 110,000. This last figure is bigger than that of industries manufacturing for the local market or that of the sugar industry, both stagnant since the beginning of the 1980s. It represents 5% of total employment in the country. In 1988, value added in the FTZs reached 15% of value added by the whole of the manufacturing sector. Exports from the FTZs reached $517 million, more than a third of commodity
The reasons for this growth are many; proximity to the United States; exemption from US customs duties for many products under the Reagan Plan; relative political stability; total freedom from taxes; and above all, as the promotion brochures boast, "cheap and abundant labour"
The Dominican FTZs attract investors above all because of a very high rate of exploitation of labour. The minimum salary applicable in the zones is currently 650 pesos a month, that is around £50/$100. The working week is at least 44 hours. Conditions of work are in general very bad, the rhythms imposed by piece work very high. Despite the recognition of trade union rights in the rest of the country, in the FTZs repression of trade union activities is absolute. Workers are recruited after police surveillance of any previous trade union or political activity. The Sergives ation is a organi bion adiate 19 lective action is followed by immediate
The share of Free Zones in Dominican exports
International Viewpoint #196 • December 10, 1990
FREE TRADE ZONES dismissal without any right of appeal.
Three quarters of jobs in the zones are held by women. The factory bosses particularly appreciate their dexterity in assembly tasks (mainly garments, shoes and electronics) and their relative docility, a consequence of their dominated situation in a particularly patriarchal society. The majority of these women are young between 16 and 24 — and remain only for some years in the workshops, whether because of maternity or the attrition of work. In brief, the FTZs are areas of intense repression and exploitation!.
Nevertheless, the development of the FTZs does not constitute a path to capitalist development, contrary to the claims of the ruling class and the bourgeois econo-
One of their chief claims is that enterprises in the FTZs have created jobs. In fact they have wasted the labour force in tasks which could be automated according to existing technical knowledge. The rapid turnover of the workforce is a proof of this waste — their labour power is used up
Moreover, these jobs are very precarious. Any change in the social or political climate can lead to the foreign enterprises, or the mother companies transferring their orders to another competing country, or moving their workshops from the FTZs at little cost. This is what Haiti has experienced since the fall of Duvalier in 1986, despite the efforts of the military, Washington and Paris to preserve the social
Wave of departures
Also, it is enough for one or several of the competing countries on the FTZ market to devalue their currency sufficiently to provoke a wave of departures. The elec-
Barbados, which reached $150 million in 1984, have thus been reduced to nothing in three years. Finally, progress in automation of industrial production can render these jobs no longer profitable, at least without a further lowering of real salaries. Since 1970, when the first Dominican FTZ was created, the minimum real monthly salary has fallen from $58 to $23.
The FTZS were supposed to generate an inflow of foreign currency. In fact, the net revenues of foreign currency from this activity, that is to say the added value in the Dominican FTZs, rose to only $129 million in 1988. For an average of 80,000 jobs in the course of the year 1988, this represented only $1612 a year per job.
Again, the FTZs were supposed to facilitate the transfer of technology favourable to the industrialization of the country. In fact, the transfer is insignificant. By definition, industries with a high intensity of labour do not tend to integrate modern technologies. The weakness of investment 20 indicates clearly that the Free Trade Zone enterprises are sweatshops and not indus-
1975 In Millions % National exports 97 Sugar products 594 65
34 34 25 149 50 FTZ exports 27 Total exports 914 100 tries; $3318 per worker in the shoe indusclothes manufacture, $9057 in electronics?.
The average investment in the industries of the United States is at least ten times higher than this figure. The time devoted to genuine training of workers is in general not more than a few weeks. The attitude of the Dominican state is moreover in line with the adoption of this mode of "under-development" — it is progressively abandoning its responsibility for education, the standard of which has been in spectacular decline for nearly
The FTZs, it was claimed, would stimulate economic activity in the rest of the country through the purchase of goods and services.
In fact, purchases from the local economy by the FTZs are practically nil. Pieces for assembly, like, for example, fabrics or electronics components, are produced at least cost and with least risks in the more advanced countries. Even the enterprises which have been installed for 15 years or more in the Dominican Republic have not begun to integrate themselves in
To sum up, the expansion of the TZs in the Dominican Republic took place only because the country has, through its
1980 1988
In Mili s in Milion s
960 89 901 64 330 31 178 52 64 35 18 51 64 380 408 29 111 10 169 12
11 36 1077 100 141 100 policy of repression and superexploitation of the workers, placed itself on the lowest rung of the hierarchy in the international division of labour. This does not mean that the country might not one day drop out of the hierarchy, due to competition from the other dominated countries, or from the conjuncture of protectionism, labour force in the imperialist countries.
The only positive gain of the growth of the FTZ in the Dominican Republic is the development of a new sector of the working class. This sector is concentrated -two of the FTZs each employ more than 30,000 workers (San Pedro de Macoris and Santiago).
It is also young in the majority and essentially female. The development of feminist and class struggles will allow it to organize itself and become conscious of its strength. The FTZs thus hold the promise of a renewal of social and political struggles. * 1. See Isis Duarte, "Trabajadores Urbanos en RD", Editora UASD, Santo Domingo, 1986. 2. See A. Abreu et al, "Las Zonas Francas Industriales", Centro de Orientacion Economica, Santo Domingo. 3. Francisco Moya Espinal, "Zonas Francas Industriales y Empresas Multinacionalese RD", Working Paper no. 46, project OIT.
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