Tag Archives: China

Preliminary Report on China’s going Global Strategy: A Labour, Environment, and Hong Kong Perspective

Capital Mobility Research Paper Series No 3

By Au Loong Yu and Kevin Li (Globalization Monitor)

Globalization Monitor, Hong KongSince the turn of the century Chinahas already become a significant player of out-flowing FDI (Foreign Direct Investment), FPI (Foreign Portfolio Investment) and an international world lender. This is against the background of China’s proclamation of seeking a ‘peaceful rise’. It is followed by more than 20 years of huge FDI inflow, which for many years was second only to the USA and then for three consecutive years, beginning from 2002, surpassed it.

For some years the think tanks of the Chinese government saw the relationship between Yinjinlai, literally meaning ‘inviting in’ (inflow FDI),and Zouchuqu, or ‘going global’ (outflow FDI), as supplementary to the course of modernization. According to this discourse, in the first phase of modernization, a country tends to accept more inflow FDI, without, the surplus capital for export. Then the inflow FDI, after interacting with the domestic market, necessarily modernizes the country to a point where it is both possible and necessary for the country to build its own TNCs (Transnational Corporations) and conduct overseas investment.

In 2004 the head of the Research Centre for the study of TNCs, Wang Zhile, edited a report on China’s TNCs with funding from the state. The Research Centre is a branch of the Research Institute of the Ministry of Commerce. Wang noted that

“Both the ‘inviting in’ and ‘going global’ strategies are ways to integrate into economic globalization. ‘Inviting in’ is the base for ‘going global’, and ‘going global’ is the necessary result of ‘inviting in’. The former strategy enables our country to get necessary economic resources like capital, technology and raw materials, but the initiative does not lie in the hands of our corporations. In fact, China’s accession to the WTO (World Trade Organisation) not only implies that she has domestic obligations to fulfil, but also that she is entitled to her legitimate rights beyond China. Only when we enhance our strategy of ‘going global’, of trans-national operation, can we balance our obligation with our rights’

Another professor from the think tank further elaborates the relations between ‘going global’ and the WTO:

“Now that China has become a WTO member state, we on the one hand need to fulfil our domestic obligations, while on the other we can also enjoy the privilege of national treatment (under WTO terms) afforded to Chinese enterprises, when they enter the markets of WTO member states.”

Chinabegan her overseas investment in 1980 following the course of market reforms that were kick started in 1979. Generally we can divide the last 28 years into three periods.

The preparatory phase: 1979-1991

Although the amount of over seas investment in this period is small, it helped Chinese firms to accumulate the necessary experiences and to cultivate partnerships and contacts for more overseas investment in the following years. In this period the place for overseas investment was first and foremost Hong Kong.

The second phase: 1992-1998

Deng Xiaoping’s tour to the South marked his attack on the ‘Conservative’ and the inauguration of full scale integration to global capitalism. It also began a period when China’s overseas investment increased dramatically. Again HK remained the most important destination, although it also started to diversify.

The third period: 1999- present

In early 1999 the State Department adopted a new document to promote overseas investment with special emphasis on processing industry. In 2001 Premier Zhu, in his policy address to the People’s Congress, officially used the term “going global” strategy for Chinese firms. In this period there is not only a dramatic increase of out flowing FDI, but also FPI(Foreign Portfolio Investment), including financial investment and international lending.

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Calling for worldwide support for Wukan’s fight for democracy

“Down with Corruption, Reclaim Our Land” —Hong Kong
Calling for worldwide support for Wukan’s fight for democracy

On November 21st, 1927, under the leadership of Peng Pai, pioneer of the Chinese Communist revolution as well as committed socialist, the country’s first rural Soviet administration was established in area of Hailufeng, Guangdong province. Thus began the first chapter of the Communist movement in China.

On November 21st, 2011, less than a few kilometers away from the founding site, at Wukan village (part of Lufeng city in eastern Guangdong province), a few thousand villagers took to the street. Holding up signs that read ‘Down with dictatorship’, ‘Curb corruption’, ‘Down with government-business collusion’ and ‘Return land to the people’, villagers marched to the government headquarters at Lufeng city to protest against officials’ illegal land seizures and sales. Their demands were clear: to reclaim the land sold without the consent of the people, to release public accounts concerning the some 400 hectares of land seized and sold since 1978, to launch investigations into fraudulent elections and to enforce the Organic Law of Village Committees to hold fair and open elections. The demonstration ended peacefully after the acting mayor received the villagers’ petition.

