Liberation from Liberalization: Gender and Globalization in South East Asia

About the author Roksana Bahramitash teaches courses on gender and development at the Simone de Beauvoir Institute Concordia Women Studies Programme at Concordia University in Montreal. Awarded a PhD by McGill University in 2001, she is currently researching globalization, Islamization and women’s employment, a project supported by the Social Science and Human Research Council of Canada (SSHRC). She has won several awards for research on female poverty, including the Eileen Ross award (SSHRC) and the Margaret Gillet Award (McGill University). Part of the data for this book was gathered while she worked on Islamization and women’s economic power in Indonesia for the Canadian International Development Agency (CIDA) in 2001–2.

Liberation from Liberalization Gender and Globalization in Southeast Asia Roksana Bahramitash

Zed Books LONDON & NEW YORK

Liberation from Liberalization was first published in 2005 by Zed Books Ltd, 7 Cynthia Street, London N1 9JF, UK and Room 400, 175 Fifth Avenue, New York, NY 10010, USA www.zedbooks.co.uk Copyright © Roksana Bahramitash 2005 The rights of the author of this work have been asserted by her in accordance with the Copyright, Designs and Patents Act, 1988 Cover designed by Andrew Corbett Set in 10/12 pt Bembo by Long House, Cumbria, UK Printed and bound in the UK by Biddles Ltd, King’s Lynn Distributed in the USA exclusively by Palgrave Macmillan, a division of St Martin’s Press, LLC,175 Fifth Avenue, New York, NY 10010 All rights reserved A catalogue record for this book is available from the British Library US Cataloging-in-Publication Data is available from the Library of Congress ISBN ISBN

1 84277 438 7 hb 1 84277 439 5 pb

Contents List of Tables and Figures • vii Acknowledgements • ix Introduction • 1 1

Market Fundamentalism • 19 The post-Second World War development effort • 20 The rise of neo-liberalism • 27 Alternatives to market fundamentalism • 32

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Who Pays for Market Fundamentalism? • 40 Background to theories of gender and development • 41 Women’s work as defined by the market • 43 Neo-liberalism and increasing women’s employment • 45 Women’s invisible contributions • 53 Labour of love: the care economy and declining social services • 57 The interventionist state versus market fundamentalism • 60

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Taiwan: Neo-Liberalism or Developmentalist State? • 64 Colonial history • 64 The making of modern Taiwan • 69 Women’s role in Taiwan’s economic success • 77 Invisible economic contributions • 91 Community and volunteer work: state-initiated organizations • 96 Gender politics, civil society and Taiwan’s future • 99

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Indonesia: Paper Tiger and the Asian Crisis • 106 Colonial history • 106 Modern Indonesia: state structure and political economy • 112 Women’s role in the economy • 120

vi

CONTENTS

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The Philippines: Exporting Women Is Good for Growth • 136 Colonial history • 136 Modern Filipino state structure and development strategy • 146 Women’s role in the economy • 155

6

Conclusion: Liberalization in Crisis • 172 Challenging neo-liberalist assumptions • 172 APEC and the unholy marriage of neo-liberalism and neo-conservatism • 179 Neo-liberalism in crisis: looking into the future • 183

Bibliography • 187 Index • 201

Tables and Figures

Tables 0.1 Comparative backgrounds of the three countries 0.2 Stages of economic policy in the three countries 0.3 The three economies compared 3.1 Taiwanese economic development policies 3.2 Female employment ratio 3.3 Proportion of average monthly female wage to male wage by industry 3.4 Number of sexually oriented businesses in Taiwan (1946–73) 3.5 Partial correlation of female employment ratio on social variables (controlling for GNP/GDP per capita) 4.1 Phases of development strategy 4.2 Female employment ratio by sector 4.3 Average hourly wage for female workers (US$) 4.4 Number of registered prostitutes, Indonesia, 1984–95 4.5 Total Indonesian international labour out-migrants by gender 4.6 Life expectancy at birth, infant mortality rate (per thousand) and illiteracy rate 5.1 Phases of Filipino development strategy 5.2 Manufacturing and agriculture as percentage of total exports 5.3 Female employment ratio by sector 5.4 Ratio of women to total workers in service sector by occupation 5.5 Filipinos residing abroad, 1981–94 (in thousands) 5.6 Domestic servant work permits issued by local emigration department

15 16 17 73 80 82 90 95 116 122 124 126 126 131 151 152 156 159 164 165

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TABLES AND FIGURES

Figures 0.1 Middle East and North Africa 0.2 Sub-Saharan Africa 0.3 Latin America 0.4 South Asia 0.5 Southeast Asia 3.1 Female employment ratio, Taiwan, 1960–93 3.2 Female share of employment in manufacturing, Taiwan, 1960–93 3.3 Manufacturing as a percentage of total GDP 3.4 Female employment ratio and total fertility rate 4.1 Female employment ratio by sector 4.2 Female employment ratio and total fertility rate 5.1 Female employment ratio by sector 5.2 Female employment ratio and total fertility rate 5.3 Female employment ratio, infant mortality and life expectancy 5.4: Female employment ratio and educational attainment

11 11 12 12 13 84 86 87 92 122 128 156 166 168 169

Acknowledgements

This book is the result of a search that is both intellectual and personal. It reflects my intellectual concern about the deficiencies in academic treatments of economic development with respect to gender issues; and it reflects my commitment, based on personal experience, to the need to assure women adequate access to economic resources. During the seven years spent developing the arguments in this book, I incurred many debts. I wish to thank my doctoral supervisor, Professor Michael R. Smith. He was a source of intellectual support and someone who demonstrated by his example the importance of tolerance of other points of view in maintaining a strong and healthy academic climate. I also want to thank Professor Lillian Robinson, director of the Simone de Beauvoir Institute of Concordia University, who was my supervisor for much of my post-doctoral work, a truly resourceful supervisor who has proved to be of great inspiration and academic support. This book has benefited from the opportunities provided by two post-doctoral awards, first with the Globalism Project and then one granted by the Social Sciences and Humanities Research Council of Canada. Many academics at McGill and Concordia, and at other universities in Canada as well as abroad, have been generous with their time and advice, including Professors Rashad Antonius, Marjory Cohen, Diane Elson, Homa Hoodfar, Gordon Laxer, Daniel Lev, Uli Locher, Roger Krohn, Thomas Naylor, Anthony Paré, Kari Polanyi-Levitt, Axel van den Berg and Don Von Eschen. Others have also provided a great deal of support and advice, by reading the manuscript on several occasions. I especially would like to thank Dr Eric Hooglund who has provided unique support for this project. I also want to thank Fred Reed and Farbod Honarpisheh for listening to my ideas patiently and providing ix

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ACKNOWLEDGEMENTS

insightful feedback. I might never have thought of publishing this book if Dr Anthony Synnott, previous Chair of Concordia University’s Department of Sociology and Anthropology, had not kept encouraging me to seek its publication. I was extremely fortunate to meet Chris Corrin who gave me the confidence to publish my work and provided me with extremely important advice on how to approach various publishing houses. I have also benefited from support from the Centre for Teaching and Research on Women of McGill University, under the directorship of Professor Shree Mulay, and from McGill’s Canada–Indonesia Project, who together financed a research trip to Indonesia to do fieldwork that would otherwise have been impossible. On a more personal note, I thank my mother, Fatima Samady Haghighi, and my uncle, Behzad Farrahi, for being there when I needed them. Thanks, too, to many wonderful friends, including Susan Lafontaine, Dana Hearon, Nada Sofian, Parvin Saghafi and Farkhondeh Aghai, for their emotional support. I feel special gratitude to Farzaneh Khatir because of the supportive role she played during a very difficult time of my life, one which coincided with the last stages of turning the manuscript into a finished book. Last but not least, my wonderful family has been a great source of strength. My children have filled my life with great personal satisfaction and gave me an invaluable opportunity to enjoy my life while busy writing a book. Raising my children gave me a chance to understand and gather first-hand experience on the very topic that I was writing about. Raising my family transformed me from being just an academic to someone who had the opportunity to be the subject as well as the object of her study. As my career proceeded I watched them grow from children into adults and they watched me patiently, giving me the courage and strength needed to be a working mother.

This book is dedicated to four wonderful individuals without whom my life would have been meaningless: Mahsan Sadegh, Arash Sadegh, Iman Sadegh and Atena Sadegh

Introduction

Globalization of the economy refers to the process by which the forces of the market, including increasing flows of trade, investment and financial capital, expand beyond the powers of nation states. This is not a new phenomenon. It dates back to the beginning of colonization, as pointed out by world-systems theory (Wallerstein 1974). Yet what is new about today’s globalization is an acceleration of market expansion prescribed by neo-classical economic policy since the 1980s. Such policies have aimed to abolish protectionist rules, tariffs and regulations to allow for the free flow of goods, services and capital around the globe. This is a process aimed at turning all countries of the world into one global market, and therefore limiting the role of the nation state as the major player in the economy. In order to expand the free market, neo-liberalism has called for deregulation and privatization, thereby limiting the role of the state in the economy as well as reducing the scope and size of the welfare state (Lal 1983). Neo-liberalism, also known as the Washington Consensus, has been adopted by the North and imposed on the South, through international monetary organizations such as the International Monetary Fund (IMF) and the World Bank. Neo-liberalism claims that its policy prescription will bring economic prosperity. This may be true purely in terms of GNP per capita and most countries’ balance of payments, by which measures economic prosperity in today’s world appears phenomenal. Yet it has created huge poverty and income disparity, the net wealth of ten billionaires being worth one and a half times the combined national 1

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INTRODUCTION

incomes of the 48 least developed nations. The expansion of the global market has also brought huge benefits to corporations. Half of the world’s 100 largest ‘economies’ are, in fact, not countries but corporations (UNDP 1997). The result of growing income disparity and poverty has taken its toll on vulnerable groups in general and on women from the South in particular. At the World Conference on Women’s Beijing+5 session, held at the United Nations in New York during June of 2000, the following facts were presented. Out of the world’s 1.3 billion people living below the poverty line, some 70 per cent are women. During the past 21 years, in 41 developing countries, poverty for rural women has increased 17 per cent. Two thirds of the world’s 900 million illiterates are women, which has obvious implications for their employability and relative earnings. Similar disparities exist in health data, with similar consequences. In addition, in more than 90 countries of the world fewer than 10 per cent of parliamentarians are women. It would be a surprise if this political under-representation did not bear some relationship to the economic disparities. As UN SecretaryGeneral Kofi Annan pointed out at the Beijing+5 conference: the gender divide is still widening. Women earn less, are more often unemployed, and generally are poorer than men. Women’s work is still largely part-time, informal, unregulated and unstable. The fact that they have productive as well as reproductive roles is still too rarely recognized. (Annan 2000)

A massive increase in poverty is not alarming for the female population alone; it is a problem for society as a whole. Women’s economic disempowerment hinders their role as primary care giver of the family. Furthermore, as women typically are more concerned with issues related to the community than men, female poverty goes beyond the family and affects the community as well. In spite of several decades of development effort and numerous projects that have aimed to empower women, there has been little gain and globally an overall loss, as indicated by the Beijing+5 conference. The obvious question is why so much effort has failed so badly? This leads us to look at the ways in which mainstream-inspired policy making has failed women. One of the major objectives of this book is precisely to examine mechanisms through which such a failure has taken place. This failure is particularly significant since

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3

national governments and international agencies have adopted policies to increase the female employment ratio (FER – defined as the ratio of women working to the total number of women in the economically active age bracket), as an important part of the solution to the problem of growing global poverty. But increasing female employment alone will not address the issue of rising poverty as long as the role of the state remains limited and the welfare state deteriorates. Throughout the world, expansion of the market economy has increased employment for women but this increase has exacerbated poverty rather than reducing it (Sen 1997). The proportion of women employed has steadily increased in the past few decades nearly everywhere. The proponents of mainstream economic development theory point to this fact and use it to legitimize their policies, ignoring the poverty that it has created and what a mixed blessing it is as a result. It is only through a careful examination of the empirical situation of women that the issue of rising poverty in spite of increases in employment can be understood. One of the factors is increased inflation in the price of basic goods and services. Such increases in inflation resulting from globalization have disproportionately affected the real incomes of those who belong to the lower strata. Although inflation is a serious issue it is not the only one. Another factor is a decline in male employment, which has a negative impact on household income. Male unemployment has to some extent offset the gains of increased employment for women in terms of overall household income. Other important factors have been contributing to female poverty as well: for example, the nature of jobs and the working arrangements in the type of employment that has mainly recruited women have had an impact. With globalization there has been a change in the nature of employment and work – there has been a tendency towards less-skilled, low-waged jobs, increasingly with casual employment arrangements (Standing 1999). Since the 1980s these types of jobs have mainly employed women. In addition, deregulation and privatization have eroded the collective bargaining power of labour and, as a result, labour standards have been declining. At another level, increased employment for women has created new problems regarding women’s role as caregivers. More paid work outside of the home and little increased participation of men in housework activities have led to a decrease in the level of care

4

INTRODUCTION

provided for the family, particularly in developing countries. The phenomenon is not limited to developing countries, however: as Broomhill and Sharp (2002) point out, even in an industrialized country like Australia, few men share housework. This means that more women work outside their home for pay, while their labour inside the house remains the same. This phenomenon has been discussed in the literature and is referred to as the ‘double day’. Clearly, this is a situation where rising employment has reduced the quality of life. Women’s role as the primary caregiver of the family is ignored in national economic calculations even though it is an important part of the social and economic life of societies. Women not only produce the future labour pool, but they take care of them. It is often overlooked that women invest their physical energy and their financial resources in their families (typically much more so than do men). Because this contribution has been overlooked, the decline in women’s resources and its impact on this aspect of their lives and on the lives of their dependents is also ignored. This is a huge problem, particularly in the context of the decline of the welfare state. As women have less time and energy to spend on their families and states are cutting down on public services such as health and education, many children are suffering. This has been translated into a declining quality of life for the working poor of the world. For the rich of the world, both from the South and the North, who can afford to purchase private care either institutionally or informally, this is not an issue. This is illustrated by increased private health care and education as well as by increasing employment of domestic workers, many of them from the poor households of the South. But as the trend towards income disparity between and within countries is accelerating, such options are not a viable solution for the masses of the working poor. There is yet another aspect of women’s work, and that is their volunteer and community work. Since women, much more than men, identify with their families, they are much more concerned with their immediate communities and, as mentioned above, communities become an extension of the family, especially in the South. Women, then, are the dominant actors in the field of volunteer work and provide a whole range of community welfare services. The reduction of the role of the state has increased the burden for women as community care takers. This is much more critical in the context of

INTRODUCTION

5

developing countries, where the welfare state was never as fully established as it was in the North. In addition, policies such as structural adjustment in the South have had disastrous effects and have forced many women to devote their time and energy to volunteer work, often through non-governmental organizations, to provide community care. This situation is likely to deteriorate even more, as many states in the South are forced to retreat from the global economy even further. In fact a major feature of mainstream economic orthodoxy is to celebrate the impact of the cutbacks in stimulating growth, while ignoring the crucial role of women’s work in compensating for those cutbacks and cushioning the social repercussions. Ironically, many states in the developing world have been consciously using this aspect of women’s work precisely for such ends. Those states often go so far as to set up, or encourage the establishment of, women’s non-state organizations precisely as a vehicle to implement policy or to substitute for the lack of such policy. The book will examine a few cases where the state in the Philippines and Indonesia has used women’s organizations to deal with the issue of rising poverty. Though the book is mostly restricted to three case studies, these examples are fairly representative of a more general phenomenon. Using women’s organizations to deal with issues of poverty resulting from cutbacks of the welfare state is not limited to nation states. In fact, the World Bank has been moving in the same direction. The case of Indonesia, where the World Bank has provided funds for women’s non-governmental organizations to support social safety net programmes, is a good example. The World Bank, a major agency enforcing neo-liberalism, has been giving aid to women’s organizations. In this sense, it has been acting as a state above the nation state, giving funds for welfare expenditures and thereby contradicting its own policy of enforcing welfare reductions. This is because the World Bank’s hands-on experience has given it a real taste of the results of its policies. The World Bank has realized that there has to be institutional support for those who cannot protect themselves against the forces of the market. Yet there is no indication that this practical experience will make the World Bank go against the gospel of the rules of the market. This book argues that increased employment for women will not alleviate the problem of poverty either for women or for the society

6

INTRODUCTION

as a whole unless there is a state policy to guarantee labour rights and provide basic welfare for all. But this requires a particular kind of state, one capable of resisting the rich and the powerful business interests that try to use and control it. Only such a state could be responsible to its citizens and be involved in the economy with policies aimed to empower those in the lowest social strata – women. Ideally, a state must operate and formulate economic policies based on the interests of its citizens, where citizens act and interact as members of society and not merely as consumers and producers for the market. But this will only be the case where there is a welldeveloped civil society to make sure that those in control of the state are in fact elected by the people to represent the interests of its citizens. A strong civil society, backed by grassroots women’s organizations, will support a state that accepts responsibility for its economic policies and is willing to take measures that will empower those who are economically disadvantaged. Two of the case studies presented in this book, Indonesia and the Philippines, are examples of rentier states. These two states have acted to protect business interests at the expense of their citizens. In the third case, that of Taiwan, the state has acted as the main entrepreneur but at the same time it has committed itself to providing basic care for all and adopted policies of land redistribution and welfare provision. As a result, Taiwan experienced growth with far less poverty than has been experienced by many countries of the region. The case of Taiwan shows that a state policy of bringing women into the labour force, even when its primary motives were purely economic, if combined with a welfare state, can lead to poverty reduction. It illustrates that when a state is committed to welfare for all there is great potential for tackling the problem of poverty. The impact of increased employment for women as a mechanism to reduce poverty is a very interesting issue and it is related to the fact that men and women participate differently in economic life. This distinction is an important one: cross-cultural studies show that women have a different expenditure pattern from men. They identify with their communities and are therefore more inclined to spend their time and energy with and for their families and their communities, helping both their households and their communities to improve collectively. Men, on the other hand, identify with their workplace and their peer groups, spending their time and energy on luxuries and

INTRODUCTION

7

outside their household and immediate communities. As a result of women’s role as mothers and caregivers, their expenditure and saving patterns are different from those of men. They tend to be more inclined towards improving conditions economically as well as socially for their families, which makes it more efficient for developing countries to put money into women’s pockets rather than those of their husbands. This is crucial to bear in mind, since globalization has led to a disproportional increase in the level of female poverty. Furthermore, an extremely important difference between male and female labour force participation lies in the indirect social consequences. Women are a vital part of the economy not simply because of their direct income-generating or income-spending behaviour, but also because giving more women economic resources by increasing the female employment ratio has a positive effect on such social variables as the fertility rate, literacy, infant mortality and life expectancy. The case studies will provide evidence for these assertions. This is not to suggest that the state should attempt to replace men with women in the formal labour force as a means of addressing the current gender gap. Rather, the process of encouraging female employment should be incremental. The state should undertake measures that favour increasing participation for women in the formal economy and in the context of policies that raise the overall level of employment. Women’s role as economic agents complements their role as primary caregivers both in a family and in a community setting. Therefore each extra unit of female labour employed is likely to produce greater ‘externalities’ in terms of the success of social policy than would each extra unit of male labour employed. This is particularly important as the definition of economic well-being must move away from simple GNP per capita towards incorporating broader measures of the quality of life, including infant mortality, life expectancy and literacy rates, to name just a few. In addition, more intangible benefits such as greater social autonomy for women are a likely result of their having greater access to regular income in the formal sector and a chance to upgrade their skills and education. That, too, will have positive feedback effects in terms of the health and education of the next generation. And, certainly not least, any attempt to raise the female employment ratio in the modern, formal sector, which inevitably takes women away from their immediate and

8

INTRODUCTION

traditional environment, will be a critical step in controlling fertility and population growth. Many studies show that when women have control over family planning and are economically independent they choose smaller families. Granted, increasing female employment in the informal economy will also increase women’s immediate access to economic resources. In fact, with globalization, female employment in the informal economy has increased. But, to the extent it is possible to get a clear picture of an underground phenomenon, employment in the informal sector is irregular, unregulated, and usually at very low wages. In addition, it provides less opportunity for training and advancement. Hence any positive impact on the target social variables would be expected to be much less powerful (as well as, by definition, impossible to measure accurately). All of these distinctions in gender-based economic performance, both in earning and in spending income as well as in their broader social consequences, are well substantiated by micro-studies of an anthropological nature cited throughout the three country case studies to follow. But how all these mechanisms fit into a more general picture of macro and structural analysis for the economy as a whole has been neither examined nor elaborated with much analytical clarity in the existing literature. This book will contain quantitative analyses of the impact of female labour force participation rate on GNP per capita (and its rate of growth) as well as fertility rates. In addition, the effect of female employment on the Human Quality of Life Index – measuring infant mortality, life expectancy and education for the population as a whole – will be examined using national and international data. The analysis does not make specific reference to the impact of changes in relative participation on the difference between male and female longevity, educational attainment or other social variables. Rather, it focuses on the overall impact of increased female employment on the population as whole. An important objective of this book is to demonstrate that the state should give strong priority to increasing female participation in the formal (as opposed to the informal) economy instead of leaving the economy to market forces alone. This is a significant point as the literature on women and development in general, and the works discussing gender issues in the context of globalization in particular,

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9

focus on the nature of the problem but rarely on solutions. Increasing the role of the state and implementing policies to promote the formal employment of women will indirectly affect other critical social variables. While this argument will be based partly on statistical analyses, many of the possible feedback mechanisms, from policies to increase female employment to reductions in the gender gap, will be picked up in the actual case study analysis using micro data. The main statistical analysis is not very meaningful unless put in a context that will include factors not subject to simple quantitative measure but, nonetheless, essential for capturing the nature of economic growth. This context includes, as a central consideration, institutional factors related to the political climate in which economic strategies are formulated, particularly the nature and ideological orientation of the state. In addition, analysis of case studies allows us to consider other factors such as colonial history, culture, economic structure and so forth that are beyond simple statistical examination. Included in this category is the role of women’s political organizations, which can, under certain circumstances, have a strong impact on state policies and their effects. In this book, I have combined qualitative and historical-comparative methods with statistical analysis because those following a historicalcomparative approach often find themselves in ideological conflict with those using more formal statistical-quantitative methods, seeing the latter as implicitly loaded with free-market bias. In turn, those preferring a quantitative approach often regard historical and institutional studies as weak and inconclusive. In my view this methodological division is a serious mistake. Particularly in a context where data are often poor and unreliable, and even definitions of what constitutes ‘work’ are inconsistent, it is useful, sometimes critical, to assess the quantitative data and attempt to flesh out their meaning by paying attention to the political, social and historical context (Rueschemeyer, Stephens and Stephens 1992). On the other hand, given the complexities so often exhibited by developing societies, statistical data are often essential to really make sense of trends and patterns. For this reason I have used statistical analysis and comparative-historical analysis, buttressed by anthropological field studies and on-site interviews, to reinforce each other for the purpose of increased credibility. One of the advantages of the book is that it has used the type of detailed, contextual data widely used in the feminist literature,

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INTRODUCTION

namely data of an anthropological and qualitative nature, but it does so in order to formulate a more general, theoretical and conceptual argument on the topic. Since the 1970s a huge literature on the field of women and development has emerged (later emphasizing gender and development) some of which is very relevant to the issue of globalization. But a gender perspective on globalization is still new. This relatively new area with important works (such as Connelly et al. 1995; Mitter and Rowbotham 1995; Sassen 1996; Sen 1997; Standing 1989; Beneria 2003) needs to be enriched by regional and case studies. Thus the current book aims to bridge the gap between general material on gender and globalization and detailed case studies. The book is focused on Southeast Asia for two reasons. First, because neo-liberal economic theory has used the economic growth of this region as evidence of its validity. Mainstream economists had long predicted that Indonesia, the Philippines, Thailand and Malaysia would be the next Southeast Asian ‘miracles’ (Castells 1992). Second, a quantitative analysis of different regions of the South shows that this region has enjoyed both a high level of GNP per capita growth and an increased employment rate for women. In Figures 0.1–0.5, GNP per capita growth rates in different regions of the world are charted alongside rates of female participation in the workforce. The results do not take into account the size of individual countries within each region: all countries, in other words, carry equal weight regardless of their size. Though this does present certain problems with regard to the relative weighting of some countries over others at the macro level, since the focus here is on regional trends, the size of each country is not as important as the region in which each is located. In the Middle East and North Africa region (Figure 0.1), GNP per capita growth fluctuates a lot. This is because the region’s economy, tied as it is to oil, is so dependent on the constantly changing price of oil on the world market. Significantly, the level of female labour force participation is lower here than in other regions. In sub-Saharan Africa (Figure 0.2), GNP per capita growth is exceptionally low. Whilst the female labour force participation rate is generally high, this has shown a slight decline over the past few decades. From Figure 0.3, we can see that Latin America and the Caribbean have had fairly stable GNP per capita growth, accompanied by a rising employment rate for women. Noteworthy here, however, is that the region’s

INTRODUCTION

GNP Labour

Figure 0.1 Middle East and North Africa

GNP Labour

Figure 0.2 Sub-Saharan Africa

11

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GNP Labour

Figure 0.3 Latin America

GNP Labour

Figure 0.4 South Asia

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GNP Labour

Figure 0.5 Southeast Asia

growth rate never exceeds 5 per cent. In South Asia (Figure 0.4) the female employment rate is high, and continues to rise. At the same time GNP per capita growth in this region, although stable, is still generally below 5 per cent. In other words, it is only in Southeast Asia (Figure 0.5) that one sees both a rising female employment rate and relatively rapidly growing GNP per capita. In this region, the GNP per capita growth rate levels are higher than in other regions, going as high as 10 per cent. If the 1997 crisis resulted in a brief period of negative growth for the region, Southeast Asia has demonstrated the best overall economic performance, and this has been coupled with high and rising female employment. Within this region, I have examined in detail three countries that differ widely economically, socially and politically. These are Taiwan, Indonesia, and the Philippines. While Taiwan has been economically successful over a long period of time, Indonesia’s economic performance has been uneven, relegating it to the category of mediumincome countries. The Philippines is the only country in the region to have experienced negative income growth (during the 1980s) since the Second World War. Whereas Taiwan’s economy remained robust in the aftermath of the Asian crisis, in Indonesia the crisis precipitated

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INTRODUCTION

a major political upheaval and a regime change. Likewise, the Philippines experienced a resurgence of separatist movements following the events of 1997. Of the three countries, it is Indonesia that has suffered the most and continues to be plagued by regional and ethnic conflict. Other factors that need to be taken into account can be divided into two categories. The first consists of static factors such as the size of the country, its colonial history, the nature of land reform, the character of the state, and the dominant religion. The second category is comprised of dynamic factors such as the country’s economic development strategies or the nature of its industrialization process. As far as the static factors are concerned, Taiwan is a small country – basically one island with a small population. Indonesia, by contrast, is a large country spread over 8,000 inhabited islands. It is the fourth most populous country in the world. The Philippines lies between these two countries in terms of size and population. In terms of historical background, all three countries have a colonial legacy. However, whereas Taiwan’s colonizers, the Japanese, implemented a very successful land reform programme, the same cannot be said for the Dutch in Indonesia. The Philippines, like many Latin American countries, was a Spanish-American colony. Like Indonesia, it had no land reform programmes. As we shall see, the issue of land reform has played an important role in each of these countries’ respective economic performances. In the case of Taiwan, land redistribution laid the basis for an equitable society, whereas in the other two cases, inequitable land holdings remain a major obstacle to income redistribution. In fact, in the Philippines, where political representation is dependent on ownership of land, the old landowning class has been able to use its political power to block any moves towards a more equitable economic redistribution. Three different world religions are also represented here: Christianity in the Philippines, Islam in Indonesia and Taoism/Confucianism in Taiwan. But more than any of the static factors listed above, it is the nature of the state that seems to have played an instrumental role in these three countries’ respective economic development processes, strategies, and performances. For this reason, this last factor deserves special attention. Unlike the other two, Taiwan has followed the interventionist state model – an option perhaps not open to the Philippines and

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Indonesia given their particular colonial histories. Both the SpanishAmerican and Dutch colonizers left behind a political infrastructure upon which a strong state could not be built. The political infrastructure set up by the Japanese in Taiwan, on the other hand, facilitated the formation of a state with a strong bureaucratic system. As a result of this system, Taiwan has remained committed to charting a unique course of broadly integrated economic development programmes. Indonesia, long ruled by military autocrats, has basically followed the classic dual-economy model, with the bulk of the country’s income coming from state-controlled capital-intensive and export-bound resource exploitation, while most of the population makes a subsistence living through traditional economic activities such as keeping rice paddies. The Philippines, lacking both the state’s commitment to development and a lucrative resource base through which to generate export income, has fared least well of the three. The lesson here would seem to be that state involvement in the economy yields greater economic growth. Table 0.1 Comparative backgrounds of the three countries

Country

State

Colonial Religion power

Taiwan

Strong welfarist

Japan

Indonesia

Weak rentier

Holland Islam

Large

Not effective

Spain Christianity America

Medium

Not effective

Philippines Weak rentier

Size

Confucianism Small

Land reform Effective

Key to this discussion of the nature of the state (and by extension, the dynamic factors – or economic development strategies – that grow out of it) is the question of how each country has mobilized its female labour force. In order to fully grasp the importance of this, it is necessary to first examine the three phases that each of these countries has gone through – phases which, incidentally, are similar to those experienced by many other countries in the world. The first might best be described as an inward-looking import substitution phase. Note that its exact manifestation and its duration vary from case to case. In Taiwan, for instance, this phase was relatively

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short (it had ended by the late 1950s) and ‘import substitution’ here meant largely the substitution of imported manufactured goods. In Indonesia, import substitution lasted into the 1960s. While at first the focus was on substituting agricultural production with the aim of food self-sufficiency, by the end of the 1970s the government had begun to move into indigenous manufacturing in a number of sectors, of which automobiles was just one. In the case of the Philippines, the inward-looking phase was fairly minimal. During the pre-Marcos period there seems to have been a brief flirtation with import substitution, and this continued into the early Marcos period. After the imposition of martial law in 1971, the power of the old landed élite who had pressed for restrictions on foreign control waned, and the economy began to open up. Table 0.2 Stages of economic policy in the three countries Taiwan Indonesia Philippines

1946–early 1959 1950s–1960s 1940s–mid-1960s

1960–early 1990s 1960s–late 1980s 1960s–late 1980s

Early 1990s From 1989 From 1980s

In the second phase – characterized by an outward-looking strategy that emphasizes export promotion – it was the state, in the case of Taiwan, that instigated and encouraged manufacturing designed for export to the world market. The state also created a favourable atmosphere for foreign companies to invest by setting up free trade zones. For its part, the Indonesian state opened the door to foreign companies to set up either independently or in joint ventures with Indonesian firms. Indonesia also set up free trade zones where foreign companies, many from Taiwan and Korea, produced manufactured goods for export. In the Philippines, the influence of the local landowning class continued to decrease and a new class of industrialists sprang up, allied themselves with foreign firms, and invested in free trade zones mainly to produce manufacturing for export. The third phase was a period of structural change: Taiwan had already reached a certain level of industrialization and, increasingly, Taiwanese entrepreneurs went offshore to invest in the production of manufacturing goods. Those entrepreneurs who remained in Taiwan specialized in high-tech industry. In Indonesia, pressure from the World Bank and the IMF meant that the state adopted free market reforms such as deregulation and a reduction in social spending. As

INTRODUCTION

17

for the Philippines, the huge debt that had built up under Marcos made the Philippines particularly vulnerable when it came to its dealings with the World Bank and the IMF. As a result, restructuring through free market reforms not only started earlier than in Indonesia, but was more pronounced. In all three cases women have had a very high rate of employment, but with major differences. Principal among these differences is that while women in Taiwan tend to find formal employment (the informal sector being relatively limited), levels of informal female employment are high in Indonesia and the Philippines. As for the jobs themselves, in Taiwan the percentage of women employed in manufacturing is very high compared to those employed in agriculture and services. In Indonesia, the vast majority of women are employed in the agricultural sector. Though Indonesian women are also well represented in manufacturing, this sector only accounts for a small percentage of overall employment. As for the Philippines, women there are mainly employed in the service sector. Table 0.3 The three economies compared Country

GNP growth

Economic base

Natural resources

Taiwan

High

Labour-intensive manufacturing

Not applicable

Indonesia

Medium high

Dual economy Labour-intensive & capital-intensive manufacturing

Oil, mining Timber

Philippines

Medium

Manufacturing & agriculture

Arable land

In the three case study chapters a historical review of each country’s political economy is provided. This is followed by an in-depth analysis of the nature of the state in that country, and the development strategy to emerge as a result of it. In each of these chapters, much emphasis is placed on how women have contributed to the country’s economic growth (as measured by GNP per capita) over the past few decades. These analyses are twofold:

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INTRODUCTION

they first examine women’s direct contribution to the economy, then move on to discuss the positive impact that female employment has had on the living conditions of the population as a whole. The effect that increased employment of women has had on the Human Quality of Life Index (Morrison and McAlpin 1982) is assessed through a quantitative analysis. In each case, this is complemented by a qualitative examination of the important role that women’s groups (and by extension gender politics) have played in putting pressure on individual states to take responsibility for social welfare and environmental problems. In the final chapter the results of the case studies are used to show that expansion of the world market has brought wealth to countries partly because of an increase in women’s work as cheap and flexible labour. But these gains have been lost in more fundamental ways: for example, forces of globalization have increased women’s burden in terms of their workload in the family and the community, not to mention the fact that the Asian financial crisis has caused huge economic and political losses. Nonetheless, increased female employment by itself is an important measure to reduce poverty, as paid employment has had favourable effects on indicators such as fertility. At the same time, increased employment for women has led to decreased infant mortality, while life expectancy and educational attainment have increased. Yet expansion of the market economy, globalization and the reduction of the welfare state have limited the benefits of increased paid employment for women, and that explains the irony of rising poverty among women while their employment has gone up; it also points to directions that could reverse the trend. However, any critique of globalization must not only provide documentation of its impact but must also provide insight into ways it can be challenged. In the final chapter of this book, the results of the case studies will be used to argue for increased women’s political participation through their grassroots organizations. Only when the increased employment of women is accompanied by a commensurate increase in their political participation can there be any hope that economic growth will benefit society at large. Only a strong state that is nevertheless embedded in and dependent on a well-developed civil society is in a position to protect its citizens from the encroachment of market expansionism and to build a welfare state that will not be eroded by the forces of globalization.

1 Market Fundamentalism

Globalization has many aspects, including economic, technological, political and cultural. Of the four, it is economic globalization that poses the most serious challenge to developing countries and has had the most powerful impact on them. A simple definition of economic globalization is that it is a process of decline in the role of national borders and the gradual fusing of separate national markets into a single global marketplace. This global marketplace has brought prosperity to the rich and poverty to the poor, both between and within nations. According to the Human Development Report (World Bank 1997a), the ratio of the incomes of the world’s poorest peoples to the richest had more than doubled from 30:1 in 1960 to 78:1 by the mid1990s. It is this aspect of globalization and the issue of growing poverty and income disparity that lies at the heart of this book. The accelerated rate of growth in income disparity in the past few decades is a by-product of an economic orthodoxy emphasizing the free market as the engine of growth. The concept of the free market as formulated in neo-liberalism is a market that is almost entirely selfregulating, in Polanyi’s terms. It is this particular type of market that has become the centre of orthodoxy, despite its failure to address poverty. Polanyi’s critique of the self-regulating market system goes back to the mid-1940s. In his work, The Great Transformation (1944), he argues that throughout human history the market has been part of human society as a subordinate institution or, in his words, embedded in social life. At the end of the eighteenth century, a great transformation 19

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takes place that marks the beginning of the self-regulating market system peculiar to industrial capitalism. Up until the eighteenth century, Western economic systems, like all others in history, were based on the principles of reciprocity and redistribution. However, at the end of the eighteenth century, a new social structure based on a self-regulating market emerged, and it gave precedence to the market as a separate institution from the society and one geared to producing prosperity as its primary raison d’être. The self-regulating, wealthmaximizing market became the basis of social life rather than the traditional type of market that was an institution embedded in society. It is this particular type of market that is theorized in the work of classical economists such as Adam Smith and became the fundamental premise of mainstream economic theory. Throughout the post-Second World War era, mainstream economics has been dominated by modernization theory. This theory emphasized the role of the state as a major agency for development initiatives. However, in the late 1970s there was a shift toward neoliberalism, with a stronger emphasis on the free market as a major part of the policy agenda imposed by international agencies on the South. These developments are briefly reviewed in the next sections before I proceed to consider alternative theories.

The post-Second World War development effort An overview of modernization theory After the Second World War, the United States formulated the Marshall Plan, a set of reconstruction policies that were proposed for Western Europe with the objective of using rapid development of the region’s war-torn economies to rebuild European military power in the face of a real or contrived Soviet threat and to curb the popularity enjoyed by the Communist parties in parts of war-ravaged Europe. Those Western European countries, in turn, passed on to developing countries certain principles of economic development based on mainstream theories. In all these plans there was no question that in these newly independent colonies the state would be the agent to implement these policies. Prescriptions for development offered by the North since the Second World War were premised at the outset on the assumptions

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21

of modernization theory. Advocates of modernization relied on a type of state that would take the lead in achieving growth in development efforts in the 1940s and throughout the 1950s, 1960s and much of the 1970s. Also, until the 1970s economic growth was the most important policy objective of modernizers, on the assumption that improved living conditions for the population as a whole would follow. Therefore, major effort was focused on accelerating growth through the policy agendas adopted by national and international development agencies. Growth, for most of the period when this paradigm remained dominant, was measured by GNP or GDP per capita. The assumption that economic growth would somehow automatically produce rising living standards even for the poor is an important assumption to emphasize here, since it became central to later disillusionment with the traditional approaches to development theory and policy. According to the theory, at the centre of the modernization process lay a distinction between the ‘traditional’ and the ‘modern’, involving a comparison not only between the North and the South but also within developing countries. Two economists, Arthur Lewis and W. W. Rostow, both of whom took rising per capita income as the main measure of growth, had a particularly marked influence on policy making based on modernization theory (1960). Lewis, like many in the 1950s, was preoccupied with the problem of poverty and employment and, like others, saw the answer largely in terms of economic growth (1955). Also like many others, he argued that when capitalists become rich, they invest back into the host economies. Such investment in turn will bring about growth, create employment opportunities, and reduce poverty. In other words part of their wealth would soon trickle down to the poor. The belief in the trickle-down effect became the engine of policy making and was not questioned. Lewis argued that in order to generate accelerated growth, it was essential to push the rural population out of ‘traditional’ production activities into a ‘modern’ urban industrial sector. Such a transition would accelerate growth, according to the Lewis model, because: (1) the traditional, overpopulated rural subsistence economy had zero marginal labour productivity; and (2) labour from the subsistence sector would be transferred gradually into a modern urban industrial sector in which productivity was high. The rate of this transfer was determined by the rate of industrial

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investment and capital accumulation in the modern sector. Such investment was made possible by the excess of modern sector profits over wages – on the assumption that capitalists reinvest their profits. This self-sustaining growth and expansion of employment would continue, it was argued, until all surplus rural labour was absorbed in the new industrial sector (Ranis and Fei 1961). Rostow, similarly, based his theorizing on the concept of a dual economy (a traditional, rural-based non-commercial sector and a modern, urban manufacturing one). However, his theory was more ‘historical’ in nature. This is best illustrated by his five stages of economic development: traditional society, precondition for takeoff, self-sustaining growth, drive to maturity and, last, high mass consumption. As a top adviser in the Kennedy and Johnson administrations, Rostow saw savings, either domestic or generated by foreign investment and foreign aid, as the key to reaching the stage of capital accumulation, which in turn provides the basis for a take-off into self-sustaining growth. He defined the take-off stage in structural as well as quantitative terms. As an interventionist of Keynesian persuasion, Rostow recommended that US foreign policy support states (rather than support free markets directly) to generate growth (1960). Rostow’s prescriptions were widely accepted, particularly since they fitted the political priorities of the era. Moreover, by stressing foreign investment and foreign aid, they also seemed to counter one of the main weaknesses of other modernization theorists, namely their failure to take account of the need for external financial inflows. The growing popularity of communism in the 1950s and 1960s and American involvement in two wars in Asia – in Korea and Vietnam – made it very important for the United States and its European allies to take great initiatives to solve the problem of growing poverty. The objectives of development aid directed through states, some of which were heavily influenced by US foreign policy, was to alleviate the poverty that fostered social unrest and facilitated the appeal of communism. This applied to many countries of the South, namely those in which there was a great deal of sympathy for socialism such as the Philippines and Indonesia, which were close to Vietnam, as well as to many countries in Latin America. Therefore, under the influence of theorists such as Rostow, who had become an influential adviser to the United States, aid came to

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play a dual role. Politically it was to be an important preventive medicine against communism. Economically it was to be used not just to remedy poverty directly, but also to instigate economic growth by offsetting the deficiency of savings/investment. The role of the state was important in delivering aid and in making sure that the funds given to the country were pumped into the economy. Just as Keynesianism was a popular domestic policy in Europe and America (no less a figure than US President Richard Nixon declared in the early 1970s that everyone was Keynesian now), throughout the early and middle Cold War era a kind of international Keynesianism was implemented abroad. The United States and its Western allies granted aid to states in many developing countries and initiated development projects in rivalry with the Soviet Union. They left it to these states, through intervention and planning, to achieve growth, alleviate poverty and prevent unemployment. Although modernization theory achieved wide acceptance and became the foundation for development policy in, and the rationalization for foreign aid to, much of the Third World, it was also subject to criticism. Critics argued that the model of accelerated growth, and the Lewis model that complements it, assumes that the rate of labour transfer to and employment creation in the modern sector is proportional to the rate of modern sector capital accumulation. Furthermore, the model assumes that surplus labour exists in rural areas and full employment in urban areas. This was questionable. In some rural locations there was little general surplus labour, and many developingcountry economies could not absorb the substantial unemployment in urban areas. Neither did the model pay attention to the diversity of experiences within different developing countries at different stages of industrialization. Moreover, the model failed to take into account that employment patterns were gendered. The sexual division of labour is different in rural and urban areas. Migration from traditional to modern sectors also has a gender pattern – in most cases men migrate to the urban areas disproportionately, while women usually stay behind (though there are exceptions, to be discussed below). Furthermore, the degree to which women can perform the required economic roles – acting as an army of reserve labour in case of labour shortage, remaining confined to the home when there is a labour surplus, or acting as seasonal labour – varies from country to country and region

24

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to region, depending on cultural traditions and socio-political conditions, as well as economic structure. Throughout this period, development projects were blind to the gendered composition of labour. Almost all aid went to men as the heads of households. The stereotypical assumption of donor agencies that men were the heads of households and breadwinners, while women were home makers, in some cases courted disaster. In many developing countries, traditionally women have been responsible for food and agricultural production. Yet aid donors gave fertile land to men who had no experience in farming, probably contributing, for example, to the famines in Africa in the 1960s and 1970s. In addition, mainstream development theories (based on Ricardo's theory of comparative advantage) assumed that less developed countries (LDCs) gradually would move away from production of agricultural goods for export and shift into manufacturing consumer goods, primarily for the internal market, and then for the external market, using their cheap unskilled labour (Little et al. 1970). First, this has not happened for many countries, such as those in subSaharan Africa. Second, the theory neglects gender issues. Women, much more than men, have been the source of cheap unskilled labour in developing countries and in export processing zones. In fact this is increasingly the case. But modernization theory was not purely economic. It also had a cultural component. Inspired by Max Weber’s theory about the Protestant ethic and the rise of capitalism, some modern followers put great emphasis on the role of culture. They argued that development is only possible if the culture of a developing country is congenial, or made more congenial, to assimilating the norms of Western culture (McClelland 1967). Equating modernization with Westernization, they assumed that social change or development is unidirectional and homogeneous. The same traditional versus modern dichotomy of economics was reflected in cultural analysis. These theories have remained widespread to this day. Being economically rich is regarded as the ultimate goal, and in order to achieve it, ‘traditional’ societies must abandon their culture and adopt Western culture in order to develop. While at an academic level such an analysis can help us to understand different cultural dynamics in low-income countries, applying cultural analysis to the international development policy agenda can be quite problematic. The danger is that people’s ways of

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25

living in low-income countries come to be viewed as inferior and in need of change towards the ‘better’ ways of the Western world. Implicitly, such analysis assumes that low GNP equals being poor not just economically but culturally. Western culture has come to be viewed as superior to others, and ‘inferior’ cultures are seen to be traditional/primitive and in need of transformation and adaptation on the Western model (So 1990). This is strongly reflected in the development literature and that literature forms the basis of development aid to countries in the South. In fact, foreign aid has become a tool by means of which the North imposes its cultural values on the South. Cultural modernization theory, particularly in its classical form, also had in common with economic modernization theory its gender blindness, and therefore its neglect of the role of women. When women did get recognition, it was in their traditional role as mothers. Thus, for instance, in The Achieving Society (1967), McClelland, like other modernization theorists, argued that it is the lack of the (Western) drive for economic advancement that is a barrier to progress. However, unlike the others, he viewed this lack of ‘achievement motivation’ as part of a traditional culture of patriarchy. He recognized that traditional patriarchy hindered female employment and therefore was a barrier to growth. The Achieving Society looks exclusively at women’s productive role, as opposed to their reproductive role, completely missing out how crucial women’s social situation is in fostering ‘achievement motivation’ in their children. The position of women has been one of the arguments used to illustrate the inferiority of the South. While there is no doubt that many cultural practices in the South are patriarchal, using this as a means to devalue other cultures is highly problematic – not to mention the fact that at the time that McClelland was writing millions of women in Europe and North America were still fighting for basic gender rights. Modernization theory came under serious challenge in the 1960s and early 1970s. It was criticized as being unable to deal with worsening economic conditions in many parts of the South such as sub-Saharan Africa. By the early 1970s it was apparent that poverty had continued to persist in spite of development efforts initiated by the North. Both the United Nations and the International Labour Organization had been providing documented reports on the state of world poverty. The theory was also attacked because it left out any

26

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consideration of the role of women, who remained the poorest segments of the developing world. There was, however, one important exception. The failure of modernization: blaming the women of the South In an attempt to explain the reason for the failure of the dominant school of policy making based on modernization theory, some economists argued that it was population growth that led to increases in poverty and unemployment (Galenson and Liebenstein 1955). They claimed that good policies had been swamped by a population explosion, itself partially a result of rising economic welfare (a position that sounds self-contradictory). Thus it was implied that women from low-income countries were responsible for the lack of national prosperity. Holding high fertility rates responsible for low economic growth continues to be a powerful idea. In fact, during the Clinton–Gore 1992 presidential campaign, the candidates recommended that federal budget funding for greater family planning efforts in poor countries be given in place of traditional foreign aid (Bayes and Tohidi 2001: 3). What is missing from the analyses behind such policy agendas is that poor economic performance stimulates higher fertility because poor living conditions lead to women wanting large numbers of children as an extra source of household income and/or a sort of oldage security scheme. As the 1974 Bucharest World Conference on Population slogan put it,‘Development is the best contraceptive’ (Allen and Thomas 2000: 134). Despite these criticisms, most national and international organizations targeted fertility control as a means to enhance development. They therefore pushed family planning programmes in the simplistic form of contraception rather than attempting to address the factors, such as high infant and child mortality rates, that encouraged women to bear more children. They did so despite many cross-cultural findings that indicated improving conditions for women and increasing female social status would decrease fertility rates further and faster. Instead of a female-centred, bottom-to-top strategy for population control, for the most part a top-to-bottom population planning that does not take into account women as active agents has formed the basis of many of the strategies used for reducing the total fertility rate (TFR). The issue was raised

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by the United Nations, which remained critical in some of its publications (for example, UNFPA 1990). However, as the economic crisis beginning in the early 1970s left many countries with even deeper economic problems, the failure of modernization theory to deliver on its promises became more and more evident. Although Marxist and structuralist (as well as world system/dependency theory) criticisms of conventional development policy had been formulated since the 1960s, the mainstream opted for a completely different direction in response to the undeniable failure of the policies inspired by modernization theory. It was neoclassical economists who persuaded the United States and its allies, as well as international organizations such as the World Bank and the IMF, to adopt a neo-liberal approach instead (Lal 1983).

