If you want to work abroad, you typically need a job offer and a work permit. If you are in a regulated profession—i.e., if you provide a service to the public where regulators need to impose basic standards and there often is professional certification or licensing—you need to prove that you are qualified to practice at your destination before you can be awarded either of these things.

Mutual Recognition Agreements (MRAs) aim to make it easier for professionals and their prospective employers to prove such qualifications: the ideal for such agreements is for an individual to automatically qualify to practice in another country included in the agreement once they qualify in their home country. Essentially, MRAs are a formal implementation of the phrase: “If it’s good enough for them, it’s good enough for me”. When an MRA is implemented successfully, the probability that someone is qualified but ends up denied the right to practice in a different country because their qualifications or professional accreditation are not recognised is minimised, and the costs of multiple testing and assessment to prove equivalency of qualifications is reduced.

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MRAs are among the most significant formal frameworks addressing labour mobility in ASEAN, alongside two other agreements, the ASEAN Agreement on the Movement of Natural Persons (MNP) and the ASEAN Comprehensive Investment Agreement (ACIA), which streamline business visa procedures for ASEAN citizens and promote temporary access to facilitate cross-border business activity. They currently cover six sectors: engineering, nursing, architecture, medicine, dentistry, and tourism. There are framework agreements for two more sectors: (geographical) surveying, and accountancy—the key difference being that framework agreements do not provide agreed implementation details and simply include “broad principles for further bilateral and multilateral negotiations”, according to ASEAN’s Framework Agreement for the Mutual Recognition of Surveying Qualifications.

Yet the reach of MRAs has been noticeably limited. After all, most intra-regional migrant labour is unskilled and only a portion of skilled workers are members of the 8 professions covered. A joint report by the International Organisation for Migration and Migration Policy Institute highlighted that workers potentially impacted represent only 1.5 percent of the region’s workforce.

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MRAs have also been noted for their seemingly uneven application, with different standards imposed for each profession. The market advisory firm Dezan Shira & Associates have for instance cited that even as engineers’ applications are reviewed on a case-by-case basis by the ASEAN Chartered Profession Engineers Coordinating Committee (that is, if they already hold a license from their home regulatory body and have at least 7 years of work experience), people in the tourism industry receive automatic recognition across 32 job-titles.

The state of ASEAN’s labour movement policy, warts and all, can perhaps be better understood if we look at the context under which they have been created: labour movement in ASEAN has always been more about trade policy than migration policy.

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MRAs are almost literally an extension of what is being done to facilitate free trade in goods to cover trade in services. In fact, Mutual Recognition has been a common item in trade discussions for at least two decades, and has been used in a variety of trade deals around the world and within trade blocs such as the EU and APEC. Even today, Japan and Britain are looking at a mutual recognition deal for post-Brexit trade. One of the earliest MRAs implemented in ASEAN in 1998 was meant to facilitate cross-border trade of products such as electronics and cosmetics. Trade in services require the flow of people who provide these services, and MRAs are a way to ensure that the quality of services that flow across ASEAN borders meet product standards within individual countries as cross-border flows of professional services (and personnel providing them) is liberalised.

At their core, ASEAN’s MRAs are nothing more than tools meant to smooth over regulatory differences that act as de facto barriers to trade—this is evident for instance in the language of the MRA for Engineering Services, which states that “MRAs serve as a substitute for full-blown regulatory harmonisation, allowing for market access commitments to be operationalised for the covered goods and services while preserving regulatory diversity”. Benefits highlighted by the various agreement handbooks mention enhancing access to markets, allowing importing countries to make use of imported skills to increase comparative advantage in certain fields, and facilitating cross-border transfer of expertise and best practices.

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In light of this, it becomes clear why MRAs are negotiated by sector rather than at a broader level covering more professions and individuals (which would expand their impact), and have diverse methods of implementation. Furthermore, given that the key objectives of MRAs and ASEAN’s broader programme of labour-related agreements are to develop ASEAN markets and increase the competitiveness of professional services rather than to promote freer movement of people as a goal in itself, it makes little sense to negatively compare the scope of ASEAN’s effort in this arena to ‘gold-standards’ like EU’s Schengen.

While it is tempting to compare the ASEAN and EU (as has often been done), the two organisations have drastically different goals: the former has since its inception been economically oriented and has over the years strived to be as ‘non-interfering’ as possible, while the latter was founded on ideals of political and social integration.

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Recognising this certainly doesn’t excuse ASEAN from discussions about whether policy regarding labour mobility should expand beyond a spin-off of trade policy (notably, labour mobility is the only AEC goal without specific targets), or more controversial debates about whether there is scope for the role of the organisation to evolve. It does, however, mean that the success of current policy cannot be evaluated on the basis of most migration policies.

Unfortunately, MRAs do fall short in the goals they actually set out to achieve. The limited number of MRAs so far may be due in part to the tension industries experience between wanting to expand markets and secure the domestic market at the same time. Professional associations may be unwilling to enter negotiations for MRAs unless they think the benefits of market expansion are greater than potential competitive threats to local members.

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Benefits to broadening market access for services are limited further if professionals don’t see the point in practicing in an ASEAN country other than their own or would rather practice outside ASEAN. Empirically, labour flows in ASEAN tend to be one-sided and concentrated in a few corridors as a result of economic disparities, making reciprocal market access less of a boon, and a trade framework less appropriate in this context.

Furthermore, industries where practitioners require local familiarity to be competent (for example, lawyers need to be familiar with local laws, which may display significance variance depending on location, but local familiarity may be relatively less of an issue for doctors since medical science is universal even if there are some differences in administrative procedure) may be less inclined to participate.

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MRAs’ limits are also closely related to why more ambitious agreements do not exist in the first place: there are understandable fears regarding cultural change and employment insecurity, which precipitate political barriers. MRAs may grant regional eligibility, but eligibility by no means guarantees actual access.

In fact, professionals in the 8 categories where MRAs apply are still subject to national policies regarding foreign employment, which have a ‘locals-first’ emphasis across the board. In Indonesia and Malaysia, employers need to prove that an available position cannot be filled by a local employee, as is the case in Singapore where job vacancies need to be advertised locally on a government portal a fortnight in advance. In Cambodia, Thailand, Myanmar, and Laos, companies must demonstrate that skills and knowledge transfers will occur and that foreign employees will eventually be replaced by locals. Permanent flows are still severely restricted in practice, making the impact of MRAs beyond existing agreements promoting temporary access more limited.

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Migration is complex: massive economic, cultural and social disparities that exist across ASEAN nations complicate the issue and create demand and supply conditions which undercut policy aspirations. Policies can close some gaps: efforts to harmonise and translate regional qualifications via the ASEAN Qualifications Framework may broaden the reach of mutual recognition of skills. Suggestions have also been made for mutual skills recognition for medium-low-skilled occupations such as construction, garments, agriculture & fishery sectors.

Yet, the trials faced by MRAs suggest that broadening policy is only part of the solution. Until anxieties about job insecurity and cultural differences can be organically addressed, legitimate social and political opposition will always undercut efforts to liberalise migration. Until labour flows match what ASEAN is trying to regulate— i.e. reciprocal flows of skilled professionals from educational systems of comparable quality, rather than throngs of mostly low to middle-skilled workers seeking better opportunities in a handful of nations— there will always be a gap between what can be done and what is.

 


Yi Ying is an Economics undergraduate at the LSE and hopes you found this article as informative as she found the process of writing it.  Yi Ying can be contacted at yiyingtan100@gmail.com.

Disclaimer: All opinions expressed in this article are the author’s own and do not necessarily reflect the views of the ASEAN Economic Forum.