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GLOBAL WAGE REPORT 2008-09: ILO warns of cuts in real wages for millions of workers in 2009: Declines follow decade in which wages failed to keep pace with economic growth

ILO News, Geneva

The global economic crisis is expected to lead to painful cuts in the wages of millions of workers worldwide in the coming year, according to a new report published yesterday by the International Labour Office (ILO).

"For the world's 1.5 billion wage-earners, difficult times lie ahead,' says ILO Director-General Juan Somavia. 'Slow or negative economic growth, combined with highly volatile food and energy prices, will erode the real wages of many workers, particularly the low-wage and poorer households. The middle classes will also be seriously affected.'

The report, entitled Global Wage Report 2008/09, warns that tensions are likely to intensify over wages.

Based on latest IMF growth figures, the ILO forecasts that the global growth in real wages will at best reach 1.1 per cent in 2009, compared to 1.7 per cent in 2008, but wages are expected to decline in a large number of countries, including major economies. Overall, wage growth in industrialized countries is expected to fall, from 0.8 per cent in 2008 to -0.5 per cent in 2009.

The ILO report shows that this bleak outlook follows a decade in which wages failed to advance in lockstep with economic growth.

According to the report, between 1995 and 2007, each additional 1 per cent in the annual growth of GDP per capita led to on average only a 0.75 per cent increase in annual growth of wages. As a result, in almost three-quarters of countries worldwide the labour share in GDP has declined.

While inflation was low and the global economy grew at a 4.0 perm cent annual rate between 2001 and 2007, growth in wages lagged behind, increasing by less than 2 percent per year in half of the world*s countries, the report says.

There were wide regional differences. The growth in real wages was about 1 per cent per year or less in most developed and Latin America countries, but reached 10 per cent or more in China, Russia and a number of other transition countries.

UNSUSTAINABLE GROWTH IN WAGE INEQUALITY

The report also shows that since 1995, inequality between the highest and lowest wages has increased in more than two-thirds of the countries surveyed, often reaching socially unsustainable levels. Among developed countries, Germany, Poland and the United States are amongst the countries where the gap between top and bottom wages has increased most rapidly. In other regions, inequality has also increased sharply, particularly in Argentina, China and Thailand.

Some of the countries which have succeeded in reducing wage inequality include France and Spain, as well as Brazil and Indonesia, though in these latter two countries inequality remains at a high level.

The pay gap between genders is still high and closing only very slowly. Although about 80 per cent of the countries for which data are available have seen an increase in the ratio of female to male average wages, the size of change is small and in some cases negligible. In the majority of countries, women's wages represent on average between 70 per cent and 90 per cent of men*s wages, but it is not uncommon to find much lower ratios in other parts of the world, particularly in Asia.

WAGES TO SUPPORT THE REAL ECONOMY

Based on an analysis of major trends in the level and the distribution of wages around the world in recent years, the ILO report shows that while wage growth has lagged behind overall economic growth during upswings, it slowed down more rapidly during economic downswings.

According to the report, between 1995 and 2007, for each 1 per cent decline in GDP per capita, average wages fell even further by 1.55 percentage point - a result that points to the possible effects on wages of the current crisis.

'If this pattern were to be followed in the rapidly spreading global downturn it would deepen the recession and delay the recovery', Mr. Somavia said.

As the reports says, 'In this context, governments are encouraged to display a strong commitment towards protecting the purchasing power of wage earners and hence stimulating internal consumption.

Firstly, social partners should be encouraged to negotiate ways to prevent a further deterioration in the share of wages relative to the share of profits in GDP. Secondly, minimum wages should effectively protect the most vulnerable workers. Thirdly, minimum wages and wage bargaining should be complemented by public intervention

through, for instance, income support measures'.

