PRODUCTIVITY CHALLENGES FOR THE THIRD WORLD IN A GLOBAL COMPETITIVE ECONOMY

PRODUCTIVITY CHALLENGES FOR THE THIRD WORLD IN A GLOBAL COMPETITIVE ECONOMY

Discussion Paper in a Public Lecture Organised by Federal Ministry of Labour, Productivity and Employment Kano State 19th February, 1993

By

Mu’azu Mohammed Yusif
Department of Political Science
Bayero University, Kano

Introduction
The subject of this lecture is “productivity challenges for the Third World in a global competitive Economy”. I am not surprised the organisers of this conference have coined the theme of the discussion in this term. This must be deliberate, as the global economic system, especially the connections of Third World countries in it is currently being restructured in the face of monetarist economic theory. The central proposition of this theory is the creation of global competitive economy governed by the principle of market forces.

In the light of the on-going industrial action by public service workers against one of the elements of monetarist economics, i.e. deregulation of collective bargaining, I am going to raise some issues on productivity, wage control and wage determination.

Definition
The leading concept in the topic of this discussion is Global Competitive Economy. Somebody may ask, is there a global economy? Who compete in this economy and for what? The global economy is a capitalist economy. It is moved by the motive of capitalist development. The making of profit. Therefore competition is inherent of it. The major capitalist forces in the global system are western European, Japanese, and US based multinational corporations. Their operations cut across the countries of the world. They are the forces of competition in the economy, because they operate to make larger and larger profit and each searches for profit only by expanding into a market against other competing enterprises. The workers of the world are the sources of the profit of the enterprises.

Workers of the Third World are specifically cheaper source of profit for US, Western European, and Japanese based multinational corporations. Because of the imperialist root of the economy of the Third World countries and the role of the indigenous allies of the multinational corporations, the workers organisational capacity of resistance needs to be strengthened.

A weak resistance could allow the forces of imperialism – nationally and internationally to dictate theoretical models of Economic Policy measures to maximise the exploitation of workers.

The Economic Model
This is the case of the monetarist economic theory, which has come either as structural adjustment programme, or rehabilitation programme or simply Economic Recovery Programme, which most countries in Africa, including Nigeria are now implementing. The underlying rationale of the model is to increase but rationalise the exploitation of workers. As I have earlier mentioned, the principle of this model is to create market forces mechanisms in the operations of the economy of the countries implementing the programme, which means integrating the countries deeply into the network of global competitive economy.

Productivity and Wage-fixing
There are many theoretical concepts used in the principles of the said programme to intensify the exploitation of workers. One of these is connecting wage increases with productivity. In Nigeria, this dominated the thinking of many economic theorists on the analysis of the causes of Nigeria’s economic crisis and the search of solutions to the crisis.

The Structural Adjustment Programme now being implemented by Babangida regime is rooted on such economic theory. Following the framework of this theory, on Wage-fixing the Government deregulated collective bargaining. This means all centralised wage-fixing institutions and legislations are to be abolished or privatised? This implies that salaries of workers in the same industry, same sector of the economy, are to be different depending on productivity (Sic:)

Although, there are a few exceptions, in general, whether deliberately or not the ideology of productivity is used by the governments in Third World countries in wage control and wage determination. In some countries the organised Labour Movement embraced the same ideology. However, in most countries, inspite of legislations, institutions, commissions and boards to monitor that, is not practically possible to establish results of the connection between wage determination and productivity. The fact is that it is impossible to measure the connection. Indeed, even a monetarist economist asserts that “Any long-run application of the principle that wage increases should be tied to increases in measured productivity would thus be grossly unfair; it would cause those who happened to be employed in sectors where output per head could be measured and for technological reasons could be increased to grow richer and richer, at the expense of those who happened to be employed in the other sectors of the economy where such measured increases in productivity were technologically impossible”1.

The theory is only a theoretical as well as ideological justification of avoiding general increases of wages. If really, we take productivity as the means of improving the wealth of the society, and if there is no fear of decline of profitability, the more wages workers receive the more productivity increases.

Conclusion
The on-going public service workers strike highlighted the dangers of deregulated collective bargaining in a situation where the organised labour movement is not sufficiently united ideologically, politically ad organisationally to deal a final blow to anti-labour forces. The best is therefore to return to centralised wage control and wage determination system.

Footnote
1 J. E. Meade, Wage Fixing, George Allen and Unwin, London 1982 Pg. 40.