China marked its third year as a member of the World Trade Organisation (WTO) last month with many neoliberal commentators celebrating its economic modernisation as a model for other developing countries.
China's rapidly expanding economy has certainly transformed some parts of the country beyond recognition, improving the standard of life for many, but its economic development is riven with contradictions.
The divide between the eastern seaboard and the rural interior is stark. Within urban areas the gap between rich and poor is also widening. Increasingly those hardest hit by Beijing's economic liberalisation appear prepared to resist. In mid-November the Guardian estimated that some 3 million people had taken part in demonstrations, strikes and other forms of protest in the previous month.
Since China's membership of the WTO was affirmed in late 2001 the Chinese economy has received US$50 billion a year in foreign direct investment. It is now second only to the US in the amount of foreign investment received. China's foreign trade is also expected to jump this year by up to 30 percent to $1 trillion, making the country the world's third largest trading power.
However, not everyone has been able to follow the late Deng Xiaoping's maxim to 'enrich yourself'. Even government figures show that for the first time in 25 years poverty increased in China last year. If one uses the international poverty threshold of $1 per day then an estimated 200 million people, around 18 percent of the population, live in poverty. At the same time it was revealed that the country's richest 100 businessmen saw their incomes grow by more than 25 percent last year.
Small farmers and peasants have increasingly found their land being taken from them, with little or no compensation, by corrupt local officials and businesses. This is a major cause of protest in rural areas. A protest in late October erupted in Hanyuan, Sichuan province, over a proposed dam that threatened tens of thousands of peasants with displacement. Over 80,000 people joined a series of protests against the project, which included running battles with riot police. Police cars were overturned and set ablaze and the local Communist Party chief was even held captive by the demonstrators! At the end of the protests at least four demonstrators and two policemen had lost their lives.
The scale of the protests has meant that national government has not been able to rely on brute repression alone. In the wake of the protests local party officials were fired and a promise was made to 're-evaluate' the level of compensation offered. The Sichuan dam protest is not a unique or isolated event. At last month's national Communist Party plenum top officials described the growing rural unrest as a matter of 'life or death' for the party and its economic programme.
Certainly the problems faced in rural provinces are not easily solved. Government figures indicate that 150 million people in rural provinces are unemployed. This has led to a mass migration from country to city. Mintong (rural workers) have become increasingly visible in China's cities. In 1997 the number of rural migrants in Shanghai was 2.76 million. There are now almost 5 million. In total, government figures suggest that there is a 'floating' population of 100 million mintong throughout the country. The urban renewal of many Chinese cities has literally been built on the backs of these workers, many of whom live in squalid temporary accommodation. The excess supply of labour, combined with the fact that many workers are employed illegally, has meant that real wages for the mintong have remained static for the last decade.
One side effect of China's economic growth is a chronic energy crisis. To alleviate this problem the government has given the green light to the increased development of private mines. Peasants and farmers are often recruited to work in atrocious conditions. In the province of Henan a gas explosion killed 160 workers at the Daping mine in mid-October. All of those killed were mintong.
A riot broke out as the families of those killed were met by indifference from officials. In the same week two other mining disasters killing over 80 people were reported in the state press. As a Henan miner told the Hong Kong based South China Morning Post, 'When it comes to making more money for the bosses, workers' rights and safety conditions always become secondary concerns.'
The number of strikes and demonstrations that have taken place in Chinese cities has also been on the increase. The continuing strike by 6,000 workers at a cotton spinning factory in Xianyang, Shanxi province, is a typical example of the increasingly militant strike action taking place in many cities. In response to a plan to cut wages and lay off over 1,000 workers, the mainly female workforce downed tools and occupied the factory - on occasion blocking the city's main railway line.
In Shenzhen 3,000 workers in an electrical component factory struck against low pay in October. But it is not only manufacturing workers who have shown themselves ready to take industrial action. At a department store in Jining, Shandong province, several thousand workers walked out against long hours and low pay in mid-October, while in Bengby, Anhui province, 10,000 retired workers staged a protest for several days for higher pensions and lower food prices.
Although such actions are often defensive in nature they have won important victories in the face of state repression. The South China Morning Post noted that such strikes 'are signs of ever growing social discontent on the mainland'. That's certainly true but they also demonstrate an impressive level of organisation within sections of the working class and highlight the potential for such struggles to generalise politically.