The rise of neo-liberalism: embracing the market, reducing state power, more poverty Neo-classical economic theory (embodied in a set of proposals since referred to as the Washington Consensus) became extremely influential, particularly after the accession to power of Ronald Reagan as US president and Margaret Thatcher as British prime minister. Since the late 1970s, and throughout the 1980s and much of the 1990s, advocates of neo-classical economic theory pointed to the failure of modernization theory, with its interventionist agenda, as an argument in favour of the free market. Neo-classical economics, unlike modernization theory, has been much more focused on micro-level analysis. As Lal in The Poverty of ‘Development Economics’ (1983) argued, macro-level theories miss out on micro-economic details. This tendency of neo-classical economics to focus on the micro level is very useful in terms of attracting attention to regional and individual cases and therefore to regional differences. The main theme of neo-classical theorists, distinguishing their idea from modernization theory, has been their advocacy of limiting government interference with the economy. Neo-classical economists argue that the free market is the best distribution method for scarce resources. Their theoretical position is based on the notion of human beings as profit-maximizing individuals. Under free-market conditions such individuals have access to perfect knowledge about how they

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can best satisfy their own needs. Also, it is the marketplace that provides the mechanism for the neutral transmission of information. It therefore guarantees people’s ability to fulfil their needs freely, thus maximizing human welfare. Some neo-classical economists go one step further and argue that under a free market economy, the freedom of individuals is guaranteed from the monopolistic power of the state and from powerful groups that run the state, therefore assuring or at least promoting democracy (Friedman 2002). In fact, Friedman argues that laissez-faire capitalism is a necessary condition of political freedom itself. In his view, under a market-driven economy the role of the state is limited; economic power is separated from political power and this in turn reinforces political freedom for individuals. But let us return to the alleged economic benefits of the free market system. According to its neo-liberal advocates, because knowledge is freely available under such a system, those producers who do not produce efficiently and at the right price would be forced to exit the market because consumers would not purchase their products. Since the free market guarantees competition, only those producers whose goods and services are the most competitive would profit, survive and continue to produce. This mechanism guarantees that only the most efficient firms continue to exist, and therefore that the whole economy becomes more efficient in the long run. Furthermore, the market operates through a price mechanism determined by the level of demand and the supply. It is in effect the flexible, ‘free’ price mechanism that produces the allocative efficiency of the free market system. So if there are any problems with the economy, then the first remedy is to allow the market to ‘get the price right’ – itself a dominant theme in neo-classical writings on development (Lal 1983). Price determination, therefore, in the work of neo-classical economists, became a central issue and was used against Keynesianism, which argued in favour of state intervention that would only ‘artificially’ affect prices. It is through allowing the price mechanism to operate freely, without interference by the state, that the market operates, so the neo-classical economists argued, as the best distributor of scarce resources (McKinnon 1973). The neo-classical approach therefore argued strongly for minimizing the role of the state, and not merely in terms of distributive

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efficiency. The state’s role should also be limited in that taxes should be kept at the lowest level possible. Keeping taxes low, they argued, would encourage entrepreneurs to invest and provide incentives for the private sector, while high taxes work as a barrier to investment. Furthermore, the state should keep regulations concerning the economy at a minimum so that the market can operate freely. In their criticism of the state, the neo-classical economists add that states lack incentives for their public works, since there is no direct gain to be made by the state, particularly where there are no meaningful public elections. Moreover, state-owned enterprises often suffer from inefficient management. This seemed to have been well illustrated by the failure of the centrally planned economies of the Soviet type. In addition, in many cases governments are subject to corruption and there are always administrative delays when important decisions must be made. These bureaucratic delays become costly (Little 1982). In addition to the critique of the state, neo-classical economists pressed for limiting the power of trade unions since they, like the state, interfere with the smooth functioning of the market. Since unions can push up costs through collective action, leading to wage increases above the competitive level, their activities must be limited, if not abolished totally. Furthermore, employment regulations, neoclassical theory points out, must be reduced or abolished to prevent interference with the price mechanism in the labour market. Much more so than modernization theory, neo-classical theory relies on the theory of comparative advantage, and the notion that promotion of specialization and free trade will achieve maximum efficiency. If countries specialize in the types of products for which they have the greatest comparative advantage and then trade with one another, each economy will benefit. The choice of the sector(s) in which an economy should specialize very much depends on the particular circumstances of each and every country (Little, Scitovsky and Scott 1970). Regardless of the types of goods and services in which any particular economy specializes, under free trade those goods and services can be freely exchanged on a world level. In the absence of barriers to trade, all countries would benefit on a continuous basis. Each country would have particular strength in the production of one type or several types of products at the lowest price, which would be rewarded by a ‘healthy’ international price mechanism. It is important that there should be no government

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regulation or tariffs to interfere with the most efficient production choices. This argument was a critique of the import substitution policy that some countries, such as Egypt and several Latin American countries, had implemented. The import substitution and self-sufficiency strategy was popular, particularly among countries that wanted to be politically independent and viewed trade between the rich and poor countries as potentially creating dependency on the part of developing countries. Neo-classical economists were the most prominent critics of import substitution, arguing that state regulations protected inefficient home industries. Since, by the 1970s and 1980s, import substitution had caused obvious problems in many countries – already some, like Taiwan, had abandoned the policy altogether – these criticisms were very effective. Following their criticism of import substitution, many neo-classical economists argued for full liberalization of foreign trade as well as currency devaluation – overvalued currencies were closely associated with import substitution policies. Neo-classical theorists pointed on the one hand to the ‘miracles’ in Southeast Asia in countries that developed through export promotion strategies; and, on the other hand, they pointed to failures, such as India, where self-sufficiency continued to be pursued (Wolf 1988). Yet another major contribution of neo-classical theorists to the emerging mainstream, one that was very influential in guiding the policies of the IMF, was their adherence to monetarist macroeconomics. They argued that the problems of balance of payments instability and inflation in developing countries are caused by state intervention. In many developing countries where the state cannot raise high taxes – either because the country is too poor or because its state apparatus is not well enough administered to collect taxes – the state ends up with a budget deficit. The state then attempts to push the central bank which controls the money supply to increase that supply to finance its own expenditures, often for social services. The result is to increase the supply of money relative to the demand for it, stimulating inflation. Based on this argument, neo-classical economists formulated a financial stabilization programme. It called for limiting public expenditure in instances where raising taxes to meet the deficit was particularly difficult. It called for policies to encourage the shift of

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resources from the domestic to the export sector in order to generate foreign exchange. This was required to pay off the heavy foreign debts incurred by state borrowing after the world crisis of the early 1970s. Since those debts also made developing countries vulnerable to pressure from creditors – commercial banks and the IMF, for example – nearly all developing countries were either forced or persuaded to follow the Washington Consensus. Under structural adjustment programmes worked out by the IMF and World Bank, throughout the 1980s many states in the developing world made huge cutbacks in their social welfare expenditures. In nearly all African and in many Latin American countries, and in many other parts of the developing world, states cut their budgets for education, health care, unemployment benefits, food and shelter subsides. Many of them were also forced or persuaded to devalue their currencies. As currencies devalued, particularly in low-income countries, the price of basic goods such as food increased, and this further exacerbated poverty. In terms of poverty and redistribution, neo-classical economists were in favour of increasing welfare through the free market and they regarded income inequality as an incentive for growth. Some theorists such as Bauer (2000) argued that governments should not intervene to redistribute income because it would work as a disincentive for saving and therefore limit investment, which in turn would mean fewer jobs and more poverty. However, within this body of theory, not all would agree with Bauer. A more moderate view that emerged by the end of the 1980s, when the more doctrinaire free market ideas came under intense criticism, calls for some degree of state involvement in creating welfare. More recently, there has also been a trend towards accepting some types of state intervention in providing conditions for efficient resource allocation and accelerated private sector growth. The same distinction applies to neo-classical views on foreign aid. Those who adhere to laissez-faire and who are against government intervention per se reject the concept of foreign aid because it would require state intervention to spend it. The more moderate view, however, sees technical assistance as useful. Increasingly, too, the IMF and World Bank have been severely criticized for demanding austerity measures in structural adjustment policies based on neoclassical development and modernization theory. Public expenditure

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cutbacks throughout the developing world have had disastrous effects on general welfare in the form of rising poverty and growing income inequality. Although the neo-classical approach argued that this constituted a form of short-term pain for long-term gain, the critics insisted that poverty and inequality were more likely to be protracted. The consequences of neo-classical policies were not gender-neutral. As state cutbacks hit many developing countries, many services previously provided by the state have been put on women's shoulders. Increasingly, women have had to make up for the reduction in unemployment benefits, health care provisions and food and shelter subsidies. Many vital services previously performed by the government were left to women to carry out, as will be documented in more detail in the next chapter.

Alternatives to market fundamentalism: embedded autonomy and the interventionist state A central part of the doctrine of the neo-liberal/economic orthodox theorists was that Southeast Asia developed because it opened its market to world trade. This claim was roundly criticized by a group of state-centred theorists who insisted that neo-classical economists seriously misinterpreted the sources of economic success in the newly industrialized countries (Amesden 1985; Skocpol 1985; Evans and Rueschemeyer 1985; Wade 1988; Castells 1992; Henderson and Appelbaum 1992). Originally, neo-classical economists argued that, contrary to the position of structuralists and the dependency school, free trade, rather than the old import-substitution model, had been the real source of growth in the newly industrialized countries of Southeast Asia. Southeast Asian countries abandoned import substitution in the 1950s and early 1960s for export-oriented open trade (using their cheap female labour) and this was the reason behind their great economic prosperity. However, the critics noted that far from its being the result of a free market, the economic success of Southeast Asian countries was due to the strong role played by the state (Griffen 1973; Amesden 1985; Barrett and Whyte 1982; Evans and Rueschemeyer 1985; Wade 1988; Greenhalgh 1988). What had been true of later developers of a previous era, namely Germany and Japan, was also, these critics

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insisted, true of Southeast Asia: the state had played a central role in development planning (Amesden 1985). These critics articulated a quite different vision of the role of the interventionist-developmentalist state. Unlike the role of the state in the centrally planned economies of the Soviet type that replaces the market, they argued that an interventionist-developmentalist state is essential in order for the market to operate smoothly (Wade 1988: 130). They also insist, unlike the old advocates of import substitution, on the primacy of the international rather than the internal market. The need for state regulation to assure the proper development and functioning of the market is particularly strong when the market is underdeveloped. There are many ways in which an interventionist state can promote smooth market operations. It can both stimulate and discipline entrepreneurial behaviour. This can be attained, for example, by preventing monopolies and oligopolies so that genuine entrepreneurs can thrive. The problem of market power is greater in developing countries where a powerful agrarian class can try to form oligopolies to control production and marketing in order to avoid risks and maximize their profits. Therefore, a developmentalist state is necessary to break concentrations of market power, ensure risk taking and channel resources to internal development as well (Evans and Rueschemeyer 1985: 44–78). State-centred theories have pointed out that what has occurred in Southeast Asia has been a form of dependent development based on international subcontracting. They assert that the success of these economies has depended upon the willingness of multinational corporations (MNCs) to invest and on the strength of the state in these countries to regulate the opening of their domestic economies to the world market. In fact, Evans has elaborated the concept of a triple alliance whereby the state remains in control of the relation and mediates the relationship between international investors and national firms (Evans and Rueschemeyer 1985). Evans’s concept of the triple alliance was originally formulated with reference to Latin America, which after the Second World War was performing much better than Southeast Asia. Yet more recently the reverse is true. Southeast Asia’s newly industrialized countries (NICs) have operated with a highly interventionist state (Wade 1988: 114), while in Latin America the free market has played a much more

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important role and the effects of structural adjustment, especially in the 1980s, have created enormous obstacles to further development. Most of Latin America in recent years has been characterized by a minimalist state, in which a strong landowning class has continued to play a major role in the political and economic sphere, preventing the state from being able to act effectively and independently. Therefore in the more recent case of Latin America, Evans’s triple alliance of state, international capital and national investors has been ineffective (Evans 1997: 203–27). A very similar situation prevails today in the Philippines, which shared much of the colonial heritage of the Spanish-American colonies, in sharp contrast to other parts of Southeast Asia. That absence of the triple alliance in the Philippines, analysts insist, has been a contributing factor to its high income inequality and massive poverty, to political repression and instability, as well as to a capitalist development that has not enjoyed the type of sustainability illustrated by the NICs of South East Asia. The fact that the Philippines shares so many characteristics with Latin America points to the importance of historical factors, and particularly the history of colonialism, in determining whether a developmentalist state will emerge. Those countries that came under Japanese rule were able to free themselves from the domination of a large landowning class and implement an effective land redistribution that helped to create a more equitable society, and therefore made it easier for the state to penetrate into all social layers. On the other hand, where many countries started as Euro-American colonies, they were left with strong agrarian interests resistant to capitalist development and to industrialization. Furthermore, Japanese colonialism was more inclined to create a bureaucratic apparatus, the legacy of which was so vital to the formation of a developmentalist state in the Weberian sense, bureaucracy being a precondition for the creation of modern effective administration (Evans and Rueschemeyer 1985: 67). There are many different ways in which the state can intervene in the economy. These various ways can be divided into two different categories: direct intervention and indirect intervention. Appelbaum and Henderson (1992) have pointed to the various paths of such interventions in Southeast Asian NICs and Meiji Japan. The state can directly create, and in some NICs has created, new industrial sectors either through state companies or by supplying credits and financial guarantees to private companies (Deyo 1987: 236). Indeed, in

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Taiwan and South Korea the state owns such vital sectors as steel, shipbuilding and petrochemicals. Such industries, deemed necessary for a healthy modern economy, need heavy investment. It is not likely that private firms would be willing to invest huge amounts of money for the good of the national economy, and if they were, they would expect such high returns that it would make the products of such industries too expensive to be beneficial to the economy. In addition, the state can invest directly in creating and refining new technologies through government research and development facilities, as it has done frequently in Taiwan’s high technology sector. Additionally, such a state can create favourable conditions for foreign investment through low taxes on corporate profits and provisions for industrial infrastructure (Barrett and Chin 1987). There are a number of indirect ways in which intervention can operate, too. For instance, the state in Taiwan encouraged firms to advance in the high technology sector and in high-value-added goods through controlling credit via the banking system. Additionally, through price controls, the state can discourage the emergence of domestic monopolies or near-monopolies of supply. Furthermore, the state can protect domestic markets either across the board or with regard to particular products by imposing restrictions on the import of certain commodities. Taiwan has followed such a policy of import restrictions on a set of particular goods while liberalizing trade in certain other goods necessary for the national economy such as certain machine tools (Deyo 1987: 236). The state can also keep a close eye on the quality of production. If standards are not maintained, it can deprive the company of its guaranteed credit. This practice is particularly important with regard to goods for export. Southeast Asian NICs also have subsidized wages through public housing – the NICs have the world’s largest public housing systems (Appelbaum and Henderson 1992: 21–2). A developmentalist state can also implement welfare measures. It is obvious that no agency other than the state has the ability and political accountability to provide welfare programmes. In many Southeast Asian countries, the states have been very committed to providing social security. In various countries such as Meiji Japan, South Korea, and Taiwan the state has invested heavily in public health, housing and education, and in other social expenditures. This heavy involvement in social welfare programmes, however, has not

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been matched by commitment to political democracy. Political repression rather than freedom have been the norm. These states have built up military power and used it to guarantee civil obedience. Nearly all have used military power to suppress union activities and diminish collective bargaining power (Barrett and Chin 1987, Appelbaum and Henderson 1992: 14). It should be noted, however, that, as in the case of Japan, both Taiwan and South Korea have moved towards free elections once a certain level of economic development has been achieved. In addition, it can be argued that political repression has been prevalent throughout the Third World. In this respect the Southeast Asian countries have followed the general pattern, where after a certain level of economic success and sustainability has been reached, they have become more democratic. Thus, martial law in Taiwan was lifted in 1987 and since then democratic elections have been taking place. In his most recent work, Peter Evans has expanded the concept of a developmentalist state beyond what state-centred theories deduced from the empirical evidence. In his work, a developmentalist state is comprised of bureaucrats selected on the basis of meritocratic criteria. This type of state, as a Weberian ideal type, is autonomous yet at the same time it maintains social ties. These ties allow policy formulation to be subject to negotiations with the business community in order to guarantee effective implementation. In order to prevent corruption, it is important that the bureaucrats be well paid and offered a meritbased career, producing a sense of corporate coherence. Evans gives the example of Korea, where the bureaucracy is both embedded and at the same time autonomous. Evans takes the concept of embedded autonomy beyond the notion of state bureaucracy and the corporate world typical of Southeast Asia, and discusses a different type of embedded autonomy. In this type, the state is transparent to grassroots organizations or is politically rooted in them, and therefore it has to negotiate its policies with subordinate social groups. As an example, Evans examines the socialist state of the local government in Kerala, India, where a mobilized peasant class put pressure on the state to formulate policies that led to the land reform of 1969 and decimated the old landlord class. Evans argues that, in the case of Kerala, there has been a certain degree of autonomy and that ‘the structure of relations between state and society in Kerala provides a solid basis for autonomy from

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subordinate groups as well as the élite’ (Evans 1995: 238). Kerala has been far more successful in dealing with poverty than the rest of India and Bangladesh, which have received huge amounts of aid from foreign agencies, and it has more health centres per capita than the rest of India. Kerala’s lower infant mortality, longer life expectancy and high literacy rate, along with low fertility, are impressive. However, the existing pattern of embeddedness and continued redistribution has made it difficult for the province to promote industrialization because its government lacks sufficient ties with the entrepreneurial class and the state has not been sufficiently engaged in encouraging a transition from an agrarian economy to an industrial one (should one assume that industrialization is the ideal goal). Additionally, because of the forces of globalization, there has been enormous pressure on the state for the privatization and reduction of the welfare state. Clearly, there are problems with the embedded autonomy of the Kerala type, but the case is certainly interesting, at least theoretically and as a conceptual tool for formulating an ideal type of developmentalist state – one that is an entity not just embedded in the business community (which is normally the case) but also inclusive of the lower classes and grassroots organizations. The concept of the embedded autonomy of the developmentalist state is an important theoretical alternative in dealing with two major shortcomings of neo-liberalism: its failure to deal with rising global poverty and income inequality, on the one hand, and financial crises such as the Asian Crisis on the other. These failures have forced organizations such as the World Bank, long a strong advocate of neo-classical policies, to re-examine its assumptions. In its 1997 World Development Report, it states: Development – economic, social and sustainable – without an effective state is impossible. It is increasingly recognized that an effective state – not a minimal one – is central to economic and social development, but more as partner and facilitator than as director. The State should work to complement markets, not replace them. (World Bank 1997a: 17)

It is not just the World Bank. There are also signs that the IMF is showing some scepticism about its erstwhile free market fundamentalism, as when it praised Malaysia’s control on capital flight. During the 1997 crisis, the IMF was unable adequately to address the problem in Indonesia because of its orthodox prescriptions. Throughout the

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crisis, the IMF continued to condemn exchange controls. During the same period President Mahatir Mohammad imposed restrictions on capital flight and controlled the exchange market, measures that contributed significantly to Malaysia’s relative immunity to the worst effects of financial instability. In fact, the country was the first to recover from what had become known as the Asian Crisis. Two years later, in September 1999, the IMF publicly praised Mahatir Mohammad’s policy. This praise, however, is not an indication that the IMF actually is shifting away from its fixation on market-oriented policies, as distinct from just putting the best face on an embarrassing inconsistency within its orthodoxy. Neo-liberalism’s failure to address economic crisis, rising poverty, and endemic income inequality has become exacerbated as a result of the more recent crisis in Argentina, where poverty and income inequality are rising. Global poverty and income disparity is an alarming issue. In 1960, the richest fifth of the world’s population received 70 per cent of global income, compared to 2.3 per cent for the world’s poorest 20 per cent. By 1997, the richest 20 per cent had increased their share to 90.0 per cent, while the bottom fifth’s share of global income shrank from 2.3 to 1.0 per cent (World Bank 1999a). It is indeed time to take alternatives to the free market more seriously. In this section we reviewed theories that emphasize the role of state as opposed to the free market. But what type of state intervention is desirable is an important question. Some state-centred theories argue for state interventionism as a necessary condition for the smooth functioning of capitalism. Other theories emphasize state interventionism as a form of central economic planning and commitment to the basic welfare of all citizens. An interventionist state with extensive social programmes may fail, however, to provide for popular representation in its decision-making process. This chapter included a discussion of the ideas of Peter Evans about the embeddedness of the state, where the role of civil groups in the state apparatus was emphasized. Such groups may include those committed to environmental protection as a top priority. Environmental protection, however, is an important issue that may well challenge the aim of capitalist development. This dilemma leads to an entire new set of theories that are generally viewed as alternative development theories. Alternative theories of develop-

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ment object to the very notion of development as industrialization and the expansion of capitalism. Such theories generally emphasize a type of development that is people-centred and give the environment a high priority. In the following chapter, this book deals with one of the most important critiques of the mainstream orthodoxy, that emanating from theories of gender and development as one type of alternative theory. The literature on gender and development has been influential to some degree in national and international policy formulation since the 1970s. The popularity of gender and development theory comes from the fact that it has proved to have obvious merits for dealing with the issue of sustainable development, as well as with poverty and income disparity.

2 Who Pays for Market Fundamentalism?

The previous chapter ended by pointing to the failure of mainstream economics, particularly in terms of rising poverty and income disparity and the need for alternative theories. This chapter will discuss one of the most important alternative theories put forward by feminists. A discussion of this theory is essential because increasing poverty and income disparity have affected women more than men (Parpart et al. 2003; Bakker 1996). Rising female poverty has become a pressing issue, and as a result for the past few decades there has been a growing recognition of the need to incorporate gender issues into development. During the 1950s and 1960s, mainstream economics was gender blind. In line with colonial era thinking, the modernizers were aware of women’s economic subordination but believed that as developing countries became modernized, the inequality of access to resources that systematically discriminated against women would diminish (Tinker 1997: 33–42; Moser 1993; Sen and Grown 1987). Modernization theory took the position that with ‘modernization’ (synonymous with Westernization) women in developing countries would become (like Western women) liberated and equal. This idea, of course, would beg the obvious question whether the situation of most women in the West really was being depicted in a completely accurate way. In much the same way that modernization theorists thought of the relationship between poverty and income inequality (that with rising GNP per capita, wealth would trickle down), they (if they addressed the issue at all) assumed that gender inequality was a cultural problem that had an economic solution. 40

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By the late 1960s this gender blindness on the part of development planners provoked a great deal of agitation among feminist researchers and political activists, who tried to influence major development agencies. But by the time the feminist movement was strong enough to bring pressure on national and international organizations in the later part of the 1970s and the early 1980s, the rules of the game had started to change. The policy guidelines of neo-classical economists became dominant at the international level. Partly in response to a paradigm that preached market rule and a minimalist state structure, the state throughout the developing world increasingly was restrained from interfering with the economy. Simultaneously it also left gender issues aside, while its policies of deregulation left those most vulnerable and most in need of state intervention, namely women, deprived of aid . Paradoxically, the dominance of neo-classical theory coincided with the mushrooming of organizations designed to address gender issues. The gap between the two sides grew steadily. The split was also evident in major international organizations. On the one hand, the World Bank wanted to decrease the role of the state, while, on the other hand, organizations such as the ILO wanted universal laws and regulations that would create equal opportunity for men as well as women (Tinker 1997; Young 1992; Moser 1993).

Background to theories of gender and development The first time in the post-Second World War era that women’s issues were raised in a public way and captured attention on an international level was in 1962, when the UN General Assembly instructed the Women’s Commission (formed as a subcommittee of the Human Rights Commission in 1946) to prepare a report on the role of women in the social and development plans for member governments. By this time awareness of gender issues was gaining momentum throughout the world. Simultaneously, many female scholars, a great number of them anthropologists, had obtained extensive understanding, through their fieldwork, of the realities of the lives of many women throughout the world. Thus, at three different levels – policy making, political activism and scholarly endeavour – many women came to realize the negative consequences

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of mainstream developmental economics for women (Kabeer and Subrahmanian 1999; Parpart et al. 2003). In addition, during the 1970s, the publication of Esther Boserup's book, Women and Development, attracted widespread attention. Boserup, who in fact regards herself as a scholar rather than a feminist, took existing studies and illustrated how the division of labour between women and men shifted as economic development proceeded, with a gradual change from family production of goods and services to specialized production. By pointing out that the introduction of modern technologies and the expansion of cash cropping benefited men, while often increasing women’s work burden both in the family and as casual labour, she refuted the prevailing assumptions held by economic planners that their efforts had been beneficial to everyone. Her analysis of women’s work in agriculture provided a basic justification for arguing that economic assistance should reach rural women as well as men (Boserup 1970). The concern over gender and development therefore started with efforts by feminists to illustrate how women were being left out of development projects. Consequently, many women scholars gathered massive data, mainly of an anthropological nature, to illustrate the result of development policies. Data from diverse societies have demonstrated that, contrary to the principles of equality to which international agencies and donor countries of the Western capitalist world are committed, women have been and continue to be overlooked in development projects. As the development effort continues to fail women, many feminists persist in documenting the negative aspect of development for women (Bakker 1996; Afshar and Dennis 1992). However, within the body of feminist work there have been different types of thinking. In the beginning liberal feminists (who were in the majority) sought not to change the underlying sociopolitical and economic structure, but merely to address women’s issues within the existing one. By contrast, Marxist and socialist feminists have argued that unless inequality as a whole was addressed, gender inequality in particular would not be eliminated. More recently, an increasing number of feminist scholars and activists, mainly from the South, have come up with their own interpretation of development and how it should be achieved. The result is ongoing debates among feminists of different political standings, as well as

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between women from the North and those from the South (Sen and Grown 1987).1 Feminist efforts to address gender bias, however, continue to be challenging. One of the most important parts of this challenge stems from the very problematic nature of defining development in simple economic terms. This is particularly evident when dealing with the conception of women’s work purely in relation to the market.

Women’s work as defined by the market What constitutes ‘women’s work’ has been subject to great controversies and has given rise to a great deal of critical discussion among feminists during the last decade. Much work that women do has remained unaccounted for, posing serious problems for female labour analysis. The dilemma stems from the very definition of work itself as formulated by the International Conference of Labour Force Statisticians in 1954. According to this definition, still accepted, work is defined in relation to the market – it is something done ‘for pay or profit’ that increases GNP. But there are problems with such a definition, particularly with regard to the work of women (ironically captured in the often-cited phrase that when a man marries his housekeeper, this causes GNP to decrease). Since what is not paid for is not regarded as work, a high proportion of what women do, ranging in estimated value from between one-third to one-half as much as the measured GNP, remains unrecorded (Goldschmidt-Clermont 1983). There are different mechanisms by which such under-numeration takes place. Agricultural work is one example. Agriculture usually involves a large subsistence sector with all manner of transactions both outside the market and outside the official statistics (Waring 1999). Furthermore, often men are presumed to be the heads of the household, which means that much of what women do is counted as men’s work, a demonstration of what Diane Elson refers to as male breadwinner bias (Elson and Cagatay 2000). In this sector what women do is often an extension of their job as housewives, and therefore is unpaid and uncounted. For example, in much of Africa and South Asia women are responsible not only for what is cooked in the kitchen but also for what goes into the kitchen (Mies and Shiva 1993: 264–77). But the household is regarded as one unit, with intra-household

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transactions remaining outside the arena of economic analysis (Elson 2003). Because men are regarded as breadwinners and household heads, the fruits of women’s work are viewed as household production and often men are credited for the required labour when data are gathered (Folber 1994; Elson 1999). The problem is partly rooted in the fact that the borderline between women’s productive and reproductive work is blurred, particularly in developing countries. When the situation is hard for an impoverished family, women’s reproductive labour stretches to help the family make ends meet by engaging in activities that generate essentials for material survival, either for home consumption or for exchange. There are a great deal of goods and services that women produce for household consumption that are missing from the official data. There is small back-garden production, home-made processed foods, and a whole range of services such as haircuts, dressmaking, nursing the sick, helping with children’s education and such. These activities constitute work that is unpaid and therefore unrecorded (Waring 1999). This blurred borderline, whereby much of women’s work is an extension of their role as mothers and wives and remains unaccounted for, is true of both rural and urban families (Waring 1999). As long as men are heads of the household, non-waged family workers are seldom taken into account unless they are engaged in commercial production outside the family. In both manufacturing and services women tend to be outside of the official data, especially where there is a family business. Many surveys indicate that women's work in this sector has been greatly underestimated (Boserup 1970; Gardiner 1997). In response to pressure from women’s organizations and feminist writers, there has been some recognition of the problem of undercounting women’s work. The ILO now has categories that register the number of unpaid family workers as well as other categories such as working on one’s own account. Since the 13th International Conference of Labour Statistics in 1982, goods and services produced for household consumption that do not enter the market are regarded as work. That is why the category of unpaid family worker and selfemployed has been added to the official statistics. By so doing the ILO is attempting in effect to address a much bigger problem, that of the formal versus the informal economy.

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The size of the informal economy as a whole has expanded precisely in response to the implementation of the demands of neoclassical economic theory. Limiting the role of the state subsidy programmes and liberalizing economic policies has increased greatly the necessity for micro-enterprise, usually in the informal part of the economy, as a survival strategy. As employment in this sector is elastic, many women have created employment in petty trade and micro-enterprises in order to deal with rising poverty. Self-employment has expanded the informal sector, which relieves the pressure on the state to create employment. Informal employment has increased faster than employment in the formal sector (Elson 2003). Calculating the numbers, however, is difficult. Sometimes high female labour force participation is observed in developing countries because micro data combine informal and formal, and then are extrapolated in order to form macro data. But there is still a problem, since the definitions of formal versus informal economy and the borderline between categories of informal employment are fuzzy. In any case, however, a disproportionate percentage of women are in the informal economy and their percentage is growing (Joekes 1987: 4; FernandezKelly and Garcia 1995; Beneria 2003). In addition to all of these difficulties, there is another problem where comparative research is involved. The definition of female labour varies between countries2 and has changed over time. For instance, in the case of the Philippines in the 1970s the data show a sudden increase in the percentage participation of the female labour force, particularly in the agricultural sector, which partly can be explained by changes in official definitions. In addition, official policy and ideology regard gainfully employed female workers as problematic (Elson 1999). In the agricultural sector many women work as unpaid family workers and their labour is ignored and overlooked unless the official definition makes explicit effort to include them.

Neo-liberalism and increasing women’s employment One of the arguments in favour of neo-liberalism is that it has led to greater employment opportunities for women. It is true that the increase in world trade has boosted female employment, providing many women with an opportunity to work outside their homes.

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With the exception of Eastern Europe, more women have become employed for wages everywhere, particularly in the urban sector. Yet in many cases the gains of such employment have been offset by rising inflation and a drop in the real income of low-income families in particular (Ng 2003). The rise of the cost of basic living has forced many women to seek employment outside of their homes. For many families one income is no longer sufficient to feed the family, even as the number of single, female-headed households has increased in many parts of the world (Chant 1997). Therefore, while it is true that the female labour force participation rate has increased steadily in the past few decades throughout the world, this increase has not led to an improvement in the economic condition of the majority of women (Levesque 2003). On the contrary, the increasing participation rate has been accompanied in many cases by overall female impoverishment because much of the gain has been taken up by rising prices of basic goods. In order to understand the dynamics of female impoverishment, the nature of the recent increase in female employment must be examined closely. Much employment for women has clustered in labour-intensive production (Joekes 1987: 64–79; Anker 1998). In many countries where multinational corporations employ women as ‘cheap labour’ in labour-intensive manufacturing and agriculture, women’s share of employment in manufacturing has increased considerably over the past few decades. This pattern exists all over the world except in subSaharan Africa (UN 1996) and in a few countries such as Haiti and Jamaica where severe economic crisis has squeezed women out of manufacturing jobs (Joekes 1987: 96). Other than in these few cases, the role of women has been especially important in export industries. In fact, for many countries throughout the developing world women’s increasing employment in export-oriented manufacturing, both inside and outside free trade zones, has been a particularly important source of foreign exchange. In some cases, for example the Southeast Asian NICs, it has been the most important part of their economy (Khalideen and Khalideen 2003). Typically, women’s employment in labour-intensive sectors is in footwear, garments, plastics, food processing and electronics, where the products are relatively cheap and the number of local producers large (Joekes 1987: 91–2). One third of the labour force in manufacturing, both formal and informal, in low-income developing countries

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are women. Female labour force participation is highest in free trade zones, reaching 97 per cent in some countries. But inside and outside the zones women’s increasing share of employment in manufacturing, in the labour-intensive sector in particular, has been largely due to the fact that women’s wages are much lower than those of men. The wage gap between men and women continues to be striking. Women’s earnings are on average 75 per cent of those of men, and this may be an overestimate, as pointed out by Kurt Waldheim in a report of the UN Commission on the Status of Women at the end of the International Decade for the Advancement of Women: While women represent half the global population and one-third of the labour force, they receive only one-tenth of world income and own less than one per cent of world property (Morgan 1984: 1).

The United Nations Report on the Advancement of Women World Survey (UNDP 1999) indicates that there is no evidence of any tendency toward a diminishing of the gender gap. In some cases women’s relative earnings continue to deteriorate, as in Mexico during the period of structural adjustment of the 1980s, when women’s average wages fell from 80 per cent of men’s in 1980 to 57 per cent in 1992 (World Bank 1997: 64). This is a good example of a case where the increased participation rate has been accompanied by greater poverty for women. It is possible that during the 1990s the general trend may even have worsened in some parts of the world. As governments retreat from labour protection, working conditions, wages and job security deteriorate for women much more than for men, since women are at the lower end of the job ladder and very often work on a part-time basis and in non-union jobs (Anker 1998). Many reasons are given for women’s low wages. Some reflect social prejudice. Many managers claim that women’s lower wages are due to the fact that women have a ‘lower aspiration for wages’ (Standing 1989: 1080). Others claim that women are less skilled. Sometimes less skill means less education, though it is not clear that for labour-intensive manual labour formal education is always a crucial factor. Perhaps one of the most useful explanations put forward for the male–female wage gap is the segmented (or dual) labour market theory. According to this theory the labour market is divided into two categories: one is ‘skilled’, offering high pay, fulltime jobs and opportunities for advancement; the other is ‘unskilled’,

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characterized by low pay, a tendency to be part-time, and providing little or no opportunity for advancement. There have been criticisms of this dual labour market theory because of the rigidity of the two categories. Nonetheless, in analyzing women’s labour as compared to men’s the theory can provide useful insight into understanding why women throughout the developing world continue to be paid less, work more as part-time workers, and do so at the lower end of the job ladder, with little prospect for advancement or skill enhancement. The existence of the segmented/dual labour market also reinforces stereotypes about women based on their reproductive role (Anker 1998: 325). That reproductive role is used to justify practices such as a ‘marital masculinity premium’ given to men in Taiwan. This male wage premium is a clear expression of the ‘breadwinner’ ethic. The fact that the number of single female-headed households is rising throughout the world seems to have little impact on the underlying attitudes. Women's low wages may also be reduced (and the reduction rationalized) on the basis of another assumption about the nature of female labour, namely that women’s turnover and absentee rates may rise upon marriage. The facts behind such beliefs have been questioned. What little concrete information exists on labour turnover and absenteeism by sex indicates that there are such differences, but on average the differences are minor (Anker 1998). It is true that the bulk of family responsibilities are on women’s shoulders and not on men’s, which explains a slightly higher absenteeism among women. However, this is not universal – in some cases, female absenteeism is actually lower than men’s (Humphrey 1985). Nonetheless, such a stereotype keeps female wages down, maintaining gender bias in pay (Robinson 2001). Another stereotype about female labour that helps to justify the concentration of women in labour-intensive jobs, is that they are not fit to operate machinery. They are regarded as having less physical strength. That is complemented by the fact that machinery is expensive – hence it is better to make use of expensive machinery 24 hours per day to recover the capital cost as quickly as possible. This means night shifts are important and women are not regarded as fit for night shifts because it is supposedly unsafe for them to go out at night. Even though many of these notions are stereotypes with little or no factual basis, belief in them both rationalizes and helps explain lower wages for women and their concentration in labour-intensive tasks.

