Op-ed: A labour dispute in northeastern China was settled quickly when authorities paid coal miners two months back pay. The miners took to the streets on Saturday and in spite of heavy police presence got the concession of some of their back pay. Often public demonstrations of unhappiness are put down quickly with force.
Details of the labour action are still sketchy because the PRC discourages publicity about any form of civil unrest.
Government officials at the Shuangyashan foreign affairs bureau told Reuters reporters that they were not allowed to report without permission and escorted them out of town on Tuesday. Reuters
The mine operators, Longmay Group, have been suffering losses since 2012 and are seeking to cut their workforce from 248 000 to 148 000. The corporation is owned by the provincial government.
Coal is the major supplier of energy to the nation, but the central government is seeking to curb its use because of worsening air pollution and reduced demand as factories slow output due to dropping demand for products.
The central government has announced that no new coal mines will be opened for at least three years and a programme to shut down within the year, 1000 mines currently operating. In late January the central government added an additional 4300 more mines to the list of closures. More than 7 000 mines have already been shut down. Those are the official mines. There are an uncountable number of unofficial mines that are operated by one or two people making a subsistence living.
The downturn in the Chinese economy has coined a new term – zombie factories. Many factories continue to operate at a loss in order to keep workers employed. As in the miners’ situation, sometimes the pay is late in coming.
The central congress has decided that they must cut this over capacity not just in the mining sector, but across the whole economy and have predicted that as many as six million people will lose their jobs.
While zombie factories can’t continue indefinitely, the prospect of millions of out of work, out of money people is a daunting one. The central government still maintains that the official growth rate is over 6% but those investing in the Chinese stock market have shown their lack of confidence in those figures. The value of the yuan has continued to drop.
Adding to the economic woes, the wealthy are scurrying to get their money out of the country.
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