Our Work

Created: 18 June 2012

Program Information

Program Supporter The US Department of State

Implementing Partners
Instituto Nicaragüense de Estudios Humanísticos (INEH)
Asociación de Investigacion y Estudios Sociales (ASIES)
Poliarquía Consultores

GFI implemented PILAR (Promoting Informal Labor Rights), a two-year project funded by the US Department of State to improve government capacity to collect data on the informal sector while developing strategies that encourage formalization and provide capacity building to informal sector workers in Nicaragua and Guatemala. Using GFI’s multi-stakeholder approach, we have worked with a broad range of formal and informal worker organizations, government ministries, the private sector, and key civil society organizations.

Engaging Stakeholders to Assess the Problem

Beginning in 2008, GFI conducted national public opinion surveys and focus groups on obstacles and barriers to formalization as well as on ways to extend labor rights to the informal sector. In Guatemala, the survey revealed that a significant percentage of informal workers (67%) are agreeable to registering and paying taxes if the processes are clear and workers gain access to government services such as social security. In Nicaragua, 64% of workers surveyed stated that the lack of access to social security was the worst aspect of informality. From the data assessment, GFI developed discussion topics, which addressed the most pressing needs - while searching for consensus. These topics were discussed at national roundtables and also tied with the design of a schedule of trainings for informal workers.

The national roundtables in each country focused on strategies for formalization looking at cross-cutting issues such as labor rights, women and informality, and vulnerable groups. The strategies included incentives - for example, social security and better access to financial services and credit - to bring informal workers into the formal economy and improved government practices - such as streamlining bureaucratic practices and improving tax collection. Participants of the roundtables, as well as various individual meetings, included government leaders, labor union officials, civil society leaders, private sector representatives, and informal workers. PILAR worked to influence policy makers by building consensus among the private sector and civil society, finding government allies, and working with multi-lateral organizations, such as the ILO, to cement policy recommendations under internationally-recognized standards.

Focus on Workers

To complement GFI's top-down strategy, roundtables kept in direct connection with informal workers' needs by providing bottom-up trainings on a wide range of topics, including computer skills, budgeting, complying with government requirements, accounting and financial management of microenterprises, assertiveness trainings for domestic workers, and more. In this manner, PILAR took a new approach to formalization: GFI assisted self-employed street vendors in setting up their own association (FENTRAVIG), which today has over 2,000 members. We further worked together to start a cooperative, allowing them to import goods and reduce costs by ending dependence on middlemen. Working directly with government, we encouraged relationships with municipalities and helped promote policies, currently in effect, to benefit workers and enterprises. Finally, PILAR encouraged workers to be part of the political system and bring their needs to the table in an effective manner.

A tangible result of PILAR is the Roadmap to Formalization, a document that compiles the consensual recommendations of the many stakeholders. The Roadmap's specific proposals are different in each country, as it is based on the cultural, political, and economic realities of the diverse sectors of workers and microenterprises as well as on each country's laws. However, the core findings can be systematizes: First, decent work is the Roadmap's guiding principle. It was clear through the survey and national roundtables that improving competitiveness and extending labor rights is not mutually exclusive; in fact, formalization can serve as a tool to establish long-lasting business and attract sustainable investment. Second, one of the pillars of good governance is sound information; hence the roadmap focuses on improved labor statistics for the design of government programs. Taxation is also at the crux of formality. Informal workers and enterprises pay "taxes" in the form of bribes or other hidden costs, which through effective governance can be directly collected and used for improved government services. Finally, reducing administrative barriers is necessary to ease the entry of workers and enterprises, taking into consideration the high level of illiteracy and the importance of work hours for street workers. To start implementing integrative policy, the Roadmap recommends launching a simplified registration system called "monotributo."