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In addition to stereotypes about women’s frail physique disqualifying them from certain occupations, they supposedly have physical characteristics that give them a superior ability to work at repetitive jobs – which also have particularly low pay. In the electronics industry in Southeast Asia, for instance, thousands of women have been employed (while men became the supervisors), allegedly because of their more nimble fingers. Close to 80 per cent of the electronics work force is female (Joekes 1987: 410). But there are also more concrete and factually based reasons why women’s wages are lower. Some countries impose certain types of requirements for the employment of women, such as day-care facilities and maternity leave, that make female labour more expensive. Where such legislation exists, women’s wages are kept lower to compensate for such costs (Anker 1998: 319). Another factor is social conditioning. Women in most cultures are raised to be modest, self-effacing and accepting of men’s superiority. These cultural attitudes produce a greater willingness to take orders, behave docilely and perform monotonous/repetitive work with less inclination to complain publicly. Therefore, women stay in low-paid dead-end jobs much longer than would men. They are also less likely to form unions. Furthermore, some are desperate for work, particularly women who are the heads of single-income households (Joekes 1987: 86–7; Standing 1989: 1080; Chant 1997). These aspects are especially important in the rising employment of female labour in free trade zones where foreign capital is not prepared to take the risk of production disruption. As women in low-paid jobs continue to work without unions, men are kept quiet by having them work as supervisors, which gives them more power and financial advantages over women (Standing 1989). Therefore, the nature of female labour not only increases profit for the economy but also guarantees production continuity and minimizes the risks of labour unrest within the total labour force. Not least, as a result of the expansion of international commerce and competition, employers have sought to reduce labour costs. Reducing the price of labour is partly guaranteed by flexible arrangements by which during the down cycle labour can easily be dismissed, and rehired during the up cycle (Standing 1999). Women’s reproductive function has been used to justify this labour flexibility. When labour is in high demand, women are encouraged to leave the home and join the

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labour force. During the down cycle, the opposite occurs. Women's family responsibilities make a good argument to send women back home when there is a reduction of demand (Anker 1998: 317–18). For example, in Taiwan during the recession in the early part of the 1970s women's employment fell by 14 per cent compared with 8 per cent for men (Berik 2000). In addition to these factors, there are certain structural constraints, related to the recent trend towards downsizing and subcontracting, that contribute to female impoverishment. Prior to the 1970s, the dominant trend was toward mass production, with specialization of function within a large labour force gathered in one place. But since the 1970s a different model has become popular, one based on the decentralization of production structures and requiring even more flexible specialization and flexible employment arrangements (Standing 1999). Two forms that decentralization can take are home work and subcontracting (Rowbotham and Mitter 1994: 4; Standing 1999). This model became even more prevalent with the triumph of the neo-classical approach during the 1980s and early 1990s. The attempt to get the price ‘right’ in the context of international competition has led to the ‘casualization’ of work, and with it a dramatic increase in subcontracting and home work. Not least, decentralization of production, combined with subcontracting and home work, has exacerbated the growth of the informal economy, which remains unprotected by state regulation and taxation, and therefore also outside union contracts and without fringe benefits (Standing 1999). Decentralization of production sometimes means that production is broken down as much as possible into very basic tasks and then distributed among subcontractors. This type of low-skill production brings wages down further. It also makes women's cheap nonunionized labour increasingly desirable for investors seeking temporary employees and part-timers for subcontracting jobs (Anker 1998: 329). A report by the Division for the Advancement of Women’s Survey on the Role of Women in Development (United Nations 1996) confirms that the increase in employment for women has continued to be in jobs that are part-time, irregular, casual and flexible. As poverty has increased particularly sharply among women, many women take up home-based jobs because of the possibility of combining childcare with home work. Such subcontracting of manufacturing work has been very important to investors, who in turn

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contract with multinational corporations. Shoemaking in Asia is one example of subcontractors signing deals with major multinationals, and then putting the work out to home workshops dominated by women and often children as well (Benaría 2003a). The Nike firm has achieved considerable notoriety in recent years precisely because of this practice. As more women take up work at home rather than in factories, significant overhead costs associated with factory production are shifted onto the household. Entrepreneurs save substantially by cutting down not only on the wage (along with utility charges and other elements of variable cost) but also on maintenance of buildings and similar fixed costs. According to conventional theory, these savings become profits in the pockets of entrepreneurs and presumably are reinvested into the economy, promoting further development – though clearly in reality a large number of other conditions have to be met for this to happen (Standing 1998: 1078–9). Manufacturing has not been alone in witnessing a major increase in female labour participation. It has also been true in the service sector. Although the dynamics are slightly different, nonetheless there are strong similarities. Women are still in low-paid jobs and more likely to be clustered in areas dictated by their reproductive function. Women as mothers and wives continue to perform the same type of services for the society as whole. Therefore, the proportion of women employed as teachers, nurses and social workers is much higher than for men. Although women employed as nurses, for example, might be expected in some cases to be paid more than men in some of the more menial industrial jobs, nonetheless women employed as teachers, nurses or social workers typically earn less than men in roughly equivalent professions. (Anker 2001). Again, dual labour market theory helps to explain female concentration into types of employment typically regarded as female. Women are elementary school teachers rather than university professors; they are nurses and midwives rather than doctors; secretaries rather than managers or administrators (Safa 1977). The result is that the economy in many developing countries has benefited from women’s low wages to improve social welfare. In fact, some types of welfare programmes were extended by the state in many developing countries precisely because it was possible to employ women with low salaries for welfare programmes. The assumption is that women work for ‘pocket money’. An alternative explanation, that there are

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an increasing number of single women-headed households desperate for work at any wage, is not adequately taken into account in formulating state policy. There are other, less traditional, sectors in which ‘pink-collar’, low-wage jobs are increasing. For instance, a growing international financial sector and the accompanying services (telecommunications and the like), along with insurance and tourism, can be provided at low cost because of low female salaries. This clearly benefits the international trade position of other sectors, including the heavy industries where a better-paid male labour force dominates production. And it also benefits foreign investors in sectors relying on these services. However, most of the female contribution to the workforce in the service sector is in working-class jobs that reflect women’s reproductive labour activities. That is why women dominate occupations such as housekeeping, cleaning, cooking and laundry work (Anker 2001). These women come from low-income families, frequently from the rural areas. In times of poverty they are more willing to take up such jobs to make ends meet, even if it requires migration to the cities. Many women who move to the cities also work as street vendors, expanding the underground economy, and some end up in prostitution (Khalideen and Khalideen 2003). The economy in many countries, particularly in Southeast Asia – Thailand being the most notorious – has benefited a great deal from prostitution (Bishop and Robinson 1998). Under the cover of the tourist industry, the state in some developing countries has used women to attract male sex tourists from the wealthier countries. In addition, they export women as prostitutes, though usually with the pretence that they are bound for other more reputable jobs. The Philippines is a good example, where many women have left the country as maids and housekeepers, but many also have headed to Europe and Japan as ‘entertainers’ (Velasco 2003). In the case of Cuba, too, women who can find foreign sponsors are allowed to leave the country under the category of artists, which is often a euphemism for prostitution.3 Whether women end up in ‘respectable’ occupations or in prostitution and street peddling and other similar work in the informal or formal sector, this internal migration of rural women from low-income families to the cities is important to the economy as a whole. These women often have strong family ties that induce them to send most of their earnings

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home. This provides low-income families with an important financial lifeline. If they also go abroad, this provides an important source of foreign exchange for the country (Sen 1994: 45). If they move abroad with official sponsorship, these women also pay taxes to their home governments and provide the state with some revenue collected through taxes. And in both cases the flow of remittances from abroad to very poor rural families helps alleviate income disparities, raising the purchasing power of the rural poor, and therefore having a stimulatory effect on the economy as a whole (Kung 1994; Salaff 1994).

Women’s invisible contributions Even when women do not work outside the home, they still contribute to the economy by alleviating poverty. As Dalla Costa and James (1970) have argued, women's free labour in the household reduces what a worker, particularly in an urban job, has to be paid. If workers had to purchase such services as food, laundry or even sexual gratification, it is possible that their wage demands would increase considerably to cover the cost of obtaining the same goods and services from the market. If women’s unpaid work at home, measured by comparable market price and wages for the substitute worker, were actually paid, it might force a major increase in legal minimum wages (Goldschmidt-Clermont 1982). Women’s unpaid work at home, however, does not mean that their productive (paid work) work will automatically disappear. In fact, many women perform a ‘double day’ – a full day at work in addition to their work at home (United Nations 1996). Therefore, they contribute doubly to investors’ profits – working cheaply themselves and subsidizing wages of male workers through their unpaid work at home. In recent decades the impact of structural adjustment programmes, with rising food prices and reduction of other subsidies such as statesponsored health care and education services, has increased the burden on low-income families. Furthermore, under structural adjustment, unemployment has been exacerbated in many parts of the world. However, in the context of rising poverty, women, as the main caretakers of their families, have acted to prevent a major reduction of food and welfare services. In fact, in many ways women have made up for the shortcomings of the state welfare function. For

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instance, as subsidized food became less available, many women shifted to buying cheaper food that usually requires more preparation time or travelled further to market to obtain better prices or came up with alternative menus that would provide the same nutritional values (Elson 1989: 70). Cross-culturally women are more responsible for ‘household management’, for making certain that the members of households are fed, clothed and cared for. While in general men are regarded as breadwinners and women as managers of the resulting income, ‘stretching’ the husband’s cash contribution through housekeeping skills becomes a great asset to family well-being. Very often when that income is far from enough, women undertake one of three possible alternative strategies – they themselves go out to work to bring an additional income; they produce food or clothing themselves; or they engage in bartering goods and services to compensate (Waring 1999). Many cross-cultural studies have shown that women's income is almost exclusively used for collective family needs, particularly children’s education and nutrition. By contrast, men tend to retain a considerable portion of their income for personal spending and to use it for such things as alcohol and tobacco (Khalideen and Khalideen 2003). There is research in India, for instance, showing that increasing the wages of working women improves child nutrition while the same increase for men has no such effect. Also, there is a fairly large and increasing proportion of poor households headed either temporarily or permanently by women. Given women’s lower incomes, this exacerbates the impoverishing effect of single-parenthood (Loutfi 1987: 112–13). In such situations, because of women’s particular expenditure pattern, the family survives nevertheless. The difference between male and female expenditure patterns stems from the fact that women, especially as mothers, identify themselves first with their families and then with their neighbourhood – which in turn leads them to be concerned with their communities. By contrast, men’s identity as breadwinners tends to be focused outside their family and immediate community, particularly when they live and work in an urban setting. It tends to be focused on their work environment and the social connections linked to that work environment. This in turn helps to explain the difference in expenditure patterns, the fact that men are more prone to use income for luxuries or vices while women will spend more reliably on family

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needs (Eviota 1992: 152; Hoodfar 1997). This pattern is likely to continue among low-income communities in particular. As a result this aspect of women’s unpaid work will continue to be crucial to family survival. Furthermore, the traditional view that women’s expenditures on the basic needs of their families are merely consumption has been subjected to considerable criticism. It has been pointed out that spending money on children’s education and health ought to be viewed as an investment. Indeed, children’s education and health are arguably the most important investments that a family makes for the economy as a whole. In India, when women earn an income there is more equality within the family, which further increases investment in the education and health of the family (Jejeebhoy 2002). Women’s investment in education is more crucial in low-income families. When the family is very poor, education for children might mean just the primary level. Very often girls are encouraged to drop out in order for the boys to continue their higher education, depending on the availability and the cost of higher education. Yet over and over again education has proved to be very important for development. And, as already suggested, when the family is better off as a result of women earning income, what women earn very often gets spent on higher education. Not only do women with access to earned income of their own experience some degree of economic empowerment, but they also become good role models for girls and that helps favour the possibility of education for girls (Cain et al. 1979). Higher education for girls in return further increases employment possibilities for women, thereby enhancing human capital as a contribution to the economy. In many parts of the world, women and female children traditionally receive less food than males. Changes in the bargaining power between men and women within the household will affect the allocation of food between male and female children. Therefore as women's power increases, there is also a greater chance that female children will survive. Cross-cultural studies also indicate that working women enjoy greater autonomy from their husbands and in-laws (Chaudhury 1982: 71–106).4 And when women do have more decision-making powers, because of the aforementioned expenditure/investment pattern differences, again children tend to benefit. Children of working mothers

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are virtually always better fed. As a result, infant mortality decreases and as children grow into healthy adults, life expectancy increases. Additionally, women with income can and do provide for better medical care, with the same results. When women enjoy greater access to economic resources, they have more chances of learning how both to improve their own and their families’ health conditions and to gain better access to family planning information and services (Becker 1991). There are many reports indicating that women’s access to resources and improvement in their general status leads to a decrease in fertility rate (UNFPA 2003). Research on Nepalese families showed that women’s employment outside the village increased their domestic decision-making role, from which female children often benefited. Econometric analyses have indicated that female child mortality decreases as women’s access to resources through employment increases (Kanbur 2002). When the girl child has a better chance of survival, it helps to reduce the fertility rate further, a fact of which the World Bank is well aware (World Bank 2000). The striking difference between boys’ and girls’ mortality rates due to nutritional and medical neglect of girls and the sex bias against women has been one of the reasons that fertility in some parts of the world has not declined. Furthermore, cross-cultural analysis indicates that as the opportunity cost of raising children increases, women tend to limit their families. With a general increase in the level of female employment, there is no doubt that the opportunity cost of raising a family increases enormously (Blackwell and McLaughin 1995). It is obvious that however low the wages for women are, they receive a higher pay than they get at home (where it is effectively zero). This differential is greater in urban areas than in rural ones. In addition, in rural settings the types of jobs are much more susceptible to combining childbearing and employment (Smith 1981). An increasing number of educated women who live in urban areas face a conflict between their roles as wife-mother and as worker, and increasing opportunity costs of childrearing. As Becker and Lewis (1974) illustrate, when the relative costs of raising children increase against the purchase of goods, many couples face a dilemma due to their declining expenditure power, and that contributes to limiting family size. Becker and Lewis argue further that in many cases as female labour force participation increases, a shift occurs from the quantity of children to the

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quality of child care. Many other studies have pointed to an inverse relationship between the ‘price’ of children and desired family size. As A. Sen argues, on the basis of an array of research and cross-country analyses, there can be no doubt that the economic (opportunity) cost of children to household income in many developing countries is an important factor in limiting fertility (IFPRI 2002). Fertility also decreases with high female labour force participation, particularly in the formal market economy, because it leads to a tendency to delay marriage. When women’s participation rates, particularly in the formal market, are high, this is usually coupled with an increase in educational level and an awareness of the health implications of multiple births. Therefore there is a tendency to increase spacing between births, further limiting fertility (Joekes 1987: 15). Within the formal market sector in particular, it is often hard to combine child rearing, particularly of young children, with work.

Labour of love: the care economy and declining social services An important part of women’s contribution to the economy as family care givers is overlooked by mainstream economics and policy making. The origin of this gender bias lies at the very basis of modern economics, which is rooted in certain assumptions about the nature of human beings as profit-maximizing and competitive individuals – homo economicus. The founding fathers of modern economics – Hobbes, Smith and Locke – formulated their theories on the axiom of the selfish nature of human beings. According to Steinbrugge, the Enlightenment philosophy was based on the ideal of the European upper- and middle-class white male, a self-interested, competitive, rationally calculating, individualistic homo economicus (Steinbrugge 1987, quoted in Bennholdt-Thomsen and Mies 1999: 53). Based on this assumption, Adam Smith argues that the ‘invisible hand’ of the free market is the ideal mechanism for production because if individuals are profit-maximizing and competitive they will always try to consume the most for the lowest price. This will lead to efficiency secured through the price mechanism and price adjustment. There is no doubt that profit maximizing and competitiveness are characteristics of human beings but they are not the only ones. Homo

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economicus provides only a limited explanation for most of the care and love that are essential parts of the most basic human institution – the family (Benaría 2003a). It is therefore problematic to take an incomplete assumption about human nature as the basis for a theory about how to govern society. There is also a contradiction between organizing society on the basis of competitive profit-seeking individuals and the obvious fact that there is a need for altruistic, care-taking work. Human society cannot survive if everybody is a profit-seeking competitive individual. If this were so, why would so many women look after their families, particularly in the context of the modern nuclear family structure where children grow up, leave home, and are not expected to give anything back in return to their families? As more mothers and housewives have to take up another job outside their home, many of them have to take on a ‘double-day’ workload, coming home after a full day at work to cook, clean and look after all the chores around the house. This increased burden undoubtedly has had a negative impact on women’s health and their ability to take care of their families. This has alarmed many scholars who warn us, from different points of view, about the problems of the ‘double day’ (Folber 2001). Women’s role in providing care for society is far from minimal. According to the recent report on women’s unpaid work, it is estimated that globally the value of unpaid work is $11 trillion, most of which is performed by women.5 As Diane Elson argues, providing care for the family is absent from mainstream economics, but just as there is a ‘commodity economy’, there is also what she calls an ‘unpaid care economy’ (2003). The care economy is the part of the economy that provides services for families as part of women’s role as mothers, wives and housewives (see, for example, Folber 2001). Since women are responsible for the welfare of their families, state cutbacks on basic care translate into an increase in the burden on women’s reproductive work. The decline in the role of the state along with structural adjustment policies have put a major strain on women’s care-giving role. Structural adjustment programmes have transferred costs from the public sector to both households and communities, yet such costs are absent from statistical accounting. Because they are absent, structural adjustment policies seem economically beneficial in addressing balance of payment problems. But they do so at the cost of extracting more labour from women.6

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Privatization of social services and health care means that private clients and patients get better access to such services and care. That means the poor are squeezed out. Since maintenance of members of the family falls into the domain of women’s unpaid work, women end up being responsible for strategies to cope with such losses of social and health care services (Gardiner 1997).7 As Diane Elson points out: mothers do not ‘scrap’ their children or leave them to rot untended just because the state has decided or been forced by the international agencies to cut down on its social expenditure to balance its budget. (Elson 1989: 68)

Reduced public expenditure and increased poverty has increased women’s work not only inside the household but also in the community. In the past few decades women’s groups have mushroomed to make up for needs as public services have declined and poverty has grown. In some cases international organizations have provided them with assistance. Under the UN policy of ‘adjustment with a human face’, for example, the United Nations Children’s Fund (UNICEF) mobilized women to implement a programme called ‘glass of milk’ in Lima. The programme was entirely carried out by women in their ‘free time’ (Mosse 1993). In many other parts of Latin America, during the worst days of the structural adjustment policies, women’s voluntary work was used as a means of survival and in order to deal with deteriorating conditions. For instance, women’s volunteer groups set up communal kitchens, particularly in Bolivia and Peru during the 1980s. The number of collective kitchens grew from 600 in 1985 to 1,550 in 1988, and the number of women involved from 100,000 in 1985 to 250,000 in 1991 in Lima alone (Mosse 1993: 160). This type of women's volunteer work has been of enormous importance in dealing with poverty and in providing for social welfare. In some cases, the state has welcomed women’s groups’ initiatives or even created groups to deal with poverty. As an example, in the aftermath of the 1994 devaluation crisis in Mexico, the Women’s Regional Council of the National Council of the Urban Popular Movement (CONAMUP) emerged to improve women’s conditions, and since then the organization has been a great help to the government’s anti-poverty programme (Stephen 1997). In the case of Iran, a

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Women’s Voluntary Health Workers’ Association (WVHW) was initiated by the government in the 1990s to address high fertility rates in poor neighbourhoods. The association was highly successful and has been the main force behind Iran’s family planning programme, which targeted low-income families (Hoodfar 1998). In the case of Iran, WVHW was initiated by the state; in the case of Mexico, CONAMUP grew spontaneously but was incorporated into the state anti-poverty programme. Both of these groups became pressure groups making political demands on the state. WVHW did not remain under the control of the government and later on began to gather petitions mobilizing neighbourhoods to demand public services such as electricity, water and green space (Hoodfar 1998: 24–5). CONAMUP has become a political constituency and continues to put pressure on the state for social programmes. CONAMUP has turned into a group the government cannot afford to alienate. The state not only gives it financial support but has also been forced to recognize its political demands. Although women’s groups’ demands tend to focus mainly on poverty, increasingly environmental degradation is becoming another important issue. Poverty and income disparity as well as environmental degradation have been exacerbated as a result of the expansion of trade and the decline in state power to protect natural resources. The parallels between female poverty and environmental degradation are very interesting. Environmental resources, just like women’s reproductive work, fall outside of the market economy, remain unaccounted and unrecognized, and are treated as though they were unlimited.

The interventionist state versus market fundamentalism While increasing the number of women’s groups is a crucial and a positive step towards female empowerment, there is a danger that the burden of what the state must provide will be transferred to women’s organizations. This is precisely why a dictator such as Ferdinand Marcos started a nation-wide women’s group headed by his wife. Similarly, under the Shah the Iranian government mobilized rich women and women who worked for the establishment. More recently, however, the trend is for international organizations to

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provide funds for women’s groups to address social problems, particularly those related to poverty. The World Bank as well as the United Nations have been giving grants and support to women’s groups. The peril of having to fill in for the state is a crucial issue at two different levels. At one level, it adds to women’s unpaid work. More and more women have to do volunteer work in their ‘free’ time. At the other level, the more women’s groups are engaged in welfare programmes, the more the state can legitimize its lack of action and withdraw its support from social programmes as these come to be performed by non-governmental organizations. Once citizens accept the notion that the state is no longer responsible because women’s groups are providing welfare services, not only is the care economy undermined but state lack of commitment to welfare is legitimized. While there is no doubt that women’s groups must be supported by national and international organizations, financially as well as politically, their contribution must be intertwined with that of the welfare state. The last chapter ended by discussing an interventionist state embedded in civil society. Since women constitute the poorest segment of the society their organizations offer one of the best ways in which the state can become embedded in society. Instead of downloading the work of the welfare state on women’s groups, an interventionist state that is subject to political pressure from women’s groups can guarantee social services without having to become a burden on women’s organized group responsibility. At the core of an alternative to the globalization process is strengthening women’s groups and bringing them into the political process as major influences within state policy-making bodies. The current new trend toward the transference of the social welfare functions of the state to women’s groups must be reversed. If the state becomes re-embedded in women’s organizations such as India’s Self-Employed Women’s Association (SEWA),8 an organization of low-income women workers that fights alongside labour unions, the state will be subject to pressures and lobbying in making laws. Moreover, not only will such embeddedness be focused on legal empowerment but it will also be able to supervise its implementation and thereby prevent much of the current labour exploitation. This is an important initial step to overcome the negative forces of globalization. Before ending this section it has to be pointed out that much of the

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feminist literature on development remains highly critical of capitalist development in general. As an example, Maria Mies and Veronika Bennholdt-Thomsen have put forward their Subsistence Perspective (Bennholdt-Thomsen and Mies 1999) as an alternative feminist theory. The theory favours subsistence economy and promotes people’s empowerment and the preservation of nature. By putting a human face to globalization, subsistence theory calls for political empowerment of people, particularly women, as the most disadvantaged group. For a society based on a subsistence economy, the goal is to provide for human needs as opposed to having a perpetual desire to produce more. The theory rightly argues that our current society is unsustainable because of the current rate of environmental destruction and mass poverty. While recognizing the importance and relevance of such powerful feminist alternative theories, this book chooses not to examine them in further detail but rather to stay within a framework that proposes less drastic changes for an effective start. The next chapters will focus on providing empirical data on the failure of mainstream orthodoxy from a gender perspective. The importance of such data is particularly crucial for challenging the mainstream through national and international organizations. Persuading development agencies to abandon their unquestioning support for market fundamentalism through concepts that do not require dramatic shifts in the existing social structure is the first step in realizing alternative views. It is in this spirit that the book will remain within a framework that stops short of questioning the very notion of capitalist development and/or promoting more people-centred theories. In order to bring about necessary fundamental changes, there has to be a start that can pave the way for the ultimate goal, a society based on human values rather than those dictated by the market. NOTES 1 These debates have made an impact on the gender and development discourse. One of the outcomes of such debates has been the shift of emphasis from Women in Development (WID) in the 1970s and 1980s to Gender and Development (GAD). While WID was concerned only with incorporating women into the development process, GAD takes into account issues concerning both sexes, and focuses on men as well as women.

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2 An example from two neighbouring countries can illustrate the point. The participation rates for women in Iran and Turkey are dramatically different. However, in both Iran and Turkey women’s share of the labour market in the agricultural sector is comparably large in reality. But the Turkish state automatically counts all women as agricultural labourers, even though they might be unpaid family workers, whereas in Iran they are not counted. 3 Information based on several interviews I conducted in Cuba (15 August 2000). 4 Feminists who have done work on intra-household resource allocation such as Elson (1990: 88) point to the fact that, as women’s access to resources increases, there is a change in the dynamics of family expenditure: ‘The household is a site of conflict as well as cooperation; of inequality as well as mutuality; and conflict and inequality are structured along gender lines.’ It is now widely accepted that not all household resources are necessarily or automatically pooled together. 5 http://unpac.ca/economy/unpaidwork.html. 6 While it is true that many countries in the South have suffered the effects of structural adjustments in the 1980s and 1990s, women through their reproductive role have reduced the loss to human capital to a great extent. 7 In some cases there has been an overlap between home work and supplementary income-generating activities, for example in such home-based services as baking, cooking and sewing, and in such jobs as repairs, printing, photography, haircutting and giving injections (Tipple 1993: 521–39). 8 SEWA is a trade union registered in 1972. It is an organization of poor, selfemployed women workers who earn a living through their own labour or small businesses. They do not obtain regular salaried employment with welfare benefits, like workers in the organized sector. Their labour is unprotected.

3 Taiwan: Neo-Liberalism or Developmentalist State?

In this chapter the case of Taiwan as a successful model will be carefully examined. However, any understanding of modern Taiwan will be handicapped if its colonial background is not taken into account. The first section of this chapter focuses on the history of Taiwan’s political economy as well as the role of women. This is followed by a detailed analysis of the role the Taiwanese state has played in the economy.

Colonial history Socio-political background By the mid-seventeenth century many Chinese, mainly farmers, had migrated to the island where they cultivated rice, sugar cane, indigo, grain plants and potatoes. They also hunted deer and fished. The Chinese intrusion led to isolated acts of trade with the small indigenous communities, bringing them into the world of international exchange. Deerskin and sugar became the major exports to Japan, while dried fish and deer meat were shipped to China (Eto 1964). After the overthrow of the Ming dynasty, trade was followed by formal conquest. Although the intent of the Chinese was to use the island as a stepping-stone for restoring the Ming dynasty, in fact the occupation turned into a permanent one. The Chinese continued to dominate except for a brief period of Dutch and Portuguese control. 64

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With the arrival of European imperial control came substantial changes in patterns of government and trade. While the Chinese had used Taiwan as a resource base, for the Dutch East India Company it was more a base for long-distance trade, particularly the exchange of Chinese tea, raw silk and silk products, lacquer and porcelain for gold and gold objects, silverware, copper and copper goods, and other goods such as porcelain from Java, Japan and Europe (Ho 1978). Simultaneously the Dutch sought to promote an increase in domestic agricultural production to feed their soldiers. The economic base evolved from hunting and gathering to slash-and-burn agricultural practice. At the same time the demographics began to change. More Chinese arrived, and the indigenous people were driven further inland. In the 1660s, Cheng Ch’eng-kung (known as Koxinga to the Dutch), the founding father of today’s Taiwan, managed to defeat the Dutch and establish the first Chinese-run government. For the next two centuries Chinese migration from the mainland accelerated. The result was extensive sinicization. Over the same period, the remaining aboriginal people became incorporated into the sinicization process through intermarriage, or were beaten back into the highland regions. Although there were periodic uprisings of the indigenous population, Taiwan’s sinicization continued without interruption up to the late nineteenth century when the Japanese defeated the Chinese and took over. Today out of the total population of 20,659,000 only about 250,000 aboriginals remain, mainly residing in the mountainous central and eastern regions (Lin 1989: 283–300). Sinicization of Taiwan does not mean that ethnic conflict has been absent from the history of the island (Eto 1964: 47). The four major ethnic groups in Taiwan, and their estimated percentage in the national population in 1989, are the Holo (73.3 per cent), Hakka (12 per cent), Mainlanders (13 per cent), and Australian Aboriginal (1.7 per cent) (Corcuff 2002: 163). Since the aboriginal people of Taiwan are nearly extinct, this work will not include an examination of the nature and socio-economic fabric of the aboriginal population. The discussion is confined to the social and political dynamics of the dominant Chinese migrantcolonizers who in turn were colonized by the Japanese, albeit for a relatively short period of time.

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Towards the end of the nineteenth century Taiwan was ruled by a reform-oriented Chinese governor who installed a postal service, telegraph lines, railroads and seaports. By the time Taiwan was handed over to Japan modernization had started. The handover brought a great deal of dissatisfaction among the Chinese both inside Taiwan and on the mainland. It is no coincidence that the same period witnessed the first sparks of the modern Chinese revolution led by Sun Yat-sen. Although following the Sino-Japanese war the Chinese government quickly moved to hand over Taiwan to Japan, the transition was far from smooth. In fact, the Sino-Japanese war was a smaller affair than the ensuing Taiwanese armed resistance. In the north, where an independence movement had proclaimed Taiwan a republic, the war ended quickly. But in the south the armed struggle was protracted. In 1920 a new rebellion erupted led by Taiwan Seinen (Young Formosa), which called for Formosan (Taiwanese) autonomy. With a large following among farmers and factory workers, the movement eventually constituted the Formosan Communist Party. Through the 1920s the number of people annually arrested or executed ran at 3,400. While the Japanese had to face great resistance, it did not stop them from improving living conditions in Taiwan. They implemented many reforms: improved sanitation, controlled diseases and reduced death rates. They also brought in extensive welfare and education programmes. In fact, living conditions for many farmers were, if not better than those of Japan, at least almost as good. Japan’s rule ended on 15 October 1945. Even before then, the Cairo Agreement of 1943 had ceded Taiwan back to the Chinese Nationalist government. However the outcome of the Chinese Civil War prevented that agreement from being implemented. Colonial economy In 1624 the Dutch East Indian Company seized Taiwan and opened up trade relations. As we have seen, traditional Chinese exports went via Taiwan to Java and Japan and on to Europe, while European merchandise returned to Japan and China. The Dutch also encouraged Chinese immigration. Their slash-and-burn farming

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techniques were intended not simply to increase agricultural production but to deprive the indigenous people of their means of livelihood so that they would be a source of cheap labour. In the early seventeenth century, after the Ming dynasty had already been defeated on the mainland by the Manchus, Ming loyalists drove the Dutch from Taiwan. The leader of the Ming loyalists brought 25,000 troops to Taiwan to encourage further settlement and agricultural cultivation. From this time agriculture, with the products traded for domestic consumption, replaced foreign trade as the foundation of the island’s economy. Under the special system of land tenure created by the Chinese to encourage further migration of mainland Chinese at the expense of the local population, tenants were given rights not seen on the mainland. For instance, the tenant could lease or sell surface rights (Lin 1989: 285–6). This process of steady migration and settlement continued until the Chinese defeat in the Sino-Japanese war in 1895. One of the most important features of early Japanese domination was a significant land reform (Auty 1997: 447). Rather than forming large agricultural farms, the Japanese mainly worked with the existing peasant sector. They expropriated estates of larger absentee landlords and redistributed the land to middle-sized landlords actually resident on the lands (Amesden 1985: 81). The Japanese also introduced a new system of tenure, halfway between full ownership and tenant status. Furthermore, irrigation networks were expanded. By the 1930s a ‘green revolution’ had taken place in which new farming techniques and chemical fertilizers were used to increase rice and sugar production for export to Japan (Amesden 1985: 81). Taiwan thus became Japan’s food supply depot as well as a good market for Japanese consumer and capital goods. In addition, the Japanese built an infrastructure, expanding the system of roads and railways. They also improved the educational system and health care provision. Japanese colonialism was thus very different from that of the Europeans, creating many of the advantageous conditions of Taiwan’s later development. This positive impact of the Japanese era has put Taiwan in a favourable position compared to other countries in Asia. It certainly set Taiwan apart from those countries of the region visited by European and American colonization (Indonesia was a Dutch colony, and the Philippines a Spanish and American one).

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Women’s role in the colonial era Under Chinese rule Taiwan’s economic structure was founded on agriculture, and based on an imported land tenure system. Although the land tenure system changed during Japanese rule, agricultural production – and in particular, the cultivation of rice – remained the economic backbone of the country. Traditionally the cultivation of rice has been linked to the Chinese family structure, relying heavily on women’s labour. This Chinese family structure is based on the Confucian precepts of filial piety and ancestor worship. The patrilineal extended family acts as a unit: producing, investing and economizing communally. Although numerous religions have been introduced into Taiwan from many parts of the world, Chinese Confucianism still dominates. This means that the extended family continues to play a central role in the country’s economy. As is common in traditional Chinese society, women in Taiwan are taught to cultivate the ‘four virtues’: morality, skill in handicrafts, feminine appearance and appropriate language (Cohen 1988: 107). However Chinese commitment to Confucian principles (enshrined in the practice of ancestor worship of the husband’s family) means that, although women’s work is essential to the economy, women cannot challenge their subjugation within the extended family structure. According to the concept of filial obligation, girls are regarded as liabilities, as a drain on family income and resources because they marry and have to leave their natal family (Wolf 1992). In order to deal with this future negative impact, ‘loss’ girls must fulfil their filial obligation from the time they are able to work. They are socialized to work hard, hand over the fruits of their labour, and remain docile. Though girls work much harder than boys it is the latter that are regarded as an asset, since men bring women into their families whose productive and reproductive labour serves the husbands’ family. In the past, girls were discouraged from bonding with their mothers, and were subjected to harsh living conditions to ensure that they would be submissive daughters-in-law. This tradition, wherein girls are docile, hard-working and loyal to the patriarch of the family, in conjunction with exogamy, which separates women from their natal family, underlies the composition and comportment of today's Taiwanese women workers (Kung 1994). Women must still work hard outside and inside the home,

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unquestioningly handing over the fruits of their labour to their family, be it natal or post-marriage. As in Mainland China, traditionally women in Taiwan have not had land ownership rights.

The making of modern Taiwan The making of Taiwan’s developmentalist state Much of the neo-liberal literature in the late 1980s and the early 1990s used the ‘Asian Miracle’ as evidence to support the assumption that economic growth was generated by increased trade (Amesden 1985). There is no doubt that much of the wealth that was brought to Taiwan, South Korea, Hong Kong and Singapore had resulted from trade expansion. But the type of trade expansion that took place was not the same as that which advocates of neo-liberalism recommend: that is, free trade. In fact, far from free trade springing the miracle, it was the promotion and protection of trade by the state that was absolutely crucial. Many scholars have argued that the economic success of Asian countries was not the result of the reduction of the role of the state. They argue that, contrary to neo-liberal theory, it was a developmentalist state that promoted trade and generated growth (Amesden 1985; Wade 1988; Deyo 1987; Appelbaum and Henderson 1992; Salaff 1994; Park and Johnston 1995; Auty 1997). In the case of Taiwan, a developmentalist state was formed based on the historical legacy of Japanese colonialism. Amesden has argued that Taiwan inherited from the Japanese occupiers the policy of establishing state monopolies, along with a general interventionist approach to shape and transcend the market. During the 1930s, the Japanese established industries in Taiwan to support their military ambitions – production of chemical and metallurgical products for example – along with creating new roads and manufacturing facilities for automobiles, trucks and bicycles. In the final analysis, the Japanese left behind an economy that was much more developed than many other parts of the world under colonial rule. As already mentioned, the Japanese also engaged in a very comprehensive land reform, which freed Taiwan from a strong agrarian interest (Evans and Rueschemeyer 1985: 40). Particularly between

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1926 and 1940, there was a marked increase in agricultural production. As a result, when the Kuomintang (KMT) retreated from the mainland to Taiwan in 1949, it did not have to face a powerful interest group rooted in the landowning class. The absence of such a quasi-feudal landlord class facilitated land redistribution and the introduction of new agricultural technologies that raised productivity while simultaneously redistributing income (Amesden 1985: 75–107). Furthermore, Taiwan inherited an efficient bureaucratic apparatus that facilitated the creation of a developmentalist state. At the time that the KMT arrived, Taiwan’s independence movement was very strong. In 1947, in an attempt to consolidate their power, Chiang Kai-shek’s troops killed thousands of Taiwanese and much of the leadership of the mainland opposition to the KMT. For the next several decades Taiwan lived under martial law, supported by a repressive police force and networks of political informers. Because the KMT regarded Taiwan as its stepping stone for the reconquest of China until well into the 1970s, the military budget remained very high, and with it state encouragement to industries that would support the KMT militarily (Evans and Rueschemeyer 1985). The KMT used its military and civil power not only to guarantee political domination, but also to implement its economic strategies. For instance, when the KMT decided to enforce a massive land redistribution programme, effectively finishing what the Japanese had started, the army and the police made sure that large landowners sold their properties below the market price. The KMT also used its military and police power, and the pretext of an ongoing (technical) state of war with China, to make sure that labour unions remained under control. Strikes were non-existent in the 1950s, 1960s and much of the 1970s (Amesden 1985: 75–107). In the 1970s, with Chiang Kaishek’s death, a modest process of political liberalization began in which native Taiwanese were slowly incorporated into the political and economic decision-making process. This process accelerated in 1987 with the lifting of martial law. That same year the Democratic Progressive Party (DPP), formed in the 1970s but soon after outlawed, was finally allowed to campaign publicly (Evans 1985).1 Since the election of 1987, these opposition groups have gained further power. Support for the DPP in particular has grown (Dessus et al. 1995: 16). In 1989, liberalization went further when a law was passed that permitted non-governmental organizations, particularly

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those concerned with human rights and environmental issues and including women’s organizations, to be more publicly active.2 These liberalization trends continued into the early 1990s. Along with them came an effort, particularly under president Lee Teng-hui, to reduce the traditional policy of state interventionism, and integrate the island more fully into the world market. Interestingly enough, Taiwan was prevented from becoming a member of the World Trade Organization (WTO) because of China’s objection to Taiwan’s membership throughout the 1990s. Nonetheless, Taiwan has attempted to follow the World Bank and IMF prescriptions for liberalization and deregulation. Moreover, Taiwan has sought to become the economic and commercial centre of free trade in the Asia Pacific region. This plan has received support from the United States. Nevertheless, throughout the process the Taiwanese government has remained very present in the economic planning of the country, using tensions between the US and China to its economic benefit. Strong state presence in the economy may, to a large extent, be responsible for the fact that, during the 1990s, Taiwan’s growth rate only dropped as low as 3 per cent per annum. When compared to other Asian countries in the 1990s, this figure was quite respectable, but for Taiwan the decline was a significant setback, given the double-digit growth rates achieved in the 1960s, 1970s and 1980s.3 Economic liberalization, therefore, did affect Taiwan but to a much lesser degree than other countries in the region who suffered from the 1997 Asian Crisis. The Taiwanese state’s economic strategy The first item on the KMT’s development strategy agenda was to continue the Japanese land redistribution – this policy of promoting agricultural smallholdings was also consistent with Sun Yat-sen’s criticism of monopoly capitalism (Amesden 1985: 75–107). The KMT promoted the use of fertilizers and new seeds as well as introducing multiple cropping and encouraging diversified farming. In addition, it promoted the establishment of cooperative institutions. The result, as early as the 1950s, was a large increase in agricultural exports (sugar, rice, bananas, canned pineapple, tea) to Japan in particular. However, since the 1950s agriculture has been in relative decline, with manufacturing moving to the fore (Lee and Kuo-Shu 1982: 310–50).

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The emphasis on manufacturing had already started under Japanese rule. The Japanese, however, concentrated mainly on industries that would service their war machine, the sole exception of any significance being textiles. In the early days of their development strategy, the KMT continued the Japanese policy of encouraging textiles, but added to this the food-processing industry. Once again following policy guidelines set out by Sun Yat-sen, the KMT put a lot of energy into promoting enterprise-level corporatism through encouraging dispersed rural industry (Deyo 1987: 199). While private ownership of small enterprises was advocated, the government also engaged in central planning (Haggard and Chen 1987: 115). As a result of this eclectic approach, the state owned much heavy industry such as petroleum refining, aluminium and steel production, and fertilizers (Haggard 1987: 136), while small enterprises flourished. It should be noted that from the 1950s until well into the 1970s, Taiwan’s economy also benefited from large amounts of economic and military aid from the United States. In the years immediately after the KMT came into power, US aid accounted for half of the country’s gross investment.4 Simultaneously, American military assistance based on Taiwan’s front-line position against Communist China helped to maintain the repressive institutions that kept down strikes in the emerging industrial sector, and generally enhanced the KMT’s political power. Although the KMT’s economic strategy revolved around central planning and state direction, its objectives were to achieve a decentralized industrialization. It encouraged networking relationships between firms, between firms and the state, and between firms and the world economy – the latter consisting mainly of Japanese companies. Through this mechanism, Taiwan managed to become incorporated into the international market whilst simultaneously remaining controlled by the state. This situation is dramatically different from that in many Latin American countries, where the state has been unable to dictate the terms of international economic integration. After the initial period of post-war modernization (actually an extension of Japanese policy on the part of the KMT), the post-war period can be divided into three phases: (1) import substitution; (2) export promotion; and (3) restructuring. Taiwan, like many other developing countries, started off with a relatively short-lived import-

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substitution policy. This stopped by the beginning of the 1960s. The country moved to export promotion until the late 1980s. Then it entered a period of restructuring. Taiwan’s import-substitution strategy started in the late 1940s and continued until 1959. Initially the objective was to help form a class of small independent capitalists based on their acquisition of old Japanese facilities in order to carry out the task of industrialization (Amesden 1985). Taiwan was far from alone. Import substitution was a popular policy among newly independent countries at the time. It could be regarded as a form of economic nationalism, which aimed to create a national entrepreneurial class that produced for the home market under government protection. This was widely regarded as a viable means to switch from an agricultural economy to an industrial one.

Table 3.1 Taiwanese economic development policies 1905–55

– Early modernization of agriculture. – Development of other primary or extractive industries.

1949–59

– Import substitution. – Expansion of modern secondary manufacturing industries.

1960–89

– Export promotion, labour-intensive industry. – Establishment of free trade zones.

1990s

– Structural change to more technology-intensive industries. – Shifting labour-intensive production to other countries of region.

During the import-substitution phase, high tariffs were combined with government subsidies to infant industries to encourage local production of finished goods, while barriers were imposed against the import of foreign-made luxuries. Other imports were restricted, using a licensing scheme. The emphasis was on consumer goods – textiles, clothing, wood and leather products –already initiated by the Japanese in the 1930s. The KMT also used taxation and exchange rate policy to favour the industrial sector at the expense of the agrarian sector (Lee and Kuo-Shu 1982: 310–50).

