Migrant workers unload frozen fish from a boat at a fish market in Samut Sakhon Province, west of Bangkok, Friday. Pic: AP.

The United States downgraded Thailand, Malaysia and two other countries in its 2014 Trafficking in Persons report, released Friday. Thailand is now listed as a Tier 3 country, due to its poor record on trafficking and workers’ rights for migrant laborers. The report describes Thailand as a “source, destination, and transit country for men, women, and children subjected to forced labor and sex trafficking.” According to the report, the conservative estimate of trafficking victims in Thailand is in the tens of thousands.

The Tier 3 designation could result in economic sanctions from the U.S. for both Malaysia and Thailand. The CNN Freedom Project noted that Tier 3 countries “could … face U.S. opposition in obtaining development aid from international financial institutions like the World Bank or International Monetary Fund.”

Thailand had been on the brink of downgrade for the past several years, but remained at level two on promises it would take more effective action against trafficking. Many victims in Thailand come from neighboring countries such as Burma, Laos, and Cambodia, off on the promise of legitimate work. But they are often coerced into what essentially amounts to slave labor, working up to 20 hours a day seven days a week under threat of physical punishment if they refuse. The report also noted the smuggling of Rohingya people fleeing persecution in Burma, who are then often sold into forced labor situations. Because these people are considered stateless in their own country, there is little recourse for their plight.

The report also indicated that foreign children are at serious risk of trafficking and forced labor in Thailand:

Some children from Thailand, Cambodia, and Burma are forced by their parents or brokers to sell flowers, beg, or work in domestic service in urban areas. Thai victims are recruited for employment opportunities abroad and deceived into incurring large debts to pay broker and recruitment fees, sometimes using family-owned land as collateral, making them vulnerable to exploitation.

Child sex trafficking also appears to have gone underground, occurring in “increasingly clandestine” circumstances, such as in massage parlors, karaoke lounges, hotels, and private homes, rather than out in the open, according to the report.

The downgrade comes at an unfortunate time for Thailand’s military government, which took over in a coup in May. Foreign governments have been critical of the coup, and Thailand’s decreased status on human rights will not help bolster its image any.

The Nation reported that Gen. Prayuth Chan-ocha said the junta’s recent focus on illegal labor was in response to the possible downgrade, but reporting for the TiP was done before the coup. Prayuth reportedly blamed criminal gangs for rumors about crackdowns on foreign workers, and for the sudden exodus of migrant workers from the country.

Before the report was released, Thailand’s Commerce Ministry set up a working panel on trade and labour to address problems in those areas. The Nation quoted Srirat Rasrapana, permanent secretary at the ministry, as saying, “All sectors are waiting for the US [anti-trafficking] report. Thailand will move forward to solve labour problems no matter what the report comes out with. The committee will be a deep trilateral collaboration and will show Thailand’s seriousness in resolving the [people smuggling] problem.”

Malaysia was also downgraded to tier three, as were Venezuela and Gambia. This means they rank at the same level as North Korea, Eritrea, and Democratic Republic of Congo, among other countries notorious for human rights violations. The TiP noted that Malaysia does little in the way of assisting trafficking victims, often detaining them for more than a year, allowing little mobility outside detention centers, and refusing them work permits. This inability to work makes them vulnerable to exploitation and trafficking, and to ending up in situations of debt bondage as they seek help from smugglers, traffickers, and brokers who promise them assistance and jobs for exorbitant fees.

Complicated work agreements for migrant workers, in which they might be employed by a recruiter rather than the company where they actually perform their jobs, can lead to confusion and pave the way for exploitative situations in Malaysia, according to the TiP. The report states:

In some cases, foreign workers’ vulnerability to exploitation is heightened when employers neglect to obtain proper documentation for workers or employ workers in sectors other than that for which they were granted an employment visa. In addition, a complex system of recruitment and contracting fees, often deducted from workers’ wages, makes workers vulnerable to debt bondage. A Malaysian government policy implemented in January 2013 that places the burden of paying immigration and employment authorization fees on foreign workers, rather than the employers, increased this risk.

Regarding sex trafficking in Malaysia, the report stated, “A significant number of young foreign women are recruited ostensibly for legal work in Malaysian restaurants, hotels, and beauty salons, but are subsequently coerced into the commercial sex trade.”