Magazine Issue 11 Summer 2000
SEZs – Specially Exploitative ZonesWhile China’s application for WTO membership stumbles ahead, Laurence Van de Walle reveals the appalling labour conditions in the country’s Special Economic Zones - in which many of the goods to be found in British high streets are manufactured.
Transnational companies’ huge profits are based, at least in part, on the cheap labour of Special Economic Zones. In 1991 Levi-Strauss was reported to be using young female labour in near-prison working conditions. Consumer campaigns in the North have also targetted the labour behind labels such as Gap, Nike, Reebok, Disney and Wal-Mart. However nothing has really changed for the producers of these goods: the introduction of corporate codes of conduct, for example, is little more than a public relations tool for transnationals (Labor Rights in China, June 99).
What is a Special Economic Zone (SEZ)?
In China the SEZs were designed as windows to the world – attracting foreign currency and technology thanks to an investor-friendly environment: including low wages, tax breaks and no trade unions (China Labour Bulletin, issue 49). Most of the foreign investment comes from Hong Kong, Taiwan, Japan, Macau, South Korea, the US and Germany. Goods produced are mostly sports shoes, toys, clothing and electronic goods. These are produced in small makeshift plants set up by the local authorities or private owners under layers of sub-contracting for the export market. These sweatshops produce more or less the same item for different brands by simply changing the label. Gap, Adidas and Nike all use Chinese labour: Nike has over 70,000 sub-contracts.
Commercial concentration camps?
These Chinese companies hire young rural migrant workers (Mingong) pushed by poverty from the inner Chinese countryside. These people are considered an ideal workforce to exploit - they are isolated, relatively uneducated, and have little knowledge of trade unions. Most of them are young women between 16 and 24, who are believed to work harder and be less rebellious than other workers. They have short-term contracts or no contract at all. These workers also include children under 16 years old, although the use of systematic child labour has been difficult to prove.
Workplaces resemble concentration camps rather than commercial premises: workers are searched when going out, private guards watch the exits, monitor the pace of production and count how many minutes workers spend in the bathroom. ‘Three in one’ factories, where the production floor, the storage space and the workers’ dormitory are on three levels of the same building are common, despite being in theory illegal. Fire exits are often kept locked and windows barred.
Fires in SEZs are not an unusual occurrence as local officials and foreign investors ignore all kinds of safety regulations. In Shenzhen, 28 workers died during a fire at the Zhimao electronics factory in 1999. In May 1998 in Guandong, 19 workers died and 46 were hurt in a fire blast explosion in a factory which was a joint venture with the Japanese Company Ikebun. One of the worst disasters took place on 19 November 1993 in Zhili Handicraft factory, a Hong Kong-owned plant producing toys for Italian label Chicco, when 87 people died and 47 were severely injured.
Han Dongfang, a Chinese trade unionist in exile in Hong Kong, gathered evidence from one worker employed at a shoe assembly factory in Guandong, producing K-Swiss sports shoes. The employee earns 540 Rmb (about £40) a month, including overtime premium. He pays the factory for his food and for the bedding he uses in the dormitory. Dormitory conditions are no better than the working conditions: 30 to 40 workers occupy a 20 square metre room; 4 workers share one bunk bed, 250 workers are packed on each floor and there is no toilet. A deposit of 100 Rmb (£7) is required when a worker starts a job, 20 Rmb is deducted from the monthly wage to cover the 200 Rmb that the factory paid to the authority for the temporary residence permit. There is no medical insurance or pension scheme. During the busy season, the working day lasts up to 14 hours, 7 days per week, with no more than 1 or 2 rest days a month. The fines make the wages even lower: 10 or 15 Rmb can be levied if the worker is late or unable to meet production quota.
Some companies, such as the Taiwanese-owned YiXing shoe factory, use corporal punishment. The technique, called ‘the militarisation of management’, is so brutal that it even breaks the rather lax Chinese labour laws. Some managers claim to have found this style of management the only way to avoid a drop in production.
China’s much-applauded economic success is built upon the growing exploitation of its workforce and the repression of any attempt at workers’ organisation. Northern governments are well aware of this but are far more concerned about accessing the potentially huge Chinese market which will be opened to their own companies when China finally completes its WTO accession.
Unless stated otherwise, info in this article is taken from the website of the Chinese independent trade union movement: http://www.china-labour.org.hk