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Don’t discriminate against expatriates [The Fiji Times, 19 Aug 1999]

29/03/2012

The FLP Government and some sections of the public have been concerned that expatriates have been unnecessarily taking up jobs in Fiji.

No doubt, there are some expatriates doing jobs which could be done equally well by locals. But we need to be careful that we do not shoot ourselves in the foot by indiscriminately tossing out expatriates.

Expatriate witch-hunts may result in a few short-term gains but deny long term, “big picture” benefits to Fiji.

Many areas, locals not available

Our own recent everyday experience tells us that in many specialised areas, locals are just not available, at the right time, of the right quality, and in the right quantity.  For example, to investigate an air crash; or run an international airline; or advise on perpetually troubled water supply systems.

Of course, it is equally not true that the cost factor will ensure that expatriates will not be hired un-necessarily.  Many times, expatriates do tend to hire other expatriates, even if a qualified, lower cost local is available.

But this is also to be expected given that expatriates (like most of us) enjoy the social company of people with the same culture and interests as themselves.

Often, there may be no personal cost involved for the hiring expatriate, as they may be hiring on behalf of their institution (like a University or a foreign bank).

Strange advantages of hiring expatriates

Some Machiavellian employers (both expatriate and local), in their own long-term financial interest, may prefer to hire more expensive expatriates, if there is a fear that the local, once he “learns the business”, will set up in competition.  An expatriate, on a work permit, can always be sent packing.

In some Government departments and public enterprises, local chief executives may prefer expatriate advisers beneath them, who are less likely to threaten their own  positions.

But the above situations were surely not the case when the local board of Fiji TV appointed another expatriate Chief Executive.

Government interference not sensible or desirable

And in general, why should Government interfere if a private individual or company wishes to hire expatriates?   It is not Government’s money at risk.

Will Government assume liability for lower profits or even losses made because of Government interference in hiring or firing of expatriate staff?

Does Government have the capacity to efficiently control such appointments throughout the private economy?

It is even doubtful that Government should interfere with the decisions of boards of pubic enterprises, to make appointments (whether expatriate or local).

Fiji’s taxpayers have lost hundreds of millions of dollars where the chief executives and board members of pubic enterprises, appointed by Government, have been incompetent or corrupt locals. This is not to say that expatriates cannot be incompetent or corrupt.

But public funds should not be endangered because companies are forced to employ locals whose hiring may save a few thousands in salary and perks, but end up costing the enterprise millions of dollars in the long run, because of bad decisions by the appointees.

May discourage foreign investment and entrepreneurship

As important is the effect on foreign and local investment, if Government begins to discourage the employment of  expatriates needed by investors.

For more than a decade, the Fiji economy has been suffering from a great dearth of investment, both foreign and local.

Fiji does not lack for capital: our money markets are awash with money for which there are no takers with acceptable returns and risks.  What Fiji lacks is dynamic entrepreneurship and productivity which converts our ample resources into investment projects, economic growth, income, and employment.

Some entrepreneurship is available locally, but is very limited in scope, diversity and depth, especially when it comes to generating export-led growth.

Solid sustained economic growth will not occur unless we do have a significant increase in expatriate entrepreneurship and investment,  right across the economy.  Even local investors will require expatriate expertise.

Is there any developing country in the world, which, this century, has demonstrated sustainable economic growth without expatriate investment and expertise?

Of course, foreign investors and expatriates will take out their profits and savings (as also do local investors).  But they also create incomes and employment for the rest of the economy.  And they transfer much needed skills and vital first-hand information on investment possibilities, to locals.

It is extremely unlikely that such foreign entrepreneurship and investment will be attracted to Fiji if  their operations were subject to Government’s less than transparent discretion in control of work permits for expatriates.

Would not any investor of millions like to have a few management staff of their own, even if there may be locals who could do the same job as the expatriates?  It is their money, their perceptions of risk, not ours.

As importantly, excessive limitations on expatriates working in Fiji will also deny Fiji citizens the opportunity to learn at first hand, what  is needed for Fiji to compete globally with other countries.

WTO pressures on Fiji

It is increasingly being realised that for developing countries to survive in a WTO driven deregulated world economy, there is a need for a quantum jump in the productivity of their labour forces.

Those who have experienced  international levels of productivity know only too well that Fiji lags far behind.

One competitive skilled craftsman in Australia or NZ does in one day, the equivalent of a typical 5-person team in Fiji:  one person driving the truck, one person to set up the tent and boil the tea or mix the grog, one person to carry the tools and materials out, one person to do the actual work, and one person to stand around and “supervise”.

We see this everywhere in Fiji- the building and construction industry, the PWD, the utilities,  you name it.

Of course the skilled person in Australia is paid more as well.  But there is a “chicken and egg” situation here: the Fiji employer won’t pay more because the productivity is not there; the Fiji labourer won’t work harder because the pay is not worth it.

Fiji workers are also reluctant to leave low wage or salary work for better paying self-employment, because the risks are thought to be too high.

How will these cycles and ruts in thinking be broken?  I suggest that the presence of expatriates (of all kinds) helps to break the cycle.

Fiji people learn from expatriates

Fiji people, (with our malua mentality) can surely learn from the new Chinese migrants who have taken dalo farming and marketing, restaurants, beauty saloons, garment factory work etc. to new heights of productivity through sheer hard work.

These Chinese migrants need to be emulated, not subjected to inhumane mid-night raids, frightening old people and children.

When an expatriate (or former expatriate) very successfully runs a simple local artifact shop for tourists, it clearly encourages locals to do the same

This “learning by seeing” has surely been working right across the economy, for individuals and companies.  This cannot be taught in schools or universities, where the lecturers could not become entrepreneurs, even to save their lives.

This is not a zero sum game where locals lose just because there are expatriates in the country.  This can be a win:win situation for both locals and expatriates alike.

Look at Singapore with a fraction of our natural resources, and multiples of our population.  Their per capita income is higher than many developed countries now.

A primary cause is the virtual freedom Singapore gives to foreign firms, entrepreneurs and skilled people to invest and work in Singapore.  A quarter of all residents are expatriates.

Yes, expatriate companies in Singapore are also responsible for three quarters of income generation.  But ordinary Singaporeans only know and enjoy their own extra-ordinary high incomes which result from the presence of the expatriate companies and personnel.

Not suggesting “open season” either

I would not suggest that Fiji should completely open its doors to foreign investment and expatriates.  Of course, we may have natural resources (such as our rain forests or fisheries) that must be protected from vicious unsustainable exploitation.

And there may be a few limited situations where Fiji does not derive any great benefit from having large numbers of expatriates.

But it is extremely unlikely that a Government Ministry and Government officials can efficiently and fairly control where expatriates should be employed and under what conditions, through the entire economy.

This will be even more difficult if foreign investment does increase significantly over the next five years, as is expected and hoped for.

What Fiji needs are simple, transparent rules which will discourage genuine “malpractices” of expatriate hiring, without our society becoming inhumane to individuals.

We are also “expatriates” elsewhere

Can we remember that Fiji citizens are also becoming part of global labour markets.  Our own citizens, working in Australia and NZ, would surely hate to be treated as “expatriates” who are doing the “locals” there out of a job.

 

There are probably many other more important problems that the new Government could be devoting its energies on, rather than this one which can send out so many wrong signals.

 

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