As the world's third largest country, holding a quarter of the world's population, a vast pool of labor and new consumers for the products of multinational corporations - China's economy will soon be among the world's largest. Market-oriented reforms have recently helped generate very rapid economic growth. The World Bank has predicted that China's economy will grow 8-10% per year until the year 2000 and economic output will reach US$10 trillion by the middle of the next century.
Beginning in late 1978, the Chinese leadership has been trying to move the economy from a sluggish, Soviet-style, centrally planned economy to one that has more market-oriented, but still within a rigid political framework of Communist Party control. To this end the authorities switched from rural collectivization to a system of household responsibility, increased the authority of local officials and plant managers in industry, permitted a wide variety of small-scale enterprises in services and light manufacturing, and opened the economy to increased foreign trade and investment.
The result has been a strong surge in production. Agricultural output doubled in the 1980s, and industry also posted major growth, especially in coastal areas near Hong Kong and opposite Taiwan, where foreign investment and modern production methods helped spur output of both domestic and export goods. GDP has more than tripled since 1978 and the number of people living in absolute poverty has been reduced by 60%. However, not all Chinese have benefited equally. Eight-two percent of foreign investment is in the coastal provinces; Guangdong alone accounts for 33% of all foreign investment. In stark contrast, the 18 inland provinces have received only one-tenth of all foreign investment. "For the working class, the reforms have generally meant powerlessness, poverty and a total lack of influence, in direct contrast to the network of corruption, avarice and greed that envelopes China's elite. Moreover the dramatic wage differentials, growing unemployment, brutal management and the loss of welfare and social benefits have lead to apathy and negativity. Since 1993, a wave of more generalized protest has swept across China, manifesting itself in mass petitioning, strikes and even demonstrations often involving thousands of workers," a labor activist pointed out.
In the midst of such problems, the 15th National Party Congress of the Chinese Communist Party (15th NPCCCP) approved a motion to accelerate the reform of state-owned enterprises. This is to be accomplished by converting large and medium-sized state-owned enterprises into standard corporations according to the requirements of "clearly established ownership, well defined power and responsibility, separation of enterprise from administration, and scientific management," in effect making them corporate entities and competitors adaptable to the market.
China has been in negotiations for entry to the World Trade Organization (WTO). To gain WTO entry, all prospective WTO members are required to comply with certain fundamental trading disciplines and offer substantially expanded market access to other members of the organizations.
Many major trading entities - among them the United States, the European Union, and Japan - have shared concerns with respect to China's accession. These concerns include efforts to obtain satisfactory market access offers for both goods and services, full trading rights for all potential Chinese consumers and end-users, nondiscrimination between foreign and local commercial operations in China, the reduction of monopolistic state trading practices, and the elimination of arbitrary or nonscientific technical standards.
Rural migrants, known as "peasant workers" or Min Gong, are a consequence of China's economic reforms that encouraged the diversion of rural labour into industrial production. Rural migrants, widely put at between 80 and 100 million strong, are still referred to as a "floating" population. Simply, whilst a household stands to gain very little from extra hours in the fields, ten times as much is likely to be gained by the migration of a family member. But for the household as a whole the most lucrative option is local, off-farm employment. Opportunities for employment of this kind are most likely to arise in coastal provinces since these have the highest concentrations of township and village enterprises. The remote, rural areas of inland and western provinces still tend to rely almost exclusively on agriculture; and consequently, the incentive to migrate is greatest there. Escaping poverty, moreover, is not the only motivation for migration. Numerous studies and reports suggest that migrants also commonly aspire to self improvement, the broadening of their horizons and, quite simply, a more interesting life than the village can offer. One survey conducted in Henan province found that more than one third of all households had at least one migrant member. Of these, 90% were male, and more than half went into construction work. A survey conducted in Shanghai in 1995, by contrast, found the highest percentage of migrants to be working in restaurants or street trading (28%), followed by manufacturing (24%) and construction (19%), with gender ratios varying distinctly according to occupation. Women accounted for slightly more than half of the migrant jobs in manufacturing and 40% of the jobs in restaurants and trade.
Migration patterns, and strategies, can thus differ significantly between areas. In terms of distance, moreover, there are three different levels of migration:
1) to different provinces which usually implies a long stay, returning home, if at all, only during the Chinese New Year festival;
2) within the same province, to main cities and the provincial capital; and
3) within the same county, perhaps to the main town or to a township and village enterprise in a different township, in which case migrants may return quite frequently, for example at weekends.
