South African Chinese Clothing Industry Faces Life And Death Choices

The labor and wage policy in South Africa has made the clothing industry emerging by Newcastle because of Chinese businessmen face the choice of life and death.

Can Chinese businessmen struggle to save themselves?

There is no Chinatown in South Africa, but Newcastle is worthy of the "Chinese" in South Africa.

The title of "city".

The city in northwest South Africa rises with the arrival of Chinese businessmen at the end of last century.

About 60 families produce at least 180 thousand garments a day, serving the local market in South Africa.

The factory mainly employs Chinese enterprises and employs about 6500 people, accounting for 1/3 of the total employment of Newcastle.

However, the profit margins of Newcastle's garment factories have been greatly squeezed by exports from China and Southeast Asia in recent years, and intensified labor conflicts have pushed them into a desperate situation.

"All aspects of the policy are against us now.

The South African government seems to give us a signal that you can end your journey home, Game Over. "

A woman factory owner who arrived in Newcastle from Shanghai in 1992 said.

Since the 90s of last century, a large number of Chinese businessmen in Taiwan and mainland have come to Newcastle, and dozens of factories have been set up, making it the most concentrated area in South Africa's textile and garment industry.

According to official statistics, there are about 1100 garment factories in South Africa, and the total number of underground factories may be close to 2000. Newcastle has concentrated about 3% of the clothing factories in South Africa.

The Chinese garment factory of Newcastle is now attracting the attention of South Africa.

Previously, they were known as "sweatshops" and became "illegal pioneers". They were accused of refusing to pay legal salaries and face huge tickets.

In the autumn of 2010, Chinese garment factories and law enforcement officers were confronted with a threat of collective closure.

In order to overthrow the jurisdiction of the collective bargaining Committee of the South African national garment industry, five Chinese garment factories launched a lawsuit against the labour Committee and the South African labor minister in 2011. The case is expected to be held in January next year.

If it wins, it will change the important basic economic system in South Africa in the garment industry. It is also a big step for the Chinese to take part in politics in South Africa.

Labour Committee's ticket

Albert (Ferdie Alberts) has been in charge of attracting foreign investment for 20 years.

Local Chinese businessmen said that no matter whether Taiwan businessmen or mainland businessmen were brought to Newcastle by Albert.

Albert recalled to reporters that in 1993, a local state-owned steel plant declared privatization, and 7000 people were laid off in six months, and seven hundred or eight hundred houses were vacant.

"We must do something.

Because of sanctions, we have limited access to help.

The arrival of Taiwan businessmen actually created this industry. "

Albert said.

Before 1994, South Africa was subjected to international sanctions because of apartheid system, and many preferential policies were formulated to attract foreign investment.

At that time, the cost of manufacturing in Taiwan increased, and labor-intensive SMEs moved outward.

A large number of Taiwanese enterprises came to South Africa, bringing an industrial chain of textile, printing and dyeing, and garment making.

Today, more than half of the property in the old industrial area of Newcastle City is owned by Chinese businessmen with yellow skin, and the new industrial area on the Yellow Street in the motor outside the city outside the city. Most of the factories are also leased by Chinese factory owners.

The early traders in Taiwan made a lot of money. They not only supplied the local market in South Africa, but also exported to Europe and the United States.

Liu recalled that there were 70 Taiwanese sweater factories at the height of Newcastle's textile industry.

The situation reversed after 2000.

One reason is the sharp appreciation of rand (South African currency), followed by the African Growth and Opportunity Act, which came into force in 2000. This bill gives South African tariff free clothing exports to the United States, but the specific restrictions on fabric sources put South Africa at a relative disadvantage.

Since then, there have been several changes in the Chinese garment industry of Newcastle: clothes replaced sweaters, domestic sales instead of exports, and mainland manufacturers replacing Taiwan manufacturers. The threshold of textile and garment industry is not high. The mainland workers who worked before had enough money and experience to start running their own factories.