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Import substitution survived for a while because successful land reform and redistribution of income provided the home market with purchasing power. With the home market assured, investors found the industrial sector highly profitable. That in turn helped cause a doubling of the manufacturing sector’s size during the period from 1950 to 1958. Soon, however, problems with import substitution began to plague the economy. The basis of import substitution was its emphasis on the protected domestic market, a multiple exchange rate system and strict import controls. In the long run these policies produced economic inefficiencies. For instance, protection meant that some enterprises could operate without having to perform at maximum efficiency. Licensing opened avenues for corruption. Taiwan’s relatively short import-substitution period ended with the promulgation of the Programme for Improvement of Foreign Exchange and Trade Control in 1958. The multiple exchange rate system was eliminated, the currency devalued and import restrictions were reduced (Lee and Liang 1982: 310–50). At that point Taiwan, like many other developing countries (in fact it was among the first) switched to export promotion. Since the 1960s, many countries, particularly small ones, have found it difficult to survive on their own resources and their home market. Accordingly export promotion was a virtual reversal of the logic of import substitution. The idea was that each country would specialize in producing for the external market and in return import what it needed for its home market. Although the fundamental rule appeared to be similar to the classical law of comparative advantage, in fact in this case the process was state-initiated and centrally planned. In Taiwan, the KMT focused on labour-intensive light industry, producing non-durable consumer goods such as textiles, processed food, footwear and electronics. Although they were initially created for domestic consumption, after 1960 their main orientation became the export market. The Taiwanese industrial structure that emerged was comprised of a large number of local enterprises set up with family savings and cooperative savings networks, supported by government-controlled bank credits. Many of these firms were located in the rural fringes of metropolitan areas, where family members could work on the land and in the industrial shop at the same time. It is in these types of enterprises that women, as unpaid family workers,

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have made an impressive contribution as cheap flexible labour (Haggard and Chen 1987: 123). In common with other countries pursuing such a path, Taiwan’s ‘liberalization’ of international trade was not an attempt to move towards a free market. Rather export promotion was a development strategy implemented through monetary and fiscal policy designed to make exports more profitable (Amesden 1985: 75–107). Taiwan was the first country to set up free trade zones (FTZs). In 1964 the government established the Kaoshiung zone into which Japanese firms moved to benefit from Taiwan’s low wages, particularly from a labour force that was largely female (Li 1988; Wiltgen 1990; Castells 1992; Brinton 1995: 1107). Taiwan has put great emphasis on joint ventures, while protecting the domestic investor. Moreover, the state has further provided assistance for domestic enterprises through state-supported trading companies. Official trade representatives in major cities around the world have taken on the task of negotiating the entry of Taiwan’s manufacturing goods into major department stores in the United States and Europe (Deyo 1987: 237). The KMT also imposed regulations restricting MNCs in certain aspects of marketing and profit repatriation (Deyo 1987: 236). Unlike similar efforts in Latin America, in Taiwan the state has been able to both restrict and manage foreign capital in ways that support its development strategies through different mechanisms. Particularly in the early stages of the export-promotion phase, MNCs operated through subcontracting. The government encouraged American firms such as K-Mart and medium-sized Japanese firms to enter into subcontracting with local private enterprises, mainly small family-owned firms that relied heavily on mainly young unskilled women to produce the products they marketed abroad (Amesden 1985). From 1955 until 1960 manufacturing grew by 11 per cent a year. The share of manufactured products in total exports rose from 28 per cent in the 1960s to 77 per cent in the 1970s. And manufacturing employment rose by 8.3 per cent per year from 1965 until the mid1970s (Lee and Kuo-Shu 1982: 311). During the first part of the export-promotion era, rapid growth was concentrated in food processing and textiles. When those sectors began to decline, particularly after an international economic crisis in the mid-1970s,

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the government began promoting the electrical and electronics industries to take up the slack (Fei et al. 1981). In the 1980s protectionism in the countries that were the main markets for Taiwan’s manufacturing industries increased, resulting in another economic crisis striking Taiwan around the end of the 1980s. This crisis led the country towards a new development strategy. The government shifted its policy orientation towards ‘restructuring’ – an effort to reduce state interventionism. On the one hand, it has moved toward deregulation, privatization and devaluation. On the other, Taiwanese investors have invested offshore. That shift to offshore investment, in fact, had already been in progress by the time the new crisis hit. As Taiwan’s economy had expanded, wages had risen. Where previously women could be used as a huge pool of cheap labour, by the late 1980s a rising level of general prosperity pushed up their wages to the point where Taiwanese women were no longer competitive in the world market. Since the early 1990s, Taiwanese entrepreneurs have been employing women in neighbouring countries such as China, the Philippines, Indonesia, Thailand and Malaysia for their labour-intensive manufacturing. In China alone it is estimated that 15,000 Taiwanese companies operate with an investment of more than $10 billion, mostly to produce items like toys, garments and shoes for export (Salaff 1994: 5). As a result of the emergence of a female labour surplus comprised of young women who had been brought into paid employment, the Taiwanese government adopted policies aimed at sending women back into the home. Simultaneously however, the government has concentrated its efforts on high technology (Haggard and Chen 1987: 123). One of the ways in which the KMT was able to initiate high-tech industries was by setting up Hsinchu, ‘science-based industrial parks’, to serve as models for high-tech economic initiatives (Chow 1997: 2). With the help of the government, Taiwan now produces goods and services that are technology-intensive, and as a result fewer women are employed. Thus, as Taiwanese investors using women in China produce stuffed toys and running shoes, in Taiwan itself they make three-foot electronic cars for children and fashion shoes that compete with those made in Italy (Bowring 1994: 37–9). Since Taiwan, unlike countries like the Philippines, did not have a major problem of international debt, it has not been pressed as hard

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by international creditors to follow economic policies based on liberalization of the market. Nonetheless, since the early 1990s Taiwan has not been immune to pressure to further privatize, deregulate and devalue (Dessus et al. 1995: 17). Pressures for liberalization have been intensified recently because Taiwan is competing directly with China to become the trading gate for all of Southeast Asia.

Women's role in Taiwan’s economic success Paid work: cheap flexible labour After the KMT chose to continue the Japanese policy of agricultural reform, a green revolution took place in Taiwan during the late 1940s and 1950s. This green revolution had major consequences for female labour. Because it was based on land redistribution, the number and percentage of farmers who owned their own land increased. Therefore, family farms became more common. Increasingly, small land holding became the dominant pattern, farmers worked on their family land and women's participation as unpaid family labour on family farms increased. This increase was simultaneous with a decrease in the number of people working as day labourers – small land holding did not require day labourers and female labourers were busy with their own land. Even today, especially in Southern Taiwan, most rural women work full-time on family farms. Another outcome of the policy of green revolution was the mechanization of agriculture, the spread of the use of machinery and of pesticides and industrial fertilizers. It is common in farming when technological advance occurs and less ‘unskilled’ labour is required that women's participation in agriculture is reduced. Taiwan was no exception. Women had dominated the labour-intensive unskilled section and technology advances permitted men to take over from women. The state monitored and encouraged these changes. Putting men in charge had a dual purpose. According to the feminist literature, it was easier for the state to police the farm sector with men entrenched as the heads of households. In addition, as the demand for labour in agriculture fell, preference was given to men to fill the

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declining number of jobs. Consequently, during the 1940s and 1950s the percentage of women in the sector decreased. From 1946 to 1966 the percentage of women in the agricultural sector declined from 31.03 to 27.67. This reduction in female labour was another extremely important factor encouraging Taiwan's transition from an agricultural economy to manufacturing. The labour-intensive nature of industrialization required an influx of cheap flexible labour. Although an increase in the female share of employment in manufacturing took place during the period of import substitution, when export promotion came into full effect the percentage of women in manufacturing skyrocketed. One would expect that this increase in manufacturing employment would decrease the percentage of women in the agricultural sector. But this did not happen. From 1966 to 1967, the female share of employment in agriculture increased from 27.56 to 31.44 per cent, a trend that continued throughout the export-promotion period. This increase could be explained by the fact that when men left agricultural work in order to get better-paid jobs, women, many of them married, picked up the slack. This meant that many of them had to cope with the double burden of productive and reproductive labour at the same time. The increase in the female share of employment in the primary sector was obviously due to the fact that more women entered the agricultural/primary sector to compensate for the loss of men. Furthermore, as the state focused more on the manufacturing/secondary sector, it was no longer particularly interested in advancing farming methods. The state stopped pumping more resources into advancing the agricultural sector. As a result, since the 1960s the primary sector has increasingly declined in importance. In fishing,5 forestry and mining the number of women employed has been insignificant (Stokes 1983: 318), but so has been the total production of these two sectors within the primary sector as a whole From the early part of the import-substitution phase, the percentage of women employed in manufacturing slowly increased from 10.08 in 1946 to 11.82 in 1959. However, as the state switched from import substitution to labour-intensive export promotion a huge increase of female employment occurred. In the course of one year, 1965–6, the percentage of women in manufacturing doubled, a sudden jump that was not matched by a corresponding decline in the agricultural sector. In fact in the same year the percentage of females

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in the labour force increased in both manufacturing and agriculture. This major increase was not matched by a decline in the tertiary sector. What explains this huge increase is the fact that the exportpromotion policy peaked in the mid-1960s, the period that can be taken to represent the ‘take-off’ period for Taiwan. State policy for improving comparative advantage required cheap labour to produce goods for the international market; and labour shortage brought many women into the labour force. As Taiwanese industrialization was rural-based and small-scale, it was young unmarried women from nearby villages that became the main labour source. During this phase of export promotion, many companies set up bus services to take young unskilled female workers to nearby factories. As far as cities and major industrial centres were concerned, throughout the early stage of export promotion migrant females provided the main source of factory workers. These migrant workers were placed in dormitories built in major industrial centres with extremely poor and severely overcrowded conditions. These lowcost, cheaply maintained dormitories contributed to keeping labour costs down and therefore helped raise profit rates. High profits, in turn, were reinvested by entrepreneurs, helping to further economic growth. In spite of low pay and poor conditions, many young women continued to migrate to these industrial centres. Apart from the obvious economic motive, migration was facilitated by two cultural factors. First, because of Taiwanese family structure, which is exogamous, girls are brought up with the notion they will have to leave home. They are prevented from establishing close ties with their natal families. This prepares them emotionally to leave their families when the need arises. At the same time, due to filial obligation, girls are obliged to pay back their natal families. Filial obligation played an important role in sending young women from low-income rural parts of Taiwan to the industrial centres. These young women in turn sent a large percentage of their income to their families. These remittances were extremely significant to the survival of low-income rural families during the early part of the exportpromotion period. Other factors, in addition to low pay and subservience, have been important in raising the female share of employment. Women were

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Table 3.2 Female employment ratio Year 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993

Population 15+ years Total Females 6869 6948 7212 7482 7787 8115 8444 8763 9070 9383 9712 10043 10375 10784 11092 11378 11698 12013 12263 12544 12860 13161 13432 13696 13955 14219 14496 14711 15807

3301 3442 3580 3719 3867 4022 4181 4341 4496 4564 4818 4984 5151 5333 5504 5664 5833 5990 6126 6267 6420 6565 6700 6840 6966 7102 7240 7370 7522

Employed population Total Females 3763 3856 4050 4225 4390 4576 4738 4948 5327 5486 5521 5669 5980 6231 6432 6547 6672 6811 7070 7308 7428 7733 8022 8107 8258 8283 8439 8632 8745

% FER

1029 1065 1165 1252 1334 1396 1447 1577 1837 1835 1802 1831 1982 2048 2126 2191 2224 2301 2509 2647 2709 2912 3057 3064 3110 3108 3165 3252 3323

31.17 30.94 32.54 33.66 34.50 34.71 34.61 36.33 40.86 40.21 37.40 36.74 38.48 38.40 38.63 38.68 38.13 38.41 40.96 42.24 42.20 44.36 45.63 44.80 44.65 43.76 43.72 44.12 44.18

Source: Statistical Yearbook of the Republic of China (various years). Absolute figures are in thousands.

traditionally involved in weaving and spinning and food processing. Therefore, women were thought to have better skills in these two industries, which happened to be the most crucial ones in Taiwan's industrialization. This preference for women was further reinforced by the fact that the nature of Taiwan's development at the early stage was labour-intensive. Both the state and management preferred to

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employ women for labour-intensive tasks for reasons such as the belief that women have qualities like manual dexterity (Kung 1994: 25). In addition, the repetitive nature of labour-intensive manufacturing required patience, another supposedly innate characteristic of women, which made them much more attractive to employers than men were. Another important characteristic of female workers in general is their lower propensity to engage in strikes. Labour docility was further guaranteed when young women were encouraged to look at the company managers as their new fathers. Further, under martial law, no collective action was allowed. Female workers, unable to form unions, did not campaign to raise their wages or ask for improvements in working conditions; they remained docile. As there was an abundance of young female migrant labour there was little bargaining power any individual dissident could use. The percentage of women as a proportion of the total labour force rose from 10 per cent to a third in the course of the 1960s. By the early 1970s, during Taiwan’s take-off, more than 40 per cent of the labour force in the manufacturing sector was female (the overall female employment ratios for 1965–93 are given in Table 3.2). This was an important component of the country’s comparative advantage. In addition to factory work, the early period of export promotion is also identified with the establishment of FTZs to entice foreign companies to invest in Taiwan. These FTZs offered cheap labour, mainly women. Foreign companies found the offer attractive. Again, these women were mostly young and unmarried and were paid low wages (Haggard and Chen 1987: 115; Deyo 1987: 182). In fact, many young women preferred to work in factories and away from home since it provided space for relative freedom (Castells 1992: 44). This willingness made them even more subservient to their factory’s authorities. Therefore, in the period prior to the crisis of the early 1970s, women constituted the bulk of the labour force in the most important manufacturing sectors of Taiwan, namely, food processing, textiles and leather goods (Stokes 1983: 318; Castells 1992). In this period a large number of women worked as apprentices. Manufacturing accounted for 37 per cent of labour absorption between 1966 and 1971. These young women were a source not only of cheap but also of flexible labour as the depression of 1974–5 proved: at that time female workers were sent back home without compensation

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Table 3.3 Proportion of average monthly female wage to male wage by industry

Agriculture Mining Manufacture Utilities Construction Commerce Transport Financial services Social and personal services

1973

1978

1984

1988

--37.2 54.4 68.5 65.4 --71.7 --71.3

56.8 65.8 61.0 75.1 75.8 72.6 71.2 59.2 72.7

51.9 53.6 61.1 74.0 68.0 68.0 75.0 68.0 75.7

55 55.2 57.6 81.6 71.9 68.4 76.7 65.1 72.8

Source: Statistical Yearbook of the Republic of China 1974: 682; 1978; 1984; Liu 1985: 61–2.

(Salaff 1994: 2; Amesden 1985: 75–107), a situation that happened again during the 1978–81 recession (Salaff 1994: 2). During the early part of the 1970s, a world economic crisis hit Taiwan and many firms had to close down. Female workers, whose employment had peaked in 1973, were laid off en masse. In some cases, such as television manufacturing companies, up to one third of the labour force was laid off, virtually all of them women, without any compensation (Kung 1994: 48). The state ban on organization and trade unions under martial law guaranteed that there was no resistance. Labour dismissal without compensation was very widespread (Li 1988: 99; Kung 1994: 48). With the help of the US military, the state and its army was in full control of the situation. Although it is true that military power was primarily responsible for the smooth redundancy of a large number of workers, there was another factor at work as well. Labour unrest is more common when income disparity is high and there is a lack of basic welfare. Taiwan, however, was an equitable society and the state provided for many basic needs. There was a minimum level of social welfare and the gap between the poor and the rich was not huge. After the 1970s crisis the government, in an attempt to revive the economy, shifted away from textile and food processing (the decline in the latter was also closely associated with the decline of agricultural production) to electrical products. By the end of the 1970s the percentage of women in manufacturing, this time producing electrical

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machinery, increased. Again women’s ‘natural’ characteristics such as dexterity (‘nimble fingers’) were very important for the employment of women in electrical and electronic goods production. As much as 80 per cent of all employees in electronics were women (Li 1988: 98; Park and Johnston 1995). Table 3.3 shows that in manufacturing the average monthly female wage is barely half that of men. It also indicates that the situation does not improve dramatically in the 1980s. The fact that women as a source of cheap labour have been crucial to Taiwan’s economic success is well illustrated by looking at the wage gap between the sexes. Such an important matter is absent from macro-level analyses that are part of mainstream economics. In order to ensure a supply of cheap unskilled labour, the government also put limitations on higher education. Upon recommendation of the Economic Planning Council in 1974 annual enrolment in senior middle schools was reduced to match vacancies in universities and colleges (Kung 1994: 41). After the crisis, the new phase of industrialization and the booming economy were characterized by an increase in subcontracting. This was because Taiwan has relied on small firms: up to 80 per cent of Taiwanese firms have been small-to-medium in scale (a firm with 30 employees or less is defined as small; one with between 30 and 100 is medium). From the early period of export promotion the state has encouraged small firms through several measures such as bank credits. This high percentage of small firms has meant that a large proportion of firms are family-owned and familyrun, relying on a kin network. In these types of firms women play a prominent role (Deyo 1992: 300). With the increase in subcontracting, the composition of the female labour force changed – more married women entered it (Hsiung 1996: 43). In addition, as higher education became important for the population as a whole, and there was a general rising standard of living, girls stayed in school longer. As the percentage of young unmarried women who went into higher education increased, a higher percentage of married women entered the labour market to fill the labour scarcity. The high employment rate of married women is particularly important. From the late 1970s, a great deal of production has been taking place in satellite factories. The result is a large number of export-oriented, small-scale factories that specialize in various aspects of production through subcontracting networks and smaller-scale

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FER

1960

1965

1970

1975

1980

1985

1990

Figure 3.1 Female employment ratio, Taiwan, 1960–93

family-centred enterprises operating through the local neighbourhoods (Hsiung 1996: 145). In Taiwan, thousands of small companies, many of which rely on family members and primary social networks linked to part-time agricultural activity, have acted as the engine of development throughout the export-promotion stage (Castells 1992: 44). Married women working part-time or full-time are among those who are over-represented as unpaid female workers in small family businesses and factories (Salaff 1994: 2; Hsiung 1996: 39, 42–3). The KMT successfully used paternalism in its satellite factories to make sure that production was not only efficient but also low-cost and free from labour strikes (Hsiung 1996: 89-111). It is obvious that women working for their family firm would combine their productive and reproductive role in the most efficient way. They would not put the family’s income in jeopardy by a unionization attempt and would settle for low pay. The entrance of married women into manufacturing solved the problem of securing an adequate labour supply during the period of economic recovery after the early 1970s crisis, and set a trend which continued into the next two decades (Hsiung 1996: 39). The state has used its paternalistic power to continue to bring women into the labour force as cheap flexible labour through the ‘Living Room as

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Factories’ programme (Cheng and Hsiung 1992: 243).This family subsidiary employment programme has brought the surplus labour of communities and families into productive work from the early period of export promotion. It has been particularly popular as subcontracting has become important. According to this programme many ‘idle’ women were given the opportunity to turn their living rooms into ‘factories’. In order to make Living Rooms as Factories a successful programme, the KMT actually conducted a survey to measure the nature and extent of surplus labour in various communities to find out how local communities can be mobilized into higher productivity at the national level. The Living Rooms as Factories programme was formed because the KMT surveys suggested that there were a great number of ‘idle’ women. The state then set up day-care centres and provided special loans for families intending to purchase machines to do home work. The government also organized workshops for housewives to be trained so that family living rooms could be converted into factories (Hsiung 1996: 47–65). The Living Rooms as Factories arrangement, along with other forms of subcontracting, was very important to production after the 1970s. Women produced goods at home that would be collected by producers. They were paid according to their output. Subcontracting had two benefits for entrepreneurs. First, the costs of production are cut since infrastructure costs are born by the worker and the entrepreneur saves on such items as building, utilities, and heating as well as health insurance, day-care services, etcetera. Second, the entrepreneur avoids the risk of strikes since the isolated nature of this work makes it very difficult for the workers to engage in any type of collective action. In addition, since there is no employment as such, merely a contractual relation, the cost of the business cycle is born by labour rather than by the investor. When the business cycle is up, the investor can make contracts with individual workers who are in abundant supply; and during a down cycle the investor can simply stop entering into new contracts without having to pay unemployment benefits. Figure 3.1 shows the overall trend in the female employment ratio. It rises sharply until the early 1970s, then decreases because of the depression. It picks up again in the late 1970s, rising until the end of the 1980s. It begins to decline in the early 1990s owing to (1) a

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50

Female share (per cent)

45 40 35 30 25 20 15 10 5 0

Figure 3.2 Female share of employment in manufacturing, Taiwan, 1960–93

relative change in the economy from manufacturing to services; and (2) a decline in total employment in manufacturing as it shifts from labour- to technology-intensive production. (The data for the midto late-1990s are not published in compatible form.) During this period, the gender composition of the labour force was transformed yet again. As the state encouraged the production of technology-intensive goods that no longer relied on cheap unskilled labour, the demand for female labour in manufacturing declined. (This is reflected in the declining percentage of females in the total labour force since the late 1980s, as shown in Figure 3.2.) During the same period, there was a shift of production from labour to capitalintensive production inside Taiwan. At the same time many Taiwanese investors invested outside Taiwan using cheap unskilled labour, mainly women, in mainland China, Indonesia and the Philippines. As a result the domestic labour-intensive sector plummeted (Salaff 1994). During the earlier period when Taiwan needed flexible cheap labour to provide the basis of its economic miracle, Taiwanese women were there to do the job. In Figure 3.2 we see how women’s role in manufacturing increased dramatically. The figure shows a jump in the female share of employment in the 1960s. It illustrates

87

Per cent

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Year

Figure 3.3 Manufacturing as a percentage of total GDP

that much of the employment of female labour has been due to increase in the female percentage of labour in manufacturing. Manufacturing has been the most important source of female labour employment and the impact of this contribution to manufacturing is visible by the end of the 1960s, rises through the 1970s and stabilizes in the 1980s, as illustrated in Figure 3.2. Since structural changes began in the late 1980s, the economy as a whole has moved away from labour-intensive to technologyintensive production. Simultaneously, the service sector has become important, a pattern very similar to that recorded in other industrialized countries. The restructuring period has also been characterized by a high percentage of women in service industries. Within the service/tertiary sector it has been trade and commerce in particular that have experienced a high female percentage growth. Currently much of the expansion in services is related to commerce, insurance and trade, in which women play a big role (Hsiung 1996: 47–65). While it is true that manufacturing for export has been reduced in relative importance, export promotion is still part of the state policy. As discussed in the first part of this chapter, increasingly more sophisticated technology-intensive consumer goods are produced for

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export. With export promotion and labour-intensive industrialization, which brought rising female participation in factory work, the barriers to women entering jobs such as shop assistant, waitress and barber have been lifted and, as a result, increasingly service jobs with low pay benefit from women’s labour in the cities. Women’s labour has also been important in the face of the expansion of social services to which the state has been committed. In fact, a large female participation rate in health and education has played a major role in Taiwan’s welfare state programme. Furthermore, since women are always paid less than men, their contribution has subsidized Taiwan’s welfare state. This is particularly true since a high percentage of education, health care and social work has been done by married women, whose wages are regarded as supplementary rather than essential income to the family and therefore can be kept low. One third of young married women have been in whitecollar occupations such as teaching (Brinton 1995: 1114). But in spite of women’s entry into male jobs, women continue to lag far behind in employment in high-ranking jobs. There are still political barriers to their entry at this level – for instance, women are prevented from taking the civil service examinations for high-ranking government jobs, the diplomatic services and international journalism (Hsiung 1992: 242). As indicated by Table 3.3, the female wage in the late 1980s was still 70 per cent of that of males in personal services. But since 1984, as women are increasingly better educated, there are more women in white-collar jobs and their number is exceeding those engaged in the blue-colour jobs. Other than the jobs mentioned in the service sector, there is another category of service workers that must be considered – sex workers. Normally prostitution is among the least regulated professions. But, in the case of Taiwan, where the government has had a strong hold over the economy, the informal economy has been relatively small. The Taiwanese government has controlled the sex industry as part of its tourist promotion policy. The American military presence during and after the Korean and Vietnam wars, along with heavy investment in the aircraft industry, increased the sex trade throughout Southeast Asia. The number of cities that provided ‘rest and recreation’ (R&R) for the United States army grew after the 1950s and 1960s. In fact, the Taiwanese state was able to channel aid

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from international agencies such as the World Bank and the United Nations into its ‘tourist industry’, which was really aimed at promoting sex tourism by single men (Cheng and Hsiung 1992: 244–6). Table 3.4 indicates the rising number of single male tourists through the corresponding increase in registered brothels since the 1950s. As male tourists increased, not only registered brothels, but commercial sexual services under various guises, including barber shops, bath houses, massage parlours, bars, coffee houses and restaurants (labelled by the government as specialised businesses – see Table 3.4) increased as well (Cheng and Hsiung 1992: 244–5). Table 3.4 outlines the increases not just in brothels but also in businesses that are often closely related to prostitution. Hotels were frequent fronts for prostitution rackets, cafés formed pick-up locales, cabarets were used as lead-ons for prostitutes, and waitresses sometimes used their position to solicit prostitution clients on the side. These figures, however, do not fully reflect the extent of prostitution since part of the sex industry is in the sphere of the informal economy. Since the late 1980s a great deal of pressure has been exerted on the government by religious and women’s organizations to stop prostitution, and as a result it is now much more part of the informal rather than the formal economy, and therefore not well reflected in official statistics. Throughout the 1960s and the early 1970s the state encouraged prostitution as a source of hard currency for the country. This policy became less visible after the early 1970s as other countries in the region, particularly Thailand, promoted their sex industries and Taiwan focused more on women’s factory work. The proportion of women working in Taiwan’s informal economy, other than in prostitution, is very small compared to other parts of the region and Asia as a whole. There are several reasons for this. One is that, since the Taiwanese state has had a strong hold over the economy, the proportion of the informal economy as a whole has been comparatively much smaller than in many other countries in Asia. The state has been able to control most cash transactions in the productive sector and to incorporate market activities into its formal sector. Furthermore, since there has been a labour shortage in the formal sector, the need for the informal economy has been small, a situation very different from many other developing countries where high unemployment drives many into the informal economy.

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Table 3.4 Number of sexually oriented businesses in Taiwan (1946–73)

1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973

Hotel

Tea & coffee room

Restaurant

Waitress/ Cabaret

Brothel

866 969 932 902 801 842 892 961 1,093 1,137 1,251 1,326 1,479 1,576 1,671 1,782 1,897 2,014 2,143 2,272 2,403 2,949 2,662 2,802 2,864 2,916 2,974 2,997

----------346 546 786 930 930 1,001 984 1,043 1,030 963 1,002 793 825 801 859 756 765 629 596 568 511 485 451

--------31 56 88 86 54 52 ----------------------76 163 449 429 372 342 407

11 ------------------------3 8 11 15 17 27 32 31 46 33 25 25 25 25 25

216 --------------------249 349 424 463 476 453 412 529 509 489 636 452 384 355 337 319 311

Source: Statistical Yearbook of the Republic of China 1974: 188–9

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In addition, state public housing has eliminated the traditional infrastructure that in most developing countries cultivates the informal economy. Public housing, which broke up old neighbourhoods, meant that there was no space for women to share childcare with their extended kin or their neighbours. Women under such circumstances have found themselves in a situation where they had to use day care, which is expensive, compared to neighbourhood childcare. Additionally, the cost of new houses and a new lifestyle that complements it (Deyo 1992: 301) have left little choice but working in the formal economy, where jobs are always better paid and have been abundant. The informal economy, however, must be separated from the underground economy and the black market where illegal transactions take place, which by definition are outside statistical data collection and would be outside the scope of this work. In any case, it is a common cross-cultural practice that men play a much bigger role in this underground economy than women. Fewer women than men are in organized crime and their criminal activities are largely limited to prostitution and street vending of smuggled goods such as cigarettes.

Invisible economic contributions As discussed in Chapter 2, there are many ways other than their productive role in which women indirectly contribute to the economy. In this chapter, an example can be given from young women’s expenditure patterns. Many girls and young women who were employed in manufacturing during the early period of Taiwan’s industrialization in the 1960s and 1970s provided their low-income families in the rural areas with the means of survival. Survey after survey has documented the huge remittances that daughters working in FTZs or other industrial centres sent to their families (Kung 1994; Salaff 1994; Arrigo 1984). Although these remittances have been part of the income from young women’s productive work, since they are linked closely to the operation of the extended family they can be considered indirect rather than direct contributions. This is especially true because of the role of filial obligation in the Chinese cultural tradition. Filial obligation meant that many daughters sent a great percentage of their earnings to their families. These remittances have

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Female Labour Force Participation (FLFP)

92

Figure 3.4 Female employment ratio and total fertility rate Source: Statistical Yearbook of Republic of China, various years

been so important to low-income households that they accounted at times for up to one-eighth of household income for poor farmers. This pattern of behaviour has been a very effective way of narrowing the earnings gap between social classes (Wiltgen 1990) and has itself been an important factor in Taiwan's economic development. It is now an established fact that increasing jobs for women in the formal economy reduces the total fertility rate. The decline in the total fertility rate has been very impressive in Taiwan, from 5.7 per cent in 1960 to 1.7 per cent in 1997. As illustrated in Figure 3.4, a high and rising female employment ratio since the 1960s has corresponded to a steady decline of the total fertility rate. There are several reasons for this change. As women have entered the labour market, the marriage age has risen. More women have been marrying after the age of 25 and the birth rate sharply declined in the 1970s (Salaff 1994: 8). A rising marriage age is itself influenced by female independence associated with a high participation rate in the formal economy. Working women tend to delay childbearing and/or space out births at greater intervals to reduce the conflicts between working and caring for children (Lin et al. 1973: 332). Furthermore, cross-cultural analysis indicates that as the opportunity cost of raising children increases, women tend to limit the size

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of their families. With a general increase in the level of female employment, there is no doubt that the opportunity cost of raising a family has increased enormously, which helps to explain declining fertility. An increasing number of educated women who live in urban neighbourhoods face a conflict between their roles as wife-mother and as worker, as well as increasing opportunity costs. Another contributing factor has been a rise in educational levels for women, which is partially determined by rising formal-sector employment. Cross-national data indicate that as educational levels increase there is a tendency for the total fertility rate to drop. The state has had a policy of increasing educational levels, particularly since the restructuring period, as technology-intensive goods became more important. Increasing technology-intensive production required a highly educated labour force. Under such circumstances, smaller families with highly educated children are preferred. The state in fact set up motherhood workshops to teach women how to raise their families better. The Taiwanese state’s plan for the role of women was very extensive and multi-faceted. For instance, the state was deeply committed to providing and facilitating family planning. By encouraging small families, the state was able to free women’s time for paid employment as part-time workers. This is in addition to the fact that decline in the fertility rate is an important factor in economic growth. Abortion was legalized as early as 1956 (Li 1988: 70). During the 1960s about 450 family planning programmes, health stations where family-planning workers worked, were established. The China Family Planning Association operated a mobile IUD team for poor people and the Chinese Red Cross provided field nurses (Li 1988: 75). In addition, there is no doubt that there are other factors influencing the fertility rate such the as reduction of infant mortality. Not only have young women contributed to the general welfare of their families, but cross-cultural studies indicate that women have a much higher tendency to spend their income on family welfare, as compared to men, who tend to spend a larger part of their income on luxuries. Taiwan is no exception. In fact, greater access to employment by women has progressively increased women’s income, which in turn has been spent more on the welfare of their families. Chapter 2 discussed different ways in which high female incomes contribute to family welfare. This applies to Taiwan. Working women’s greater

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autonomy translates into the decision to allocate earned income to children’s welfare. As a result, children from families with working mothers are better fed and better educated, resulting in a lower infant mortality rate and higher life expectancy, as well as educational attainment.6 This was perhaps not directly planned by the state but, nonetheless, it was a by-product of state policy to promote paid employment. Data on infant mortality and life expectancy indicate a dramatic change. Life expectancy has risen from 65 years in 1952 to 73.5 in 1987. In addition, the percentage of the aged has increased from 2.46 per cent in 1951 to 5.54 per cent in 1987 (Lin 1991: 172). As important as female employment is to infant mortality and the life expectancy of the population as a whole, state policy is also an important element. The Taiwanese government has doubled its health care expenditure between 1971 and 1993 (Dessus 1995: 21). Again with reference to the literature discussed in Chapter 2, cross-cultural surveys point to the fact that women rather than men spend their time and energy on improving not only their family's health but also other aspects of human capital, mainly education. Not only mothers but, in the particular case of Taiwan with its filial obligation, working daughters have played an important role in the welfare of their families and the society at large. By providing for their families, many young women have been able to assist other members of their families to continue with higher education. Some of these other members of the families have themselves been women, which in turn reduced the amount of unskilled labour, a trend that caused the entry of married women into the labour market in the 1970s (Salaff 1994).7 Literacy as well as primary and secondary education, infant mortality and life expectancy are dependent on state policy and the level of GDP per capita. For this reason, analysis of the role of female employment and its impact on the educational level and the other variables mentioned, should include a control for GDP per capita.8 Table 3.5 summarizes the relationship between the female employment ratio and all of the social variables mentioned. The data used for partial correlation are national data extracted from the Statistical Yearbook of China for various years. It is very interesting that the result of statistical analysis reflects and confirms the literature on the role of women in general and in

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Taiwan in particular. The results have extra importance since Taiwan is a country in which data quality is extremely high and the results are therefore very reliable. Table 3.5 indicates that after controlling for GNP per capita, the female employment ratio explains 63 per cent of the increase in life expectancy, 64 per cent of the decrease in infant mortality, 84 per cent of the increase in primary education, 53 per cent of the increase

Table 3.5 Partial correlation of female employment ratio on social variables (controlling for GNP/GDP per capita) FER

Life expectancy

1.0000 ( 0) P= .

.7948 ( 26) P= .000

–.8023 ( 26) P= .000

.2951 ( 26) P= .127

.7326 ( 26) P= .000

.7874 ( 26) P= .000

Life Expectancy

7948 ( 26) P= .000

1.0000 ( 0) P= .

–.9815 ( 26) P= .000

–.0857 ( 26) P= .665

.9452 ( 26) P= .000

.9385 ( 26) P= .000

Infant Mortality

–.8023 ( 26) P= .000

–.9815 ( 26) P= .000

1.0000 ( 0) P= .

.0333 ( 26) P= .867

–.9316 ( 26) P= .000

–.9330 ( 26) P= .000

Primary Education

.2951 ( 26) P= .127

–.0857 ( 26) P= .665

.0333 ( 26) P= .867

1.0000 ( 0) P= .

–.0428 ( 26) P= .829

.0089 ( 26) P= .964

Secondary Education

.7326 ( 26) P= .000

.9452 ( 26) P= .000

–.9316 ( 26) P= .000

–.0428 ( 26) P= .829

1.0000 ( 0) P= .

.9755 ( 26) P= .000

Tertiary Education

.7874 ( 26) P= .000

.9385 ( 26) P= .000

–.9330 ( 26) P= .000

.0089 ( 26) P= .964

.9755 ( 26) P= .000

1.0000 ( 0) P= .

FER

Infant Primary Secondary Tertiary mortality education education education

Source: Statistical Yearbook of Republic of China, various years

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in secondary education and 61 per cent of the increase in tertiary education. These results are very strong indications of the impact of female employment on all of these social variables. Before ending this section on women’s reproductive role and their indirect contributions to the economy, it is worth mentioning a particular women’s saving pattern in Taiwan called diau huei. Diau huei is a betting club whereby women who know and trust each other gather and put their savings together. At the end of each period, every woman is allowed to bet by bidding with a certain interest rate, and the one who bids the highest can borrow the total sum. Each woman can only bet once. If no one from among those who have not yet had their turn can beat the interest rate, then the sum will go at a lower interest rate and the rate is subject to negotiation. Men generally do not take part in diau huei for two reasons. One is that diau huei relies on a great deal of trust. Since women are much more involved in their communities than men and have greater access to kinship networks, it is much more feasible for them to establish trust. The second reason is that diau huei involves small amounts of money. Once obtained, diau huei is either handed over to male members of the family to invest or used to pay tuition fees for children. When money from diau huei is raised for investment, it is normally used for family welfare, given women’s concern for the health and well-being of the family.9

Community and volunteer work: state-initiated organizations Up to now we have looked at women’s productive and reproductive work. In this section, we examine a third dimension of women's work, their communal work. In this section we discuss the way in which the state has utilized this aspect of female work to carry out its policies through state-initiated organizations. Such programmes have functioned in different ways. What they have in common is that they have all involved subsidizing certain public goods and services, freeing the state’s resources to carry out other tasks. Among such organizations are the Women’s Department and the Chinese Women’s Anti-Aggression League, which is a semi-official institution that focuses on projects that are an extension of women’s

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reproductive work (Hsiung 1996: 47–65). As Diamond points out (1979; cited by Cheng and Hsiung 1992), their programmes organized the sewing of clothes for military personnel; this was particularly important in the 1950s and 1960s when state expenditure on the military was high. The programme has also arranged for collection and donation of cash and clothes and foodstuff for military dependants (Cheng and Hsiung 1992: 254). Perhaps the most striking of all these efforts was the establishment in 1968 of the Community Development Programme, initially an eight-year programme that was extended over and over. There are two particularly important projects under this programme: one is the previously discussed Living Rooms as Factories and the other is Mothers’ Workshops. Under these projects courses were organized to teach women about leisure activities, planning and social services. The purpose of these courses was to encourage women in their leisure time to organize themselves to visit the elderly, orphans, the handicapped, the mentally retarded and families of military servicemen or families in poverty. These Mothers’ Workshops had another major purpose, to prepare and motivate women to deal with social problems caused by modernization and urbanization. As programmes became extended several times the emphasis on social welfare and ethics and morality grew. The aim was to improve the basic infrastructure of local communities, fight poverty, improve civilian life and advocate traditional values and ethics. (Needless to mention, these traditional values are ones that advocate female subordination to their families.) With modernization and increasing problems associated with the breakdown of community, such as rising crime rates, women were encouraged to take care of the well-being of their communities in their ‘free time’ in programmes that act as a community watch. These activities certainly saved the state part of the cost of dealing with crime. Furthermore, the Mothers’ Workshops programme has organized courses in local communities on a wide variety of topics such as promoting ethics and morality, sanitation and public health, home making and productive skills and social services. These courses educate women in skills such as nutritious cooking and taking care of the elderly with chronic diseases, again capitalizing on women’s reproductive role. The state, by using women's voluntary work, has

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not only ensured delivery of an efficient service but also managed to save expenditure on health care. Since the 1990s this programme has intensified the stress on women’s reproductive work in order to respond to the changing economic realities of the restructuring period. Since the 1990s, with declining demand for labour, the state has used these workshops to encourage women to become better wives and mothers and spend more time at home. Such courses as the ones designed to enhance women’s feminine etiquette teach women what it means to be women in the traditional sense. To supplement this state definition of womanhood other courses on flower arranging, interior decoration, folk dancing and make-up reinforce these notions as feminine ideals. The Mothers’ Workshops programme, financed by government since 1977, has published a ten-volume series of textbooks, Mama Duben (Mothers’ Readers). Emphasizing women’s role as wives and mothers has a dual purpose. Since the demand for labour in the 1990s is for higher-skilled workers, the programme, by encouraging women to stay at home and take care of their children, reduces the rate of unemployment, since women’s work at home keeps them preoccupied; they will not be seeking jobs and therefore will be excluded from the unemployment figures. At the same time by encouraging women to do so, it also encourages the children to go on to further education and become highly skilled labour. The overall purpose of these Taiwanese state programmes was to ensure that rising paid employment for women would not upset gender roles, which could threaten the supply of cheap flexible labour. In preserving gender roles, the state guaranteed that the general assumptions about women being home makers and, therefore, having incomes that were supplementary, remained intact in spite of the fact that economic success was based on their contribution. As long as the economy was in deep need of an army of cheap reserve labour, the state successfully promoted a gender ideology based on traditional norms and values. This however, changed as the country became prosperous to the extent that even low pay in Taiwan was much higher than in neighbouring countries and the average Taiwanese worker was earning far more than many countries in the region. There was then no need to impose harsh control on gender role ideology. This is not to deny the fact that increased employment in the long run did lead to demands for equality of opportunities and

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the challenging of gender roles, as we shall see in the following section.

