The G20 Common Framework for Debt Treatments Must Be Stepped Up Further wage increases could pressure more businesses to follow suit.Ĭhina’s manufacturing advantage at risk as restrictions mount and competition intensifies, leading engineer warnsĪdviser to Beijing suggests that China set up a vocational education system to train talent for advanced manufacturing as nation tries to stave off international competition Pandemic has accelerated the push to reshore parts of the manufacturing process, and this poses a serious challenge as China strives to improve its supply chain Samsung Electronics shifted smartphone production to Vietnam from China in 2019. Some manufacturers are already moving operations out of China. Japanese companies paid ordinary manufacturing workers in China an average base salary of $531 a month in 2020, compared with $447 in Thailand and $250 in Vietnam, according to a survey by the Japan External Trade Organization. Labor costs are already higher in China than in many Southeast Asian countries. But higher wages also risk driving businesses away. Provincial governments are also eager to attract more workers amid a worsening labor crunch. He likely aims to further strengthen his grip on power by appealing to China’s nearly 300 million migrant workers. Xi has essentially solidified his bid for a rare third term as Communist Party leader at the party congress in 2022. Those employed at factories tend to earn a significant amount of overtime and are believed to usually make around double the minimum monthly wage. Migrant workers from rural areas to cities stand to benefit the most. Half the provinces that lifted minimum wages this year did so in September or later. In an August meeting, the Communist Party’s Central Committee for Financial and Economic Affairs called for broader income distribution in order to realize his vision. Larger offices and factories already pay above minimum wage, so “the increase will have no direct impact at all,” This year, Xi’s call for “common prosperity” accelerated the trend. Many overseas companies, including Toyota Motor, Honda Motor and Nissan Motor, operate in Guangdong. Twenty out of China’s 31 provincial-level regions have increased their minimum wages so far in 2021. Trend risks a production exodus over costs already higher than Southeast Asia’s Chinese provinces have responded to President Xi Jinping’s “common prosperity” campaign by hiking minimum wages, but higher labor costs could prompt manufacturers to shift production elsewhere.
Minimum wage hikes sweep China in ‘common prosperity’ push European Union Chamber of Commerce in China report says China’s ‘state-centric approach’ to standards will add to risks due to increased politicisation and potential decoupling. The West has long had a lead when it comes to global technical standards, setting the specifications that shape most of the products consumers use.
China’s ‘state-centric approach’ to technical standards-setting worries EU firms
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