This will allow workers to register with ease and pay a set fee, which gives them access to social security and other benefits of formalization. The roadmap was presented on October, 2010, at the National Palace in Guatemala City by GFI's President, Karen Tramontano to Mr. Edgar Rodriguez, Minister of Labor, who accepted it on behalf of the Guatemalan government. During the presentation, the Minister of Labor committed his government to work on the implementation of the recommendations, stressing the importance of the Roadmap as a tool for the design of effective public policies and requested the future assistance of GFI. In Nicaragua, Verónica Rojas, Vice Minister of Industry and Commerce (MIFIC), stressed the importance of the Roadmap's recommendations for reaching out to informal workers in a more effective manner and ensure the most successful application of the "One-Stop Window," for which GFI currently assists in it's outreach and dissemination strategy.

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Created: 18 May 2012

For poor nations highly dependent on textile and garment exports, the 2005 expiration of the textile quota system (the Multi-Fiber Agreement or MFA) could potentially be devastating to their national economies. Nowhere is this fear more genuine than in Cambodia, whose economy is more dependent on textiles and garment manufacturing than any other in the world. However, unlike most textile producing countries, Cambodia has a unique advantage in the post-quota environment; a labor rights verification system administered by the International Labor Organization that provides rights protection to Cambodians and brand security to buyers.

The Challenge

Can Cambodia’s success story be sustained as its preferential access to lucrative markets is eliminated? Can its approach to promoting business and labor interests be reproduced in other countries?

With support from the World Bank Group and the US-ASEAN Business Council, in 2004 GFI designed and implemented an engagement process to explore ways to use this uniquely just, innovative advantage to protect and expand Cambodia's textile exports. Joined by the European Commission, Australia AID, and the United Nations Development Program, in February 2005 we organized a 2-day conference of leading CEOs, government officials, and other trade and development experts to discuss Cambodia’s unique opportunities in the global marketplace. Hosted by the Royal Government of Cambodia, the conference highlighted Cambodia’s leadership potential in defining new best practices in global trade and investment, and the many reforms aimed at making Cambodia a premier destination for business.

How GFI Addressed the Challenge

In July 2005, GFI collaborated with the Carnegie Endowment for International Peace and Oxfam America to bring the discussion to American policymakers. More than 200 experts from government, industry, and civil society joined us for a wide-ranging discussion of the fate of textile workers and industries in the 21st century.

In 2006, GFI began to extend its work on textiles to other regions of the world, focusing first on the countries participating in the US-Central America Free Trade Agreement. Our efforts to make the global economy work for poor producers is helping bridge the gap between Central American industry, labor, and government, thereby increasing the prospects of better lives for workers and healthier profits for industry (see our hand-out on the Central America Work Program).

Countries like Cambodia face several challenges in the post-MFA context. They must successfully convert its verification system to meet the needs of the private sector, rather than governments, and do it in a way that conveys transparent and credible information to the media and the activist community that has created and motivated the demand for brand security in the first place. They must also establish and maintain successful market niches for themselves and their industries. While premium buyers have sustained this movement until now, the key to long-term success lies in securing business from a wider array of buyers that may be interested not only in high-quality product from Cambodia, but also in their reputation-safe production environment. GFI and its partners will be there, every step of the way.

Created: 18 May 2012

Program Information

The Challenge

More and more consumers worldwide insist on using sustainably harvested timber and responsibly produced wood products. Corporate buyers and public procurement officers are responding to this demand by sourcing products from producers that can provide them with certifications of properly managed forests, and for tighter scrutiny over the legal origin and production methods of wood products in the market place.

Recently, the demand for certified wood products has begun to have an impact on policies aimed at protecting Indonesian forests, some of the most beautiful but least protected tropical hardwood forests in the world. Policy changes are designed to reduce the amount of lumber harvested, and—more importantly—to suppress illegal logging by strengthening law enforcement.

How GFI Addressed the Challenge

Despite the demonstrated political will at the national level and some excellent new public-private partnerships, the campaign for sustainable forestry in Indonesia is still in its early stages, with much work remaining. To strengthen this campaign, in 2005 GFI convened a coalition of multilateral organizations and civil society institutions— including the World Bank, the International Finance Corporation, PENSA, the World Wide Fund for Nature, The Nature Conservancy and the Global Fairness Initiative— to assist the Indonesian government’s national campaign against illegal logging by generating a set of policy recommendations to encourage increased forest certification.

