6 - Free Flow of Skilled Labour in ASEAN

Summary

I. Introduction

The AEC provides for market access for ASEAN skilled labour, that is, professionals and skilled manpower. “Free flow of skilled labour” affects the implementation of the ASEAN Framework Agreement on Services (AFAS) through allowing foreign service suppliers, and the ASEAN Comprehensive Investment Agreement (ACIA) through allowing employment of foreign corporate personnel to accompany FDI.

The AEC Blueprint focuses on action to implement Mutual Recognition Arrangements (MRAs) for major professional services which, as discussed in the chapter, is highly inadequate to achieve the AEC objective of “free flow of skilled labour”. The AEC Scorecard Report on skilled labour for the 2008–11 period is extremely brief:

To support greater mobility of qualified professionals in the region, the MRAs for engineers and architects have been implemented, while work is underway to effectively operationalize the other professional MRAs (nursing, medical, dental, accountancy and surveying). To facilitate the movement of persons engaged in trade and investment, the ASEAN Agreement on Movement of Natural Persons (MNP) has been drafted and is expected to be finalized in 2012.

An example of the legal hurdles to implement MRAs is given by Tilleke & Gibbins (1 March 2012) in the case of Thailand. Thailand was the second last member (after Laos) to ratify the ASEAN Framework Agreement on MRA in May 2002, which came into effect in December 2002. But Thailand has yet to ratify any of the seven MRAs signed, and in engineering services, it came short of ratification by merely sending a “notification of participation” to the ASEAN Secretary-General. Thailand has to revamp its two major legal stumbling blocs:

• The Foreign Business Act (FBA) restricts the participation of aliens in certain business activities according to three lists. List 1 principally contains agriculture and land-dealing activities. List 2 includes businesses related to national safety or security or involving art and culture, tradition, folk handicraft, or natural resources and environment. List 3 contains most services, including legal and accounting. Foreigners cannot engage in List 1 activities at all, while the activities under List 2 and List 3 may be pursued if the foreigner obtains an alien business license. Tilleke and Gibbins argue that a major overhaul of the FBA would cause delays in the implementation of Thailand's AEC commitments.