Page 70 - Accelerating out of the Great Recession

THE NEW REALITIES

2. In the Czech Republic, the government announced that
it will pay foreign workers to return to their native coun-
tries; it has committed $3 million to the program.
3. In Malaysia, the government decided to revoke the visas
of 55,000 Bangladeshi workers following protests by the
Malaysian Trades Union Congress. The decision to
revoke visas followed an earlier ban on hiring foreign
workers.
4. In the United States, foreign students who typically have
stayed in the country after finishing their studies—thus
adding to the talent pool—are facing increasing difficul-
ties in doing so.

So, whether it is the application of conditions for state aid,
the pressure of public opinion, industrial action, favoritism, the
widening of the definitions of “sensitive” industries, the use of
“sustainability” as a reason to invest locally, or any of the many
other forms of job protectionism, there will be more of it over
the coming years.
This trend defies the laws of free trade. There is a broad con-
sensus among academics that free trade generates wealth for all
the countries participating in an open market and that protec-
tionism is not helpful for any country. But the political reality
means that protecting domestic labor is a high priority, espe-
cially in times of crisis. And it comes as no surprise that most of
the executives (more than 70 percent) we surveyed expect an
increase in protectionist measures.
Only executives in Japan and Germany, the most export-
dependent nations of the developed world, are more optimistic.
But they run the risk of being severely disappointed.

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