After a spate of strikes across its export zones last year, including 200-odd mass incidents in the Pearl river delta that were sparked off by an agitation at a Honda car-parts factory, Chinese minimum wages have risen by an average of 22% in provinces like Guangdong. And the previous year, seeking to cushion its export zones against the global downturn, Beijing had pumped in a $600bn stimulus that was historical in scale and the envy of all other economies. But most of that stimulus is spent now; US recovery hasn?t picked up as hoped; and the crisis has entered a worsened phase in Europe, which accounts for over one-fifth of all Chinese exports. So the challenge of yet another round of labour protests is going to be harder to tackle, as Beijing is now also trying to rein in credit growth to curb inflation and calm the real estate bubble. Yet, there is no doubt that the new rounds of protests aren?t unsubstantial, as the competition pressure to move inland or overseas is structurally a long-term reality. The Federation of Hong Kong Industries has warned that up to a third of the 50,000 Hong Kong-owned factories in China could downsize or close by this year?s end. Even the state sector has begun to feel the pinch, with complaints of migrant workers not having been paid for months now flooding in from railway and road building industries.
As China?s manufacturing heartland, as its wealthiest and most economically liberal province, the irony is that Guangdong?s ambitions are inextricably tied up with a migration of low-paying jobs elsewhere. But even that which looks pretty as the future is not comfortable as the present.