"This is the way people in mainland China work, raise money and start factories.

With equipment and monads, it can be produced. "

Mr. Ye, who works for a year, said he worked for five years and did not send money home. In September 2010, he made a production line, hired 15 workers, and now invested about 200000 rand (about 180 thousand yuan).

Unexpectedly, Mr. Yip, who has just started, hasn't tasted much sweetness. He has been punished with huge penalties for failing to pay legal remuneration to the workers.

He showed reporters a ticket that he just received from the labor and capital committee Kwazulu natal division.

The ticket shows that he fined 264 thousand Rand from September 1, 2010 to May 31, 2011.

The difference in the wages of workers is the main part, which amounts to 170 thousand Rand, and others include collective bargaining committee membership fees, workers' welfare benefits, and a total fine of 25%.

This is the number one problem facing Newcastle clothing factory.

Many of the costumes in South Africa are Chinese.

Disputes between labour and capital are both right and wrong.

The collective bargaining committee is a unique wage system in South Africa and is applicable to many industries.

The establishment of collective bargaining system is to protect individual workers who are in a weak position in labor relations, and also a typical product of strong trade unions.

The salary level negotiated is legally binding, and the committee is also responsible for overseeing the implementation of industry wide enterprises.

Newcastle has been classified as Non-Metro Areas, and its salary level is lower than that of metropolitan area.

However, Newcastle's Chinese garment enterprises unanimously complained that the negotiating committee's calculation of wage differentials was too hasty and unfair.

Mr. Yeh received a ticket showing that the legitimate weekly wages paid by his factory to two categories of workers should be 489 Rand and 418 Rand, but he only paid 310 Rand and 200 Rand.

As a matter of fact, most of the Chinese garment factories in Newcastle have received huge tickets because of the lower level of remuneration paid to workers.

The larger the size of the garment factory, the higher the number of workers, the higher the tickets.

Yan Ronghua, chairman of the Newcastle textile and Garment Industry Association (hereinafter referred to as the Textile Association), has a ticket of up to 4 million Rand.

According to Liu Quanyi, chairman of the Newcastle Chinese Chamber and Taiwan businessman, if the company considers the fine is unreasonable, it may request the representative to arbitrate.

"Many times they will maximize the amount and then step back to solve the problem.

But even if it is halved, no one can be punished.

According to Liu Quanyi, 562 of the 1058 garment enterprises in South Africa failed to meet the statutory pay standards. These manufacturers were collectively referred to as non compliant manufacturers.

Most of the owners of Newcastle's tickets received no penalty as Mr Ye did.

In the autumn of 2010, the Labor Committee approved the enforcement of the ticket application. First, the registration and evaluation of assets value, then the confiscation of assets, and the final sale of these assets.

However, the police enforcement action encountered a collective boycott of Newcastle traders.

According to local media, all Chinese manufacturers stopped their business when the police confiscated a Chinese garment factory called "Wingtong".

At the end of September 2011, the labour committee acted again.

On the one hand, it continued to apply for the confiscation of the assets of the Chinese garment factories, and issued auction notices; on the other hand, in September 29th, the Negotiation Committee joined the Newcastle police office, immigration bureau and trade union to conduct a joint law enforcement and raided the illegal employment of 12 Chinese textile mills.

During the operation, 6 Chinese workers and 40 other nationality workers were detained for work visa issues.

The inspection of Chinese factories and the arrest and extended detention of Chinese workers caused two Chinese Chambers of Commerce to stop all Chinese manufacturers in Newcastle area for two days in protest.

The Chinese community believes that the negotiating committee selectively enforce laws on Chinese enterprises.

"Unqualified manufacturers account for half of the industry, and Newcastle has 60. Why not check other vendors?" Yan Ronghua said.

Local immigration official Myz (Dumisani Mkhize) denied this.

He said that the local immigration authority has the right to execute any law or report on any factory or residence that may have illegal immigrants.