Gender politics, civil society and Taiwan’s future While the state was able to use women for its social and economic policies, women, in turn, have successfully put pressure on the state to change its policies to respond to their demands. For example, Mothers’ Workshops were designed by the government but were, nonetheless, run by women. Since the 1960s many women have been engaged in state-initiated programmes. However, this very public engagement that initially was designed to guarantee female submission, nonetheless provided the means for women to learn to organize themselves around political issues in ways that were not necessarily in line with what the state wanted. In fact, as women’s entry into the labour force escalated and women’s public role in state-initiated organizations and the KMT party increased, the experience of public work became fertile ground for a more radical political campaign for women’s rights. Rising educational levels, formal employment and collective action, even through state-initiated organizations, have given women greater gender consciousness. Historically, the women’s movement in Taiwan has not been very animated compared to Mainland China (Lin 1989: 12–23); however, the situation has changed slowly since the late 1980s and the 1990s. The low initial profile could partly be explained by the repressive nature of the government and its complete ban on all civil organizations. Although in theory women had already been given equal rights in the constitution, in practice women have been subordinated by much of the civil law – such as family law, property ownership and child custody rights. It was during the 1970s that the present women’s movement began. Prior to that actions were much more individualistic. The catalyst came when Lu Hsiu-lein, who campaigned on issues such as sexual awareness and the role of women in society and the workplace, was imprisoned on the charge of inciting a female riot with one of her speeches. During the 1980s popular attention to women’s rights increased. Women’s organizations began to flourish and Awakening, the most prominent feminist magazine, was first

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published in 1982. The Awakening Foundation then became legal after the 1989 Civic Organization Law, which in turn followed the lifting of martial law in 1987. At this time many educated women joined feminist groups. Feminist groups together with Christian organizations have been very successful in mobilizing women around human rights issues. One of the important factors helping to shape the women's movement has been its ties with the international women's movement. These were reflected in three international conferences on the role of women in developing countries organized by the National Taiwan University, Soochow University and the United Daily News and China Tribune. As a result a movement, which at first attracted only the middle class and educated women, now began to attract wider support (Chou 1991: 26–31). Prostitution, particularly child prostitution, was the first issue that mobilized women’s groups, along with the Christian organizations (Cheng 1995: 22). In 1987 a red-light district march against teenage prostitution and native girls’ abduction for prostitution was organized (Lin 1989: 12–23). The women who organized the march also published papers such as the pioneer publication, New Feminism Magazine. Other organizations that have been active on child prostitution have been the Women’s Rescue Foundation and the Homemakers’ Unions (Underwood 1995: 48–53). This anti-prostitution campaign has extended since into a more fundamental criticism of state policy. The feminist campaign against prostitution started in the late 1980s. Women protested against the way the government had closed its eyes to commercialized prostitution, while criminalizing individual prostitutes. They have also protested against government-issued tourist booklets that stress female submissiveness, caring and nurturing (Cheng and Hsiung 1992: 244–5). One of the banners carried by women during their protest against the International Lions Club in Taipei said ‘Welcome to Taiwan for Friendship but not for Sex Tours’ (Cheng and Hsiung 1992: 244–5). The other issue that has raised much criticism of the government, with the aim of changing legislation, has been violence. Recently, some women’s non-governmental organizations such as the Modern Women’s Foundation (established in 1987) have campaigned against violence. Today even older women who a few decades ago would

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not protest are involved in collective action against violence. The women’s shelter, Good Shepherd, is another organization which has provided abused women with legal advice (Cheng 1995: 21). These efforts have brought pressure on the government to change laws. Perhaps one of the most important by-products of women’s organized campaigns has been a focus on the issue of the right to equal pay. It started in the early 1980s with an article about women’s unpaid work in the leading feminist magazine, an article about the value of women’s work in the house. The value of the work an average woman carried out doing daily chores such as cooking, laundering, cleaning, caring for the elderly, and tutoring children was calculated at the time to be the equivalent of a university professor’s salary (Cheng and Hsiung 1992: 250). Since then many campaigns around equal pay have been carried out by organizations such as The Awakening and Rainbow. They have been so effective that they have managed to secure an Equal Employment Bill stipulating that employers pay equal wages to men and women for the same work. Slowly, too, women are entering jobs traditionally regarded as male preserves (Salaff 1994). This process is having an impact on top jobs such as those of computer scientists as well as professional and technical workers, and administrative and managerial jobs. The professional and technical sectors have seen very high employment growth rates for women during recent years (Zeglich 1997: 599). The number of women in ‘male jobs’ has also increased at the low end of the labour market, as in taxi driving. Since the 1980s the number of women’s organizations has been growing and they are now much better focused and more capable of gaining public attention. As noted earlier, one of the most striking facts about Taiwanese working women has been the wage gap between men and women. But as the number of professional women increases they are bringing more pressure to bear on the government to address the problem. As a result the Labour Standards Law was revised in the early 1990s to provide further guarantees for equal pay. A remarkable improvement in rights and benefits in the workplace has come into effect, as well as other measures such as changes in maternity leave rights (Chou 1991: 26–31). Not only written laws but also unwritten laws and practices such as single and no-pregnancy rules, a souvenir of the Japanese occupation which forces women who have children to withdraw

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from the labour force, has been targeted. Awakening has challenged this unwritten law by campaigning against discriminating regulations in firms and has gained success especially in professional organizations (Huang 1997: 14). In addition, issues pertaining to sexual harassment have been addressed by Pink-Collar Solidarity, another organization lobbying for a safe work environment for women. After action taken on labour rights, the most important issue has been women’s real political participation. Whereas a few decades ago women would follow their husbands’ or fathers’ voting behaviour, increasingly women not only vote independently but as a social group are putting pressure on the political machinery to address gender issues. Since the late 1980s women have particularly targeted political parties and are now recognized as an important political constituency. In fact today all the candidates for public office have women’s concerns in their campaigns. Equality in the workplace and equal benefits have increasingly become political demands that women collectively are making, and they are not shy to use the mass media to get attention (Chou 1991: 26–31). Political pressures from women and their organizations have been raised to the point of producing constitutional change. In response to their demands, in 1994 an amendment to the constitution guaranteed women a fairer place in the society, including a clause to ‘protect the dignity of women and safeguard their personal safety’. This constitutional change has since been used to negotiate equality between the sexes in the workplace (Huang 1997: 5). Since 1994 the constitution has been interpreted to mean that the husband no longer has the sole right to the property of a married couple and custody of children; that married couples can now have separate assets; and that the wife’s property does note automatically go to her husband. On divorce the father is no longer guaranteed the right to custody; this is now decided by the court. As already noted, organized women’s campaigns have increasingly forced the political parties to take up women’s issues. In the 1996 election the KMT prepared a Women’s Policy White Paper to address women's welfare, with measures such as equality of access to social participation and protection from violence as notable examples. The importance of women's political role was made clear in the results of the recent election in which the former political prisoner, Lu Hsiu-lien, was elected as second-in-command to President Chen

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Shui-bian. Lu started the first feminist association and spent more than five years in jail. She was a founding member of the Democratic Progressive Party and was an important figure in politicizing President Chen. The President admits that Ms Lu had been instrumental in his recent victory. Currently women hold 25 per cent of the seats in Taiwan’s legislature and one-third of Taipei’s city council. As we have shown in the previous section, it is apparent that women’s contribution to tightening the regulatory framework of the economy has been accompanied by their empowerment to build organized resistance against repressive state policies. It is very important that such civil organizations gather strength in order to guarantee not only gender rights, but also democratic rights as a whole, as increasingly women’s organizations in Taiwan are establishing closer links with environmental organizations challenging state policy in all spheres. Taiwan provides strong evidence against neo-liberalism by showing the importance of an interventionist state and of the role of women in bringing about economic growth. The country provides an ideal case of an interventionist state, still committed to welfare even though this commitment is declining under the pressures that are being put on the country by the World Bank and the IMF. The state is relatively transparent, its president democratically elected, and many civil groups such as women’s groups are playing an important role in putting pressure on the government to ensure their rights are taken into account. The future may bring new challenges to the country as it seeks to maintain independence and its sovereignty visà-vis Mainland China. What may happen is that at some time in the future Taiwan will be unable to resist the pressure to follow Hong Kong and join China, which would mean a transformation of the existing structure. Current trends towards a powerful and high profile civil society may have to give in to the demands and restrictions imposed by the Mainland. In reviewing the case of Taiwan, one notes the role of the interventionist state in promoting economic growth as well as the contribution of a civil society that is gathering strength: together they illustrate an ideal-type solution to the problems facing many countries of the South. However, the model may not be easily replicated for a variety of reasons. For instance, Taiwan’s particular colonial legacy promoted both a bureaucratic tradition and an effective land reform

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that seems to be specific to Japanese colonial rule and does not apply to European and American colonization. Moreover, the manner in which US–China relations motivated US support to guarantee Taiwan’s economic success is also unique to the historical and political circumstances of the time. In addition, it is worth reminding ourselves that the KMT was an autocratic state up until the early 1990s, which is quite the opposite of what could reasonably be called an ideal model. Nonetheless, as rising poverty and income disparity increase the desire for an alternative model, experiences such as that of Taiwan may provide useful empirical guidance. NOTES 1 From the outset the DPP attracted Taiwanese Chinese and native Taiwanese who, until the 1970s, had been completely left out of the political process: the KMT, in the post-Second World War era, was very much made up of migrant Chinese from the mainland. 2 Since 1993, there has been yet another major shift in Taiwan’s politics as a result of the KMT splitting into two. The new faction separated itself from the old KMT in order to move away from patronage and corruption. To this end, the New Party refuses large donations from big business. 3 There is no doubt that Taiwan strongly desires closer incorporation into global capitalism. In fact, while still encouraging small business, the government now wants to turn Taiwan into a regional base for economic transactions of the ‘AsiaPacific Regional Operation Center’ (Eugenia 1996: 32–5). 4 The KMT was also able to mobilize American help for its initial rural development through the Joint Commission on Rural Reconstruction that was established to win over the peasantry. Defeat in Mainland China had given the KMT a good lesson. Now it used American aid to reassert its power, and in its quest to combat communism it was able to mobilize US aid and use it for Taiwan’s capital formation. It should be added that Taiwan had a geopolitical advantage because the Americans had a great interest in developing Taiwan as a showcase that could be pitted against communist China. That said, countries that have enjoyed a similar geopolitical advantage (Iran, for instance, under threat from the Soviet Union during the Cold War) and in which the Americans have expressed similar interest and provided assistance, have not been able to channel this aid through sound state policies into sustainable growth. 5 As far as the fishing communities are concerned, women together with their children participate in pulling in fishing nets. 6 Cross-cultural studies indicate that working women have a greater autonomy from their husbands and in-laws. And when women do have more decisionmaking power and money they spend it on their children. Children of working mothers are better-fed: as a result infant mortality decreases and as children grow

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into healthy adults they live longer and life expectancy increases. Women with income can and do provide for better medical care, which is then reflected in increases in both infant mortality and life expectancy. In addition, working mothers are capable of and willing to take care of their female children. This is because economic dependency of female children is not regarded as an economic loss, as it is in situations where women rely on their men for their survival (Cain et al. 1979). Econometric analysis has indicated that female child mortality is inversely related to women’s labour force participation. 7 Education is both a cause and an effect of female employment. While it is true that educated women are more likely to be in the labour force, it is also true that the more women are employed, the higher the chance of girls getting more education, for two reasons. One is that working mothers have a higher tendency to send their girls for higher education; the second is because of the income that educated working women bring in, making it more logical to extend girls’ education for their future economic return. 8 As a legacy of Japanese rule, Taiwan started with a higher literacy rate than many other countries of the region. Also, by the end of Japanese rule up to 70–80 per cent of school-age children were enrolled in high school. The total literacy rate during the following period of KMT rule increased from 45 to 90 per cent by the early 1980s (Lin 1991: 172). 9 There is very little literature on this institution and my data come from several interviews that I have conducted with Taiwanese who live in Montreal.

4 Indonesia: Paper Tiger and the Asian Crisis

At the end of the 1980s and in the early 1990s, advocates of the mainstream, dazzled by the Asian Tigers, called Indonesia, the Philippines, Thailand and Malaysia tigers-to-be. However, the financial meltdown of the late 1990s posed a major challenge to neo-liberalism. In order to understand modern Indonesia, this chapter, following the structure of Chapter 3, will start with a review of the colonial history.

Colonial history Socio-political background Recorded Indonesian history goes back much further than that of Taiwan. Some 7,000 years ago, the islands were settled by people of Mongolian stock, followed by successive waves of people from China, Thailand and Vietnam. Ancient animist religious traditions were giving way to Hinduism from India by approximately 200 AD. This was but the first of many outside cultural influences. Around 700 AD, Buddhist missionaries arrived, though Hinduism continued to be strong. In fact the Hindu Majapahit Kingdom was formed in East Java in 1294. For a time the kingdom had considerable control over the archipelago. Muslims had arrived in Java in the eleventh century but not until the fifteenth and sixteenth centuries did Islam become the state religion. As the kingdom of Majapahit declined from the late fourteenth century, old satellite kingdoms converted to Islam (today, 87 per cent of 106

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Indonesians are Muslim). By the fifteenth century the centre of power had moved to Melaka, which became the trade centre. When the Europeans arrived, Indonesia was divided into many kingdoms and principalities. In the late fifteenth and early sixteenth centuries the Portuguese waged war and captured Maluku. That gave them control of a trading empire stretching from Maluku to Melaka. But it was the Dutch in the seventeenth century who achieved final victory over Indonesia, which they controlled until the Second World War when the Japanese took over.1 The Japanese occupation provided the foundations on which Indonesia’s independence would be built. The Japanese did not repress the independence movement. Indeed, the emerging nationalist leader, Sukarno, was free to campaign. At the same time the Japanese allowed Indonesians to work in their government bureaucracy, providing them with the infrastructure for their future state. They also organized a militia youth army. When, at the end of the war, the Japanese were forced to leave, the Dutch, supported by the British military, attempted to resume control. Indonesia, under the leadership of Sukarno with the help of both the Indonesian Communist Party (PKI) and the Muslim parties, entered into a bloody war, first against the British, then the Dutch. The brutality with which the British and Dutch tried to suppress the independence movement attracted the world’s attention, while Sukarno skilfully played on a combination of world sympathy and Soviet support to win independence in 1949 (McCawley and Booth 1959). Colonial economy Before Dutch colonization, the Portuguese had been actively trading with the inner islands (such as Kalimantan and Celebes). Soon they ‘discovered’ the outer islands (namely Java and Sumatra) where the economy was based on wet-rice production (Geertz 1963a).2 Once the Dutch moved in, they opened trade with Bengal, Japan and Formosa (Taiwan). Java became de facto a huge estate using forced labour to cultivate export crops, which were exchanged for manufactured goods imported from Europe. The main concern of the Dutch was to extract the maximum profit from Indonesian commercialized agriculture for the world market, without fundamentally changing the general economic

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structure of the archipelago as a whole, or altering its social fabric. They also attempted to leave room for the indigenous economy. In other words, they created a dual economic system. The way the dual economy worked was that the export sector was carefully administered while the indigenous family and landownership structure was preserved to grow basic food crops. Thus family-unit agriculture, home industry and petty trade coexisted with plantations and factories. Plantation agriculture, chiefly based on coffee, pepper, spices and sugar for export, mainly belonged to the nobility, hand-picked by the Dutch. But there was a second group of plantation farmers, of growing importance. The Dutch East Indian Company would lease land to Chinese employees and cede them seignorial rights over people in the villages. Meanwhile landless locals would work on the estates. The resulting power permitted the Chinese migrants to become intermediaries between the indigenous population and the colonial power (Geertz 1968b: 50–2). By the 1860s plantations had been set up in the outer islands as well to produce tobacco, rubber, tea, coffee and coconut. Peasants were forced to work on plantations through the institution of Tanam Paksa (compulsory planting). By the mid-twentieth century, Indonesia produced most of the world’s quinine and pepper, over a third of its rubber, a quarter of its coconut and almost a fifth of its tea, sugar, coffee and oil. As colonial production expanded along with forced cultivation, the pribumi (Indonesian indigenous population) began to resist their Chinese overseers and, even more strongly, their Dutch colonial masters. This resistance did not challenge the basis of the economic structure, however, which continued unchanged into the twentieth century. From the early decades of this century, however, limited manufacturing, producing goods such as textiles, was established, though its growth was hampered by the brief Japanese colonization, and the sector stagnated during the immediate post-independence period. Women’s economic and political role in the colonial era As the colonial economy expanded, rice production became less labour-intensive. That freed labourers, many of them women, for work on plantations. From the earliest period under the Dutch East

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India Company’s domination, women had a significant presence in the labour-intensive sector. As late as the early twentieth century, studies indicate that an average of 50–80 per cent of women’s time was spent on various aspects of rice production (Locher-Scholten 1987: 82). But the demand for labour was so great that female labour, in addition to continuing to dominate rice production, became necessary for night work in sugar, tea and coffee factories. Night shifts were also common during the harvesting of sugar cane and cassava, in the fibre, palm (oil) and tobacco industries, and in salt production (Locher-Scholten 1987: 91). In Java paid female workers made up 43.4 per cent of the labour force. Scholten argues that the percentage of employed women was not a function of population density but depended on the availability of women, mainly married women, who were willing to work (Locher-Scholten 1987: 85–6). Where there were more married women, participation was higher. In contrast to Taiwan, where women were family labourers, Indonesian women working in the cash crop sector were paid. In addition to working in agricultural production, women, along with men, went into trade and industry. In some areas as much as two thirds of employed women were in trade and industry, particularly in traditional production such as bamboo craft and in the modern textile industry. In Mandura and East Java 92 per cent of textile work was in the hands of women, while it has been estimated that up to 72 per cent of the labour force in woodworking, bamboo craft and food making was also female. Furthermore 68 per cent of workers in luxuries such as confectionery were women, as were 54 per cent in the mixed retail trade (Locher-Scholten 1987: 86–7). The extent to which women were engaged in trade and the nature of their activities varied according to their access to the means of production. Similarly, income generated from trade depended on their access to the market and marketplaces. Some had direct access to the local market. Others, though, had to carry their products to neighbouring villages and towns. Many women prepared dried herbs and carried them on their backs, travelling to wherever they could be sold, a practice that has survived until today. And many women still carry for sale merchandise they have made, such as basketwork and pottery, as well as garden products they have grown. Many women, too, set up tiny restaurants.

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The importance of women in trade became more crucial since, unlike Taiwan where women had no independent economic existence separate from their families and were not paid, Indonesian women had long been in charge of their own income and property. The fact that Indonesian women were both able to be independent wage earners and to exercise control over income they generated enabled them to function as welfare agents. Arisan, a female exclusive rotating saving/credit system was and has been a means to raise money for families’ needs. Furthermore, since they could bring additional income to the family as independent wage earners, their participation in the labour market had an income redistribution effect, much needed in the economically polarized society of the colonial era. Women were not only economically more independent than in many other parts of Asia, but they enjoyed a more important role in political leadership. In ancient Indonesia, there is evidence that kings, unlike in China and India, were sometimes succeeded by daughters or nieces. From 1641 to 1658, the Atcheh throne was occupied by a woman; and during the anti-colonial revolts of the late eighteenth and early nineteenth centuries, many women identified with Atcheh were involved in combat (Suleiman 1960: 45). Tjut Nua Dien, widow of the Atchehnen hero, Teuku Umar, was killed in action. She is regarded as one of the heroes of the nationalist movement. By other accounts, southern Sulawesi women have ruled as queens – one example is the Buddhist Queen Rajapatni who came into power in 1350. Several women also reigned in Java in the period before colonial rule (Suleiman 1960: 46). There is also evidence that in parts of Indonesia a matrilineal/ matriarchal system was dominant. Under such circumstances, women enjoyed the same rights as men and had more social power since agricultural land belonged to the matriarch. Mamoks (female heads of the household/matriarchs) would bring their daughter’s husband into their own household. The matron’s role in the family council was also important, particularly before the Dutch were able to penetrate the indigenous social structure. Women became Kepala Warrie – the matriarch of the extended family who managed the indivisible family goods. Under these matriarchal or semi-matriarchal systems there was no dowry; and in-laws stayed with the mother’s side in big family houses where the matrilineal joint family lived together. The mamok granted rice sawah (paddies) to those who wanted to marry. In some

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parts of Java women were known to own large properties and workshops and to be influential in the village council. Matrilineality and mamoks still exist in parts of Indonesia today. But this type of family structure, and the traditional distribution of power it represented, has been in decline ever since the Dutch, in conformity with their own social structure, sought to appoint men as heads of the household, as village chiefs and in other leadership roles. Under Dutch colonialism and forced cultivation, especially in Java, economic as well as political authority was placed in the hands of these appointed male village chiefs who exercised autocratic power, ruled by heredity, and were in charge of deploying manpower. By 1900, however, there was a resurgence of women’s political power. Women organized to take up the cause of nationalism and of women’s rights, challenging both colonialism and the sexual hierarchy. In fact, at the turn of the century, Indonesian women were among the most politically active in the world. Compared to English suffragettes, a women’s movement mainly composed of upper-class ladies, the Indonesian women’s organizations were mass-based, and many village women came to organize and fight on both fronts, for national independence and for gender equality. In 1916 they published the Patri Merdeka (Free Woman) newspaper; and in 1928 the First Indonesian National Women’s Congress (an umbrella organization) held a nationwide meeting in which several thousands of women gathered. These organizations were also very effective in addressing practical issues such as the fight against illiteracy, in teaching crafts and in setting up community cooking programmes to free women from their daily cooking and save their time for social programmes and political activities. In 1928 the Women’s Congress called for the creation of a Mother’s Day to highlight the importance of women’s reproductive role. The Women’s Congress worked together with the nationalists, who had a very feminist agenda, to denounce polygamy (Vreede-de Stuers 1960: 100). During Japanese rule, the women’s movement was allowed to operate openly. From 1942, women of all classes came together to fight illiteracy, run cooperative kitchens and engage in different types of social work. Furthermore, at the end of the war, they organized a sovereignty march. As the Dutch tried to resume power, nationalism escalated and fighting broke out. Women’s organizations participated both on the battlefield and behind the front lines. It was during this

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time that women founded Indonesia’s Red Cross. They organized themselves into teams of nurses and liaison officers, setting up soup kitchens and mobile clinics (Vreede-de Stuers 1960: 89–99). Because the Indonesian women’s movement was in some ways demanding the restoration of rights that women had before colonialism, it was always closely linked to the nationalist movement. Several distinct factions were fighting for national liberation, however, of which the two strongest were the Communists and the Islamic groups. Inevitably there were similar splits within the women’s movement. For example, in the early twentieth century, a Muslim women’s club was formed that mobilized women to campaign on women’s rights issues with regard to customary and Islamic law. Simultaneously, prominent Muslim male leaders took up the cause of setting women free of adat (customary laws) and adapting their role to the modern world.3 There were also currents that took a more liberal and reformist orientation, some of which were feminist in the Western sense, and still others which were communist. Many nationalists and communists who rebelled against the government were jailed between 1920 and 1929, a large number of whom were women. In addition to these different ideological trends within the nationalist movement, there was a class element. While the upperclass urban women had earned the right to vote (because they owned property) under the colonial administration in the early 1940s, only after independence was full enfranchisement implemented. The fact that the nationalist and feminist movements were so closely tied was essential in breaking down those barriers. Consequently when Sukarno came to power in the first independent government, women continued to be active, agitating for protection of female factory workers and better social security for women and children.

Modern Indonesia: state structure and political economy The Indonesian state After the Second World War, an independent Indonesian government headed by Sukarno, leader of the Partai Nasional Indonesia (PNI), assumed power. It was, however, a period of considerable political turmoil in which many other parties of various political

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persuasions entered the government in various combinations. Sukarno himself was influenced by a blend of Javanese, Western and Muslim socialist ideas with Indonesian nationalism. Although initially nationalism formed a powerful cohesive force to keep the country together, soon after independence, regional, ethnic and geographic diversity became problematic (Glassburner 1962: 113–31). One of the ways in which Sukarno sought to deal with the problem of diversity was establishing the principles of Pancasila, a religious-ethical code of conduct. Indeed, it remained a sort of state religion into the Suharto era. However, even Pancasila could not offset the effect of separatist movements. Militant Sarul Islam, for instance, was particularly bitter about the failure to create an Islamic state and waged guerrilla warfare in West Java. In addition, outside of Java, there was great resistance towards Javanese dominance (Islam and Chaudhury 1999: 209–21). This diversity of political influences was to some degree reflected in civilian coalition governments. One of the major political forces of the post-independence era was the PKI, which ruled at times side by side with the PNI, Sukarno’s party. As political parties proliferated and coalitions succeeded each other, the task of managing the newly independent country became increasingly complex. As a result, by the mid-1950s, Sukarno became very critical of the West and in 1957 with the help of the army he gave himself total power in the name of ‘Guided Democracy’. This system was based on a Javanese village model of discussion and consensus and it brought nationalism, Islam and communism together as an ideology implemented under army surveillance. However the attempt at compromise pleased none of the constituent groups. The communists became dissatisfied because, although Sukarno was seemingly committed in principle to bringing about some degree of equality and welfare, he did not have the bureaucratic machinery or resources to do so. Unlike the Japanese in Taiwan who had educated the population, the Dutch had left Indonesia largely illiterate. But even if the necessary human capital and the kind of bureaucratic tradition needed for egalitarian reforms had been present, there are doubts about the degree to which Sukarno was in fact genuinely committed to such ideas, doubts which his extravagant lifestyle and zeal for palaces tended to confirm. Thus, Sukarno’s opulent lifestyle alienated the communists; the

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confusion over Pancasila, among other things, damaged his popularity, and his attempt to redistribute land turned the élite, many of whom were influential with the army, against him. In addition, the West became worried after Sukarno’s foreign policy provoked a war with Malaysia in the mid-1960s (Crouch 1984). All the above elements, together with American connivance, finally created the conditions for the mid-1960s coup. Close to half a million men and women were slaughtered. While nominally a purge of communists, in fact much of the killing took place in areas like East and Central Java, Sumatra and Bali where Sukarno’s regime had challenged the big landowners (Lev 1966; Crouch 1987). Those who supported land reform were accused of being communist agents and imprisoned or killed. Many women were also raped, imprisoned and murdered, particularly those who belonged to Gerwani, a nationwide women’s umbrella organization for political action. Followers of Gerwani were accused of being part of the PKI’s women’s wing. Some of those imprisoned were not released until the fall of the Suharto regime in the late 1990s (KOWANI 1980).4 During the period following the bloodbath, backed by ruthless army suppression of any type of political dissidence, General Suharto replaced ‘Guided Democracy’ with the ‘New Order’. His power was soon consolidated further by the new income generated by the export of oil and other natural resources to the West and Japan. The rising hard currency earnings permitted Suharto to address such crucial matters as food shortages (Crouch 1984: 75–89). However the seeds of future problems were being sown and the results were not long in showing themselves. In 1974 Muslim dissidents, labour organizations, women’s groups and students joined together in what became known as the ‘Malari Riot’. The uprising was a protest against political repression and economic corruption. This brief but major uprising shocked the regime. There was further embarrassment from the scandal over corruption in Pertamina – the Indonesian state oil company. Senior members of the army and government were implicated in the theft of huge sums of oil revenue, prompting more political protest. However, Suharto and his army successfully co-opted all the major dissident organizations and managed to restore control over the country (Bresnan 1993). After this period of political turmoil, Suharto tightened his grip on the country’s internal affairs and enjoyed a great deal of Western

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support. The West lent massively while turning a blind eye to things like the brutal invasion of East Timor. The channelling of some of the export income from the country’s rich resource base into poverty alleviation programmes appeased local dissidents. And the local Chinese community, which collected a grossly disproportionate share of the new wealth, became a solid base of support of the regime until the late 1990s (Bowie and Unger 1997). Then came the Asian Crisis. Indonesia already suffered from gross disparity in its income distribution, and when the economy plunged into depression the problem burst into the open. Long-simmering tensions came to the surface in riots and mass demonstrations. The government collapsed, and Suharto was forced to step down. For a while power was transferred to Amin Rais, a Suharto cabinet minister and influential member of the Golkar Party (Suharto's party). Then, in 1999, Abdurrahman Wahid, leader of the largest Muslim organization, Nethzatol Ulama or NU, came to power with the support of Megawati Sukarnoputri (the daughter of Sukarno), the leader of the nationalist and secular PNI (a party backed by religious minorities and more secularly oriented Muslims) (Cohen 1999: 26–7). The downfall of Suharto brought an opportunity for people to take part in a free election. Wahid's government was another awkward coalition of diverse former opposition forces. Moreover, Wahid had no clear policy agenda and much state policy was short-term crisis management rather than the kind of long-term planning the country desperately needed to recover economically and politically. In 2001 Indonesia’s political life went through yet another crisis as the President was impeached on corruption charges. Subsequently, Megawati Sukarnoputri, Wahid’s vice-president, replaced him. Like her predecessor, Sukarnoputri has no clear long-term economic policy. The country continues to suffer from ethnic conflict and separatist movements, particularly in the oil-rich Northern Sumatran region of Atcheh. Sukarnoputri has sought closer ties with the army in order to control the separatist movements and this has strengthened the role of the army again. President Bush’s ‘war on terror’ has found many allies around the world among those who wish to suppress insurgent groups and separatists, and Sukarnoputri is among them. She has reached out to the Bush administration to reinforce her grip on power in the

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country. The Bali bombing in 2002 has strengthened the tie between the two leaders and Sukarnoputri has received support from the Americans to suppress any opposition to her rule. To end this section on the role of state, it is worth pointing out that Indonesia has never had a developmentalist state. Suharto’s attempt to provide a limited welfare state was undermined by pressure from the World Bank and the IMF in the late 1980s. This led to rising poverty and income disparity, and ended, as we have seen, in a mass uprising and his downfall. The country since then has continued to suffer from a lack of effective policies to address people’s basic needs. ‘War on terror’ has helped the current state to rely on the army, rather than on the Indonesian people, as the base of its support. Economic strategy As for state economic strategy, although the Indonesian government has come up with several five-year plans (Repelitas) since independence, these were more rhetorical than real. They set economic targets without committing the resources necessary to meet them. During Suharto’s long regime in particular, Repelitas were often used as pretexts for the corruption and cronyism of the state machinery and the army, and worked largely to the short-term gain of Suharto’s family, the rich Chinese and selected foreign investors (Nasuation 1995: 3–40). Table 4.1 Phases of development strategy Sukarno 1949–65

Nationalist ‘import-substitution’ policy

Suharto I 1965–87

Export promotion

Suharto II 1987–95

Restructuring (free market policies)

Wahid–Megawati 1998

No clear economic policy (de facto status quo)

In terms of development strategy, the post-independence era can be divided into four periods (Table 4.1): Sukarno from 1949 to 1965; the initial Suharto stage, from 1965 to the late 1980s; Suharto’s second period of free market policies; and the new government of Wahid since 1998 (Myint 1984: 39–83).

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During the first period after Sukarno came to power, there was a major economic crisis. Most fertile land had been turned to production for export, and the population could not be fed by what was produced on the remaining land.5 The period following independence was characterized by further deterioration, not only in agriculture but also in manufacturing. In an effort to address the initial looming food shortage problem, a nationalist policy was implemented to force the return of foreignowned plantations to local landlords and their previous owners. The production of export crops like rubber, indigo and sugar declined dramatically. The government aimed to replace them with food products, rice in particular, for local consumption. When Sukarno tried to go further and transfer land, not just to local large landowners but also to peasants, he encountered fierce and ultimately successful resistance (Bowie and Unger 1997: 46–7). Under ‘Guided Democracy’ Sukarno had sought to give the peasants better social conditions and tenant farmers a fairer share of their rice crops, as well as to redistribute land. When the government could not deliver on its promises, the PKI encouraged peasants to seize land. Nor did small owners receive much assistance or protection from the state. The government attempted to control the distribution of fertilizers, for instance. But the distribution to the farmers ran into administrative difficulties because of corruption among local state officials. As a result the farmers had to buy fertilizers on the black market. Their ability to do so was hampered by low incomes, for the government had not matched fertilizer control with control over final markets in rice. As a result Chinese merchants paid the farmers low prices, then resold on the urban markets. The farmers were left with the worst of two worlds – an inefficient and corrupt government distribution mechanism for fertilizers, which often failed to satisfy their needs, and a merchant-dominated ‘free market’ for their products, which kept their earnings low. This combination resulted in a growing scarcity of rice and higher prices that soon took on the dimensions of a national crisis (Crouch 1984: 175–89). Thus, unlike Taiwan where the Japanese had already started a green revolution and the KMT delivered efficient services to the farmers, Indonesia’s attempt at land reform was very limited and largely ineffective. While agriculture failed to provide the population with their basic food needs, manufacturing did not improve either. The Dutch in the

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early part of the twentieth century had encouraged very little manufacturing other than textiles for the local market. Tobacco and tea factories were for the imperial market. However after independence, all manufacturing and natural resources were nationalized. Nationalization of factories previously owned by foreigners and now run by an ineffective, short-staffed government exacerbated the downward spiral – with one important exception. The nationalization of oil, and the formation of Pertamina, was probably one of the greatest accomplishments of the independent state (Bresnan 1993). But although there were instances of nationalization, it would be misleading to argue that Sukarno’s regime had any real long-term economic policy. Sukarno, like many other heads of newly independent countries, favoured a nationalistic strategy of import substitution, but it was incoherent and contradictory. In practice it meant little more than substituting home-grown agricultural products for imports, and had little to do with the manufacturing sector (Myint 1984: 39–82). Against the background of the lack of a comprehensive economic plan, Indonesian poverty worsened. Nor was the situation helped by the diversion of scarce resources into military equipment during the conflict with Malaysia in 1963. As Sukarno sought to create a political zone independent of the great powers, the US cut off aid. Heavy military expenditure on the one hand, and lack of viable economic policy combined with low foreign currency reserves due to declining exports on the other, led to a national economic crisis. Government subsidies to the public sector decreased, resulting in an increase in public transport, electricity, water and postal charges. Inflation ran at 500 per cent (Nasuation 1995: 3–40). Finally, in the midst of a general economic crisis a coup brought down the government in 1965. After the Suharto coup the government moved to introduce Western-style economic reforms. The economic strategy switched increasingly to export promotion, particularly of natural resources – mainly oil, timber and minerals. Such exports brought a great influx of wealth, at the expense of much environmental damage. But despite the change, despite the growth of manufacturing, Indonesia, unlike Taiwan, remained largely an agricultural economy. Particularly outside of Java and Bali, most people’s means of earning their subsistence did not change. They remained part of agricultural or fishing communities with little or no technological advances (Islam

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and Chaudhury 1999: 109–221). While the rich parts, particularly the urban areas of Java, benefited from the export of natural resources, in the less prosperous parts of Indonesia, where most of the resources are located, the population continued to rely on hard work in traditional sectors. In these sectors, women play a very large role. The main thing that distinguished the first Suharto era from the post-independence one was its export-promotion policy. From the outset, Suharto opened the country to trade with the West. Alongside the export of oil, wood and minerals, during the period between the late 1960s and the late 1980s other types of manufacturing (oil and wood products are identified as manufacturing in most references) such as textiles and paper increased. But once again there was a big difference in the patterns of development followed by Taiwan and Indonesia. Indonesia followed a dual export pattern. There was a clear distinction between the capital-intensive and the labour-intensive sectors. The capital-intensive sector, run by senior military officers and by Suharto cronies, was financed by the revenue from the export of oil and other natural resources, and from heavy borrowing from international lenders. Because of heavy subsidies and other forms of government assistance, this sector – which included even relatively high-tech items like automobiles and helicopters – continued to grow right up until the beginning of the crisis in the late 1990s. Most of the markets for its products, though, remained local (Hill 1992). The second sector was labour-intensive manufacturing for export. Growth here was assisted, not by lending but by investments from other countries in Southeast Asia, mainly Japan, but increasingly Taiwan and Korea as well. It was in the second, labour-intensive, export-oriented sector that female labour became particularly important (Islam and Chaudhury 1999). As noted above, the Suharto era can be divided into two periods. The first, during which the state was more involved in the economy, lasted from the late 1960s to the late 1980s. The second stage started in the late 1980s when the state was forced by pressure from creditor countries, and from the IMF and the World Bank, to adopt market-oriented policies. This meant that the Suharto government, whose commitment to state-led development had always been much weaker than that of Taiwan, and badly distorted by corruption and cronyism where it did occur, withdrew even further from economic planning. The increasing

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free-market orientation forced the closure of ‘inefficient’ industries. That, together with the concurrent slashing of state expenditures on the social welfare system, once again exacerbated the problem of widespread poverty and made the income disparities, already notorious, even worse (Booth 1992; Hill 1992; Aswicahyono et al. 1996: 340–63). During the crisis of the late 1990s, a new government took office, but it would be difficult to describe its economic strategy as innovative. The IMF remains the most powerful determinant of economic policy. To the extent that the government has any scope for autonomous decisions, it is hampered by its internal incoherence. As a result, individual ministers issue completely conflicting policy statements. For example, in February 2000 the Minister of the Environment declared his intent to force a major multinational mining company to rewrite the contract it had drawn up with the previous regime in order to stop further ecological damage and ensure Indonesian interests were respected – only to be publicly contradicted by the Minister of Foreign Affairs, who declared the existing contract to be sacrosanct. Similar confusion occurred around the activities of other foreign and joint-venture companies in the lumber and mining sectors.6 In addition to internal contradictions, the current government lacks the operational means to implement dramatic economic changes. The civil service is underpaid, the judiciary corrupt; information flows to the central government are limited and unreliable; and, recently, the government undertook to devolve power down to the regions in a constitutional transfer that would seem to preclude Indonesia following the ‘developmentalist state’ model in the future.

Women’s role in the economy Paid employment An examination of more than a hundred sources on the political economy of Indonesia and on the nature of its female employment, interviews conducted with Indonesian scholars in Montreal and with scholars from Canada and the United States who work on Indonesia, and a field research trip involving interviews with government officials

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and NGOs in Indonesia, all led to the conclusion that there is very little, if any, macro-analysis of the role of women in the Indonesian economy.7 There are micro-studies of an anthropological nature but no sources that contain statistical data on female labour in the context of the country’s political economy since the 1960s. This is quite unlike the case of Taiwan, where there is a wealth of data compiled by government agencies. For the case of Indonesia we are forced to use data from international sources. Indonesia is still heavily reliant on agricultural production, which continues to employ a large share of the labour force, many of them women. Over the entire post-independence period there has been little change in the structure of agriculture. Sukarno’s inability to tackle large land ownership meant that women from low-income and small landowning families had to toil as agricultural labourers. However, traditionally women were the mainstay of rice production, and their knowledge and expertise was retained. Given the lack of access to capital resources, cheap (or free) female labour was critical in realizing Sukarno’s ideal of self-sufficiency in rice (Elliot 1997). In addition, women aided the development process throughout the entire post-independence period by their role in creating and running cooperative institutions. Among these was the rotating credit association run by women, known locally as arisan. These associations have provided each member in turn or in need with credit and emergency funds (Geertz 1963a: 16). Such institutions have been particularly important to the most marginal sectors of the economy as well as those parts of Indonesia which have been left out of state support other than programmes such as migration. In order to deal with a population problem in Java, the Suharto government encouraged migration, particularly of women, to less populated and less prosperous islands. This policy had one immediate and one more long-term objective. By facilitating (sometimes using the threat of force) the movement of women to less prosperous, less densely populated areas, the pressure on the resources of richer islands would be relieved. And having a higher percentage of women in less densely populated islands would bring down population increases in the future. The fact that living conditions were harsher in these islands was irrelevant to the state policy makers. Moreover, although agriculture has remained an important part of the economy, there has been very little modernization of agriculture

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Table 4.2 Female employment ratio by sector Female share of employment by sector (%) Total labour force Agriculture Industry Services

1980

1990

1995

1997

35 54 13 33

39 56 12 31

40 47 16 36

41 42 16.3 41.7

Source: World Bank 2004

Source: World Bank, 2004

Figure 4.1 Female employment ratio by sector

and, as already noted, large land ownership has remained intact. The agricultural sector therefore has two characteristics; one is that it has remained labour-intensive, and the second is that the number of landless peasants available to meet needs of labour-intensive agriculture is high (Manning 1989). This has meant that although the female share of employment in the agricultural sector has declined it still remains high, as can be seen from Table 4.2 and Figure 4.1. Commercialization of agriculture by large landowners required a large pool of landless labour, mostly female. Thus, the emergence of commercial agriculture went hand in hand with the decline of traditional forms of agricultural organization. Bawan, a traditional

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sharecropping system whereby women and children from the same or adjacent villages are authorized by the owner to participate in the harvest and receive payment in the form of harvest share, has been in decline for some time (Naylor 1994: 529). The labour shed by the decline fed the supply of plantation workers. At least initially, with commercialization and the decline of traditional sharecropping, wage workers actually got higher incomes than on their own land – though that may no longer be true in the context of the current crisis (Naylor 1994: 509–35). However, not all labour in the agricultural sector is paid. On the contrary, unpaid family workers may be even more important. Furthermore, the percentage of women working as unpaid family labour has actually been increasing while the sector as a whole has been in decline. Nonetheless, despite the relative decline, the vast majority of Indonesians rely on this sector for their survival (Grijins et al. 1994: 25). As far as manufacturing is concerned, the percentage share of women in employment has not been high. Unlike Taiwan, where the share of female employment in manufacturing rose throughout the 1970s and 1980s, women’s employment share remains fairly stagnant, even though the country’s manufacturing has increased. This is partly because Indonesia’s manufacturing has a high percentage in the capital-intensive categories of refined petroleum, liquefied natural gas and wood products (World Bank 1999b), in which male labour predominates. Therefore, the total number of women in this sector is relatively insignificant compared to the agricultural sector (Indonesian Central Bureau of Statistics: Census 1961, 1971, 1980, 1985). In terms of employment patterns, capital-intensive manufacturing in sectors such as automobiles and television production typically employs men rather than women, while women are concentrated in labour-intensive sectors such as cigarette making and textile manufacturing (Anata et al. 1988: 92). It is also typical of labour-intensive manufacturing that wages are lower than in the capital-intensive sector. The availability of cheap female labour has been increased further by government efforts to modernize traditional sectors like the batik industry, which have as a result been shedding labour (Wolf 1996). With the decline of traditional manufacturing in the late 1970s and

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Table 4.3 Average hourly wage for female workers (US$) Hong Kong Singapore South Korea Taiwan Malaysia Philippines Indonesia

1.15 0.79 0.63 0.53 0.48 0.48 0.19

Source: Wolf 1996: 41

the 1980s, many women entered factory employment in free trade zones (FTZs) where the government has actively encouraged foreign and domestic investment. In the year 1979 alone, foreign multinational and domestic investors set up 72 FTZ factories where only women were employed. After the first devaluation in 1987, more multinational enterprises (MNEs) moved to Indonesia’s FTZs. Like other FTZ factories throughout the South, these rely on cheap ‘unskilled’ and relatively docile female labour, preferably that of unmarried girls and women between the ages of 12 and 24, many of whom come from landless peasant families (Wolf 1992: 91). Indeed, Indonesian women have the lowest wage level in Asia, a prime reason for its attractiveness to foreign investors. Table 4.3 compares the wage level that prevailed in Indonesia at the start of the 1990s to that of other countries in the region. Thus, in addition to the fact that Indonesia, under the auspices of the structural adjustment programmes, undertook a very radical programme of deregulation and privatization (Utrecht and Sayogyo 1994: 48–9), there were other factors attractive to foreign investors from newly industrialized countries (NICs) in Asia. One major factor was its abundance of cheap female labour. In addition, foreign multinationals could employ women as subcontractors. Subcontracting became more common in the 1990s, particularly among women in the textile, garment and footwear industries (Smyth 1993: 7; Grijins et al. 1994: 191). As part of the growing service sector the number of women in trade has increased, but there are differences between women from high-income and low-income households, as well as between urban

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female traders and rural ones. Many women from urban areas with access to capital, for instance, tend to be engaged in higher-return trade items, such as garments (batik) (Grijins et al. 1994: 123). Women from high and middle-income families engage in a wide range of activities such as buying goods from other women and reselling them. From the lower income groups there are women engaged in dressmaking and carpentry in urban areas, as well as at the village level.8 Women from very poor households are very often driven into petty trade. Since women in Indonesia have traditionally played a large role in trade, with improving infrastructure more women can travel further and have access to a wider market. Increasingly, women, especially those in the lowest social strata, namely those from rural low-income households, travel outside their villages to sell goods. These selfemployed women sell products (on a small scale) such as traditional beverages, vegetables and fruit (Smyth 1993: 47), as well as processed perishable food such as rice cookies or smoked fish and local herbs (Titi and Utrecht 1992). Some female market traders sell daily necessities as well as factory products in the lower-price range such as toothpaste, powder, combs, hair clips, etcetera (Utrecht and Sayoga 1992: 41). Many of the women who sell herbs operate as dukon – knowledgeable women who prescribe and sell herbal remedies in both urban and rural areas. It is interesting that all three types of women, those from high, middle and low-income households, tend to reinvest their income in their families. Those from high-income groups use these supplementary incomes for providing better educational opportunities for their children, while those from low-income groups are driven into small trade to provide for the basic needs of their families as an extension of their home-making role in handling a small budget. Next to trade, and the urban equivalent, working as sales staff, the largest component of the female labour force in the urban service sector is in ‘hospitality’, working in hotels and restaurants. In fact, as the number of foreign companies and joint ventures has risen, the volume of the services related to them has increased the demand for female labour, especially in highly populated islands, such as Bali. Many women are employed in the tourist industry and related work, such as laundry, cooking, cleaning and the like (Cukier et al. 1996). Moreover, the tourist industry has increasingly benefited from

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Table 4.4 Number of registered prostitutes, Indonesia, 1984–95 1984–1985 1985–1986 1986–1987 1987–1988 1988–1989 1989–1990 1990–1991 1991–1992 1992–1993 1993–1994 1994–1995

48057 56571 59290 56524 62660 64441 49679 52389 47454 65059 71281

Source: Lin 1989: 52

female labour in another way, namely in the recent increase in the number of female entertainers and sex workers. Their opportunities for employment have been bolstered by the existence, in some neighbouring countries like Singapore, of strict laws against prostitution. The price for the service of a sex worker in Batam, Indonesia, for instance, is one quarter that of Singapore. In fact the proximity of the island of Batam to Singapore and Malaysia prompted the Indonesian government to encourage the sex industry there (Jones 1987: 49). There have been similar increases in other tourist areas such as Bandung and Indramayu. Table 4.4 indicates the increase in the number of registered prostitutes. However, it is likely to be a serious underestimate. Even Table 4.5 Total Indonesian international labour outmigrants by gender Year

Female

%

Male

%

Total

1969–74 1974–9 1979–84 1984–90 1990–4 Total

n/a 3817 55000 198735 442310 699862

n/a 23 57 68 68

n/a 13235 41410 93527 209962 358134

n/a 77 43 32 32

5624 17052 96410 292262 652272 1063620

Source: Santos et al. 1995: 93

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though the number of registered prostitutes has risen dramatically in the past decade (Jones 1987: 52) this number is in addition to all those who are not registered, many from upper and middle-class households. (With the higher class of prostitutes, clear definition and registration are considerably more difficult.) Most often, however, sex workers come from low-income families. Many poor women from rural areas migrate to the cities in search of jobs and end up as sex workers. However they tend to send part of their income back to their families. Those who migrate outside of the country similarly send remittances to their families, and those remittances have been a useful source of hard currency for Indonesia. Although many women migrate to neighbouring countries as sex workers, the largest category of migrant workers is comprised of maids. Becoming a maid is a practice that is becoming increasingly popular both inside the country and among the émigré population. Many women, chiefly young unmarried women between the ages of 12 and 25, who cannot find work in hotels and restaurants and who refuse to be prostitutes, become domestic workers, often in foreign countries.9 The Middle East is a popular destination. The remittances of émigré maids are also an important source of family income. Although the actual numbers have not always been accurately captured in the official statistics, the Indonesian Trade Union Congress estimates that today 1.5 million Indonesian migrant labourers exist in Malaysia alone, that women make up a significant portion of these migrant workers and that most of them are maids. The number of migrant maids has been so high that recently the mass media began referring to Indonesia as a nation of servants (Anata et al. 1988: 87). It is difficult to track accurately the numbers of sex workers and maids, so these data must be approached with caution. They are in all likelihood serious underestimates since Indonesia, unlike Taiwan, has a huge informal economy with a high level of female participation (Anata et al. 1988). This is not just a coincidence; the government has had a special interest in deliberately encouraging the informal economy. Government officials up to the ministry level have described the informal sector as a safety valve in times of economic hardship. The government has encouraged female employment in particular in this sector in order to alleviate poverty under the system of bapak anagka where women are employed as foster parents, and are provided with

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Figure 4.2 Female employment ratio and total fertility rate Source: World Bank 2004

credit, technical guidance and some raw materials for the purpose. In addition to the traditional forces encouraging growth of the informal economy, there has been the impact of the generally rising level of poverty since the mid-1990s and then the post-1997 crisis. The informal cash economy, however, must be distinguished from the non-cash informal economy. As the Indonesian climate and soil is rich, many women, in urban as well as rural areas, produce subsistence goods for family consumption. Although no one has effectively measured the extent and range of the non-cash informal economy, it suffices only to visit the country to see how important it is. Vegetable gardens tended by women are commonplace even in the cities, on very small plots of land. Yet another aspect of the non-cash informal economy ties in very closely with the formal. Many women in the formal as well as the informal sectors have to rely on the work of their extended families, usually older women, for childcare and other housework duties (Smyth 1993: 7). The work of these older female family members is essential to permitting younger women to work for cash, but it is largely unremunerated (except for the occasional gift), and therefore

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uncounted. In effect, this unpaid labour of older women is a logical extension of the reproductive work done when they were younger. Invisible economic contributions The previous section noted in passing the way women’s paid and unpaid work contributes to the well-being of the household. In this respect Indonesia is no different from any other part of the world. Since this aspect of women’s work has been discussed in earlier chapters, this section will restrict itself to examining the impact of women’s participation in the economy on the fertility rate. In this chapter, unlike that dealing with Taiwan, there will be no regression analysis of the impact of female employment on infant mortality, life expectancy and education because of poor data quality. There are simply too many missing figures for the results to be meaningful. As indicated by Figure 4.2, the participation of women in the labour force is high and has increased, but the relation between the increase in employment and the drop in fertility is not as strong as in Taiwan. This is because the Taiwanese state was highly committed to family planning and this was not the case with Indonesia. The state attempted to mobilize women of all classes, especially in the rural areas, as volunteers to work on family planning. Volunteer organizations such as the PKK (Family Welfare Movement) at the rural level, with a large membership throughout the country, have conducted extensive programmes aimed at family planning. Such efforts have earned outside support rather than that of the state. The PKK effort has been recognized by and received funds from organizations such as UNICEF, which granted it the Maurice Pate Award; the World Health Organization has also praised Indonesian women’s volunteer work for family planning by awarding it the Sasakawa Prize. State-initiated organizations have mobilized many women from high-income households to promote safe motherhood, nutritional standards and other community-based programmes such as health clinics for mothers and children. Such measures have reduced infant mortality, which in turn leads to a reduction of fertility. Suharto did embark on plans to extend education and during the 1970s and 1980s expanding literacy programmes brought many benefits to a large number of girls who have been able to enter secondary education as a result. In addition, the state increased the

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minimum marriage age: it is now 16 for girls and 19 for boys. Improved education and a higher minimum age for marriage have in turn led to women having their first child at a later age, with the obvious effect of decreasing the fertility rate. Furthermore, certain cultural characteristics have been encouraged by the state. For instance, unlike China or India, Indonesian society is not obsessed with producing male children (Office of the Minister of State for the Role of Women 1996: 49). These policies were implemented with large budgets before the late 1980s public spending cutbacks were imposed on Indonesia as part of the general market liberalization programme. Other than strictly state-initiated organizations, Muslim organizations supported by the state have also been active in this area. The most important is the Muhamadiah.10 Its female branch, known as Aisyiyah, is very active in providing family planning services. Funds are raised by charitable contributions and it is staffed by upperincome women volunteers. A more ‘conservative’ Islamic group with a very large membership among the rural poor, Nethzatol Ulama (NU), also has a family planning programme run by its Fatayat (young women) and Muslimat (older women) branches. Indeed, unlike the case of Christian clerics in the Philippines, for example, Islamic scholars and clerics in Indonesia in general have taken a very progressive attitude towards family planning. Like their counterparts in places like Iran, these ‘conservative’ religious groups have been very influential in bringing down the total fertility rate. The Indonesian religious authorities have supported contraceptives and other measures of fertility control (with the obvious exception of abortion), as well as encouraging the mass mobilization of female volunteers to provide information to poorer women.11 As can be seen in Table 4.6, from the 1970s until the late 1980s there was a very sharp decline in infant mortality and a relatively sharp rise in life expectancy. After this period, when the structural adjustment programmes begin, not only does the female employment ratio level off, but so does the improvement in life expectancy – it still rises, but only slightly. At the same time infant mortality continues to decrease, but at a much reduced rate, then levels off in the 1990s. The same is true of the illiteracy rate, which drops dramatically up until the early 1990s, when the rate of decrease slows

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Table 4.6 Life expectancy at birth, infant mortality rate (per thousand) and illiteracy rate Year

1960 1970

Life expectancy 41.49 47.92 at birth, total (years)

1980

1990

1995

54.81 61.71 64.15

2000

2001

2002

66.03 66.34 66.65

Mortality rate, infant (per 1,000 live births).

