China Labor Unrest Spreads, Posing Challenge to Beijing

Labor protests that have forced shutdowns at overseas-owned factories in China have spread beyond the country’s southern industrial heartland, posing a dangerous new challenge for Beijing.

Chinese workers assemble electronic components at the Taiwanese technology giant Foxconn's factory in Shenzhen.
AFP | Getty Images
Chinese workers assemble electronic components at the Taiwanese technology giant Foxconn's factory in Shenzhen.

Workers at a Taiwanese factory outside Shanghai clashed with police on Tuesday, leaving about 50 protesters injured. The confrontation represents an escalation of recent industrial action, which until this week had been largely peaceful and concentrated in southern Guangdong province.

The unrest suggests that industrial action is proliferating faster than local governments and the sole union allowed by the communist party – the All China Federation of Trade Unions – can resolve them.

There is no evidence that workers at different factories are co-ordinating their activities but the success of a strike at the transmission operations ofHonda, the Japanese carmaker, has emboldened workers by demonstrating that mass action can yield results.

Workers have largely circumvented the official union in recent protests, another concern for Chinese leaders, who are quick to suppress any political organisation outside of the ruling party.

Protests by workers are not uncommon in China but they have rarely happened in a concerted fashion in factories operated by multinationals such as Honda and their affiliates.

The clashes at KOK International in Kunshan, in eastern Jiangsu province near Shanghai, coincided with renewed action surrounding Honda and its China-based suppliers.

The strike, at Foshan Fengfu Autoparts, forced Honda to suspend production at its assembly plants in nearby Guangzhou, Guangdong’s provincial capital. The joint venture supplies exhaust components.

China mapA Honda spokesman also confirmed further industrial action at a locks supplier late on Wednesday, but no details were available on its impact.

Yum Brands declined to comment on a report by the official Xinhua news agency that 68 KFC and Pizza Hut restaurants in Shenyang, in north-east China, had agreed to raise wages 30 per cent to Rmb900 ($130, £90).

Workers at Foshan Fengfu, which employs 492, appeared to have been inspired by the strike last week at a Honda transmission plant which ended when the company agreed a 24-33 per cent wage rise.

Workers returned to the factory on Wednesday but visitors said production had not resumed.

On June 6 about 300 workers at a Taiwanese audio components factory in Shenzhen blocked roads to protest against shift changes. A spokesman for Merry Electronics said the situation was quickly defused. “We had decided at the beginning of the year to raise wages 10 per cent by July 1, but had never announced this to the staff,” Tseng Chin-tang said.