Case study: Colombia investment, export promotion and workers’ rights Maria Alejandra Gonzalez-Perez Camilo Piedrahita Vargas Laura Jaramillo Echeverri Tatiana Restrepo Rey Multinational Enterprises and Enterprise Engagement Unit Geneva 2018 Enterprises Department Copyright © International Labour Organization 2018 First published 2018 Publications of the International Labour Office enjoy copyright under Protocol 2 of the Universal Copyright Convention. Nevertheless, short excerpts from them may be reproduced without authorization, on condition that the source is indicated. For rights of reproduction or translation, application should be made to ILO Publications (Rights and Licensing), International Labour Office, CH-1211 Geneva 22, Switzerland, or by email: [email protected]. The International Labour Office welcomes such applications. Libraries, institutions and other users registered with a reproduction rights organization may make copies in accordance with the licenses issued to them for this purpose. Visit www.ifrro.org to find the reproduction rights organization in your country. Gonzalez-Perez, Maria Alejandra; Vargas, Camilo Piedrahita; Echeverri, Laura Jaramillo; Rey, Tatiana Restrepo Case study: Colombia investment, export promotion and workers’ rights ISBN: 978-92-2-132161-3 (print) 978-92-2-132162-0 (web pdf) The designations employed in ILO publications, which are in conformity with United Nations practice, and the presentation of material therein do not imply the expression of any opinion whatsoever on the part of the International Labour Office concerning the legal status of any country, area or territory or of its authorities, or concerning the delimitation of its frontiers. The responsibility for opinions expressed in signed articles, studies and other contributions rests solely with their authors, and publication does not constitute an endorsement by the International Labour Office of the opinions expressed in them. Reference to names of firms and commercial products and processes does not imply their endorsement by the International Labour Office, and any failure to mention a particular firm, commercial product or process is not a sign of disapproval. Information on ILO publications and digital products can be found at: www.ilo.org/publns. 2 Table of Contents Acknowledgements ............................................................................................................................................ 5 Foreword ............................................................................................................................................................... 7 1. Introduction ......................................................................................................................................... 9 2. Profile and context............................................................................................................................. 9 A. Macro-economic situation ................................................................................................................. 9 B. Main social and labour challenges for Colombia ....................................................................... 9 3. Attracting investment and promoting exports .................................................................... 10 A. Colombia country branding efforts............................................................................................... 12 B. Colombia attraction of FDI and impact on labour rights ....................................................... 13 5 Trade, FDI, and their implications for labour rights and working conditions .......... 13 6 The future: Colombian post-conflict ............................................................................................ 15 7 Conclusion ............................................................................................................................................... 17 Annex I: Key events of recent Colombian history ................................................................................. 19 Annex II: Recent Colombian labour policies and regulations ............................................................ 23 Annex III: ILO conventions ratified by Colombia ................................................................................. 25 Annex IV: Trade and investment agreements signed ............................................................................ 29 References .......................................................................................................................................................... 31 3 4 Acknowledgements The authors 1 would like to recognise the time and information provided during the data collection process provided by Mr. Juan David Tous, Mr. Juan Fernando Velez-Ocampo, Mr. Nicólas López, Mr. Erika Villareal, Mr. Daniel Garcia, Mr. Lorena Rivera, Mr. Carlos Abray Zapata, Mr. Andrés Sarmiento, Mr. Jhon Jairo Gallego, Mr. Guillermo Zapata, Mr. Gilberto Antonio Torres, Ms. Ana Maria Gomez-Trujillo, and Mr. Santiago Viera. Finally, we would like to thank Mr. Ronald S. Wolf for his assistance in proof-reading this report. The report was condensed and edited by Johannes Weiss under the supervision of Emily Sims, Senior Specialist Multinational Enterprises and Enterprise Engagement unit. 1 Maria-Alejandra GONZALEZ-PEREZ (PhD, MBS, Psy) is Full Professor of Management at Universidad EAFIT (Colombia). Maria-Alejandra is the Vice-President of Administration at the Academy of International Business (AIB) (2015-2018), coordinator of the Colombian universities in the virtual institute of the United Nations Conference for Trade and Development (UNCTAD) since 2009, Distinguished Fellow of the Association of Certified Commercial Diplomats; Research Partner at the CEIBS Center for Emerging Market Studies, and Editor-in-Chief of the business journal AD-minister. Dr. Gonzalez-Perez holds a PhD in International Business and Corporate Social Responsibility, and a Master’s degree in Business Studies in Industrial Relations and Human Resources Management from the National University of Ireland, Galway. Email: [email protected] Camilo PIEDRAHITA VARGAS is the Dean of the Law School at Universidad EAFIT (Colombia). Associated Professor of Labor and Social Security Law.) Member of the Latin American Institute of labor and social security law. Professor Piedrahita Vargas holds a Master’s degree in Law and Economics from the Universidad Externado de Colombia. Email: [email protected] Laura JARAMILLO ECHEVERRI is a Lawyer from Universidad EAFIT (Colombia), and holds a Master in Intellectual Property, Industrial Property and New Technologies (LLM, IP & IT) from the Universidad Autónoma de Madrid. Email: [email protected] Tatiana RESTREPO REY is an International Business Negotiator with an emphasis in Marketing from Universidad EAFIT. She also studied at Kyung Hee University in South Korea. Email: [email protected] 5 6 Foreword Job creation, skills development and promotion of respect for workers’ rights are central to sustainable development and more inclusive growth. This is especially true for linkages between MNEs and local small and medium-sized enterprises (SMEs), which may have a lot to learn from larger, globally competitive enterprises. As local enterprises increase their productivity and competitive position, they improve their capacity to provide quality jobs which respect workers’ rights. The quality of the jobs created, both directly and indirectly from investment play a crucial role in advancing social development. The ILO Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy (MNE Declaration) contains principles addressed to governments, enterprises and social partners with the aim to stimulate the positive contribution of multinational enterprises to economic and social progress and decent work for all, especially in the areas of employment, training, conditions of work and life and industrial relations. Investment Promotion Agencies (IPAs) are the interface between government and investors. They are on the front line in carrying out government investment policies, making the case for why foreign investors should invest in their country. They also provide support to investors and in doing so gather valuable information which can help to refine government investment strategies and related policy areas. From their unique position, IPAs can play a vital role in shaping effective policies for driving sustainable development. They can raise awareness within government of the importance of attracting investment for local development while also raising awareness among foreign investors of how they can maximize their positive contribution to the communities and countries in which they operate. They can ensure sustainability components in all projects, Greenfield and others. Within the broader framework of the 2030 Agenda for Sustainable Development and the Addis Ababa Agenda on Financing for Development, IPAs increasingly look for examples of successful investment policies and strategies in specific sectors and development contexts, and of how investment policies can be linked to broader policies for developing local industry, supporting entrepreneurship, building infrastructure and developing a skilled workforce whose rights are protected. This case study evaluates the policies and practices that the Colombian government initiated to attract investment and promote exports based on improved