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ATNC Network Letter to Honda Motors Co., Ltd. CEO, Mr. Takanobu Ito

Attention:

Honda Motor Co., Ltd.

President & CEO

Mr. Takanobu Ito


Dear Mr. Ito,

We have received information about the strike by workers at the Honda Auto Parts Manufacturing Co. in Foshan, China. We are informed that of more than 1,800 employees in the factory, 80 percent are student interns from technical schools, who are not protected by the labor law and whose wages are as low as 900 Yuan per month – below the minimum wage for the city. The interns are provided with only one meal a day and are charged for the cost of utilities connected with their lodging, reducing their earnings to only around 700 Yuan per month. Even after interns become regular employees, their wages are only 1,000 Yuan per month.

The workers went on strike to demand increased wages, yet during the negotiations the management has not shown good faith. The management has begun to force the interns to sign a “no more strikes” promise and has even mobilized some of the interns’ teachers and local government officials to exert pressure on the interns to go back to work on May 31. Throughout the process, the Honda official trade union has not provided any assistance for the striking workers, but urged them to resume production as soon as possible without regard for the resolution of the workers’ grievances and demands.

 

On May 31, your company in China continued to refuse negotiations. What is more, the local government together with the trade union, went to each team of workers and threatened with dismissal if they didn’t go back to work immediately. The worker representatives’ complained to us that about 200 men wearing union badges, attacked some 40 workers who insisted on continuing the strike. The assault led to multiple injuries and bleeding. We are shocked and outraged to learn that during the attack China Honda management did nothing to stop the assault on workers. We severely condemn such illegal acts of violence and Honda owes an apology to their workers.

You yourself reported in April 2010 that last year Honda’s sales achieved an all-time record of 580,000 units in China, the world’s largest automobile market. The workers of the factory are never able to afford one of the cars, which they are helping to produce by making auto parts. As the producing workers, they have a right to bargain for a greater share in the profits of the firm, and as management of a company originating in Japan, the management should respect the workers’ rights to free association and collective bargaining. The management should not shame itself by threatening and dismissing workers when they justly demand a greater share of the huge profits reaped by the company.

Rather, we hope that Honda management will lead the way in showing ‘harmonious relations’ with its workers, and we join the striking workers of Honda Auto Parts Manufacturing Co., Ltd. in demanding the following:

  1. Take responsibility for failing to ensure the workers’ safety by allowing the union men to attack the workers on May 31 which resulted in casualty, and paying for their medical treatment and recovery.
  2. Accept workers’ demands for higher wages: a wage increase of 800 Yuan per month for all workers and a compensation subsidy of 100 Yuan for each additional year of service.
  3. Reorganization of the Honda company union – organize a re-election of the trade union chairman and officers so that workers may elect representatives who act in accordance with their interests.
  4. Reinstate the dismissed employees and impose no punishment for workers who joined the strikes.
  5. No retaliation against workers after the settlement of dispute.

 

Regards

 

 

 

May Wong, Globalization Monitor, Director 

Doris Lee, Asia Monitor Resource Centre

ATNC Monitoring Network, Coordinator


On behalf of:

Globalization Monitor, Hong Kong

Asia Monitor Resource Centre, Hong Kong

Hong Kong Confederation of Trade Unions, Hong Kong

Students and Scholars Against Corporate Misbehavior, Hong Kong

Justice and Peace Commission of the Hong Kong Catholic Diocese, Hong Kong

Cambodian Tourism and Service Workers Federation (CTSWF), Cambodia

Persatuan Sahabat Wanita Selangor, Malaysia

Workers Assistance Center, Inc., Philippines

Solidarity of Cavite Workers, Philippines

National Coalition for the Protection of Workers’ Rights – Southern Tagalog, Philippines

Labor Education Advocacy Development and Services and Research Institute, Philippines

Committee for Asian Women, Thailand

KASBI – Congress of Indonesia Unions Alliance, Indonesia

Focus on the Global South, Thailand


and

ATNC Monitoring Network

China Labour Net, Hong Kong

 

June 1, 2010

ATNC & ANROEV Letter of Condemnation of Hong Kong Employers Lobbying Against Workplace Collective Wage Negotiation in China..