In each of these categories the great majority of migrants find work through informal channels and networks, based on friends and fellow villagers from their areas of origin. These are generally fairly efficient at allocating labor.
State-organized export of labor dates back to the 1950s, when the Chinese Communist Party sent tens of thousands of workers to help ease labor shortages in the former Soviet bloc. In the 1960s and 1970s, Chinese workers were sent in the form of aid to developing countries, mainly in Africa. From 1976 to 1979, China had only 43 contracted projects and labor services cooperating with foreign countries, amounting to US$ 53 million. Shortly after China launched its economic reforms and open-door policy in 1978, the Ministry of Foreign Trade and Economic Cooperation started commercializing the system by sending labor overseas on a contract-basis. The government had two incentives: to get foreign currency and help alleviate the unemployment problem. Between 1979 and 1984, the Middle East and North Africa were the major markets for Chinese labor. During that period, workers posted overseas under the Moftec system jumped from 2,190 to about 50,000. This was followed by five years of stagnation from 1985 to 1990, when recessions in the big industrial economies and reduced oil demand globally slashed the need for foreign labor in many Middle Eastern countries. Labor exports picked up in the early 1990s, however, posting an average growth rate of 34% through 1995. By late 1995, the Moftec system alone accounted for 250,000 Chinese working overseas-largely due to the licensing of new labor-exporting agencies. At the same time, the market for Chinese manpower shifted away from the Middle East towards the former Soviet Union, which has about 10,000 Chinese agricultural workers, and to countries in fast-growing East and Southeast Asia. Hong Kong, Japan, South Korea and Singapore - countries with labor shortages - have absorbed the lion's share of Chinese workers since the start of the decade. Now labor from China has become a thriving business, serving as a safety valve for the pressures of severe unemployment. Research by the Academy of Social Sciences in China indicates that the proportion of Chinese export labor in the global labor market should grow from the present 0.3% to at least 3% within 10 years. The government fears that the huge pool of unemployed could trigger major unrest. But as state firms continue to shed workers (about 10 million were laid off in 1996, and many more will lose their jobs as Beijing tries to adjust stagnant enterprises) the problems are only expected to get worse. For the workers themselves, a job overseas offers higher wages as well as the chance to pick up new skills.
In 1996, foreign workers sent home remittances of $840 million-equivalent to about 1.6% of China's 1994 foreign-exchange reserves. The best estimate for the number of Chinese working overseas, including about 75,000 who are working illegally, is 380,000 as of 1996. More than ever before, neighboring economies are soaking up the surplus.
Chinese economic reforms have also produced unprecedented levels of unemployment. The State Planning Commission estimates that 20 million public sector employees, 70% of whom are women, will lose their jobs over the next five years. Ten million state workers have already been laid off or not paid. Millions more are underemployed and/or paid only partial wages. The national unemployment rate is estimated to be 10% and could be as high as 20% in Northeast China. In March 1997, the All-China Federation of Trade Unions informed congress that 125 million new workers would flood the urban labor market during the current five-year plan (1996-2000), producing "a long-term situation in which supply exceeds demand." In addition to a natural 70-million increase in the urban labor pool, it projected that 15 million people will be laid off by ailing state enterprises and 40 million would come from the countryside seeking jobs.
Under the household registration (hukou) system created during the Mao era, migrants are not permitted to live permanently in areas where they find work. This system was an instrument of social control, rigidly enforcing the rural-urban divide, and limiting access to urban life with its higher wages and subsidized services.
Migrants to other provinces are generally required to supply family planning, education and medical certificates, for which charge is levied as a prerequisite for obtaining employment registration cards from labor bureaux in their provinces of origin. This should enable work permits to be issued by the destination province. But restrictions, bureaucracy and charges of this kind notwithstanding, China's peasants can now move relatively freely in search of work and remain for long periods away from the villages where they are registered. In Beijing and other cities where migrant communities have been established, some migrants have been away from their home villages for more than ten years and show little inclination to return. Urban registration and rights of permanent residence can be bought: but at a price which effectively limits the purchase to a tiny number of "self made" migrant entrepreneurs. In the Pearl River Delta, the going rate is RMB 300,000 (US$ 36,000), Shanghai tops the list with a current rate of RMB 1 million (US$120,000). Yet although the vast majority of migrants cannot afford to buy formal rights for urban residence, de facto migrant communities are becoming more established. The Guangzhou municipal government announced in March 1997 its plan to register and restrict migrant workers. The province reduced the number of registered migrants from other parts of China from 6.6 million in 1996 to only 3.6 million in 1997.
