When Elephants Dance, The SADC Charter of Fundamental Social Rights, a Beacon of Hope or Confusion Compounded?

Abstract

… EU social legislation is an un‐stoppable tide, which has flowed up English estuaries and looks set to breach remaining defences. If you can not beat it, you have to join it, and go with the flow … the Social Chapter is alive and well and very much directing its attention towards the rights of employees and duties of employers. Lord Denning1 1 See www.learnedcounsel.com/eclaw.html (accessed 3 July 2007). The changing dynamics of global economic management and political participation means that a philosophical outlook on economic reconstruction and global governance is in a constant state of flux. The movement in these tectonic plates endangers conflict between competing economic and social priorities, creating dilemmas which if not reconciled are bound to cancel each other’s gain. On the one hand there is need for trade and investment as an alternative to donor aid as a means for developing countries’ global economic integration; but on the other hand there is need to cushion the shock of such adjustments by social protection programmes. In all this, global players ply their trades and interests and they come in all forms and shapes, some with many hats and others not. It does not matter these days where one lives, you will notice that the world is ‘made in China’. The question is, why is this the case? Put another way, what is attracting transnational corporations to relocate their production facilities to destinations such as China, Indonesia and Africa? The answer seems to be the comparative advantage2 these destinations have. Labour could possibly be cheap, because of underinvestment (if not no investment at all) in occupational health and safety (OHS), among other contributing factors, and it would be naïve to expect profit‐oriented corporations to sing the song of corporate social responsibility on their own. It is up to host states and regions to mitigate the erosion of social standards by social policies that ensure decent working and living conditions for the workforce and communities. The Southern African Development Community (SADC) tries to do this through the Charter of Fundamental Social Rights (the Charter). To what extent does it provide an effective policy blueprint on OHS in the region and, three years on, has it changed the regulatory terrain for OHS? How does SADC balance social and economic demands in the region? This article will reflect on these questions and suggest a formula for SADC to adopt in order to translate its policy ideals on OHS into realty. 2 In economics, the theory of comparative advantage explains why it can be beneficial for two parties (countries, regions or individuals) to trade, even though one of them may be able to produce every kind of item more cheaply than the other. What matters is not the absolute cost of production, but rather the ratio between how easily the two countries can produce different goods. The concept is highly important in modern international trade theory. The theory of comparative advantage is perhaps the most important concept in international trade theory. It is also one of the most commonly misunderstood principles. There is a popular story told amongst economists that once when an economics sceptic asked Paul Samuelson (a Nobel laureate in economics) to provide a meaningful and non‐trivial result from the economics discipline, Samuelson quickly responded with, ‘comparative advantage’. The sources of the misunderstandings are easy to identify. First, the principle of comparative advantage is clearly counter‐intuitive. Many results from the formal model are contrary to simple logic. Secondly, the theory is easy to confuse with another notion about advantageous trade, known in trade theory as the theory of absolute advantage. The logic behind absolute advantage is quite intuitive. This confusion between these two concepts leads many people to think that they understand comparative advantage when in fact, what they understand is absolute advantage See Samuelson, P.A. (1969) The way of an economist, in: P.A. Samuelson (Ed.) International Economic Relations: Proceedings of the Third Congress of the International Economic Association (London: Macmillan) pp. 1–11; generally see Smith, A. (1776) An Inquiry into the Nature and Causes of the Wealth of Nations, www.econlib.org/library/Smith/smWN.html (accessed 3 July 2007).