Bank Asia's booth at BDR Headquarters

Nation BUsiness Report

Bank Asia's first booth was inaugurated at BDR Headquarters, Peelkhana, Dhaka, on Tuesday. Syed Anisul Huq, President and Managing Director of the Bank and Col Mohammad Mashiur Rahman, Director Communication of Bangladesh Rifles, jointly inaugurated the booth. Senior Officials of the Bank and BDR Headquarters and educational institutions namely Bir Shreshtha Noor Mohammad Rifles Public School and College (Bangia Medium), Bir Shreshtha Noor Mohammad Rifles Public School and College (English Medium) and Bir Shreshtha Munshi Abdur Rouf Rifles College were present on the occasion. The inaugural ceremony was enriched by the presence of a large number 01 clients and guests.

Workshop on IFRS/IAS held in Chittagong

The Chittagong Branch Council of ICMAB organised a workshop on 'International Financial Reporting Standards (IFRS)/ International Accounting Standards (IAS)' on November 20-21, 2008 at CMA Bhaban, Agrabad in Chittagong.

Vice Presidents ABM Shamsuddin FCMA inaugurated the workshop as chief guest, while Vice President AKM Delwer Hussain FCMA and Secretary Abu Sayed Md Shaykhul Islam FCMA were present as special guests respectively. Chairman of CBC Md Shaifur Rahman Mazumdar FCA, FCMA delivered welcome address and presided over the programme.

Three technical papers presented by Dr Mohammad Saleh Jahur, Associate Professor, Department of Finance and Banking, University of Chittagong, Ranjan Kumar Bhowmik, FCMA, Additional Commissioner of Taxes, NBR and Md Salim Uddin, FCA FCMA, Associate Professor, Department of Accounting and Information Systems, University of Chittagong.

The technical sessions were chaired by Chairman, FATCOM Bangladesh Ltd Abu Sayed Md Shaykhul lslam, FCMA and Past Chairman, CBC, Md Salamat Ullah FCMA.

A good number of Chittagong based members of ICMAB participated in the workshop.

BCI calls upon govt to remove obstacles to industrialisation: Shahedul Islam elected BCI president, Shahab Uddin, Delowar Hossain Raja SVP and VP

NATION BUSINESS REPORT

The 22nd Annual General Meeting 2007 of Bangladesh Chamber of Industries was held on November 24 last in the Board Room of BCI.

BCI President AK Azad presided over the meeting and presented a brief description of BCI activities in 2007. He extended heartfelt thanks to all concerned, including the distinguished directors and members of BCI for offering valuable cooperation towards the last activities.

The meeting discussed threadbare the last year's activities and accounts. After discussion the house unanimously confirmed the minutes of the 21st AGM and adopted Annual Report of BCI for the year 2007.

The meeting elaborately discussed the problems of industrialisation and solution as well as export, investment, abnormal price hike, infrastructure problems including power, gas, water, overall political situation of the country and laid emphasis on solution of those problems.

AK Azad said in his speech that BCI has been trying desperately to help industrialise the country by facing various obstacles.

But deterioration of law and order situation, terrorism, political instability and other several problems are major hurdles on the way to industrialisation and for that reason the economy could not reach the expected target. He urged the government to remove the obstacles immediately for the sake of industrialization.

He also emphasized to take necessary action to help solve the inefficiency of banking sector, reduce bank rate, setting up more EPZ and industrial units/parks to bring down the prices of essential goods to a reasonable level. He urged the government to patronize for setting up of more backward linkage industries, to diversify export and to develop other potential sectors to face global competition.

ATM Waziullah, chairman of the Election Board announced the result of election of the members of the Board of Directors of BCI for the term 2008-2010.

Shahedul Islam has been elected the president of BCI.

SM Shahab Uddin and Delowar Hossain Raja have been elected the senior vice president and vice president respectively.

BSRS earned Tk. 21.36cr during FY 2007-2008

Nation BUsiness Report

Bangladesh Shilpa Rin Sangstha (BSRS) earned a net profit (before tax) of Tk 21.36 crore during Fy-2007-2008. Out of this profit Taka one crore will be paid to the Government as dividend.

There is no shortfall in bad debt provision and capital adequacy ratio as per Bangladesh Bank Circular.