There is a common assumption that migrants are primarily responsible for urban crime, when in fact they are very often themselves the victims. Migrants frequently mention public security as one of the services that they most need in their own communities. City dwellers also fear competition from migrants for job opportunities. The reality is, the jobs that migrants usually do are those that registered city dwellers are not willing to undertake, because they are too laborious, dirty or ill paid. Thus, there is no basis for city dwellers' fears. In fact, migrants are generally very unlikely to work alongside city dwellers: apart from public contact in service industries, migrants are as separated from urban residents in their working lives as much as in their accommodation.
Most Chinese migrant workers have to pay RMB 3,000 to 60,000 for administration charges and deposit. Labor service companies in China are legally allowed to charge a total of 25% of a worker's monthly wage. Under Chinese law, half the sum is used to maintain welfare benefits for the workers while they are away from home, and the rest is to cover company expenses. The root of the problem of abuse of exported labor lay with some middlemen, who illegally add on a high service charge.
Many Chinese have no choice other than to migrate illegally because the current labor - export system can not legally accommodate all the people who want to work overseas. Many of China's neighbors are feeling the pressure of illegal Chinese immigration. South Korea, like Japan, is alarmed by recent increases in smuggled Chinese. Cambodian officials are concerned about growing evidence that their country has become a staging post for smuggling Chinese to other nations. Some Malaysian tourist agencies have been charged with bringing Chinese nationals to Malaysia on tour packages so that they can become illegally employed as restaurant helpers, medicine sellers and entertainers in night clubs.
China has restrictive policies on local labor, no laws protecting overseas Chinese migrants and not or very limited support mechanisms for Chinese migrants. Under the circumstances, a local group was established in China to work with rural migrant women and overseas NGOs concerned Chinese migrants; they are involved with the following activities:
A new project in Beijing aims to inform women migrants of their basic rights while also helping them to overcome the isolation of migration and to adapt to city life and the implications of broader life choices. The magazine, Rural Women Knowing All, targets rural women and runs practical columns on issues such as reproductive health, and receives a large number of letters from migrants in Beijing, describing some of their problems. This prompted the establishment of a migrants' club sponsoring leisure and educational activities. Initial activities were advertised by open letters of invitation displayed in employment agencies throughout Beijing. Most of the women who have participated are around 20 years of age and employed as hospital ancillaries, shop assistants, restaurant kitchen staff or domestic workers. The areas where the women most need help are: personal guidance in matters of marriage and sex; overcoming culture shock on arrival in Beijing, and training and education opportunities. To address the latter, evening classes have been set up for a number of club members. Other bi-weekly activities have included discussion groups on legal rights and leisure activities such as picnics and parties. Informal associations broaden social horizons and also provides an opportunity for the women to share experiences and resources. The club has also become involved as an intermediary in particular disputes, working with and through the Women's Federation. In some cases it is able to assist migrants through a small loans scheme that the magazine operates.
Since 1995, workshops have been organized by Asia Monitor Resource Centre together with partner groups mainly in Macau, Hong Kong, Taiwan and the Asian Migrant Centre focusing on Chinese migrant workers. The most recent workshop was held in Macau in January 1998. Korean and Japanese groups were also invited. Labor organizations, church-affiliated organizations, and migrant support groups gathered to exchange information on Chinese migrants and highlighted the issues and problems they are facing.
The problems faced by Chinese migrants, such as trafficking/ illegal operations, violence against migrants, vulnerable status, low wages, discrimination etc., are not unique. However, there are no support mechanisms, such as documentation or monitoring, for Chinese migrants. Furthermore, NGOs in China cannot link with overseas NGOs on the issue of Chinese migrants.
From the workshop, the groups agreed to work together on the following areas:
This report was compiled from the following sources:
"Chinese Communist Party Opens Its 15th National Congress," China Daily web site.
Han, Dong Fang, "Workers - The great losers in China's reform process" (unpublished paper).
"Migrant Labour: the Fulcrum of Social Change," China Development Briefing, April 1997.
Shek, Ping Kwan (Hong Kong Christian Industrial Committee), paper submitted at the Conference on Chinese migrant workers, January 11-14, 1998, Macau.
Varona, Rex, Migrants' Human Rights: Focus on Chinese Migrant Workers, paper submitted at the Conference on Chinese Migrant Workers, January 11-14, 1998, Macau.
"Workers' offensive," Far Eastern Economic Review, May 29, 1997.