128

104

79

60

46

35

33

–

Illiteracy rate, adult total (% of people aged 15 and above)

–

44

31

20

16

13

13

12

Source: World Bank 2004

down as indicated in Table 4.6. These trends support the idea that liberalization of the economy can have an inverse impact of these indicators. While female employment continues to increase, although that increase also slows down in the early 1990s, it is clear that rising female employment without state commitment to providing social programmes will not by itself improve life quality indicators. In Taiwan, rising employment for women and state social programmes together produced an impressive result but this has not been the case in Indonesia. Volunteer work and gender politics The scope of volunteer work that women have performed in Indonesia is extremely impressive. The state in Indonesia has made a great effort to mobilize women to engage in a wide range of volunteer activities in rural as well as urban areas. The history of current state initiatives dates back at least to the time of the coup. When Suharto came to power, he slaughtered many political activists, many from Gawani (the nationwide umbrella organization of women’s groups). Then, in the early 1970s, when he attempted to

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consolidate his power, he also set out to bring women’s organizations under his control. He appointed the wives of his senior army officers as leaders of the PKK and the wives of top bureaucrats as leaders of Dhrama Wanita, a women’s group composed of middle-class women. They were then given the job of teaching women from lower income groups the ‘correct’ feminine values – a doctrine called Ibuism (Djajadiningrat-Nieuwenhuis et al. 1992: 43–52). These values included the notion that women should be supportive of their husbands and of the ‘Father State’. While the PKK became more focused on the rural areas, Dhrama Wanita became active in the urban areas (Wieringa 1985; Smyth 1993). These organizations have undertaken a wide range of activities to combat poverty. Since 1975 the PKK has encouraged ‘mutual help’ arrangements in the community as a means of poverty alleviation. It has aimed to ‘educate’ women to become better care givers, and to conserve and preserve the environment. It has engaged women in family planning programmes along with programmes designed to provide basic health care. The PKK has also raised charity funds from women of medium and high income to help poor families with clothing, housing, and home economic planning. Since the drop in the economic growth rate in the mid-1990s, these organizations have been used even more vigorously to deal with growing poverty (Utrecht and Sayogyo 1994: 48–9). It is obvious that these organizations provided an enormous number of services that otherwise the state would have had to perform. In the context of the economic deterioration of the 1990s and the erosion of state services due to structural adjustment, these volunteer programmes were stretched as far as they could be to fill in as the state withdrew from its welfare functions. As the role of such organizations increased and international links, such as those with the International Women’s Conferences in Nairobi and Beijing, became more profound, the women’s organizations in Indonesia began to formulate a much more critical and independent perspective. Along with state-initiated organizations there are other types that are neither state-initiated nor completely autonomous. Aisyiyah is the most notable example. Aisyiyah has close links to Suharto’s Golkar Party, but is not a state institution (Wieringa 1985). The two other major Islamic women’s organizations, Fatayat and Muslimat, have been quite independent. All three have carried out social

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welfare policies in their attempts to combat poverty and increase female social and economic empowerment. Their activities included setting up vocational training programmes, providing micro-credit or emergency loans for small businesses, literacy programmes using Islamic teachings, bursaries for higher education, day-care centres, programmes to teach women how to provide nutritious meals on limited budgets, extracurricular programmes for adolescents, neighbourhood safety networks, community activities for the young and unemployed, building parks for the neighbourhood, and so forth.12 Religious organizations have had a very large membership and therefore have been extremely important for social development. Fatayat and Muslimat currently have close to six million members.13 Their role was particularly important in the face of the recent collapse of Suharto’s regime. These two organizations continued to provide welfare measures throughout the period of turmoil. Since the NU (and also to some extent Muhamadiah) were independent of the state and relied on funding from their members’ charitable contributions, they managed to continue their services during and in the aftermath of the political crisis. In this sense these organizations not only subsidized the state but, in its absence, acted as the state (Fatayat Welfare, Suara Aisyiyah 2000). Women’s organizations in Indonesia have been very different from those in Taiwan. There, state-initiated organizations eventually became autonomous, partly due to rising female labour force participation. In Indonesia women’s labour force participation was high all along while, in the face of state repression of most independent organizations, the only ones to survive autonomously until the mid1980s were the religious ones, Fatayat and Muslimat. Then other small organizations were formed. One of the most notable examples was Kalyanamitra, founded in 1985 as a resource and documentation centre. Initially having a low profile, Kalyanamitra soon became the most important women’s organization in the country, taking a leading role in the protests that led to the downfall of Suharto.14 Because of the current government’s inability to carry out welfare functions adequately, these organizations are of great importance at this juncture. But they have gone beyond social welfare and are now very active in advocating women’s rights. Many have formed alliances with sectors of the newly elected post-Suharto government. Kalyanamitra, for instance, is working closely with the Ministry of Women’s

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Empowerment to campaign on gender issues such as equal pay for equal work. Indeed, both religious and secular organizations have come to focus more and more on gender issues (Jakarta Post 1999). But, much as in Taiwan, many of these organizations have gone beyond women’s issues and have extended their campaigns to wider political matters. Koalisi Prempuan, for instance, in the strife-ridden state of Atcheh, has not only been concerned with rape cases but also with conflict resolution in areas where violent clashes have occurred on a regular basis. They have mobilized local women’s organizations to mediate between the army and separatist groups.15 Many others such as Lembaga Studi dan Pengembangan (LSPPA, Institute for Women and Children Studies) have combined different issues: microcredit to help women in rural areas, organizing talks by progressive Muslim scholars for the urban middle-class women, environmental action and many others. In fact, since Suharto had dismantled the main institutions of an independent civil society and eliminated any real political parties, there was an obvious void once he fell. As a result, Indonesia has been in sore need of the means to reconstruct civil society. In this task, women’s organizations play a crucial role. Their role is all the more important given the recent emergence of powerful separatist and ethno-religious organizations that distrust the state even under the new regime. Women’s organizations are able to work in harmony with all of these disparate groups. Unlike the case of Taiwan where women’s groups can bring political pressure on the state to take measures on issues such as unequal pay or environmental degradation, women’s groups in Indonesia have not been successful in mobilizing support from the state. When the state is unable or unwilling to be engaged in the economy and relies on the army for support, it is obvious that women’s organized efforts will not bring about the changes that are necessary. In reality, a great deal of women’s groups’ resources are taken up by catering to the immediate needs of the community, particularly as poverty, income disparity and ethnic conflict continue to plague the lives of many. There has been a great deal of effort on the part of international organizations such as the ILO to increase women’s empowerment, but few of these efforts have met with success in terms of obtaining budgetary support, since there is no state commitment to support the initiative. The World Bank, for example, has invested in poverty alleviation programmes to help build a social

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safety net, but because of corruption and the lack of representative authorities to manage the funds, overall improvements have been disappointingly modest. NOTES 1 While Hinduism and Buddhism were still practised, and Islam came to dominate, the presence of the Portuguese was responsible for creating a minority of Catholics while under the Dutch some Indonesians were converted to Protestantism. Consequently in addition to different ethnicities, Indonesia is a country with many different religious minorities. 2 Java and Sumatra volcanoes provided a highly fertile soil which meant a greater population density (Fryer 1970: 295). 3 Alongside independent associations, most large nationalist or religious organizations formed sections for women’s members. The Islamic reform association led by Muhammadijah Hadji Ahmad Dahlan was against ancient methods of teaching of Islam. He wanted divorce to be decided by men and women equally, he encouraged girls to engage in sports and along with his followers established several hospitals, polytechnics and institutions of higher education open to women. 4 This account is in part based on interviews with leading members of Kalyanamitra, a prominent women’s organization. 5 In fact rice shortages are not a modern phenomenon. They were common at least as early as the late nineteenth and early twentieth centuries (Turner et al. 1997). 6 Information in this paragraph is based on field research and interviews conducted in Indonesia. 7 Others have come to the same conclusion with respect to limitations inherent in the data on the Indonesian female labour market (Benjamin 1996: 85). 8 During my interview with an American expatriate woman in Jakarta, who taught at Jakarta International School, I learned about women from high-income families who travel to India to bring jewellery to sell in private parties to other women from high-income groups as well as to the Chinese and expatriates. 9 During several interviews with high-income women, I realized that the number of maids they employ has grown during the recent crisis. 10 There are two important Muslim organizations in Indonesia: one is Muhamadiah, to which Suharto belonged; the other is Nethzatol Ulama of which Megawati Sukarnoputri has been the leader. 11 The source of data is interviews in Indonesia and Montreal with leading members of the organization Nethzatol Ulama. 12 The information comes from my field research, and interviews with the leading activists. 13 The numbers come from the central office in Jakarta and are approximations. 14 Siti Aripurnami, one of five founding members of Kalyanamitra, provided me with this information. There appears to be no written account of the organiza-

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tion in English. 15 Interview with one of the leading members of Kalyanamitra, Tati Krisnawati.

5 The Philippines: Exporting Women Is Good for Growth

In this chapter, the Philippines – the second of the ‘tiger-to-be’ countries and last of the cases – is examined in detail. For comparative purposes this chapter follows the same format as the previous ones, again starting with a historical analysis of the legacy of colonialism.

Colonial history Socio-political background The Philippines has a long history of colonization and settlement. The Negritos, among others, settled in the Islands around 25,000 BC. The Malays arrived around 2000 BC, while from 400–1400 AD Chinese, Arabs and Indians controlled various aspects of the economy, as well as the land. The country’s modern history dates from the time of the Spanish conquest – the mid-fifteenth century – when, along with Spanish soldiers, priests arrived to convert the population to Roman Catholicism. The country was named after King Philippe II of Spain, and Spanish colonial rule lasted until the Spanish American War in the late nineteenth century. Following the war, the country came under American rule, and this was broken by a brief occupation by Japan. The country became independent after the Second World War (Ogden 1993: 78–81). If the Filipinos, en masse, are comprised of a variety of ethnic backgrounds (many are actually mestizos, a mix of Spanish, Chinese 136

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and local ancestry), their shared history of European conquest has given the great majority of them a common sense of national identity. Even the Chinese population has integrated into the country’s social matrix. This is in stark contrast with Taiwan, where the Chinese population dominated the whole island, and Indonesia, where the Chinese remained quite separate. More than four hundred years of colonialism have not only profoundly affected the broader society and economy of the Philippines, but also had a significant impact on women and on their position in the workforce. Colonial economy In the pre-Hispanic era, the country’s subsistence economy was based on wet-rice production on communal land. In fact, with the exception of the hunting and gathering peoples of the mountains, this communal approach to land ownership was widespread in the archipelago – contrasting sharply with other parts of Asia (China, for instance). After the Spanish conquered the Philippines, this communal mode of existence began to disintegrate. Along with Catholicism came a colonial mode of domination, and with it the introduction of a European-style class structure. The gradual privatization of land created social hierarchies and exacerbated gender inequalities. Large tracts of land were awarded to Spanish friars and imperial soldiers who put local chiefs and their relatives in their encomienda, and made them responsible for collecting tribute. The Catholic Church was one of the largest landowners. Power, both economic and political, was wielded at this stage by a coalition of Spanish officials, senior clerics, descendants of pre-colonial village chiefs (datus) and Chinese mestizos – people of mixed Chinese and European descent (Lindio-McGovern 1997). Within this new male-dominated hierarchical order, Filipino men were regarded as the heads of households and as such, it was up to them to pay tribute. High tribute payments meant that women were often forced to work hard to meet their husbands’ production quotas and tribute obligations. In a sense, this was reminiscent of what had happened in much of Spanish America, with its system of forced labour. However, whereas in the American case it was men who were directly targeted, here the targeting was more indirect, with

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women silently bearing the burden of the Filipino men’s new responsibilities. Later, as the Spanish consolidated their control through the imposition of a formal colonial administration, export-oriented cash crops replaced subsistence production. The indigenous economy was further weakened by the Spanish-assisted commercial endeavours of Chinese and mestizo merchants. As labour and other resources were increasingly diverted to haciendas producing export crops such as sugar, rice production fell, the price of rice increased, and the Chinese were able to sell imported rice at prices that were lower than local prices. In addition, Chinese merchants (and later on the British during their short period of control) imported cheap textiles, once again undercutting local prices. The decline in indigenous textile production continued to the point that on the eve of the American takeover, textiles had become the islands’ largest import (Heyzer 1986: 92–111). If all of this increased the importance of the Chinese (and other colonial) merchants, the decline of local rice and textile production (areas in which women were mainly involved) was followed by a more general decline of the economy as Spanish rule came to end. This same economic structure more or less continued under American colonial rule, with most of country’s economy centring on the cultivation of agricultural produce – mainly rice, corn, coconut, sugar cane and tobacco – much of it destined for the American market (Crouch 1984: 40). During this period manufacturing grew considerably, with the agricultural sector too becoming more mechanized. Furthermore, the Americans brought in tractors and other agricultural machinery to increase productivity of exportdestined goods like sugar. Only in one respect did the structure of the labour force change in any significant way during this period, and this change grew out of the American attempt to expand education and build an indigenous civil service. The end results were more jobs created in education, and a considerable expansion of the local bureaucracy. The outbreak of the Second World War brought with it a shift in the political dynamic of the region, with control of the Philippines passing briefly into the hands of the Japanese. In contrast to Taiwan, where the short period of Japanese colonial rule had laid the foundations for the country’s industrialization, Japan’s rule of the

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Philippines was marked by economic upheaval, rising unemployment, food shortages, hunger and disease. When the war ended and the Americans took control once again, they faced protests on the part of organized labour, and had to contend with a peasant uprising. However, this was less of a setback than it might have been, and the Americans were quick to suppress both organized labour and the peasantry (Szanton 1996: 103–4). This, of course, contrasts sharply with what happened in Indonesia when the Netherlands tried to reassert its control in the aftermath of Japanese colonial rule. For whereas Japanese control, in this latter case, had provided a breathing space for the Indonesian nationalist movement, enabling it to challenge and then quickly oust the Dutch – by then, a declining force in the world – America, when it resumed control over the Philippines, was the pre-eminent world power. It should be noted, too, that although the Philippines did eventually gain its nominal independence from America, it remained an American politico-military protectorate for several decades beyond this point in time. In fact, until the early 1990s America’s largest air force and naval bases in Asia were located in the Philippines. Women’s role in the colonial economy Historically, Filipino women were predominantly employed in two main areas: wet-rice farming, which, in the Philippines as elsewhere, is labour-intensive (not to mention heavily dependent on a female workforce); and traditional light crafts such as weaving, spinning and dyeing cloth, pottery, food processing and oil extracting. However, their contribution to the economy did not end here (Eviota 1992). During the pre-Spanish period, for example, it was women who were the main agents of trade with merchants from neighbouring islands and from China. Their dominance in the realm of trade also meant that women in the Philippines enjoyed more freedom of movement than was typical in Asia. This central economic role was accompanied by an even greater social role – most importantly in the sphere of religion. Until Islam penetrated the Philippines from the south, animism was the most common religious belief. Within animistic belief, women acted as religious intermediaries (Babaylanes), and were responsible for conducting the religion’s various rituals. Those men who became Babaylanes had to dress as women. Babaylanes,

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in addition to being part-time religious functionaries and diviners, were also healers, astronomers and interpreters of culture. That said, actual political leadership remained overwhelmingly in the hands of men (who were also the warriors), though it was not unknown for a woman to inherit the position of chief (Pineda-Ofreneo 1988: 100). Thus, although women in the pre-colonial era had little political power, they did have considerable economic and social influence. This is largely attributable to communal ownership of land, coupled with the dominant role played by women in agriculture. It was a reflection, too, of their centrality within religion. The Babaylanes (or Catalonas) had knowledge of herbal medicines, which gave them power over reproduction and the health of the community. They presided over rituals such as weddings, births and funerals. And as astronomers and diviners, they acted as advisers to the chief, foretelling the outcome of political events (Lindio-McGovern 1997: 24–5). As noted earlier, after the Spanish conquered the Philippines communalism began to disintegrate and a colonial economy was established. A debt peonage system was imposed on local communities whereby the debtor – also called a peon – was obliged to work off a private debt or legal fine with unpaid labour. In theory, the status of peon could be erased through repaying the debt. In practice, however, this was rare. Sometimes this debt-servitude practice meant that women were used as a commodity for repayment (Lindio-McGovern 1997: 225). Moreover (and like indigenous women in Spanish America), women were coerced into working hard to meet the new production quotas now imposed on their men. Filipino women also had to provide the priests with free services: pounding and husking their rice, and sewing their garments. Added to this, many women had to raise their families single-handedly. This is because the Spanish often took the men away either to fight against the Dutch or the Muslims in the South, or to work as slaves on the plantations. Records suggest that during the early period of Spanish rule, as many as 4,000 women were engaged in weaving and spinning cloth in Bulacan, near Manila. The number of women involved in home industries and textile production remained high throughout Spanish colonial rule. However, female employment figures decreased when first the Chinese, and then the British, flooded the market with

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imported cloth. The fabrication of local textiles – an activity that had employed up to half of the country’s female labourers during Spanish rule – declined to the point that the Philippines, once one of the greatest textile centres of the world, listed textiles as the single largest import by 1893 (Szanton 1996). In addition, the influx of Chinese traders gradually undermined what had, until the mid-1700s, been the domain of the country’s female peasants: namely, market trading. These indigenous merchant women traded goods which they had either processed or made: salt, coarse brown sugar and dried meat, for instance; needlework, woven mats, cloth, blankets and jewellery. They also bought and sold rice, tobacco, poultry, fruit and vegetables, as well as exchanging gold which they had panned. However, as the Chinese traders moved in and the economy became increasingly commercialized, day-to-day trade as well as larger market transactions came to be handled predominantly by men. If, however, the Chinese (and later the Chinese mestizos) began to replace local women in trade-related jobs, it remains true that these latter were forced out not so much by cultural restrictions (as in other areas of Southeast Asia), but rather by a shortage of capital. Interestingly enough, it was not unknown for Filipino women of the landowning class to own family stores and retail shops in Manila, employing a whole retinue of hawkers, sellers and cooks. But these female-run enterprises were also gradually taken over by Chinese merchants (Eviota 1992: 54; Szanton 1996). During the Spanish period the general decline of the economy in rural areas meant that many impoverished Filipino women migrated to the cities. Once there, a significant number found jobs as domestic servants, or in other kinds of ‘service’, such as prostitution. (In fact, it was during this time that Manila became the principal brothel centre of Asia.) Still others found employment in labourintensive sectors of the colonial export economy. One such sector was tobacco and cigar manufacturing, which was run as a stateregulated monopoly. In Manila (much as in Mexico under Spanish rule) women were specifically recruited for the latter jobs because the colonial authorities believed they were better suited to the work than were men: for one, they took greater care; second, they were seen as less of a risk when it came to theft or fraud. By the 1880s, and with the country’s tobacco monopoly in its last days, 30,000 women were employed in the industry in Manila alone. That said, they

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worked under male supervision, and the administration was invariably male. Nonetheless, and despite this obvious growth in manufacturing and the export of cash crops, the last century of Spanish rule was a period of intense impoverishment for the majority of Filipinos. Not only did unemployment figures rise, but, as the local economies weakened and rice production decreased, the population was hit by food shortages. This was further exacerbated by the fact that the Spanish colonists and clergy, the Chinese mestizos and the Filipino principals had taken control of most of the land. The changing structure of land control, along with food shortages and growing unemployment – particularly in the rural areas – led to a mass migration to urban areas, and especially Manila. By the end of the nineteenth century, and with the days of Spanish rule numbered, the rural economy was in a mess. If this was not altogether a novel situation – in the past, poverty had often been common in the rural sector – the swift decline of urban manufacturing around this same time sent the country as a whole into a downward spiral, causing massive poverty and affecting both men and women. Records from the time indicate an increase in the number of prostitutes – these were women who had formerly been cigar workers, domestic maids, tradeswomen and dressmakers. Those too old to work as prostitutes became beggars. While men and women alike suffered from impoverishment as a result of unemployment, it seems that women had more to lose. For example, male observers on the scene spoke of how Filipino women were more industrious than men, devoting little of their time to leisure activities while men spent a considerable amount of time drinking, gambling and attending cockfights (Eviota 1992). American colonial rule operated in obedience to the same principles as Spanish colonial rule, with the cultivation of crops destined for the US market being central to the economy. Abaca fibre, which is used to make a coarse cloth, was one such crop; in fact, it was during this period that the US Navy was obtaining 40 per cent per cent of its abaca from the Philippines. In former times, abaca had been cultivated primarily to clothe the Filipino working class, and it was homebased female artisans who were responsible for transforming the fibre into material destined for the local market. While a small export sector did exist during this period, it relied on a male labour force of

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weavers, spinners and traders. With the coming of the Americans and the wider commercialization of abaca, female workers were drawn into the previously male-dominated export domain. Women also became more prominent in the harvesting of tobacco and the making of cigars. However, if female employment in the agricultural-export sector increased at the beginning of US colonial rule, it quickly declined as the American demand for Philippines textiles plummeted during the Great Depression. In 1903, for instance, 70 per cent of the one million Filipino weavers were women. By 1939, this number had dropped dramatically. Not only had the general demand for Philippines textiles decreased, but mechanized mills had been imported into the country and were doing the work that women had once done. If this latter development meant that new jobs were being created for men at the expense of women’s jobs – after all, it is men who have traditionally been given the task of ‘running’ technology – it also meant that the overall employment rate fell. The result was a decrease in real income for both men and women (LindioMcGovern 1997: 31). What remained of the household-based textile industry also felt the impact of these socio-economic and technological changes, with the artisan production of consumer items such as shoes, slippers, neckties and ready-to-wear clothes also going into a decline (Eviota 1992: 69). Women’s anti-colonial movement Direct female involvement in anti-colonial struggles goes back to at least the mid-eighteenth century (Heyzer 1986: 125–7). Many women were involved in fighting the Spanish. During the 1896–9 revolution Filipino women, like their sisters in Indonesia, both took a front-line position in the anti-colonial battle and helped the resistance movement from the sidelines. The Mothers of the Revolution, for instance, was a group formed by peasant women to distribute food to Filipino soldiers. Women also set up temporary hospitals for the wounded, and nursed them throughout the revolution against first the Spanish and then the Americans. The relatively high educational level of Filipino women (as compared to the rest of the world), along with their elevated participation in white-collar urban work, meant that they were quite

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effective when it came to organizing around their rights. An important battle was waged over property rights. In 1938, as a result of women’s political agitation over this issue, the Spanish Civil Code – which had until then denied women the right to inherit property – was amended. The following year, a revision in family law gave married women full civil rights. Among other things, this meant that a woman could pursue economic and social activities without having to first seek the permission of her husband. The most notable political campaign that women undertook was their battle for enfranchisement. This was finally won in 1937 – three decades after men had won it. In many respects – and echoing other Asian countries at this time – the feminist movement was led by middle-class women. The Women Citizens’ League, for instance, was organized in 1928 by the first Filipina to graduate as a doctor of medicine, who was also the first woman to be awarded a chair at the University of the Philippines. Prominent men, too, often counted among the supporters of these women-led initiatives. Even the American Governor-General in 1918 was in favour of female suffrage. However, if the Philippines suffragette movement started out as a bourgeois phenomenon, it soon mobilized women of other classes. In other words, the suffragette battle was won through mass-based mobilization (Jayawardena 1986: 155–66). However, after the right to vote was won, women’s mass-based organizations did not move into collective action on broader social and economic issues in an effort to improve the position of women in the labour market, for instance, or affect the unequal distribution of income. Rather, the women’s movement became fragmented and schisms within it grew. Rural and urban poor women continued to campaign on issues like labour legislation, unemployment, income disparity and poverty, often making radical political demands, while women from the middle and landowning classes (like liberal feminists in the West) were more accepting of the status quo. For the latter, the Philippines social structure was seen to be just and legitimate; organizing themselves along professional lines, all they sought was political equality with men within the existing structure. Clearly, these class divisions served to lessen the overall impact of genderbased political demands: contributing, on the one hand, to the failure to shake up the prevailing distribution of economic power and wealth; weakening, on the other, the potential for mass-based women’s groups

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to challenge the position of women in the labour market, and in the development process as a whole. As far as state structure and policy are concerned, the Philippines differs substantially from the two previous cases. It does not fit the model of an interventionist state (like Taiwan), nor does the state take a minimalist approach (as in the case of Indonesia). Particularly during the Marcos regime, the state was heavily involved in the economy. But this interventionism did little more than serve the interests of a set of crony capitalists close to the regime; unlike Taiwan, there was no larger ideological-economic goal. What the case of the Philippines illustrates is that it is not enough simply to have the state involved in the economy. Rather, it is the specific nature of the involvement that is all-important. Furthermore, the state structure in the Philippines, although autocratic, contrasted with that of Taiwan in that it was incapable of exerting real control over the society. Many parts of the Philippines were (and continue to be) run by guerrilla groups, the most notable of which is the New People’s Army (NPA). Those zones – regardless of their official status in relation to the state – have evolved into self-governed quasi-states in which the guerrilla groups have their own army, taxation systems, and social welfare programmes. Since the state in the Philippines has, by and large, been unable (or perhaps unwilling) to implement a sound development strategy, simple categorizations do not apply to this case. In the early post-war years, for instance, there was a flirtation with import substitution, but it amounted to very little. During the long and notorious regime of Ferdinand Marcos, efforts were made to promote exports, but the results were inconsistent and a failure, even when considered in the context of Taiwan. Subsequently the country has gone through a series of drastic structural adjustments that include privatization, liberalization, currency devaluation and the downsizing of the state structure. These have created massive poverty and an unequal distribution of wealth, which in turn have fed political dissent and separatist insurgencies – a pattern reminiscent of Indonesia. In part because of the weakness of state policy, women’s contribution to the formal economy has been smaller than in Taiwan, where women’s direct labour was crucial to that country’s take-off. This applies both to the latter period in the Philippines, when there was a deliberate withdrawal from economic regulation on the part of

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the state, and to the earlier period, when the state was supposedly more actively involved. In the absence of any real commitment from the state to integrate women into the formal labour market, women have had to seek work elsewhere. The emphasis in this chapter is thus on women’s indirect contribution to the Filipino economy.

Modern Filipino state structure and development strategy At the end of the Second World War, a US-dominated military regime ‘headed up’ by a token Filipino president was restored. In 1946 the country was formally granted independence under conditions that assured the continuation of US political and economic interests (Goodno 1991). A new president, bolstered by US financial and military aid, committed the country to counterinsurgency against the Huk movement (Kerkuliet 1997: 151) – a group of guerrillas who had opposed the Japanese presence in their country, and also opposed the restoration of American control. Although this president died shortly after assuming office, his successor continued with the same policy. In 1947 a Military Base and Military Assistance Agreement was signed with the US, which further strengthened the American hold on the Philippines (Crouch 1984; Islam and Chaudhury 1999: 241). This post-war US presence took various forms. The most obvious was military, in terms of both setting up major bases and providing counterinsurgency assistance. But the US was also active politically, mainly through an alliance of American agribusiness interests and the indigenous landowning class (Islam and Chaudhury 1999: 241). During the post-independence era the Filipino economy continued to be dominated by a number of export-oriented agribusiness interests, often referred to as the sugar bloc (Haggard 1995). This orientation was further entrenched after the Cuban revolution, when the US shifted the former Cuban sugar quota to Nicaragua and the Philippines. These two forms of American control – military and political – also reinforced each other indirectly (Bowie and Unger 1997). The large plantation owners had a history of brutal exploitation of the local farmers, for instance, and it was the latter who tended to support the Huk rebels. Although the Huk insurgency never attained its

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objectives, it is also true that the government failed to gain any real political legitimacy and/or to earn the trust of the bulk of the rural population. In 1951 a US–Philippines mutual defence treaty was signed as a prelude to intensification of the counterinsurgency campaign. By 1954, and backed by a new Filipino secretary, Ramon Magasysay, the rebellion was brought under control. Having earned the gratitude of the US, Magasysay went on to win the presidency. Under his regime and that of his successor, the status quo was maintained and the politico-economic power of the sugar bloc became firmly entrenched. With the victory of Diasado Macapagal in 1961, it seemed that a shift had taken place with regard to economic and political development. In reality, though, it was less significant than it had originally appeared. That said, the Macapagal victory can be seen as the first real manifestation of a growing frustration among the industrial élite over the direction being taken by the country’s export-oriented landowning class. In this light, Macapagal’s call for a government that would work for the good of the ‘common man’ seems to have been an attempt to mobilize the country’s nationalist forces, and to pit them against the old agrarian élite. Implicit in that appeal was a challenge to the structure of US–Philippines relations, which historically had been based on the preferential entry of products of the old landowning class into the US. Although Macapagal wrapped his campaign in rhetoric designed to appeal to the peasants and workers, the real beneficiaries of his proposed policy changes were the rising industrial élite (Islam and Chaudhury 1999: 241). Once in power, Macapagal challenged laws and regulations that protected the sugar bloc. In 1962 he negotiated an agreement with the IMF to remove import controls which the agrarian powers had used to block the inflow of machinery that would have modernized agriculture, whilst simultaneously urging the people to buy locally made manufactured goods. Still, he lacked the power to effect the transformation. In reality, he spent most of his time playing one set of interests off against another. The failure of his strategy paved the way for Ferdinand Marcos who, backed by US business interests, defeated Macapagal in the 1965 election. The Marcos regime lasted until 1986, making Marcos the first president to have stayed in office for more than one term. During that period, the economic strategy

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shifted from a rather erratic flirtation with certain aspects of import substitution towards a more export-oriented strategy. That said, the Filipino version of this latter strategy was weak compared to that of Taiwan or even Indonesia. At first Marcos, like his predecessor, played the nationalist card to gain the support of both an ever-more-powerful industrial class and the left. He broke with the long-ruling Liberal Party and established a party that was more nationalist in rhetoric. (It was even called the Nationalist Party.) Although the US was initially nervous about this new upstart party, Marcos quickly placated the Americans by involving the Philippines militarily in the Vietnam war, and by opening the economy to more ‘foreign’ (read American) intervention and control (Crouch 1984: 44; Goodno 1991). Nonetheless, during his several terms in office there was a substantial shift in the nature of economic power in the Philippines. Drawing on a combination of state resources, substantial loans from foreign commercial banks and international lending agencies, and infusions of US foreign and military aid, he restructured leading sectors of the economy, creating giant enterprises run by a new class of ‘old boy’s club’ cronies. Among the most important innovations during the period was the financial and commercial centralization of the sugar and coconut industries – a move that directly challenged the power and privileges of the old landowning élite. To further cement his rule Marcos established a strong army base, once again packing it with cronies, who accumulated huge wealth as a result of military contracts (Crouch 1984: 39; Hutchcroft 1998). However, changes were not nearly as deep-rooted as they appeared on the surface. In a sense, Marcos was more concerned with giving the impression of mounting a major challenge to the old agrarian class than actually doing so, going so far during the 1970s as to stage his own ‘green revolution’ based on land redistribution. The problem was that these land reforms were limited to the rice and corn farms, and did not touch on the really large holdings that were part of the sugar bloc. In addition, the farmers had to pay for the land that they were allocated, putting them in a difficult financial position. As a consequence, the peasants were left angry and disillusioned, and many joined a new rebellion launched by the NPA. Throughout the Marcos regime the NPA and other, mainly Islamic, groups exerted political and military pressure on the government. That provided

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Marcos with a pretext to declare martial law in 1972. It served, too, as both an excuse for further extensions of his power and a reason for the US to increase the flow of military aid (Goodno 1991; Hutchcroft 1998). To win further support among the major Western powers and Japan, Marcos opened the economy to foreign firms, giving foreigners the right to sit on the boards of directors of state corporations. He also established free trade zones. In response, the US extended its Military Bases Agreement until 1991. All of this served to guarantee Marcos’s re-election time after time. Nonetheless, the rapacity of his regime, the anger of the old agrarian élite, the concerns of international debtors and the fears of the Pentagon over his failure to make any progress against the New People’s Army, combined to unseat him from power in 1986. Following a popular revolt over the results of an election widely perceived to have been rigged, he left the country and Cory Aquino, widow of an assassinated opposition leader and a leading figure among the old sugar aristocracy, took power. The era of structural adjustment began (Bowie and Unger 1997). During his two-decade rule Marcos certainly enjoyed a great deal of power. Although there were important political weaknesses – some areas were firmly under guerrilla control and the old agrarian aristocracy remained estranged – he still managed, through using military emergency as a rationalization, to create a state potentially capable of taking a strong lead in the development process. However, ability and willingness are two quite different things. It was not only that the state under Marcos did not act as an interventionist state; the nature of his regime discredited the very notion of state interference in the economy. Privatization and liberalization became increasingly appealing as ways to deal with the state monopolies created to serve the political and financial interests of Marcos and his cronies (Hutchcroft 1998). Cory Aquino managed to mobilize support from the left and from other reformist groups. She brought a great deal of hope to the country, introducing liberal reforms and promising to abolish state monopolies. She was challenged both by the military, which attempted a number of coups, and by Marcos’s ‘old boy network’, who were eager to restore themselves to power. In short, her debts to the old agrarian class were called in, and her promises of popular

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reform went unfulfilled. The real significance of Cory Aquino’s term of presidency, however, lay in what she did for the country economically. After Marcos’s discrediting of the concept of state intervention, the idea of freeing the economy from the state appealed not only to the industrialists, but also to the general public. It was therefore not all that surprising that Cory Aquino went ahead and implemented many free market policies under the aegis of the IMF and World Bank. These same policies have continued under the regimes of her two successors. However, as is typical of the Philippines, these changes were more a matter of degree than of kind. Many of Marcos’s supporters maintained their holdings, and the old agrarian élite, though temporarily reinvested with some of their old power, was ultimately doomed as a result of changes in the world economy. All of this occurred while the new industrialist class that Marcos and his predecessor had encouraged continued to gain momentum. To some degree, the old tensions between the various groups have faded as the old agrarian élite begins to interact economically with the new industrialists. The most important long-term legacy of the Aquino era seems to be the impact that these structural adjustments will have – the adjustments that created a state that has reduced its social services, curtailed its regulatory activities, and laid the framework for the rapid economic growth based on private foreign investment in the 1990s. The steady reduction of social services since the end of the Marcos era and the impact of structural adjustment on income distribution and employment have both served to reactivate the main challenge to the state. Continuously existing guerrilla-controlled zones in rural areas date back to the late 1940s, a rebellion fuelled by poverty and economic disparity. One of the strongest of these guerrilla movements operates out of the island of Negros, where the decline in the demand for sugar has produced economic devastation to which the state has failed to respond adequately. Although there is no way of knowing just how extensive these guerrilla-controlled areas are, it is estimated that 63 of the 73 provinces are at least partly ruled by guerrilla groups, many of them belonging to the NPA. In addition to these NPAcontrolled zones, Muslim insurgents in the South are forming alliances to work towards independence (Crouch 1984: 43–6). In these zones armed civilians constitute ‘the military’ and party officials collect taxes, donations and membership fees. In fact, some

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Table 5.1 Phases of Filipino development strategy Prior to Marcos, 1946–65

Flirtation with import substitution

Marcos, 1965–86

Export promotion

Since Aquino, 1986 to now

Restructuring

of the mining and logging companies have been known to pay taxes to the NPA. In return, these groups organize schools, health clinics and other social programmes that the state fails to provide. Overall state expenditure in these areas is about half that of most other Asian developing countries (Timberman 1991: 338–9). The state has not been able to defeat the NPA or groups like it. This is because the state has not been prepared to deal with the chronic poverty that is prevalent in so many parts of the country, not to mention in Manila itself. Nor has the state been able to negotiate some kind of peace settlement. In fact, in more recent times these groups have attracted so much support in places like Mindanao that the state may well lose further control of the country (Bowie and Unger 1997: 103; Islam and Chaudhury 1999: 242). State economic strategy The Philippines went through three distinct stages of economic development that are closely tied to the nature of the political leadership at each respective time (Table 5.1). During the pre-Marcos stage, policies were geared loosely (and on the whole ineffectually) towards the idea of import substitution. The second stage roughly corresponds with the Marcos era. Particularly during the 1970s, and to the extent that the policy had any coherence, one might describe it as export promotion. The last stage, after Marcos’s downfall, was marked by market-oriented policies: privatization, deregulation, currency devaluation and structural adjustment. It is questionable whether the Philippines had any real importsubstitution period for three reasons. One is that, as indicated in Table 5.2, the traditional, colonial-era pattern of heavy reliance on

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Table 5.2 Manufacturing and agriculture as percentage of total exports Year

1970

1980

1990

2000

2001

Agriculture Manufactures exports

25.78 7.47

6.07 21.09

1.86 37.86

0.55 91.67

0.52 91.14

Source: World Bank 2004

agricultural products aimed at the export market continued. The sugar bloc wanted to safeguard its access to the American market and was, therefore, fairly internationalist in orientation. Second, in the absence of any real land reform prior to the 1970s, the old agrarian élite was sufficiently powerful to block all efforts to promote the domestic manufacturing of non-traditional goods (Hutchcroft 1998: 15–29; Horton et al. 1996: 224). Third, the fact that US economic aid was conditional on internal policies that would continue to assure US businesses a preferential position in the Philippines home market more or less ensured that US interests were put first. For example, the US had a guaranteed access to the Filipino market and its exports to the country were duty free. The peso was tied to the US dollar and, under the Bell Trade Relations Act, US citizens were given equal standing with the Filipinos when it came to the extraction of the Philippines’ natural resources (Islam and Chaudhury 1999: 241). Furthermore, American pressure exerted in 1962 forced the government to accept an IMF deal that called for the removal of import controls. For all of the above reasons, the whole notion of import substitution remained more rhetorical than real. In this respect, those who addressed the issue of economic nationalism – as exemplified in the winning candidate’s call, in the 1957 presidential election, for a ‘Filipino First’ policy – spoke to the frustration of the rising industrial class, but little was transformed into genuine policy (Pernia 1993: 164; Pineda-Ofreneo 1988: 103). This lack of political action was exacerbated by the unfair distribution of income. While the vast majority of Filipinos had little purchasing power, the wealthy élite snapped up foreign goods. In cases where the state did implement policies that should have led to import substitution, corruption all too often made the circumvention of import controls ridiculously easy (Montes 1990: 91).