The above information was disclosed while approving the audited financial statements of BSRS for Fy-2007-2008 at a meeting of the Board of Directors held on 23 November, 2008 at the Head Office (BSRS Bhaban). The Board expressed its satisfaction about the performance of BSRS during 2007 -2008 and hoped the organisation will continue to play its important role in the national economy in the coming years.

AIUB's 13 years celebration concluded

The concluding ceremony of AIUB's 13 years' Celebration (15 Nov to 20 November 2008) was held at the Banani Club playground on 20 November. Dr Anwarul Abedin, Founder Chairman, Nadia Anwar, Founder and Vice President (Students Affairs) and Prof Dr T Hossain, Vice President (Academics) of the AIUB gave away the prizes to the winners. Students, Faculty Members, Officials of AIUB participated in varieties of Inter-Departmental events like, Indoor Games & Sports,

Photo Exhibition, Drama, Voluntary Blood Donation, etc during 6 days-long program. Vice Chancellor Dr Carmen Z Lamagna, Hasanul A Hasan, Founder and Vice President HR/Admin/Treasury/, Ishtiaque Abedin, Founder and Vice President (Public Relations International Affairs), Deans, Registrars, Teachers, Officials and Students and guardians were present on this occasion. The concluding session was ended with an enchanting cultural program of music and songs. The AIUB's 13 Years Celebration program was a grand success with the spontaneous support and cooperation of the whole community of the university.

DBBL opens its 3rd SME Service Centre at Meghula Bazar, Dohar, Dhaka

Dutch-Bangla Bank Limited has opened its 3rd SME Service Centre at Meghula Bazar, Dohar, Dhaka on November 24. This SME Service Centre has been linked with the Bank's Truly On-line Banking network to facilitate day-night 24 hours banking services to the clients from the very beginning of the day.

Md. Yeasin Ali, Managing Director of the Bank inaugurated the SME Service Centre from which the customers of the rural area will be able to get the services of ATM, Kiosk (to deposit money), SME loans and remittance services.

While addressing in the opening ceremony, Ali informed that DBBL has planned to open more SME Service Centers for providing modern banking facilities in the rural area. The Bank is always giving emphasis on providing financial services to the potential small and medium entrepreneurs across the country, he added. He categorically mentioned that DBBL has been giving priority to deliver the remittances very quickly and efficiently to the beneficiaries of the Bangladeshi expatriates living aboard.

The local elites, business personalities, bankers, educationists and local journalists were present at the inaugural ceremony. The respected guests opined that Dutch Bangla Bank is not only rendering present-day customers need banking services but also the Bank spends a significant portion of its annual profit for carrying out a wide range of philanthropic and social activities from which the society is at large benefited.

Warid offers bonus for inactive users

Warid Telecom has come up with a special offer of bonus talk-time and SMS for its Zem prepaid subscribers who remained inactive since August this year.

Under the offer, Warid prepaid subscribers who activated their connections before July 31 but remained inactive since August could enjoy the bonus talk-time worth Tk 60 and 600 SMS over next three months if they reactivate their connections by recharging any amount through scratch cards or Ezee loads.

Warid Telecom announced the offer for its inactive subscribers from November 22 and it will remain valid till January 31. After recharging the account during the campaign period, the customer will automatically get the bonus on the first week of the following month.

The subscribers could use the bonus talk time for making calls to other mobile operators while the SMS could be sent to Warid subscribers only.

Apart from the latest offer, all prepaid subscribers can also enjoy a 20 per cent bonus talk-time for every recharge through scratch cards.

Warid Telecom authorities hoped the new offer will encourage their valued subscribers to recharge their accounts for enjoying the bonus talk-time and SMS. Warid Telecom is committed to providing maximum benefit to its valued customer.

Warid Telecom, a subsidiary of UAE-based Abu Dhabi Group, launched its commercial operation in Bangladesh in May 10, 2007 as the sixth the mobile phone operator. Within one year, the company spread its network to all the 64 districts.