{page_break}

Initiate a lawsuit

An important reason for the continued pressure of Chinese manufacturers is that the Chinese Chamber of Commerce launched a lawsuit against the Labor Committee in June and July.

The plaintiff is the five garment manufacturer from Taiwan, Hongkong and Qingdao, and the United Clothing and Textile Association (UCTA), which was incorporated in August 2011.

The lawsuit is expected to be held in January next year.

Liu Quanyi is the core of the lawsuit.

He is a minority member of Newcastle City called "Federal Congress". He was the last city councillor.

Since March, his factory has been checked five times.

"The ultimate goal is simply that the court finds that the negotiating committee has no jurisdiction over us and the ticket will not be established.

The negotiating committee is like an octopus, and the tickets are like a pair of tentacles, so that you can't breathe around your neck. It's better to pull out the head than to cut off the tentacles one by one.

He said.

"This is very destructive to them. Once successful, the negotiating committee will be driven out of the non metropolitan area.

We believe that the recent action against Newcastle is a counter attack.

Yan Ronghua said.

Albert, who inventers Newcastle, also believes that under the current economic environment, the labor committee can be called an outdated system, and the autonomy of labour negotiations should be put down to the grassroots level.

These enterprises receive a fax saying that this is the minimum wage, and you should pay so much money.

They are not part of the negotiations.

There are only trade unions and some very large companies in the negotiating committee.

Big firms believe that small businesses do not conform to their salaries and constitute unfair competition.

What makes Liu Quanyi feel unfair is that the interests of small firms are not represented in collective bargaining.

Big firms are being taken away by many small businesses, and they are eager to squeeze the latter out.

In addition, big firms are more likely to get government subsidies.

"To destroy small employers, it becomes a game between trade unions and large employers."

Liu Quanyi said, "our demand is to strive for a reasonable environment so that enterprises can continue to operate."

This is not the first time that the Chinese Chamber of Commerce has challenged the authority of the labour Committee.

Seven years ago, when the Labor Committee extended jurisdiction to non metropolitan areas, the Chinese Chamber of Commerce first took it to court.

The lawsuit was fruitless, but under the double pressure of the trade union and Labor Committee and the appreciation of Rand, the Nova Clothing, the chairman of the Chinese Chamber of Commerce, shut down.

At the same time, there were also South African labor ministers.

Liu Quanyi explained that the Minister of labour extended the jurisdiction of the labour Committee in 2010 to 2014 and was suspected to infringe the constitutional power.

"The Constitution stipulates that the people have the right to freely assemble and freely participate in the rights of the organization. The Negotiation Committee has been forced to take part in it without our consent."

He said.

But since the initiation of the lawsuit, the two largest Chinese business organizations in the Newcastle region, the Chinese business association and the textile association, have been disagreed.

"First, I think not to challenge the Labour minister; the second, fifth plaintiffs are not considered, not all Chinese, all in the Newcastle area."

Yan Ronghua believes that the strategy of the Chinese Chamber of commerce is too radical.

The lawsuit was supported by a private trust in South Africa, and the possibility of politicization made Yan Ronghua feel uneasy.

President Liu is a statesman. We are entrepreneurs.

He is interested and time, we do not have.

Our attitude is to go. His attitude is to turn a corner and completely change the political ecology of South Africa.

Yan Ronghua further said, "I am asking a question mark: after the battle has not been finished, the material and financial resources have been almost consumed. Who will compensate you? For political considerations, it is possible for people to make use of them.

Politicizing the economic behaviour of Chinese is not what I want to see.

When elephants fight, they are crushed by grass.

The Chinese Chamber of commerce also expressed doubts about the agreement signed between the textile association and the trade union and the labor and capital committee.

According to the three step agreement, Chinese manufacturers must reach 70% of statutory salaries in April 2011, reaching 90% in December and 100% in April 2012.

Liu Quanyi believes that this agreement is impossible to complete the task.

Despite the different opinions, the Chinese Chamber of Commerce and the textile association still strive to be consistent with the outside world.