There is talk that the Beijing and and Guangdong governments are starting to play hard-to-get with foreign investors, downplaying their importance in upgrading China’s manufacturing, R&D and local market offerings.

However one report in The Japan Times indicates that Dongguan, at least, is still welcoming foreign investment.

A vice mayor of the Chinese industrial city of Dongguan urged Japanese manufacturers Friday to expand on its turf and exploit its domestic market to help the city recover from the global economic crisis and fall in exports.

“We are looking for more Japanese manufacturers to build R&D (research and development) centers in our city and create domestic brands, securing distribution routes,” Jiang Ling, vice mayor of Dongguan in Guangzhou Province, said at a news conference in a hotel in Minato Ward, Tokyo.

In many ways, what Jiang is saying is in lockstep with what the central and Guangdong governments seem to be promoting– focus on domestic consumption, R&D and high-tech manufacturing.

But what makes Jiang’s comments interesting are that he’s actively courting foreign investment, stating clearly that it essential for the area’s recovery.  Moreover, he’s speaking on behalf of Dongguan’s townships and villages, and these are the organizations which will be interpreting and implementing whatever policies flow down from Beijing and Guangzhou.

While this doesn’t mean that Dongguan is a good place to set up labor-intensive manufacturing, it does indicate that Dongguan, at least, is still Foreign Investment friendly.

A new article in the Financial Times discusses the new face of migrant labor in Dongguan.  The article basically says that the oft-predicted worker unreast didn’t materialize because those predicting it envisioned the migrant workers of yesteryear (hordes  of rural, unsophisticated “factory  girls”) rather than the migrant workers of today (semi-urbanized, getting more sophisticated,  with more connection to the communities in which they work).

Seems accurate enough.   But what caught my eye were the last two paragraphs,  sharing the stated views of a famous Chinese labor activist:

[The activist]…once incarcerated for his efforts to establish an independent alternative to the government-sanctioned All China Federation of Trade Unions, notes that the last thing the country’s labour movement needs is more martyrs rotting away in Chinese prisons for daring to challenge the Communist party’s authority. Far better, he adds, to focus on factory-floor issues that affect workers’ daily lives. [emphasis mine]

As [he] said in an address to Hong Kong’s Foreign Correspondents’ Club earlier this year: “Why not let workers and employers settle their problems [independently] at factory level? That’s the best way to make a harmonious society.”

What does he mean by “factory-floor issues that affect workers’ daily lives”?   It looks like he’s telling us workers rights will improve not by workers banding together to cause unrest, but by going to the gemba and working together with management to ensure  that their working lives are safer, more comfortable, and more productive (with the assumption that increased productivity means increased compensation for the worker).

Not news to me… I’ve said elsewhere that LEAN, JIT, and related strategies and concepts can do more than just add value for shareholders and customers, but can add value for the workers and for the community as well.   What surprises me is hearing it from labor.

I’ve argued in the past that the labor unrest in Dongguan and Shenzhen was overplayed and over-emphasised by the western media.  Here’s another article, “Violent unrest rocks China as crisis hits” which contradicts my view.

It just doesn’t scare me as it might.  As with the articles of the past, it highlights a few anecdotes (albeit fresh ones)  about unpaid workers protesting, official malfeasance in controlling the press, an extortion scheme perpetrated by an unemployed worker.

I guess if I didn’t live here and have the perspective that I do, this article might send shivers up my spine.

Maybe not.

AS AN EMPLOYER IN DONGGUAN, I HOPE NOT

There’s more rumbling in the press about the possibility of China suspending (or choosing to ignore) the year-old Labor Contract Law (LCL). The following, from a recent  Wall Street Journal article (subscription required) suggests that the Dongguan City Government may be supportive of this effort, as it may help to mitigate the impact the downturn is having on enterprises operating there.

To aid businesses, Beijing has permitted local authorities to freeze minimum-wage levels and to reduce or suspend employers’ social-insurance contributions.

The vice mayor of Dongguan, in Guangdong, says many employers hope the central government will suspend the Labor Contract Law, and his office has sent that request to Beijing. “We can’t ourselves halt the implementation of a national law,” says Jiang Ling.

Giving business such leeway could ultimately undermine trust in the still-developing rule of law, says Andreas Lauffs, a partner at the law firm of Baker & McKenzie who focuses on Chinese labor issues.

As an employer in Dongguan, I hope this doesn’t happen for at least two  reasons.

It helps keep an even playing field:
While the LCL may be flawed (I don’t think the open-ended contracts are reasonable) it does help to ensure that the rules are stated, contracts signed, and that the existing Labor Law is followed.  That means that those of us who WANT to follow the law are not so easily undercut by those competitors who can take advantage of the murkiness of unenforced laws.

Happier, healthier community:
Those of us who live and/or work in areas where migrant laborers abound would like to see them develop into a happier and more satisfied population.   If my workers are happy but the workers in the surrounding factories are not, the entire community suffers.

Just my 2 cents worth.