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In other words, import substitution was more a vague notion than a serious political and economic commitment on the part of the government. This contrasts sharply with Taiwan where, even though the US was politically and militarily present, the state initiated a policy of economic autarky. As shown in Table 5.2, the period following Marcos’s arrival on the scene and his attempt to promote the export of manufactured goods was marked by a dramatic drop in agriculture’s share of total exports (Pernia 1993). It should be noted, however, that the decline in agriculture’s percentage share of overall exports does not automatically mean that non-traditional manufacturing grew, as in the case of Taiwan. Rather, it speaks to a higher level of processing within agricultural production itself. For instance, much of the increase in manufacturing’s share of the export market at the expense of agriculture’s share can be attributed to the replacement of coconuts with coconut oil. The overall growth of food processing had a similar impact, and explains in part why agriculture’s share of the total GDP stayed more or less the same from the 1960s until well into the Marcos era of export promotion, while manufactured exports rise so dramatically. The increase in manufacturing’s percentage share during this period of export promotion – and especially in the 1970s – is significant (rising from 7.47 in 1970 to 21.09 in 1980), and marks the beginning of the Philippines’ importance in such sectors as food processing, textiles and electronics (Islam and Chaudhury 1999: 244–5). As in Indonesia, mining and logging – which were becoming increasingly important to the economy during this period – were also considered to be part of ‘manufacturing’. However, though exports in this sector skyrocketed in the 1980s, the employment rate for both men and women did not rise accordingly.1 If this is reminiscent of Indonesia, it contrasts sharply with Taiwan, where the increase in manufactured products during that country’s export-promotion stage was matched by an increase in employment in manufacturing. The increase in manufacturing’s share of the export market is also clearly related to the expansion of the FTZs. During the period of export promotion Marcos granted tax havens to foreign investors, which meant that investment in these zones grew. Concentrated in Metropolitan Manila and Batan, the foreign companies in these zones produced not only garments and electronic goods, but also furniture,

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wood products, shoes and leather goods. FTZs have a history of employing great numbers of women at minimal salaries. Not only do companies in the zones churn out non-traditional manufactured goods for export, but agribusiness products destined for export are also produced, and may well be incorporated into manufacturing statistics rather than those pertaining to agriculture. (Prime examples of this kind of agribusiness are Dole and Del Monte, which began canning and processing operations in the Philippines during Marcos’s rule.) The 1980s heralded a period of restructuring. Faced with an economic crisis, successive post-Marcos governments went along with IMF and World Bank policies of devaluation, and allowed foreign ownership both outside and inside the zones to increase (Chant and McIlwaine 1995: 62; Bello 1988: 18). The Aquino regime further implemented privatization programmes – selling off government-controlled or government-owned corporations to the private business sector – and engaged in a policy of deregulation (reducing restrictions on bank lending and investment, for example). In addition, deregulation of labour laws helped produce a flexible job structure that became an important factor in the cost competitiveness of tradable goods (Lim 1993). These measures attracted foreign firms and investors, which led to a further increase in the manufacturing sector’s share of exports. It would be misleading to argue that the Philippines has enjoyed the same type of sustainable industrialization as Taiwan. It has relied on foreign investment and technology, particularly from neighbouring countries such as Taiwan, but such investment has not generated a ‘trickle-down’ effect on employment. On the contrary, and despite overall per capita income growth in the 1990s, underand unemployment remain widespread among men and women, and in urban and rural areas alike.2 Even into the 1990s, approximately half of the country’s 66 million people were still making their living through agriculture and fishing (Pernia 1993). Moreover, unemployment in the countryside has exacerbated unemployment in the urban areas, as many migrate to cities or, in the absence of jobs in the cities, to other countries. In fact, migration has become an important factor in the Philippines economy, with the percentage of female migrants increasingly exceeding that of male migrants.

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Women’s role in the economy In general the agricultural sector as a percentage of GDP has been in decline since the 1950s. Nonetheless it continues to a source of employment for many. However, employment in agriculture has remained mainly male: the share of women has declined and the absolute number of women employed remains low. This overall low rate of employment of women is not typical of the rest of Asia. It is, however, quite typical of Latin American countries, which, of course, share a common colonial history (Spanish and American) with the Philippines. In Latin American countries the female working population constitutes about half of the labour force in manufacturing and services but only a quarter of that in agriculture (Table 5.3 and Figure 5.1). In the Philippines, the gender pattern of agricultural employment, the mode of production and the choice of crops, with an emphasis on export crops, reflects the colonial legacy (Sidel 1997: 948). For a long period of time, land remained (and remains) controlled by a set of large, quasi-aristocratic landlords. In the case of sugar, the most important crop, production takes place in haciendas where traditionally men have been employed as plantation workers. Their women and children work as auxiliaries to the men, as members of the patriarchal household rather than as workers in their own right, and usually in peak season. Although the family really works as a collective, in a cooperative way, women are mainly unpaid – the wage is given to the men (Eviota 1992). One recent survey showed that one third of the labour force in sugar production was female, but that they were mainly wives and daughters of resident and casual workers. When women work as daughters or wives of male workers, rather than in their own right, their labour is often unrecorded since it is usually unpaid labour. This could explain to some extent the low level of female employment in this sector. In those relatively few instances where women are paid in their own right, they work in ‘lighter’ tasks at lower pay (Horton et al. 1996: 103). There has been a steady increase in female employment in agribusiness. Marcos had encouraged transnational firms to invest in agriculture, in both basic food crops and more luxurious fruits for export. As in the export-oriented manufacturing sector, agribusiness

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Table 5.3 Female employment ratio by sector % of female Labour Total Agriculture Industry Services

1980

1990

1995

2000

35 37 15 48

37 31 13 56

37 31 13 56

38 27 13 61

Source: World Bank 2004

Figure 5.1 Female employment ratio by sector Source: World Bank 2004

MNCs were established in FTZs. As the volume of agribusiness activities increased, so did the share of female labour. As agriculture in the countryside stagnated, more women sought work in these FTZs. In turn the low wages paid to women attracted more foreign investment into the FTZs. During the Marcos era’s export-promotion drive, resources shifted from manufacturing for the internal market to manufacturing for the external one. Many FTZs were established, mainly around Metro Manila and Batan. In them foreign companies have produced mainly garments, textiles and electronics, with some furniture, wood products, shoes and leather goods in the Batan zone (Kurian 1992: 1587–8).

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In both Metro Manila and Batan electrical machinery and electronic components have showed the greatest growth (Tidalgo 1988: 163; Hutchison 1992: 471–89). By 1991 electronics made up 10 per cent of all exports (excluding tourism), generating $US1.75 billion in 1991 alone (Chant and McIlwaine 1995: 61). Other manufacturing sectors that increased substantially were food, beverages and tobacco, textiles, clothing and footwear, wood and furniture, paper, printing, and chemicals. However, semi-conductors and garments have constituted the largest share of export of manufactured goods since the late 1980s. The bulk of companies producing microelectronics have been foreign, attracted to the Philippines mainly by its cheap labour (Chant and McIlwaine 1995: 61). Interestingly, it seems that the higher the growth rate of the sector, the greater the share of females in total employment. Semi-conductors and electronics have the highest proportion (Islam and Chaudhury 1999: 245). But women also constitute the majority of workers in tobacco, textiles, wearing apparel, leather, footwear, electrical machinery, and professional and scientific equipment. Opportunities for women in the FTZs are directly related to the low wages prevailing in the economy. The average wage in the Philippines is much lower than in other countries of the region like Malaysia, Indonesia and Thailand (O’Conner 1987: 122–3). And, of course, since women get even lower average wages than men, the more women available for employment in the FTZs, the greater their attraction to outside investors, and the greater the evident success of the export-promotion strategy (World Bank 1997a). The proportion of women workers in the FTZs has been recorded as a high 85 per cent. A 1980 survey of working conditions in Batan indicated that 40 per cent of women received less than minimum wages compared to 17 per cent of male workers (Heyzer 1986: 42; Horton et al. 1996: 269). Apart from the ability of the FTZs to attract surplus rural female labour, women’s wages have been kept low by a number of other factors. One is the fact that the state imposed restrictions on the formation and activities of labour unions, both inside and outside the FTZs (Horton et al. 1996: 254). The suppression of unions – along with other forms of dissent – was particularly successful after the imposition of martial law in 1972. US military aid to the Philippines therefore also had an indirect but important role in assuring the supply of cheap labour to the FTZs.

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Moreover, deregulation has meant less legislative control over production processes, which in turn meant less invested in improving labour conditions or assuring fringe benefits that had formerly been guaranteed through legislation. Unionization efforts were further discouraged in the FTZs by the threat from foreign firms that they would shift elsewhere. As a result, not only have attempts at labour organization with a view to improving wages and working conditions been largely a failure, but observers insist that the situation of workers in terms of wage rates and working conditions has actually deteriorated (Lim 1993: 204). Many companies in the FTZs have their own ways of keeping female labour under control. For example many have created a ‘family’ atmosphere – the factory is portrayed as a kind of family, with managers as father figures and male supervisors as brothers who then impose discipline. Discipline and hard work is combined with selfindulgence in recreation, such as beauty queen shows organized by factory managers (Lim 1987). As recreation and social life become tied to factory work, there is little room for outside activities. Another factor contributing to the maintenance of low wages is the propensity by employers to ensure that most of their female labourers are young and single. Not only are they easier to exploit, but they also have higher productivity. They are particularly favoured because of their visual acuity, dexterity and docility. Many of these young women are sent by their families in the impoverished rural areas to work in FTZs to fulfil their filial obligation. Since their incomes are essential for family survival, they are all the less likely to protest against conditions (Pineda-Ofreneo 1988: 104). These female workers are employed as long as their vision and health allows. The companies can dismiss their workers when their vision has blurred and they can no longer meet production quotas. The companies pay no compensation or retirement benefits, and the women leave without any skill easily saleable elsewhere. In addition their health may be impaired by exposure to toxic chemicals. Electronics is regarded as particularly high-risk work but companies are never responsible for any kind of work-related damage (Lim 1993: 175). The recent trend towards deregulation and privatization both inside and outside the zones has brought wages down further with a resulting further drop in production cost (Chant and McIlwaine

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Table 5.4 Ratio of women to total workers in service sector by occupation Occupation

1960

1970

1975

1986

Professional Administrative Clerical Sales Service

51.1 14.5 23 50.7 66.1

56.8 28.5 37.9 56.9 66

59.3 20.9 41.7 51.6 62.4

66.3 21.4 52.2 67.3 59.4

Sources: ILO, Yearbook of Labour Statistics for 1960, 1970, 1975; NEDA, Philippine Statistical Yearbook 1989.

1995: 62). That effect is reinforced by other measures such as substituting part-time or temporary for full-time workers, or subcontracting to small and informal enterprises (Pineda-Ofreneo 1981). The result is to further cut, if not completely eliminate, whatever various fringe benefits and unemployment benefits might have existed, and to reduce even further the opportunities for union action. Subcontracting is particularly attractive to the companies since it makes it easier to throw the burden of any economic downturn onto the labour force. Subcontracting is widespread in industries with particularly high female employment such as electronics, clothing and footwear (Pineda-Ofreneo 1988: 158–64; Lim 1993: 204–5; Chant and McIlwaine 1995: 24). In this respect the Philippines has been very much like Indonesia, with the possible difference that the conditions are even worse than in Indonesia since the state in Indonesia provides more welfare measures than it does in the Philippines. The service sector recruits the greatest share of female labour (Table 5.4). Employment in this sector, however, has a very different pattern from both agriculture and manufacturing. The agricultural sector employs low-income women from the rural areas. The manufacturing sector draws its workers from both rural and urban lowincome groups. The service sector, by contrast, draws on women from both urban and rural low-income households and on middleclass urban women. I shall deal first with middle-class women in the urban areas. At the top of the female job ladder are educated women employed in professional and administrative jobs. In fact, the percentage of women

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in professional and administrative jobs is higher than in other countries in the region (UNDP 1999). There is another category of well-paid middle-class women, those in trade and commerce. These women predominantly remain in ‘feminine’ tasks – food processing, restaurants and pastry shops, clothing and such female-oriented services as modelling schools, song and dance studios, sewing schools, personality academies and craft shops. Middle-class women in the Philippines, as in other parts of the world, tend to spend their income on such items as private education for their family. However, the largest group of women in the middle-class service sector is that made up of teachers, nurses and clerical workers. The Philippines has for a long time benefited from women in these jobs, with low wages. In practice the state has been able to offer education and health as part of its welfare programmes because of teachers and nurses who are poorly paid compared to male professional employees. These women not only subsidize welfare for the country as a whole, but, as in other places in the world, increase the income of lower middle-class households, therefore helping to create and maintain a middle class. This is economically and socially important in a country with huge income disparities. As far as the women from low-income households are concerned, they work in trade and sales as well as hotels and restaurants. However, the official number of women in these jobs does not capture the actual numbers, since a great many of such services fall into the category of the informal economy. Even though the official numbers underrepresent the true numbers, there are still large numbers of women in these jobs. As poverty increases and structural adjustment hurts those at the bottom of the social ladder, the number of women who work as sales waitresses, cleaners, petty traders and peddlers, as well as maids and prostitutes, are on the rise.1 With 27 per cent of the Philippines population living on one dollar a day (UNDP 1999: 146) many women are driven into the informal economy, where they can create their own employment. In fact, the government has been aware of the importance of the role of women in poverty alleviation and their activities in the domain of trade. Since the 1980s the state has created an infrastructure to facilitate the burgeoning formal and informal trade sector by allocating sites for mobile markets and simplifying licensing procedures

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(Lim 1993). There has also been an increase in the number of night markets/bazaars (pasaar malam), a phenomenon spreading throughout the region. Pay in the petty trade formal or informal economy is very low and women in informal trade are worse off than maids (Sassen 1983; 1984). Maids are another category of the service sector that has a huge pull on female labour. These women, usually young, migrate into the cities to generate an income for their impoverished families in the countryside. In fact, domestic service continues to be a large recruiter of women – two out of three workers in domestic service, according to the National Census and Statistics Office in a 1978 survey, were women, and one out of five women workers were maids (Kwitko 1996). Apart from domestic services, prostitution either inside the country or outside is a prominent occupational ‘choice’ for rural women from low-income backgrounds. Whether working in the urban areas or abroad, these women remit a large part of their earnings to their families. Since prostitution is supposedly illegal in the Philippines (though the government has, in certain periods, actively promoted it), the exact numbers are hard to obtain. But it is estimated that female sex workers number 500,000 (estimates of their share of GDP run from 2 per cent to 14 per cent and are therefore of low credibility) (Lim 1998: 7; Pineda-Ofreneo 1988: 118). Apart from their contribution to their families’ incomes, sex workers support other occupations – from pimps to taxi drivers (Lim 1998: 5). These women also benefit hotels and restaurants, and all the institutions of the tourism sector. However, the role of rural women in the tourist and hospitality sectors goes beyond prostitution. They can also be found as barbershop girls, massage girls, hostesses in Japanese lounges or Karaoke bars and working in escort services (ILO 1998). The tourist industry has thrived on the image that Filipinas are more subservient, and therefore eager to serve, compared to Western women (Lim 1993: 190; Lim 1987). The reasons for the remarkably high proportion of Filipinas in the prostitution and hospitality sector are rooted in the country’s relations with the US. For many years it was host to a very large American military presence, around which the modern hospitality sector originally took shape. It began with economic bases, the largest

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being in Asia, increased briefly during the Korean War, then greatly accelerated during the Vietnam War (Astorga-Garcia 1989: 38; Hosoda 1996: 166). At their peak during the Vietnam War, the American bases held up to 70,000 soldiers and 10,000 sailors. Nor was this simply an underground phenomenon. On the contrary, prostitutes, some as young as 12, were registered and had to pay taxes to the state. During that time the American military supported the creation of 137 Offices of Social Hygiene to certify prostitutes – that ensured control of diseases, smooth delivery of service and the ability of the state to collect taxes (Pineda-Ofreneo 1988: 118). Even after the Vietnam War, the state remained an important beneficiary of the industry. In 1979 it set up the Bureau of Women and Minors at the Ministry of Labour, one of whose functions was to educate prostitutes (though not in so many words) on how to be cooperative and genteel to clients. It produced a Self-Development Guide for Women Workers in the Entertainment Industry which stated: ‘Be loyal to your employer’ and ended with the advice, ‘Your work, more than any kind of work is full of hazards and temptation. Always look up to the Almighty for help and guidance’ (Eviota 1992: 139). Nor did the end of the wars in Southeast Asia end the American military demand. In 1991, the year that American bases were finally closed, 615 registered rest and recreation (R&R) centres employed 11,600 registered women as entertainers and twice as many as unregistered workers (Pineda-Ofreneo 1988: 102).2 Undoubtedly prostitutes figured prominently among them. However, by then it was the civilian market that was by far the most important. Men from other countries come to the Philippines for sex tourism. The Japanese have had the highest proportion (29 per cent) followed by Australians, Americans and Europeans. There are now direct flights linking Japan to Cebu Island (Pineda-Ofreneo 1988: 108; Chant and McIlwaine 1995: 82–129; 172–256). It has been estimated that up to two thirds of males who fly to that destination are on sex tours, compared to about 2 per cent who travel for business purposes. A more refined form of prostitution is comprised of ‘hospitality women’. This is a relatively small but fast-growing sector (PinedaOfreneo 98: 103). Hospitality women are the only ones that have formal employment status and are officially recognized under labour law as workers. They are therefore the only ones that carry valid health cards in bars, nightclubs or massage parlours (Lim 1998: 5).

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One reason for the general increase in the number of sex workers is the fact that the trade pays better than other service jobs that fall into the category of professional work. As far back as 1973, a survey found that many of the women working as massage girls were former teachers and nurses. Many of these women, of course, were (and are) heads of single-parent households.3 As poverty has increased more women are prone to take up the job of sex worker for several reasons. Rural women with no training have few options beyond being domestic or sex workers. And urban women who do have some training choose the sex trade because of desperately low pay in more respectable professions. Although it is important for other ASEAN countries, including Indonesia, the phenomenon of the migrant worker plays a particularly important and, over much of the last three decades, an increasing role in the Philippines. These migrant workers make an important contribution on several levels. Most directly they send between 30 and 70 per cent of their income home. In the ten-year period 1985–94, a total of 5,254,000, or a yearly average of more than half a million Filipinos, were deployed overseas as contract workers. It is estimated that they have contributed US$19 billion to the Philippines economy, an average of close to a billion dollars each year. Migrant workers also contribute to the economy by paying taxes as well as consular and passport fees. Within the ranks of migrant workers, women, whose professions range from nurses and doctors to domestic and entertainment workers, played an increasing role (Islam and Chaudhury 1999; Kwitko 1996: 108–50; Rivera 1996: 34). Table 5.5 illustrates the increase in the number of Filipino women working abroad. This process of ‘feminization’ of out-migration started in the mid-1960s–early 1970s with emigration of health service workers, and continued to increase thereafter. Of an estimated 7,500 professionals who left yearly, about four out of ten were nurses during the 1960s and 1970s. From the mid-1970s an average of one out of six professional or technical workers who migrated have been female, while the national average for female professional and technical workers was one out of every twenty. Although other professions became more prominent, the high foreign demand for Filipino nurses continued, particularly from American hospitals. By 1988 nurses working abroad outnumbered

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Table 5.5 Filipinos residing abroad, 1981–94 (in thousands) Year

Women

Men

Total

1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994

28,517 32,201 24,665 24,581 26,860 28,930 32,429 33,424 32,914 37,484 37,863 39,035 40,165 38,353

20,350 31,752 17,816 16,970 18,409 20,408 23,921 24,642 22,789 25,424 24,808 25,137 26,248 26,184

48,867 63,953 42,481 41,551 45,269 49,338 56,350 58,066 55,703 63,208 62,671 64,172 66,413 64,537

Total

457,721

314,858

772,579

Source of basic data: Commission on Filipinos Overseas

those in the country. In addition to nurses, teachers, midwives, secretaries and clerks figure prominently in the category of skilled female out-migrants. Since the 1980s the relative number of ‘unskilled’ migrant workers has also increased. This, however, is a bit illusory – the ‘unskilled’ migrant female workers are not necessarily unskilled. Teachers and nurses migrate abroad as domestic helpers since they earn more money in other countries than they would at home.4 There has been a particularly active market for Filipino domestic workers since the 1980s and 1990s in Hong Kong, Singapore and Malaysia as well as in the Middle East and certain European countries (Fawcett 1984; Chant and McIlwaine 1995: 43). In Kuwait approximately 2 out of 3 domestic helpers are Filipinas: they have effectively replaced Turks and women from other Mediterranean regions. Along with domestic work, an increasing number of women enter the migrant labour force as entertainment workers, a category largely restricted to women under 23 years. In fact those in this category may

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Table 5.6 Domestic servant work permits issued by local emigration department Year:

1985

1986

1987

1988

1989

1990

1991

No. of permits:

3,743

60

2,902

534

1,158

5,340

6,460

Source: Chin 1999: 105

well outnumber domestics. Although the data are sometimes unclear, it seems that since the mid-1980s close to half the emigrating female workers have left the country as artists and entertainers (often prostitutes) (Hosoda 1996: 163–77). There is another, sometimes overlapping category of women who migrate as brides. The primary destinations have been Australia, Western Europe especially Germany and the US. Within this category there are certain ‘growth markets’ – Australia and Britain have been topping the list of destinations for mail-order brides in the last two decades. In many instances the category shades into prostitution, both voluntary and involuntary (Hosoda 1996: 166). Today there are many bureaus for mail-order brides in Metro Manila, some of which are fronts for sending prostitutes to other countries, Japan prominently among them. In almost all cases the motive for emigration is to help one’s family (Chant and McIlwaine 1995: 32). In some cases a father will decide that his daughter will emigrate. Given the tradition of filial obligation, it is expected that emigrant daughters will provide more help in the form of remittances than sons (Chant and McIlwaine 1995: 32–3). As in the case of Taiwan, repayment of obligations to parents is deeply rooted in cultural values. And the migration of daughters is viewed as a temporary sojourn, with the main aim of remittances to permit their families back home to remain as a unit (Lim 1993: 200). The migrant worker’s remittances are extremely important as a source of foreign exchange and of domestic demand. However, since the bulk of remittances return through black market channels to evade taxes, it is difficult to get accurate estimates of just how large they are. Furthermore, migration of both legal and illegal sector workers is an indicator of a deterioration of the economic and social position of women in the Philippines.

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Figure 5.2 Female employment ratio and total fertility rate Source: World Bank 2004

Invisible economic contributions As in the case of Indonesia, because of lack of reliable data on the Philippines, there was little to be gained by running a regression analysis of the impact of the female employment ratio on infant mortality, life expectancy and educational indicators. Poor data quality is partly due to the fact that much of the increase in female employment has occurred in the informal rather than the formal economy. The Philippines has one of the highest total fertility rates in Asia. In the Philippines 60 per cent of the population is under the age of 20 and the average family size is 5.7. Under Marcos the government established the National Population Commission (POPCOM) in an attempt to bring down the total fertility rate (Dixon-Muller and Germain 1994). His government also limited maternity benefits to the first four children and set up free family planning services. With his downfall and subsequent cutbacks due to structural adjustment policies, free family planning services and other measures have been slashed dramatically. The number of female population control workers fell from around 10,000 to only 200 under Aquino (Chant and McIlwaine 1995: 67).

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In the Philippines, unlike Muslim Indonesia, there was an added complication from the power of the Catholic Church. Marcos was able to persuade the Church to stifle its criticism of his decision to eliminate the ban on contraceptives, but abortion has remained illegal unless to save the mother – abortion is still murder and practitioners, like drug traffickers, face life imprisonment. Other factors beyond the active role of the state and the passive, partial acquiescence of the Church have contributed to the slow decline of the total fertility rate. Unlike Taiwan, where women’s participation has increased in the formal labour force, in the Philippines women’s participation has increased much more in the informal economy. There their pay is low. Under conditions of poverty, children are regarded as a source of income. In fact, the rate of child labour in the Philippines has been among the highest in the region. Furthermore, the informal economy mobilizes the extended family network to make work and child rearing more compatible. This is in contrast to Taiwan, where women have had to rely on day-care centres to permit them to work in the formal economy. Despite this, the total fertility rate has declined as the female employment ratio has increased. However the decline has been relatively slow, paralleling the relatively slow increase in the female employment ratio. This is shown in Figure 5.2. With respect to the relationship between the female employment ratio and infant mortality and life expectancy, Figure 5.3 shows a much stronger relationship than was the case with the fertility rate. Female employment rises dramatically until the mid-1980s, then fluctuates around a relatively stable level. Infant mortality drops sharply until the 1990s, then continues down but at a much slower rate. Life expectancy follows the increase in the female employment ratio upwards until the mid-1980s, then continues to increase marginally. As far as education is concerned the level of total education in the Philippines has been high compared to its neighbours, a reflection of American colonial policy and the active role of the Catholic Church. The state spends a large proportion of the budget on education, even more than on health, for example. In 1990 education took up 14 per cent of the national budget while the corresponding share of health in the same year was 3.2 per cent (Chant and McIlwaine 1995: 69).5 And the Church still runs 38 per cent of secondary education.

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Figure 5.3 Female employment ratio, infant mortality and life expectancy Source: World Bank 2004

As Figure 5.4 shows, illiteracy in the Philippines was always fairly low, the result of a commitment by the American colonial authorities to education, something which the Church also supported before and after independence. Nonetheless the illiteracy rate shows a definite downward trend while primary education rises. Volunteer work and gender politics As in Taiwan and Indonesia, in the Philippines women’s volunteer work has had a very high profile, deliberately encouraged by government action. In 1975, partly in response to the declaration of the International Decade on Women, Marcos created the National Commission on the Role of Filipino Women (NCRFW), headed by Imelda Marcos. At least in rhetoric, NCRFW’s objective was to work towards the full social, economic, political and cultural integration of women at the regional, national and international levels on a basis of equality with men. Some measures were actually taken to advance equality for women. For instance, under the auspices of NCRFW, the Department of Labour and Employment set up a Bureau of Women and

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Figure 5.4: Female employment ratio and educational attainment Source: World Bank 2004

Minors, which theoretically looks after the protection and welfare of women workers. The Department of Social Welfare and Development adapted measures to prevent and eradicate the exploitation of women in any form, including prostitution. It also ran programmes to promote the acquisition of skills by the unemployed (Horton et al. 1996: 266–7). However, the NCRFW also had another role, which was carrying out state policies. Particularly during the Marcos era, the state used NCRFW both as a showcase for international organizations and donor agencies and as a policy implementation tool. As with the PKK in Indonesia or Motherhood Workshops in Taiwan, leadership was vested in women from wealthier and more educated backgrounds, and its operation reflected more their class than their gender interest (Heyzer 1986: 145). One of its principal roles was to implement state policies on population control by mobilizing women to run birth control information programmes and distribute contraceptives. Other than official groups, many women throughout the Philippines have set up non-governmental organizations to provide for the needs of their community. But these groups have been kept under

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state control; as a result women’s groups critical of the state are much more active outside of the Philippines than inside. The Philippine female migrant workers have some of the strongest and high-profile migrant worker organizations in the world. These groups campaign at an international level: for example, the International Filipino Migrant Workers Association (PINAY) has forged alliances with women’s groups in the US as well as Canada, and campaigns on issues beyond workers’ rights, including other problems faced by migrant women such as violence against women. In general, however, women’s organizations from inside the country or outside have been able to bring little change to women in the Philippines. Compared to Taiwan and to some extent Indonesia, there has been much less attempt on the part of the state to mobilize women in policy implementation. On the contrary, much of the energy of women’s organizations has been directed at the lack of state action on social programmes in rural and urban areas. Women’s organizations such as the National Federation of Peasant Women (AMIHAN) have become particularly active in those areas where poverty, greatly exacerbated by structural adjustment programmes, has been worst. Along with other civil and political organizations, they have effectively replaced the state in providing for social welfare needs. Together with urban-based organizations such as GABRIELA (‘General Assembly Binding Women for Reforms, Integrity, Liberty and Action’), these women’s groups are putting a great deal of effort into setting up schools, day-care centres and health clinics. (They are also effective in promoting income-generating activities through initiatives to set up credit and consumer goods cooperatives.) To replace state-based programmes run by the public services, these organizations rely on kinship, friendship and church networks, what McGovern calls chain mobilization by people already known and trusted in the community to initiate and run social welfare programmes (Lindio-McGovern 1997: 82). However, in some regions effective functioning also requires cooperation with the guerrilla groups. That has made them occasional targets of the state security apparatus and the military. Starting in the martial law era, key personnel in these women’s organizations have been killed, imprisoned, or forced to go underground. Although since the mid-1980s there has been a revival of women’s organizations, they have had to overcome great obstacles and remain

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fragmented compared to their counterparts in Taiwan or Indonesia. Therefore they have not succeeded in making meaningful changes either to the laws or politics of the country. It is true that when Aquino came into power there was constitutional change to assure equality before the law for women (Article II, Section 14) (Quisumbing 1990: 43–54), but in the face of the state so dramatically withdrawing from economic regulation, even a constitutional change means little. The military and the paramilitary groups supported by the army continue to be powerful in the rural regions where women’s organizations are a very important source of support for the poor. And they continue to target women’s organizations, accusing them of being communists or fronts for the New People’s Army. NOTES 1 The 1984-5 economic crisis is a good example of a sudden increase in the number of women in services – to 6.9 per cent for women as compared to 3.8 per cent for men (Heyzer 1986). 2 There are now many Amerasian children as a result of the American military presence and since the late 1970s this new mestizo generation in themselves are in high demand for prostitution. 3 In 1979 prostitutes in Manila reported average earnings of $7 to $10 a day, which was then not only higher than the minimum wage but more than earnings of a factory operator or a sales clerk (Eviota 1992). 4 They earn close to six times what they would earn in the Philippines if they are practising their professions as physicians, nurses, medical personnel, engineers, scientists and teachers, and 20 times more as domestic helps. 5 One of the main reasons for the high educational level, however, is that women are relatively more highly educated than in many other countries. In fact, there has been little difference in the literacy rate between men and women or between urban and rural people (Eviota: 1992: 94). The percentages for male literacy are 89.0 and for female literacy 87.5. Further, women have a much higher proportion of the age group enrolled in secondary education than either Malaysia or Thailand (both of which have higher GDPs) (Horton et al. 1996: 245). This high educational level is matched by the high profile of women in civil service positions compared to all the neighbouring countries; in fact, females are in a slight majority in civil service professions (Horton et al. 1996).

6 Conclusion: Liberalization in Crisis

The policy of market liberalization imposed by the two major international financial institutions, the World Bank and the IMF, continues to exacerbate the problem of global poverty and income disparity. It takes its toll on the most vulnerable members of society: women and children. The situation will continue to worsen and poverty is likely to escalate, both in relative and absolute terms, as many states throughout the South are forced to adopt free market policies and reduce their welfare programmes. Ever-increasing profits are the name of the game in the global economy, and within this framework there is little concern for the growing number of people trying to eke out an existence on less-than-living wages. This book has focused primarily on Southeast Asia, a region from which advocates of neo-liberalism have frequently drawn empirical evidence in order to prove the validity of their theory. True enough, comparative trend analyses have shown that of all the regions in the South (this includes Latin America and the Caribbean, South Asia, the Middle East, North Africa and sub-Saharan Africa), Southeast Asia has had the highest growth of GNP per capita and female employment in the post-Second World War era.

Challenging neo-liberalist assumptions That said, the in-depth examination undertaken in this book of three 172

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countries in the Southeast Asian region – Taiwan, Indonesia and the Philippines – provides important insights and data that challenge neo-liberal theoretical assumptions. For instance, advocates of neoliberalism argue that free trade has been the main factor underlying the economic success of the Southeast Asian ‘miracle’ countries (Taiwan, South Korea, Hong Kong and Singapore). However, our analysis of Taiwan’s economic success showed that far from being attributable to free trade, it was the interventionist Taiwanese state that was the key to its success. In most cases it was the state that initiated projects, provided funding and technical assistance to see them through, and then went on to market the final product. The state tended to support small- to medium-sized firms producing manufactured goods that were designed for export, and that could be sold at very low prices. Furthermore, the state guaranteed low production costs by using Taiwanese women as a cheap source of labour. It is this huge pool of cheap female labour that has made Taiwan’s manufactured goods highly competitive on the world market, and allowed the country to benefit from the resulting expansion of trade. This book went on to show how Taiwanese women’s significant contribution to their country’s economic success was not limited to their low wages, but was equally the result of the tenuous nature of their employment. Female workers are treated as a flexible labour supply: they tend to be hired and fired according to the needs of the market. In times of economic recession – during the early 1970s, for example – women were sent home from the factories. They were only reinstated when the economy had recovered. The state took steps to secure this flexible workforce through the creation of various government programmes, some of which were run by the women themselves. In the case of the Living Rooms as Factories programme, for instance, the state encouraged women – especially married women – to turn their living rooms into factories. Maximum flexibility was then ensured through having these women take on contract work in the home, rather than full-time jobs outside of it. Another benefit to the economy was that factory production costs were reduced, through state programmes that transferred production from factories into households. This meant that some of the responsibility for machinery maintenance had been shifted onto individual households. At the same time – and in spite of these added

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responsibilities – the state reinforced traditional female gender roles by providing programmes that taught women ‘feminine’ skills like the ‘dos’ and ‘don’ts’ of etiquette, make-up application and dancing, as well as how best to cook fast and nutritious meals. Some of these programmes continued into the 1990s, even though the initial push to promote the export of manufactured goods outside of Taiwan and industrialization within it had passed, and there was no longer a huge demand for female labour. Using female workers as a source of cheap labour was a policy that became popular in other countries in the region in the 1970s and 1980s, with both Indonesia and the Philippines following Taiwan’s lead. In each case, indirect benefits have accrued as a result of hiring females, and these have had an impact on the economy that goes beyond these women’s productive role as workers. For example, bringing more women into the workforce has led to a decline in the birth rate. Keeping birth rates low has been a major challenge for many countries in the South, as well as for national and international development agencies. A quantitative analysis conducted with regard to these three cases corroborated the findings of other analyses suggesting that rising female employment leads to a corresponding decline in births. This was especially evident in the case of Taiwan, where the state took the initiative of providing family planning to women employed in the formal economy. Another indirect benefit of women’s employment in the labour force has been an improved standard of living for many families in these countries. This is because women spend much more of their income on their families than men. Findings of a quantitative analysis suggest that, in each of these three cases, increasing levels of employment of women meant that the rates of infant mortality dropped, and life expectancy rose. Additionally, as the number of women in paid employment increased, so too did the educational level of children. This was particularly evident in the case of girls – an added incentive to ensure that they received an education being the positive effect that it would have on their future earning capacity. Of the three countries, Taiwan proved the most committed to providing basic care to employees. When higher levels of female employment in the formal economy were complemented by statefunded public services, the improvement in living conditions was phenomenal. In other words, the combination of an interventionist

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state and high levels of female employment guaranteed more than just a rise in the GNP per capita. In addition, it had a significant impact on the Human Life Quality, an index that takes into account things like health, mortality rates and educational attainment. The impact on life conditions of increasing access for women to paid employment becomes particularly clear when a more extended definition of women’s work is used – one that includes their reproductive role. This book has documented the many ways in which women’s unpaid work as the primary care giver of the family enhances human development. The impact of increased female employment on the Human Life Quality Index in Indonesia and the Philippines was less positive than in Taiwan, because the state in each case was not so much an interventionist as a rentier state. In the neo-liberal literature that circulated in the late 1980s and early 1990s, these two countries were referred to as ‘tigers-to-be’. But by the late 1990s, it was evident that neither of them was going to be a ‘tiger’ In each case, the country was run by a US-supported dictator who implemented a number of economic policies prescribed by Washington – policies that showed growth on paper but failed to bring about improved living conditions in the country itself. The 1997 Asian Crisis had a disastrous effect on both countries and, unlike Taiwan, which continues to remain economically robust to this day, they suffered from serious economic and political instability. This is particularly true in the case of Indonesia, where Suharto was brought into power through a CIA-assisted coup in 1965 and subsequently ruled for more than three decades. He survived largely as a result of support received from a US-controlled military, and the country kept itself financially afloat by exporting natural resources. Much of Indonesia’s economic growth came at the expense of its natural resources. The country’s double digit GNP per capita growth figures might have been impressive, but the massive extraction of oil and other resources, and their subsequent export to other countries, has had a disastrous impact on Indonesia’s environment. For instance, the Indonesian lumber industry is a major contributor to greenhouse gas. Not only is an enormous quantity of lumber exported by Australian and Japanese companies operating legally in Indonesia, but, in addition to this, a significant amount of lumber is exported illegally, and the state has no control over it. In other words, the state

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– far from engaging in sound economic planning – has set up a system whereby contracts are farmed out to Australian, Japanese, European and American companies. In return for the fat profits they make, these companies pay the state either directly or in the form of backhanded bribes to officials. Granted, some of the funds generated by these exports are funnelled into programmes designed to help the growing number of urban and rural poor. This was particularly true in the aftermath of the early 1970s crisis, when the Suharto regime turned its attention to the issue of poverty and invested in public services that benefited low-income families in both rural and urban areas. Local organizations – mainly Islamic grassroots groups – stepped in to provide what the state could not, and proved highly efficient – thanks to the unpaid work of numerous female volunteers, who became the backbone of many of the Indonesian Islamic NGOs. As for economic policies aimed directly at women, a limited number of FTZs in which goods were manufactured for export were set up in Java. The regime also employed a huge number of women in social service and community jobs – jobs that, until the early 1990s, were a vital part of the country’s state welfare programmes. However, pressures exerted by the World Bank and the IMF led first to currency devaluation and then to welfare cutbacks. This put a significant financial strain on those in the lower income brackets, and the result was growing dissatisfaction with the regime. Once the social programmes started to fall apart, many were left with no alternative but to turn to the Islamic groups for help. Rising inflation and a general economic slump led to the financial meltdown of 1997, and this final crisis was the last straw for the lowest income groups. A series of mass demonstrations took place in the capital city, Jakarta. Protests quickly spread throughout the country and Suharto’s regime collapsed. Elections were called, and in the power vacuum created by the fall of the dictator, the many people who had witnessed the role that the Islamic organization of Nethzatol Ulama had played in providing basic care for low-income families came out in support of Wahid, that organization’s leader. Wahid won the election, and came to power. However, more than three decades of dictatorship had taken their toll on the country, and Indonesia continues to be plagued by ethnic conflict and separatist movements. The Philippines, though deprived of the rich resources possessed by Indonesia, shares a similar state structure. Many of its presidents

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have been supported by the US in the post-colonial era: Marcos, for instance, was backed by the Americans and worked in close collaboration with the local élite, many of whom were part of the old landowning class. Naturally, this kind of rule has not been conducive to the formation of an effective interventionist state. In terms of economic policy, the Philippines – following the example of Taiwan – has relied a great deal on its women to provide a cheap source of labour for export manufacturing. The country has set up FTZs where many young women are employed at low wages. More importantly, the Philippines has exported its women all over the world: finding employment, in the early days, as skilled labour, but increasingly as domestic and entertainment workers. Many Filipinas working as migrant labour outside of the country send a large part of their wages home. This financial support is crucial to many low-income families, particularly those living in rural areas. As a result of currency devaluation, the trend towards migration has increased. In a country racked by poverty and a huge disparity in incomes, this external source of private funds has become an extremely important mechanism for alleviating internal problems. An examination of each of these three cases showed that, contrary to neo-liberal belief, it was the state that played a key role in determining a country’s economic success. Whereas a highly interventionist policy on the part of the state has allowed Taiwan to prosper, the same cannot be said for Indonesia and the Philippines. The Asian Crisis struck both of these countries hard, whereas Taiwan remained fairly unscathed by it. What this study also reveals is that women have played an important part in Taiwan’s success – a point completely overlooked by proponents of neo-liberal theory. While high female employment in jobs requiring cheap flexible labour led to economic growth in Taiwan, this was not the case in the other two countries. As mentioned earlier, the explanation for this lies in the fact that in Taiwan the state maintained a hands-on, interventionist approach. All of this suggests that the use of certain kinds of empirical evidence to prove the legitimacy of neo-liberalism is highly problematic. Furthermore, in challenging the neo-liberalist assumption that economic growth and improved living conditions are attributable to a free market and free trade policies, the findings of this study also provide us with a useful starting point in our search for alternatives to

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the mainstream explanations. That said, it remains questionable whether the Taiwanese model could be applied successfully to another country. Certainly, Taiwan’s colonial legacy would have prepared it for the kind of conditions favourable to an interventionist state. The Japanese – paving the way for the kind of strong bureaucracy needed to run such a state – had already started a major land reform during their period of colonial rule in Taiwan. Furthermore, the Kuomintang were an élite class that had fled from Mainland China, and had no ties to the local landowning class. The population was relatively well educated, and the Americans – quick to see in Taiwan an opportunity to discredit the People’s Republic of China – poured technical aid into the country, and provided financial support for its development programmes. All of these factors combine to make the case of Taiwan an exceptional one – not easy to replicate, and hence apply, to other countries. Moreover, it can be argued that the Taiwanese state was extremely autocratic, suppressing all political parties other than the KMT and leaving little room for freedom of expression. In fact, up until the 1990s there was only one political party: the ruling KMT. These darker aspects of the Taiwanese model make its suitability as an alternative prototype for ‘successful’ economic growth somewhat questionable. As for its autocracy, the truth is that there are few countries in the South that are not autocratic. Both Indonesia and the Philippines have traditionally been run by dictators: Suharto’s rule was notoriously brutal, as was the Marcos regime. If all three cases share a similarly autocratic background, however, the improvement in Taiwan’s social conditions and standard of living in the 1990s opened up the political system. In contrast, the pattern in Indonesia, particularly, but also in the Philippines in the late 1980s and the 1990s – and, indeed, in most other countries in the South – was severe social service cutbacks followed by disastrous political consequences. Taiwan’s long-term commitment to providing basic care for the population has, in large part, enabled it to bypass much of the political and social instability experienced by Indonesia and the Philippines. This suggests that the continued implementation of neo-liberal economic policy throughout the South, without the accompanying social programmes, may well lead to more public uprisings and the kind of political instability that we have seen taking place in Indonesia. This book argues for reversing the current trend towards free

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market economies and comes out in favour of more state intervention. It supports the kind of state that, in addition to refusing to abandon the economy to the whims of an unregulated market, is equally committed to providing basic care for its citizens. In the second chapter of this book, the concept of an interventionist state is developed by drawing on state-centred theorists such as Skocpol (1985) Wade (1988) and Amesden (1985). For Peter Evans (1995), the interventionist state is embedded in civil society, and thus subject to political pressures exerted by various civil groups. In some ways, before the imposition of the neo-liberal policies, the Philippines and Indonesia were not that laissez-faire either; but they lacked coherent economic policies for economic growth and any commitment to basic welfare for all their citizens. in these two cases the interventions of the state served mostly to enrich a small élite in ways that did little to develop the rest of the country. Since women constitute the most politically disenfranchised and economically disempowered segment of society, and are also the most active in providing care for the community, groups representing them are the most likely candidates to get the job done when it comes to lobbying for changes that benefit the majority. In Chapter 2 the example of SEWA – an organization of poor, self-employed women workers in India – was presented to illustrate the kind of work such groups are doing to improve the lives of low-income female workers, including those in the informal economy.