Attention:

Mr. Anthony Wu,
Chairman Hong Kong General Chamber of Commerce
22/F United Centre, 95 Queensway, Hong Kong
Email chamber@chamber.org.hk

Dr. Jonathan Choi Koon-shum,
Chairman The Chinese General Chamber of Commerce
4/F., 24-25 Connaught Road, Central, Hong Kong
Email cgcc@cgcc.org.hk

Dr. David Y K Wong,
JP, President The Chinese Manufacturers’ Association of Hong Kong CMA Building,
64-66 Connaught Road Central, Hong Kong Email: info@cma.org.hk

Mr. Cliff Sun,
Executive Director Federation of Hong Kong Industries
31/F, Billion Plaza, 8 Cheung Yue Street, Cheung Sha Wan, Kowloon
Email: fhki@fhki.org.hk

ATNC & ANROEV Letter of Condemnation of Hong Kong Employers’ Lobbying Against Workplace Collective Wage Negotiation in China and Labour Rights Violations in Asia
To the leaders of Hong Kong’s main employers’ federations, trade associations and chambers of commerce:

The ATNC Network (Asian Trans-National Corporation Monitoring Network) and ANROEV (Asian Network for the Rights of Occupational and Environmental Victims), representing more than 50 labour groups, trade unions and activists from over 20 countries, have noticed the recent legislative initiatives in Guangdong Province in mainland China about setting up collective wage negotiation mechanisms in enterprises. These legislations are aimed at building a collective negotiation mechanism that sets workplace wages between employers and the Chinese trade union, the All China Federation of Trade Unions (ACFTU).

We further have observed that the legislations have major limitations, firstly by mandating the right to collective bargaining with the employers to the ACFTU; and secondly allowing the government a greater degree of control over the spontaneous workers’ strikes. Nevertheless, the recent legislations should be recognized as the result of workers’ struggles which have successfully pressured the government to address the low wage regimes which is widespread in the province; and the failure of the official trade union to represent workers in the workplace, thereby driving the latter to resorting to industrial actions to protest against the low wages.

The ATNC Network and ANROEV condemn the high profile protests of the Hong Kong employers and trade associations and their lobbying against the collective negotiation on wages in China. In Asia, the profit accumulation of Hong Kong companies has been based on exactly the same measures of founding a low wage regime based on violations of the right of workers to collective bargaining enshrined in the local and international labour standards such as the International Labour Convention 98; and last but not least, by the intentional busting of active, independent trade unions.
Hong Kong companies have been directly implicated in:

Occupational deaths of 134 female workers in the industrial fire of the supplier factory of Chicco in Shenzhen China in 1993; and 188 deaths and over 500 injuries of Kader toy factory in Thailand in 1993.
Dismissals of 800 redundant workers in the mainland subsidiary factory of Hong Kong based garment retail company Bossini in 2006.
Factory closure of Gina Form, a subsidiary of Hong Kong owned Clover Group in Thailand and dismissals of 1300 workers.
Oppression of workers’ strikes and independent trade union organizing in Winner Garment and River Rich in Cambodia in October 2006 resulting in 117 workers being laid off, and reinstatement of only 87 of them in 2007 after vigorous international campaign and protests against the company.
At least 200 workers employed in the Hong Kong-owned jewellery and gemstone factories located in Shenzhen, Huizhou and Haifeng city, have been diagnosed with silicosis since 2001. Other than violating the safety and health standards and causing lethal occupational diseases to the employees, the Hong Kong employers denied responsibility and compensation payments have been procrastinated at the expense of the lives of the workers and the livelihood of their families.
We strongly demand that the Hong Kong General Chamber of Commerce, the Chinese Chamber of Commerce and the Hong Kong Federation of Industries:

1. Stop the lobbying against collective wage negotiation in mainland China; respect the right of workers and trade unions to collective wage bargaining in Asia.

2. Stop busting independent trade unions in Asia and comply with the International Labour Convention 98 on collective bargaining.

We express our solidarity to workers and their struggles for the right to organize and fair wages in mainland China.

Asian Trans-National Corporation Monitoring Network (ATNC Network)
Asian Network for the Rights of Occupational and Environmental Victims (ANROEV)

28 October, 2010