Chines factories hum, but conditions are worse

Shop until they drop: UK stores shocked by conditions in their Chinese factories

By Martin Hickman, Consumer Affairs Correspondent
Published: 14 January 2006
Clothes and toys on sale in Britain's high streets are made by Chinese workers forced to endure illegal, exhausting and dangerous conditions, according to a new study. It will increase the pressure on retailers to monitor the conditions in which their products are made.

A three-year investigation into booming export factories for companies such as Marks & Spencer and Ikea discovered the human cost of China's "economic miracle". It found an army of powerless rural migrants toiling up to 14 hours a day, almost every day. Many were allowed just one day off a month and paid less than £50 a month for shifts that breached Chinese law and International Labour Organisation rules. Despite evidence of the shocking working conditions, cheap clothes, toys and increasingly electronic goods from the sweatshops are on sale in British shops with household names, including those with ethical buying policies.

Ethical trading consultants for Impactt, which works with businesses to improve their social impact around the world, were allowed into 100 factories supplying 11 British retailers.

They found that "ethical audits" - the conventional method of checking conditions - were ineffective because of falsification of records. Instead, working hours were cut by improving efficiency, said their report, Changing Over Time, sponsored by the Co-operative Insurance Society. But even these reduced working hours still exceeded Chinese labour limits, said Rosey Hurst, Impactt's director. She added: "What has surprised and depressed us since 1998 when we started working in China is that all the efforts of the ... companies have made very little difference to the working standards. The response by Chinese factories is to work out how better to cook the books."

Companies are attracted to doing business in the People's Republic of China because of its low-tax development zones, cut-price abundant workforce, and totalitarianism. Independent trade unions are banned by the Communist Party. Assembly-line personnel in free-trade zones in south China operate machinery without safety guards and spray paint with inadequate face masks. They often die in industrial accidents or fromgulaosi, the Chinese term for death from overwork. Workplace death rates in China are at least 12 times those of Britain and 13 factory workers a day lose a finger or an arm in the boom city of Shenzhen. In a sign of official disquiet, the state-owned China Daily reported in November that a 30-year-old woman, He Chunmei, died from exhaustion after working 24-hours non-stop at a handicraft factory.

The International Textile, Garment and Leather Workers Union fears that multinationals are in a "race to the bottom" in workers' conditions. Neil Kearney, its general secretary, said: "There's no such thing as cheap clothing because ... the main people paying the price are the people producing it." Of a factory visit two months ago, he recalled: "There were about 700 workers in this factory. Those workers appeared dirty, raggedly clothed and malnourished. If you had taken some black-and-white pictures they would have fitted not too badly into Dickensian scenes.

"They were sharing 12 men to a room. Literally they had a box to themselves, like the boxes you see in the films of the concentration camps. The washing facilities were a cold water tap on a balcony. The wages were something like ... £1 a day."

Such miserable conditions allow China to undercut developing countries by up to 60 per cent. It now supplies 90 per cent of the world's toys and one-fifth of Europe's clothes, though textile exports are soaring. With explosive annual growth of 9 per cent, China overtook the UK last month as the world's fourth largest economy and is forecast to pass Germany by 2010. Its transformation from peasant economy to industrial marvel has drawn 100 million peasants to the cities - the largest human movement of people in history. Most of the workers end up in the free-trade factories of the Pearl River Delta. Little publicity emerges about these factories because they are privately run and in Guangdong province, which is 1,500 miles from foreign correspondents in Beijing.

The Chinese authorities acknowledged last month that 80 per cent of private companies "frequently violated" workers' rights. Mick Duncan, national secretary of the anti-sweatshop campaign No Sweat, said: "There has been an increase in workers' unrest and rebellion and in strikes and even kidnappings of factory managers and people do not resort to those kind of measures unless they are really forced to. I think that's an indication of how awful things are."

The growth in trade with China

By Martin Hodgson

* Figures published this week showed that China's trade surplus with the rest of the world more than tripled to $102bn (£58bn) last year, as its exports outstripped imports.

* The country's exports rose by 28.4 per cent to $762bn (£429bn), while its imports rose by just under 18 per cent to $660bn (£371bn).

* China's biggest trading partner was the European Union, with bilateral trade rising by 22.6 per cent to $217bn (£122bn) in 2005. The US is China's second largest trade partner, followed by Japan.

* Within the EU, the UK is China's third largest trading partner, importing £10.6bn of goods from China during 2004, the last year for which the Department of Trade and Industry has published figures.

* China's principal exports to Britain are IT and telecommunications equipment, clothes, toys, furniture and machinery.

* Figures for December suggest the rate of China's export growth was beginning to slow, and some analysts predict export growth could drop compared with last year as the US loses its appetite for cheap Chinese goods and the yuan gains value.

* Last year, Beijing revalued the yuan for the first time in a decade, allowing its value to fluctuate within a narrow trading band, but many analysts believe it could strengthen further if China allowed it to trade freely.