APEC and the unholy marriage of neo-liberalism and neo-conservatism The current trend towards cutbacks in social programmes has been coupled with a new Washington-based ideology inspired by neoconservatism. With the election of President Bush, neo-liberalism and neo-conservatism have come together to support Washington’s economic and political policies. President Bush’s pre-emptive doctrine lends international legitimacy to strengthening the military and the use of force not just in America, but in other parts of the world such as Indonesia and the Philippines. In Bush’s policies, many states have found both material and moral support for using military force against their respective

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civilian populations and any political parties that might challenge their authority. In the Philippines, for instance, a power struggle has been raging between President Gloria Arroyo and the supporters of former president Joseph Estrada. Meanwhile, civil groups within the country have been calling for social justice in the face of terrible poverty and a dramatic disparity in income levels. However, in spite of this internal turmoil Gloria Arroyo has been able to reassert her power over the past couple of years by gaining US support with the claim that she is fighting terrorism. In President Arroyo’s eyes, any group that does not support her is a terrorist group – a sentiment with which President Bush no doubt sympathizes. President Arroyo has received financial assistance from President Bush to bolster her military in this domestic ‘War on Terror’. In reality, what Arroyo is primarily fighting are civil groups demanding justice for the island of Mindanao’s Muslim population. Fighting terrorism, in other words, boils down to suppressing dissenting voices through US-sanctioned state brutality. This is not new, of course: the US has a long history of supporting dictatorships. What is new, however, is the pretext: it used to be communism, now it is terrorism. As suggested above, one of the most vulnerable groups are the Muslim Filipinos living on the impoverished island of Mindanao in the south of the Philippines. An easy target for the state, this group has suffered from years of neglect and mass exploitation by first the Spanish and then the American colonial regimes. Because of this legacy the island’s Muslims have, for a very long time, been seeking independence. Although their Moro National Liberation Army (MNLA) was suppressed, it continued to campaign for social justice, along with other groups seeking the same goal through non-violent means. However, since the launch of President Bush’s ‘War on Terror’, the Filipino state has intensified its repressive tactics against the Muslim minority. Many Muslims from the Island of Mindanao have been abducted and imprisoned, and the situation for Muslim Filipinos living off the island – in Manila, for instance – is not much better. In a show of strength that would seem to be the army’s way of flexing its muscles against the civilian population, Muslim homes have been raided and arrests made. At present, it is mainly Muslims who come under attack. But as the power of the military increases, this could extend to any civil group campaigning for social justice. This looming threat could be particularly damaging to women’s groups,

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many of which are engaged in the anti-globalization campaign. A somewhat similar situation exists in Indonesia. With the fall of Suharto, the military suffered a major setback. In the aftermath, many groups – in particular, women’s groups – were formed. The army, especially humiliated after East Timor’s successful bid for independence, lost much of its power. For a brief time, civil group activism flourished. However, Sukarnoputri’s support for the US – especially after the wars in Afghanistan and Iraq –angered many Muslim groups. In some parts of the country, small isolated groups are prepared to take violent action against their state because of its support for Bush’s America. The 2002 Bali bombing, in which many European and Australian tourists were killed, was an example of this: a very small group of people resorting to violence – a bomb planted in the rich tourist district in the heart of the city of Bali – to protest against their state’s foreign policy. General frustration with rising poverty further fuels the rage felt by these groups. In response, Sukarnoputri turned to President Bush, finding in these acts of violence even more reason to seek US help to strengthen her army and continue the fight against terrorism. Meanwhile, the Indonesian military used its new might to combat ethnic and separatist movements such as those in Atcheh in Northern Sumatra – an oil-rich Muslim province that wants to separate from the rest of Indonesia. The overall effect of Bush’s preemptive power doctrine has been to give carte blanche to the state to harass any group that is critical of its policies or performance – even if their demands are legitimate, and their means entirely peaceful. Increasing the strength of the army has become an equally important tool for both Indonesia’s Sukarnoputri and the Philippines’ Gloria Arroyo as they bid to secure foreign investment in the Asia Pacific region. These investments are mainly in the resource extraction industries, and the military provide foreign investors with security – particularly in the case of those investors who are part of APEC (Asia Pacific Economic Cooperation). Linked to NAFTA (North American Free Trade Agreement) since 1989, APEC has been viewed by many as a means by which economically powerful countries force trade agreements upon, and open up investment opportunities in, Pacific Rim economies. APEC has continued to facilitate the purchasing of mining and timber concessions by multinational corporations. In addition, it has enabled the MNCs to gain control of lucrative local

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service sectors such as the telephone and airline companies. In fact, APEC has been involved in a number of sector-by-sector liberalization programmes, the ultimate goal of which is to negotiate binding rules with regard to investment deregulation. Under the auspices of US foreign policy and led by US-based multinationals such as General Motors, Fidelity, and Systems Integrated, voluntary liberalization, along with rapid industrialization, are strongly advocated. For many APEC countries, these measures have brought with them a host of environmental problems. A number of civil groups, particularly women’s groups, have mobilized around this issue. Campaigning for laws designed to protect the environment, they often face a hostile military presence as they do so. Some of the most active women’s groups in the South are to be found in Taiwan. These women have pushed environmental issues, along with gender equity, to the top of their agenda. This is not surprising, given the extent to which this small island has become contaminated with pollution as a result of rapid industrialization. In Indonesia and the Philippines the export of raw material and the lack of state regulation of extraction companies has had a similarly devastating impact on the environment. However, there the problem of poverty takes precedence over the environment, although women’s groups in both countries are gradually integrating these various concerns into a united movement. In Indonesia, for instance, various women’s groups have joined forces to fight poverty, resolve ethnic conflicts, reduce violence and stop the destruction of the environment. The same is true of women’s groups in the Philippines. It is interesting to note that women’s groups in these countries see free market policies as having had an equally devastating impact on both women and the environment. In this light, it is not surprising that they have come together over the two struggles. In effect, doing something to stop the exploitation of the environment is also doing something to stop the exploitation of women. For many of the women in these two countries, life is just an endless round of Catch22. On the one hand, the rising cost of living has made it necessary for them to seek employment outside the home. On the other, cutbacks to the welfare state mean fewer day-care facilities, fewer hospitals and fewer resources, and this in turn means less support when it comes to caring for their children, their sick and their elderly. If women typically carry these burdens when the public purse runs

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empty, there is little evidence to suggest that, as the number of women working outside the home increases, the men are pitching in to help take care of the home and family. It is difficult to measure the extent to which there has been a decline in the amount and quality of care provided for families. What is clear, however, is that as the number of women in the workforce rises, they have less and less time and energy to devote to their families. Because the state is not taking up the slack, the general quality of life for families has declined. Of course here, as in most societies, women’s unpaid work in the home goes largely unrecognized, as does their reproductive role and their job as nurturers. It’s the same old story: what cannot be entered on a balance sheet is considered to have no real value. Here, we begin to see the parallels between how women and the environment are regarded. Just as women’s role as primary caregiver is seen as inconsequential to the economy, the environment too is treated as dispensable. Hardly surprising, then, that women in the South have a strong presence in the anti-globalization and environmental protection movements.

Neo-liberalism in crisis: looking into the future At the end of the twentieth century the legitimacy of neo-liberalism began to be challenged. After the fall of the Soviet Union, the free market economy had been hailed as the way to go for newly formed, ex-Soviet countries. It was believed that in dismantling a centrally planned economy, prosperity would come to the resource-rich, highly educated countries of the ex-Soviet Union. ‘Unleashing the market’ became the mantra for these countries in the late 1980s and early 1990s. Moving towards a free market, however, neither promoted economic growth nor improved life conditions. With the demise of the interventionist state, social services declined and the standard of living dropped for a significant percentage of people in the ex-Soviet countries – including Russia. The second major setback for neo-liberalism coincided with the Asian Crisis in 1997, and the IMF’s failure to bail Indonesia out as the country went into a downward spiral. Interestingly enough, Malaysia remained fairly immune to the Crisis, having imposed its own

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restrictions on its financial markets. This policy provoked much anger in the IMF at the time, but proved to be just what was needed to avoid a complete financial meltdown in the region. The other country not affected by the Asian Crisis was China: China with its central planning and protective policies; China that has gone on to become an economic success story. Then came the crisis in Argentina, a country that had followed the World Bank/IMF package religiously and suddenly found that it was facing national bankruptcy. Since then, the United States has itself suffered some of the negative consequences of a liberalized economy. Increased deregulation of corporate America and the expansion of a free market have been accompanied by a number of fraud cases, such as Enron and World.com. These have shaken the US economy and precipitated major stock market setbacks. The stock market was in trouble already by the end of the Clinton boom but it was the crash of these two major companies that brought the picture into focus for the general public. A troubled stock market has coincided with an overproduction crisis that started in early 2001. It is predicted that a prolonged period of stagnation and deflation may be on the way in the US. A recent upturn in US economic growth may well not translate into a decline in the unemployment rate, generating scepticism over the future of the American economy. Additionally, the World Trade Organization (WTO) has run into difficulty and has not been able to retain the support of a number of countries – especially the poorer ones. Some countries regard the WTO as a mouthpiece of the multilateral agencies, pushing US interests at the expense of other countries’ interests, and in so doing contradicting the WTO’s basic commitment to freedom of the market. Washington’s reaction to the crisis has been typical of the neoconservative ideology: when in doubt, look elsewhere. Hence, Washington’s attempt to seek control of oil resources in the Middle East. However, the war against Iraq has met with a great deal of resistance. As the Bush administration continues to actively seek military solutions to economic and political problems, the anti-war and anti-globalization movements have not only joined forces, but gained considerable momentum. It was during the anti-war protests that a powerful global civil society movement emerged, and with it a strong and vocal criticism of US unilateralism, militarism, and economic hegemony. On 15 February 2003, over 12 million people

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marched through the streets in over 700 cities in 60 countries, and on every continent. In other words, alliances are being forged and people throughout the world are keeping their eye on Washington. The public outcry against the war, along with growing discontent over globalization, has led to rising support for leaders who promise economic reforms that limit free trade in an open market, and offer protection from Washington. In parts of Latin America such as Venezuela, for example, anti-liberalization sentiments are strong. The demand for a state prepared to stand up against liberalization, and committed to addressing the problem of income disparities, is growing. In January 2004 at Monterrey in Mexico, the special American summit to set the deadline for the formation of the Free Trade Area of the Americas (FTAA) met with strong resistance on the part of the Latin American countries. With 100 million people living on two dollars a day, and the number of people living in poverty in Latin America having increased from 48 to 57 million over the course of the 1990s, President Luíz Inacio (Lula) Da Silva of Brazil has called it ‘the decade of desperation’.1 In the same month, the World Social Forum – a coalition of forces fighting against globalization and war – met in India.2 This brought together representatives from hundreds of NGOs and other groups seeking to create an alternative platform to the World Economic Forum, due to take place in Switzerland at the end of January 2004. The theme of this World Social Forum was ‘War against Imperialism’. It was well attended by women’s groups who, in calling for world peace, expressed a strong commitment to ecological issues and condemned both globalization and the US occupation of Iraq.3 In spite of all the perils of state power, the answer is not just to fight the state but to change it. While political advocacy outside of the state is important and civil demonstrations and pressure groups must campaign on issues such as poverty and environmental degradation, it is equally important to lobby the government. It is no accident that the World Bank funds NGOs that work towards poverty alleviation. This is a way of transferring the responsibility of the state to provide basic care for its citizens to groups that mainly rely on women’s volunteer work. There is no doubt that financial assistance to groups such as women’s groups is important but these groups have to make sure that this will not merely compensate for the

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cancellation of the state’s primary responsibility as a welfare provider. While bringing an end to market expansionism, environmental degradation and war are important goals, we have to come up with a road map that points the way to achieving them. There are many ways in which civil groups and individuals can exert influence on the political system. Joining others to publicly protest the abuse of state power and the overuse of the military is one of them. Becoming part of the political system is another. What is clear, though, is that civil groups need to continue to lobby the state in order to make the state responsible for and to its citizens. For, in the end, demanding that the state be representative of its citizens and make itself transparent to those citizens is as vital as staging acts of resistance against a state that uses its military to promote economic exploitation. NOTES 1 Globe and Mail, 14 January 2004, p. A 15. 2 http://www.hindustantimes.com/news/181_536136,001300660000.htm 3 La Press Samdei, 17 January 2004, p. A 17.

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Index

abortion 93, 130, 167 Afghanistan War 181 Africa, 10, 24, 31, 43; North 10, 172; sub-Saharan 10, 24, 46, 172 agriculture 16-17, 24, 42-3, 45-6, 64-5, 67-71, 73, 77-8, 82, 107-8, 117-19, 121-3, 138, 140, 142-3, 146-8, 1515, 159; green revolution 67, 77, 117, 148 aid 22-6, 31, 37, 41-2, 72, 88, 118 Aisyiyah 130, 132 AMIHAN 170 animism 106, 139 Aquino, Cory 149-50, 154, 166, 171 Arab peoples 136 Argentina 38, 184 Arisan 110, 121 Arroyo, Gloria 180-1 Asia Pacific Economic Cooperation (APEC) 181-2 Asia Pacific region 71, 104n, 181 Asia,110, 137, 144, 155; South 13, 43, 172; Southeast 10, 13-14, 30, 32, 35-36, 46, 49, 52, 88-9, 119, 141, 172 Asian Crisis 13, 18, 37-8, 71, 106, 115, 128, 175-7, 183

Asian Tigers 106, 136 Association of Southeast Asian Nations (ASEAN) 161, 163 Atcheh 110, 115, 134, 181 Australia 4, 64, 162, 165, 175-6, 181; Aborigines 64 Awakening 100; Awakening Foundation 100-2 Babaylanes 139-40 Bali 114, 116, 118, 125, 181; Bali bombing 116, 181 Bandung 126 Bangladesh 37 bapak anagka 127 Batam 126 Batan 153, 156-7 Bawan 122 Beijing 2, 132 Bengal 107 Bolivia 59 Boserup, Esther 42 Brazil 185 Britain 27, 107, 111, 138, 140, 165 Bucharest 26 Buddhism 106, 110, 135n Bulacan 140 201

202

INDEX

bureaucracy 29, 34, 36, 70, 107, 113, 131, 138, 178 Bush, George W. 115-16, 179-81, 184 Cairo Agreement 66 Canada 120, 170 capital flight 37-8 Caribbean 10, 172 Cebu Island 162 Celebes 107 central planning 29, 33, 38, 72, 74, 183 Chen Shui-bian, President 103 Cheng Ch’eng-Kung (Koxinga) 65 Chiang Kai-Shek 70 child labour 167 China (Mainland/People’s Republic) 64-6, 68-9, 71-2, 76, 86, 99, 103-4, 106, 110, 130, 137, 178, 184; see also Taiwan China Family Planning Association 93 Chinese Civil War 66 Chinese settlers 108, 115, 117, 136-8, 140-1 Chinese Women’s Anti-Aggression League (Taiwan) 96-7 Christianity 14-15, 100, 130, 135n, 136-7, 167-8 civil society 6, 18, 61, 99, 103, 134, 179-81, 184, 186 Clinton, Bill 184 colonialism 1, 9, 14-15, 20, 34, 40, 649, 103-4, 106-12, 136-45, 155, 178, 180 communism 112, 114 comparative advantage 24, 29, 74, 79, 81, 154 Confucianism 68 corruption 36, 74, 114-17, 119-20, 134, 145, 148-9, 152, 176 crime 91, 97 Cuba 52, 146

cultural factors 9, 24-5, 49, 68, 79, 81, 83, 91-2, 97-8, 106, 130, 139-41, 158, 165, 173-4 currency devaluation 30-1, 74, 76, 124, 145, 151, 154, 176-7 Da Silva, Luzi Inacio (Lula) 185 debt 31, 76 decentralization 50 Del Monte 154 democracy 28, 36-8, 70, 103, 113, 115 Democratic Progressive Party (DPP) 70, 103 dependency theory 27, 32 deregulation 1, 3, 17, 27, 41, 50, 71, 76, 124, 145, 150-1, 154, 158, 171, 184 Dhrama Wanita 132 diau huei 96 Dole 154 domestic service 4, 52, 127, 141-2, 160-1, 163-4, 177 Dutch East India Company 65, 108-9 East Timor 115, 181 economic growth 1-3, 5-6, 9-10, 13, 15, 17-18, 21-3, 26, 31, 40, 69, 79, 93, 103, 132, 150, 154, 175, 177-9, 183-4 education 7-8, 18, 31, 35, 44, 47, 51, 53-5, 57, 66-7, 83, 88, 93-6, 99100, 105n, 113, 125, 129, 133, 138, 143, 151, 159-60, 166-8, 170, 1745 Egypt 30 employment, casualization of 3, 50; development aid and 23-4; and flexible labour use 49-50, 75, 81, 84, 86, 98, 154, 173-4; and gender 2-4, 7-10, 13, 15, 17-18, 23-5, 32, 45-57, 68, 74, 76-101, 108-10, 12033, 140-3, 153-67, 172-7, 182-3;

INDEX

and globalization 3, 10; home work 50-1, 84-5, informal 2, 8, 17, 45-7, 50, 52, 127, 160-1, 166-7; and modernization theory 21-3; parttime 2, 47-8, 50, 159; population and 26; and poverty 18; regulation of 2-3, 29; and state 7-9; temporary 159; and ‘trickle-down’ effect 154; unemployment 31-2, 53, 85, 98, 133, 139, 142, 144, 150, 154, 159, 169, 184; unemployment benefit 31-2, 85, 159; women’s work 43-4; see also female employment ratio, free trade zones Enron 184 environment 18, 38-9, 60, 70-1, 103, 118, 120, 132, 134, 175, 182-3, 185-6 Estrada, Joseph 180 ethnicity 65, 113, 115, 134, 136-7, 176, 181-2 Europe, 52, 65-7, 75, 104, 107, 137, 162, 164-5, 176, 181; Eastern 20, 46; Western 20, 23 export processing zones 24; see also free trade zones (FTZs) export promotion 30-1, 72-5, 78-9, 83-5, 87-8, 116, 118-19, 145-8, 151, 153-4, 156-7, 177 family planning 8, 26, 56, 60, 93, 12930, 132, 166-7, 174 Family Welfare Movement (PKK) 129, 131-2, 169 Fatayat 130, 132-3 female employment ratio (FER) 3, 7, 13, 17, 85, 95, 122, 128, 156, 1667, 172 female-headed households 46, 48-9, 54, 110-11, 140, 163 fertility rate 7-8, 18, 26, 37, 56-7, 60, 92-3, 129-30, 166-7, 174

203

Fidelity 182 First Indonesian National Women’s Congress 111 food subsidies 31-2, 54 foreign exchange 31, 46, 53, 118, 127, 163, 165 Formosan Communist Party 66 Free Trade Association of the Americas (FTAA) free trade zones (FTZs) 16, 46-7, 49, 73, 75, 81, 91, 123-4, 149, 153-8, 176-7 Friedman, Milton 28 Gawani 131 gender, and agriculture 24, 42-3, 45-6, 68, 77-8, 119, 121-3, 140, 155; and aid 42; and Arisan 110, 121; and autonomy 8; and care giving 2-4, 7, 54-7, 91, 125, 128-9, 132-3, 167, 175, 179, 182-3; and civil society 103; and colonial history 137, 143; and community 2, 4-7, 18, 54, 59, 68, 96-8, 111-12, 129, 133-4, 140, 170, 176, 179; consciousness of 99; and crafts 139, 142-3; and cultural conditioning 49, 68, 79, 81, 83, 912, 97-8, 141, 158, 165, 173-4; and development 8, 10, 38, 40-4, 54, 63n; and democracy 103; and the double day 4, 53, 57, 78, 183; and economic growth 103; and education 7-8, 18, 55, 57, 88, 93-6, 99-100, 105n, 125, 129, 133, 143, 159-60, 166-7, 170, 174-5; and employment 2-4, 7-10, 13, 15, 1718, 23-5, 32, 45-57, 68, 74, 76-101, 108-10, 120-33, 140-3, 153-67, 172-7, 182-3; and empowerment 2, 6, 60-2, 103, 110, 132-4, 140, 179; and the environment 60, 62, 103, 132, 134, 175, 182-3, 185; and

204

INDEX

expenditure/saving patterns 7-8, 54-5, 91-4, 96, 104n-105n, 142, 174; and export promotion 46; and family planning 8, 26, 93, 129-30, 132; and financial independence 110; and free trade zones (FTZs) 124, 154, 156-8, 176-7; and globalization 7-8, 10, 18, 61-2, 185; and health 2, 7, 56-7, 85, 88, 94, 97-8, 105n, 112, 129, 132, 140, 143, 158, 160, 163, 170; and home work 501, 84-5; and income disparity 40; and inequality 40, 42, 47-9, 51, 88, 101-2, 111, 123-4, 133-4, 137, 144, 154, 156, 158, 168-9, 171, 179; and informal economy 17, 127-8, 1601, 166-7, 179; and land 24, 69; and literacy 2, 7; and matriarchy 110-11; and micro-credit 121, 134, 170; and migration 23, 52-3, 121, 141, 154, 161, 163-5, 170, 177; and modernization theory 24-6; and neo-liberalism 32, 45-6, 172; and patriarchy 68, 81, 84, 132, 137, 155, 158; and peace movement 185; and political participation 2, 18, 102-3, 110-12, 134, 140, 144-5, 168-9, 179; and population control 26; and poverty 2-3, 5, 7, 18, 39, 40, 44-7, 50, 52-3, 59-62, 97, 132, 134, 144, 171-2; and reproduction 2, 25, 44, 48-9, 51-3, 57, 60, 78, 84, 96-8, 111, 128, 140, 175, 183; and religion 139-40; and services 15965; and the state 6, 9, 18, 41, 93-4, 96-101, 131-2, 134, 146, 169-70, 174, 182-3, 185; stereotypes 24, 489, 81, 83, 98, 141; and structural adjustment 5; and subcontracting 124, 173; and the subsistence perspective 62; and technology 143; and trade 109-10, 124-5, 139, 141,

160-1; undervaluing/repression of women and girls 49, 68; and violence 100-2, 134, 170, 182; and volunteer work 4-5, 59, 61, 131, 168-9, 176, 185; and wages 47-9, 83, 88, 101, 123-4, 133-4, 154, 156-8, 163, 173; and welfare provision in lieu of state 32, 51, 536, 58-61, 88, 93-4, 96-9, 110, 1313, 160-1, 168-70, 176, 185; women’s movement 99-100, 11112, 143-5, 182; women’s organizations 6, 9, 18, 59-61, 71, 96-102, 114, 121, 130-4, 143-5, 169-71, 176, 179-82, 185; women’s rights 99-103, 111-12, 133, 144; women’s work 43-4 General Assembly Binding Women for Reforms, Integrity, Liberty and Action (GABRIELA) 170 General Motors 182 Germany 32, 165 Gerwani 114 globalization 1, 3, 7-8, 10,18-19, 37, 39, 61-2, 180, 183-5 Golkar Party 115, 132 Good Shepherd (Taiwan) 101 grassroots 6, 18, 36-7, 176 gross domestic product (GDP) 21, 87, 94-5, 153, 155, 161 gross national product (GNP) 1, 7-8, 13, 17-18, 21, 25, 40, 43, 95, 172, 175 guerrilla movements 145-6, 148-51, 170-1 Haiti 46 Hakka people 65 health 2, 4, 7, 31-2, 35, 37, 44, 53, 557, 59, 67, 85, 88, 97-8, 105n, 112, 129-30, 132, 140, 143, 151, 158, 160, 162, 167, 170, 175

INDEX

Hinduism 106, 135n Hobbes, Thomas 57 Holland 14-15, 64-5, 67, 107-8, 11011, 117-18, 139; see also Dutch East India Company home work 50-1, 84-5 Homemakers’ Unions (Taiwan) 100 Hong Kong 69, 103, 124, 164-5, 173 housing 31-2, 35, 91, 132 Hsinchu 76 Huk movement 146-7 Human Quality of Life Index 8, 18, 175 human rights 70, 100 import restrictions 35 import substitution 30-3, 72-4, 78, 116, 118, 145, 147, 152-3 income inequality 1-4, 14, 19, 31-2, 34, 37-9, 40, 60, 82, 104, 115-16, 120, 134, 144-5, 150, 152, 160, 172, 180, 185 India 30, 36-7, 55, 61, 106, 110, 130, 136, 179, 185 indigenous people 64-5, 67, 108, 140 Indonesia, in APEC 181; and Asian Crisis 13-14, 37, 115, 183; bureaucracy in 107, 113, 120, 131; civil society in 134; colonial history 67, 106-12; dual economy in 108; environmental degradation in 175, 182; ethnicity in 176, 181-2; export promotion in 116, 118-19; free trade zones in 16, 123-4; Guided Democracy in 113; import substitution in 16, 116, 118; informal economy in 17, 127-8; investment in 16, 76, 86; Ministry of Environment 120; Ministry of Foreign Affairs 120; Ministry of Women’s Empowerment 133; neoliberalism and 10; Philippines

205

compared with 124, 130, 137, 139, 143, 145, 148, 153, 157, 159, 16770, 174; poverty in 115, 118, 120-1, 127-8, 132, 182; regional comparison 13-14; Repelitas 116; restructuring in 116; separatism in 113, 134, 176, 181; sex industry in 1257; and socialism 22; state in 6, 1415, 112-16, 118-20, 129, 131-4, 175-8; structural adjustment and 124; Suharto’s coup 114-15, 118, 131, 175; Suharto’s fall 115, 133-4, 176, 181; Taiwan compared with 107, 109-10, 113, 117, 119, 121, 123-4, 127, 129, 131, 133-4, 174-5, 177-9; as tiger-to-be 106, 175; US and 114-16, 118, 179, 181; women’s organizations in 5, 111-12, 114 121, 130-4, 181-2 Indonesian Communist Party (PKI) 107, 112-14, 117 Indonesian Trade Union Congress 127 Indramayu 126 industries, aircraft 88; aluminium 72; automobiles 123; bamboo 109; batik 123; chemical 69, 157; coconut 148, 153; coffee 109; confectionery 109; construction 82; electric/electronics 46, 49, 74, 76, 82-3, 153, 156-9; fertilizer 72; fibre 109; financial services 52; food and beverages 157; food processing 46, 72, 74-5, 79, 81-2, 109, 153-4; footwear 46, 51, 74, 76, 124, 154, 156-7, 159; furniture 153, 156-7; garments 46, 73, 76, 124, 153, 156-7, 159; insurance 52; liquefied natural gas 123; metallurgical 69; palm oil 109; paper and printing 119, 157; petrochemical 35; petroleum refining 72, 123; plastics 46; semi-conductors 157; shipbuilding 35; steel 35, 72;

206

INDEX

sugar 109, 148; tea 109, 118; television sets 123; textiles 72-5, 79, 81-2, 108-9, 118-19, 123-4, 138, 140-1, 143, 153, 156-7; timber 118-20, 151, 153, 175, 181; tobacco 118, 123, 157; tourism 52; toys 76; transport 82; wood and leather 73, 81, 119, 123, 154, 156-7; woodworking 109 infant mortality 7-8, 18, 26, 37, 56, 935, 129-30, 166-7, 174-5 inflation 3, 30, 46, 118, 176 informal economy 8-9, 17, 44-7, 50, 52, 88-9, 91, 160-1, 166-7, 179 International Labour Organization (ILO) 25, 41, 44, 134 International Lions Club 100 International Monetary Fund (IMF) 1, 16-17, 27, 30-1, 37-8, 71, 103, 116, 119-20, 150, 152, 154, 172, 176, 183-4 investment 16, 21-3, 29, 35, 50, 52, 55, 74-6, 79, 81, 85-6, 88, 96, 116, 124-5, 150, 153-7, 181 Iran 59-60, 104n, 130 Iraq War 181, 184-5 Islam 14-15, 106-7, 113-14, 130, 1324, 135n, 139, 148, 150-1, 167, 176, 180; Sarul 113 Islamic parties (Indonesia) 107, 112 Jakarta 176 Jamaica 46 Japan 14-15, 32, 34-6, 52, 64-7, 69, 71-3, 75, 104, 107-8, 111, 113-14, 117, 119, 136, 138-9, 146, 149, 162, 165, 175-6, 178 Java 65-6, 106-7, 109-11, 113-14, 11819, 121, 176; Central 114; East 106, 109, 114; West 113 Johnson, Lyndon 22

Kalimantan 107 Kalyanamitra 133 Kaoshiung free trade zone 75 Kennedy, John F. 22 Kerala 36-7 Keynes, J. M. 22, 28 KMP 170 Koalisi Prempuan 134 Korea, Korean War 22, 88, 162; South 16, 34-5, 69, 119, 124, 173 Kuomintang (KMT) 70-7, 84-5, 99, 102, 104, 104n, 117, 178 Kuwait 164 labour organization 3, 6, 29, 36, 70, 72, 81-2, 84-5, 101-2, 114, 127, 139, 144, 157-9 land 6, 14, 16, 24, 34, 36, 67-8, 74-5, 77, 104, 122, 136-7, 141-2, 144, 146-50, 177; communal 137, 140, 147; landowning class 14, 16, 34, 36, 67, 69-70, 114, 117, 122, 137, 141, 144, 146-50, 152, 177-8; redistribution/reform 6, 14, 34, 36, 67, 69, 74, 77, 104, 114, 117, 148, 152, 178; smallholdings 77; tenure 67-9, 110, 136-7, 140, 142 Latin America 10, 14, 22-3, 30-1, 33-4, 59, 72, 75, 155, 172, 185 Lee Teng-hui, President 71 Lembaga Studi dan Pengembangan (LSPPA, Institute for Women and Children) 134 Lewis, Arthur 21-2 Liberal Party (Philippines) 148 life expectancy 7-8, 18, 37, 56, 94-5, 129-30, 166-7, 174-5 Lima 59 literacy 2, 7, 37, 94, 105n, 111, 113, 129-30, 133, 168 Locke, John 57 Lu, Hsiu-lein 99, 102

INDEX

Macapagal, Diasado 147 Magasysay, Ramon 147 Mahatir Mohammad, President 38 mail-order brides 165 Majapahit Kingdom 106 Malari Riot 114 Malay people 136 Malaysia 10, 37, 76, 106, 114, 118, 124, 126-7, 157, 164, 183 Maluku 107 Manchu dynasty 67 Mandura 109 Manila 140-2, 151, 153, 156-7, 165, 180 manufacturing 16-17, 24, 44, 46-7, 51, 72-6, 78, 81-4, 86-7, 91, 107-8, 117-18, 123, 138, 142, 151-3, 155, 159 Marcos, Ferdinand 16-17, 60, 145, 147-51, 153-6, 166-8, 176-8; Imelda 60, 168 market freedom, concept of 19-20, 278, 57-8 Marshall Plan 20 Marxism 27, 42 McClelland, David 25 Melaka 107 Mexico 47, 59-60, 141, 185 micro-credit 110, 121, 132, 134, 170 Middle East 10, 127, 164, 172, 184 migration 23, 52-3, 64-7, 79, 121, 127, 141-2, 154, 161, 163-5, 170, 177 military power 36, 70, 72, 82, 88, 97, 114-16, 118-19, 134, 146-51, 157, 161-2, 171, 175, 179-82, 184, 186 Mindanao 151, 180 Ming dynasty 64 Ming dynasty 67 mining 78, 82, 118-20, 151, 153, 181 Modern Women’s Foundation 100 modernization theory 20-32, 40 Monterrey 185

207

Montreal 120 Moro National Liberation Army (MNLA) 180 Mothers of the Revolution 143 Muhamadiah 130, 133 multinational companies (MNCs) 33, 46, 51, 75, 120, 124, 155, 181-2 Muslimat 132-3 Nairobi 132 National Council of the Urban Popular Movement (CONAMUP) 59-60 National Taiwan University 100 nationalism 111-13, 117, 137, 139, 147-8, 152 Nationalist Party (Philippines) 148 Negros 150-1 neo-liberalism, and Asian Crisis 106; and ‘Asian Miracle’ 69; crisis of 1836; and democracy 27; and development aid 31; and financial crises 378; and gender 32, 45-6, 172; and health 130; and international financial institutions 1; modernization theory displaced by 20, 27; and monetarism 30; North imposes on South 1; and export promotion 301; in the Philippines 10, 150-1, 1548; and poverty 1, 31, 37, 40, 116, 120, 145, 172, 182; and price determination 28-9, 57; resistance to 185; and Southeast Asia 10; and the state 28-9, 31, 45, 130, 177; Taiwan’s challenge to 103; and trade liberalization 69, 173, 177, 185; as Washington Consensus 1, 27, 31; and welfare cutbacks 5, 31-2 Nepal 56 Nethzatol Ulama (NU) 115, 130, 133, 176 New People’s Army (NPA) 145, 14851, 171

208

INDEX

newly industrializing countries (NICs) 32-5, 46, 73, 124 Nike 51 Nixon, Richard 23 Negritos 136 non-governmental organizations (NGOs) 5, 70, 100, 121, 176, 185 North American Free Trade Agreement (NAFTA) 181 oil 10, 108, 114-15, 118-19, 175, 184 Pancasila 113-14 Partai Nasional Indonesia (PNI) 11213, 115 Pertamina 114, 118 Peru 59 Philippines, in APEC 181; and Asian Crisis 14; Bell Trade Relations Act (US) 152; Bureau of Women and Young Workers 162, 168; bureaucracy in 138; colonial history 67, 136-45, 155, 180; counterinsurgency strategy 146-7; Department of Labour 162, 168; Department of Social Welfare and Development 169; environment in 182; export promotion in 145-8, 151, 153, 1557; free trade zones in 16, 149, 1535, 157-8; import substitution in 16, 145, 147-8, 151-3; Indonesia compared with 124, 130, 137, 139, 143, 145, 148, 153, 157, 159, 16770, 174; informal economy in 17, 160-1, 166; investment in 16, 76, 86; landowning élite in 14, 16, 34; martial law 149, 157, 170; migration from 52; Military Base and Military Assistance Agreement (with US) 146, 149; National Commission on the Role of Filipino Women (NCRFW) 168; neo-liberalism and

10, 150-1, 154-8; National Population Commission 166; political representation in 14; poverty in 142, 144-5, 150-1, 160, 163, 167, 171, 180, 182; regional comparison 13-14; restructuring in 149-51, 154-8; and socialism 22; Spanish-American heritage 34; separatist movements in 14, 145, 176; state in 6, 14-15, 145-6, 149-52, 157-62, 166-71, 175-8; Taiwan compared with 137-8, 145, 148, 153-4, 165, 167-70, 174-5, 177-9; as tiger-to-be 106, 136, 175; US role in 136, 138-9, 142-3, 146-9, 152-3, 155, 157, 161-3, 165, 167-8, 170, 175-7, 179-81; ‘War on Terror’ in 180; women’s organizations in 5, 60, 182 PINAY 170 Pink-Collar Solidarity (Taiwan) 102 PKI see Indonesian Communist Party Polanyi, Karl 19 polygamy 111 population 8, 26 Portugal 64, 107 poverty, and aid 22-3, 37; and economic growth 6, 21; and employment 18; and the environment 182; and gender 2-3, 5, 7, 18, 39, 40, 44-7, 50, 52-3, 59-62, 97, 132, 134, 144, 171-2; and grassroots organization 37; guerrilla movements and 150; in Indonesia 115, 118, 120-1, 127-8, 132, 182; and informal economy 45, 127-8, 167; and micro-credit 121; and migration 177; and modernization theory 25; and neo-liberalism 1, 31, 37, 40, 116, 120, 145, 172, 182; in the Philippines 142, 144-5, 150, 160, 163, 167, 171, 180, 182; popu-

INDEX

lation and 26; and privatization 59; and public services 32; and the sex industry 142, 160-1; and the state 6, 60, 115, 120, 145, 176, 185; and structural adjustment 160, 170; and the Taiwanese model 104; and violence 181; and women’s organizations 132; World Bank and 134 privatization 1, 3, 37, 59, 76, 124, 137, 145, 149-51, 154, 158 prostitution see sex industry protectionism 1, 73-4, 76 Protestant ethic 24 Rainbow (Taiwan) 101 Rais, Amin 115 Rajapatni, Queen 110 Reagan, Ronald 27 Red Cross, Chinese 93; Indonesia 112 restructuring 72-3, 76, 86-7, 93, 98, 116, 149-51, 154-8 Ricardo, David 24 Rostow, W. W. 21-2 Russia 183 separatism 14, 113, 115, 134, 145, 181 service industries 17, 44, 51-2, 76, 82, 86-90, 122, 124, 127, 155, 159-65, 181 SEWA 61, 63n, 179 sex industry 52-3, 88-91, 100, 125-7, 142, 160-3, 165, 169, 171n Singapore 69, 124, 126, 164, 173 Sino-Japanese War 66-7 Smith, Adam 20, 57 socialism 42, 113 Soochow University 100 Soviet Union, former 20, 23, 29, 33, 107, 183 Spain 14-15, 34, 67, 136-8, 140-4, 155, 180 Spanish–American War 136

209

state, accountability 35; and agriculture 78; autocratic 178; and civil society 18, 61, 179-80; colonial bureaucracy and 34, 70; continuing importance of 185-6; and corporations 6; and corruption 149, 152, 176; and democracy 37-8; and development aid 23; downsizing of 145; economic role of 1, 3, 5; and education 4, 35, 67, 93, 167; and employment 7-9; and empowerment 6; and export promotion 74, 79, 84-5; and the environment 389, 60; and ethnicity 134; and family planning 129, 166-7, 174; and gender 6, 9, 18, 41, 93-4, 96-101, 131-2, 134, 146, 169-70, 174, 1823, 185; and grassroots organization 36-7; and guerrilla movements 151; and health 4, 35, 67, 98; and housing 35; and import substitution 30; in Indonesia 6, 14-15, 112-16, 118-19, 129, 132-4; and industrialization 35, 37, 70, 73-4; and inflation 30; interventionist-developmentalist 32-9, 61, 67-74, 76, 103, 116, 120, 145, 149-50, 173-4, 177-9, 183; and landowning class 34; and labour rights/repression 6, 47, 82, 84-5, 157; market regulation by 33, 35; and the military 134, 149, 186; minimalist 34, 37, 41, 145; in modernization theory 20-3; monopolism by 69, 149; neoliberalism and 28-9, 31, 45, 130, 177; ownership/nationalization 114, 118; in the Philippines 6, 14-15, 145-6, 149-52, 157-62, 166-71, 175-8; and poverty 6, 34, 60, 115, 120, 145, 176, 185; and protectionism 73; regulating role 50, 150, 158, 171; rentier 6, 175-7; sepa-

210

INDEX

ratism and 134; and sex industry 52, 161-2; in Southeast Asian countries 32-3; subsidies 53, 73, 118-19; in Taiwan 6, 14-16, 34-5, 67-73, 889, 93-4, 103, 173-5, 177-9; and taxes 29-30, 35, 50, 73; and trade 29-30, 75, 160; and transparency 36, 103, 186; and welfare responsibilities/cutbacks 1, 3-6, 18, 31-2, 35, 37, 51, 53-4, 58-61, 66, 82, 88, 969, 103, 112-16, 120, 130-3, 145, 150-1, 159-60, 166, 168-70, 172, 176, 178-9, 182-3, 185; and women’s organizations 9, 18, 16970; World Bank and 41 structural adjustment 5, 16-17, 31, 34, 47, 53, 58-9, 124, 130, 132, 145, 149-51, 160, 166, 170 structuralism 27, 32 subcontracting 50, 75, 83-5, 124, 159, 173 Suharto 113-16, 118-19, 121, 129, 131-4, 175, 178, 181 Sukarno 10, 112-14, 116-18, 121 Sukarnoputri, Megawati 115-16, 181 Sulawesi 110 Sumatra 107, 114-15, 181; Northern 115, 181 Sun Yat-sen 66, 71-2 Systems Integrated 182 Taipei 100, 103 Taiwan, agriculture in 77; and Asian Crisis 13-14, 71; bureaucracy in 70, 178; Civic Organization Law (1989) 100; civil society in 103; colonial history and economy 64-9, 103-4, 178; Community Development Programme 97; democracy in 36, 70; ‘dignity of women’ constitutional clause 102; Economic Planning Council 83; employment

policies in 48, 50; environmental degradation in 182; Equal Employment Bill 101; and export promotion 72-5, 87-8; free trade zones in 16, 73, 75; import substitution in 16, 30, 72-4; Indonesia compared with 107, 109-10, 113, 117, 119, 121, 123-4, 127, 129, 131, 133-4, 174-5, 177-9; informal economy in 17, 88-9, 91, 127; industry in 79, 83; infrastructure of 67, 69; interventionist-developmentalist state in 67-73; investment in 16; Labour Standards Law 101; land redistribution in 14, 67-70, 178; Living Rooms as Factories programme 84-5, 97, 173; as ‘miracle’ economy 173; Mothers’ Workshops 97-9, 169; Philippines compared with 137-8, 145, 148, 153-4, 165, 167-70, 174-5, 177-9; police state in 70; Programme for the Improvement of Foreign Exchange and Trade Control (1958) 74; regional comparison 13-15; restructuring in 72-3, 76, 86-7, 93, 98; sex industry in 89-91, 100; social welfare in 80-4, 88; Southern 77; state role in 6, 14-16, 34-5, 67-73, 88-9, 93-4, 103, 173-5, 177-9; and trade 64-6, 71; and US 72, 82, 88, 178; Women’s Department 96; women’s organizations in 71, 96-8, 134, 182; Women’s Policy White Paper (1996) 102 Tanam Paksa 108 Taoism/Confucianism 14-15 tariffs 1, 29, 73 technology 35, 42, 70, 73, 76-7, 86-7, 118, 143, 147, 154 terrorism, ‘War on Terror’ 115, 179-81 Teuku Umar 110

INDEX

Thailand 10, 52, 76, 106, 157 Thatcher, Margaret 27 Third World 23, 36 Tjut Nua Dien 110 tourism 52, 88-90, 125-6, 157, 161-2; sex tourism 52, 88-91, 162 trade unions 29, 36, 47, 49-50, 70, 72, 82, 127, 157-63 trade, 29, 32, 35, 60, 64-6, 71, 73, 87, 109, 119, 124-5, 139, 141, 181; and the environment 60; freedom of 29, 32, 69, 173; and gender 109-10; liberalization of 35, 75; and state 2930, 75, 160 transparency 36, 103, 186 trickle-down effect 21, 40, 154 United Nations (UN), 2, 25, 61, 89; Commission on the Status of Women 47; Division for the Advancement of Women 50; Human Rights Commission 41; International Decade for the Advancement of Women 47, 168; Secretary-General 2; Women’s Commission 41; World Conference on Population 26; World Conference on Women, Beijing 132, Beijing+5 meeting 2, Nairobi 132

211

United Nations Children’s Fund (UNICEF) 59, 129 United States (US) 20, 22-3, 27, 67, 71-2, 75, 82, 88, 104, 114, 118, 120, 136, 138-9, 142-3, 147-9, 1523, 155, 157, 161-3, 165, 167-8, 170, 175-6, 179-82, 184-5; Central Intelligence Agency (CIA) 175 University of the Philippines 144 Venezuela 185 Vietnam 22, 106; Vietnam War 22, 88, 148, 162 Wahid, Abdurrahman 115-16, 176 Waldheim, Kurt 47 Weber, Max 24, 34, 36 Women Citizens’ League 144 Women’s Rescue Foundation 100 Women’s Voluntary Health Workers’ association (WVHW) (Iran) 59-60 World Bank 1, 5, 16-17, 27, 31, 37, 41, 61, 71, 89, 103, 116, 119, 134, 150, 154, 172, 176, 184-5 World Economic Forum 185 World Health Organization (WHO) 129 World Social Forum 185 World Trade organization (WTO) 71, 184