These recommendations are based on a comprehensive study of global best practices in supply-side incentives for sustainable forest practices. The Motivating Sustainability project study investigated winning—and losing—strategies currently being used in tropical and temperate forests throughout the developing world. Local forest experts then applied these findings to the complex and changing social, political and economic realities of the Indonesian forest sector.

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Created: 18 May 2012

For "Grassroots Producers" -- productive poor persons working in the informal economy -- reliable access to regional and global markets is critical to long-term income growth. We believe that market opportunities for grassroots producers must be strengthened, supported, and expanded.

The Challenge

Grassroots Producer Organizations (GPOs) have developed to build the collective capacity of poor producers, leverage capital, and facilitate trade. These GPOs focus on bringing products to market.

Despite this important step, GPOs remain on the margins of commercial activities due to a number of factors, including:

• Their Size and Organization is often too small to effectively compete;
• The Lack of Information leaves them without market data or good buyer relations;
• Inadequate Technical Capacity makes it difficult to develop production practices that lead to timely delivery of competitively priced, quality goods, and;
• Policy Barriers that often limit poor persons’ access to lucrative markets

The Opportunity

In 2001, GFI facilitated efforts by the Self Employed Women’s Association to create the Grassroots Trading Network (GTN). The goal of the GTN is to strengthen, support, and expand market opportunities for grassroots producer organizations with a particular focus on women producers. Since its creation, the GTN has developed a long-term plan to grow grassroots producers into effective participants in the global economy. In 2004-05, A pilot project was launched in India leading to the preparation of a business plan projecting self-sufficiency by the year 2012. Such an ambitious plan is possible because GTN is acting like a hybrid Chamber of Commerce and Trade Association for poor producers, providing them with trade facilitation, capacity building, and policy advocacy. GTN also uses its growing network of partners to build public/private partnerships with government and businesses throughout the world.

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Created: 18 May 2012

In 2004, working with key partners in U.S. civil society, multilateral institutions, and the academic community, GFI spearheaded a dialog around the simple notion that, since employment – jobs – is the single most important economic factor for the vast majority of the world’s population, widespread sustainable employment needs to be a part of the global development agenda. We believe that sustainable job creation – not wealth creation that leads to the creation of new jobs – should be central to globalization.

The Challenge

In 2004, GFI facilitated five seminars involving key partners within civil society, multilateral institutions, government, and academia to discuss the concept of a Decent Work Agenda. The results of these meetings were so well received they became part of the 2004 World Commission Report on the Social Dimensions of Globalization, endorsed by all the members of the International Labor Organization GFI moved the debate from an academic theme to an accessible policy dialog that includes a carefully-constructed consensus among civil society partners and opinion leaders from around the world.

We view the decent work agenda as one of the most exciting and economically empowering policy challenges for the development community.

The Opportunity

Beginning in 2007 and as an ongoing initiative today, GFI is moving the decent work agenda from consensus building to implementation, and will develop a pragmatic yet sweeping set of policy prescriptions and arguments for a progressive employment and development agenda.

How will do this this? First, we will coordinate research and activities that have developed in various forms and institutions, including the International Labor Organization, the Carnegie Endowment for International Peace, the Center for American Progress, the Economic Policy Institute, the Ethical Globalization Initiative, the Brookings Institute, the International Institute for Economics, the Center for Strategic and International Studies, and the Center for Global Development.

Second, GFI will produce an accessible document—a “white paper” -- for use by the general public and political leaders. The white paper will describe the basic, non-technical concepts and public policy rationale for the decent work agenda. The “white paper” will also outline the arguments for employment lead growth to policy makers, the media, opinion leaders and civil society.

Creating a movement and set of policy prescriptions around the decent work agenda requires a long-term commitment. It may take another decade before we fully realize the economic policy reform necessary to promote workers' interests and inspire real changes in the lives of the poor, the unemployed or under-employed. Starting from a very modest intellectual base, GFI has made an important and clearly defined impact on the early growth of this movement. Looking to the future, the policy generation and implementation phases are not far off.

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