Xiamen PX Workers Protest Layoffs

12:47 Jan 23 2008 Xiamen City Hall Fujian China

[Note: in the account below, "trade union" should really be "staff and workers' representative congress," which is not the same thing as the ACFTU]

From China Digital Times:

Though the people’s coup over paraxylene (PX) in Xiamen is not official yet, echoes it are being heard in protests from Nanjing to Shanghai to Beijing. The trend, in turn, is said to have made the Xiamen case much trickier for the central government to close. “They don’t want to provide an example that would set off a chain reaction,” notes one official source in Xiamen, adding: “But it seems a chain reaction’s already underway.”

The latest ripple of protest in Xiamen may complicate matters even more. It’s NIMBY in spirit but minus the “N.” Angered employees with the PX project descended on city hall on Wednesday after the company decided to cut more than a quarter of its staff. They petitioned officials for compensation and a decision on the future of the suspended project.

The demonstration was a curious aberration for Xianglu, the Taiwanese-run chemical conglomerate behind the PX project. It has never been the kind of company to foul up in public. One thing company bosses are most agreeable about, when interviewed, is how they’ve kept a “very, very low profile”. In part that’s been an effort to offset the company founder’s notoriety across the Strait, but it’s mostly been a function of the firm’s obsequiousness to its official sponsors (most of whom are now in Beijing).

Since Xiameners mutinied against the paraxylene plant, the company has sunk its energies into government guanxi but deferred to Xiamen on public relations (to its detriment). At a series of critical junctures, company heads allege, they tried to take greater initiative to defend themselves, but local officials stopped them, reasoning (perhaps rightly) that the ill-reputed company would only fan public rage. Nowadays in private conversation, they’re bursting with rebuttals, clarifications and grievances against officials and activists in Xiamen, yet are oddly devoid of new information or negativity. “We believe in the government,” runs the well-programmed refrain. “We’re just waiting for the final word.”

But on Wednesday afternoon, a routine call to a contact at company headquarters produced a surprise.

“Were you at the [Xiamen] city government building?” he began.

“City government? Why? What was going on there?”

“Our brothers are there.”

“Your brothers?”

He paused.

“I mean employees from Aromatics [Dragon Aromatics, the PX subsidiary]. About 60 to 70 of them are there. They’re holding a sit-in.”

The scene was cleared by the time this reporter arrived, but witnesses at the scene backed up his account. That morning, employees with the PX project staged a sit-in outside the gates of the city government – the same spot where Xiameners converged to march against the project on June 1.

The workers were provoked when word slipped out of proposed layoffs at the company, according to the contact, and were holding the Xiamen government responsible for their jobs. The city suspended construction on the factory in late May in response to a grassroots revolt as well as populist pressure from on-high. In December, together with Fujian provincial authorities, Xiamen decided the plant should be relocated altogether down the coast to Zhangzhou. But no official decision has been announced and the National Development and Reform Commission must still ratify the move..

“If I understood them correctly, they most want the site to project to stay on the original site so they can keep their jobs where they are,” said the contact, who had visited the scene. “But the protracted delay is a problem too. If not for the delay in the decision, the [job] situation would be different. The future would be clearer.”

[UPDATE: In an interview at his office on Friday, a Xianglu executive confirmed that his company's board had come to a decision in recent days to let go more than 100 staff in coming weeks. He blamed the job cuts on the project's uncertain future. Over the eight months since the PX project was grounded the company has bled US$1.2 million a month in operating costs alone, he said. It could not afford to so any longer. "I would hope it's only temporary," he sulked, "but before we have a clearer picture we must do this." He said the layoffs would be "very painful" but were "unavoidable."

Once word leaked out employees convened meeting of a new "trade union" (职工大会) they formed in conjunction with China's new Labor Contract Law, which went into effect on Jan 1. There they passed a resolution to protest, the executive later learned. At city hall, they presented Xiamen officials with a statement pressing for a swift decision on the project's future and financial settlement for downsized members of their work force, much of which was recruited for the PX project from other parts of the country.

The executive said he didn't learn of the demonstration until police phoned to tell him what was happening. But he feared authorities may try to connect the company to the protesters. Nonetheless, he voiced strong solidarity with their cause. "It's a matter of survival. It's their entitlement. How can I can go out and tell them that we must force them not to go out, not to protest. I cannot."]

Uniformed workers fanned out and blocked the front gates of city hall, said a woman who watched the protest unfold while manning a door at the People’s Hall across the street. Then the group sat on the ground. They did not shout any slogans or carry any banners, she said, so she had no inkling of what they were on about. “Who were they?” she asked blankly. Public security and military police vehicles soon showed up and officers secured the scene.

Company officials were not aware of the sit-in until it was in-progress, the contact recounted. The Dragon Aromatics general manager, Lin Yingzong, got to the scene from the plant in Haicang district in the late morning. He and other company supervisors met with city officials to discuss the matter and helped persuade the employees to move along. “They still abide by what our company says.” The firm sent buses to transport the demonstrators back to the Xianglu campus. They were dispersed within a short period of time without any incident or detentions, a military police official told one local journalist.

On returning, protesters spoke of heading back to city hall in coming days, said the contact. “They talked to officials but they didn’t get any clear response.” But no protests materialized on Thursday.

Though it lasted several hours and involved a crowd of at least 100 protesters, officials and police, news of the incident was non-existent. No one heard about it in the journalist’s newsroom, located not far from city hall. There were no immediate reports of the incident in the press or online.

But after the demonstrators returned to the project site in Haicang district, word of their actions filtered fast through adjacent villages, which have long been hostile to Xianglu and its existing factories and been slated to move to make way for PX. Unconfirmed rumors already have arisen there of the company’s involvement in the sit-in. One villager said he heard the plant put its employees up to it, and “threatened to dock their pay if they did not participate.”

The contact laughed off that suggestion. “If we had organized anything, it wouldn’t have been a mess like that.”

At the public forum held in December, individual Xianglu employees were among the few to defend the PX project. While the company was barred from distributing a statement of its own, its employees were seen as puppets and drew jeers of suspicion when they failed to make clear their company affiliation up front.

The contact distanced the company from the protest in this instance but showed that it empathized with the protesters. He said their ranks included engineers and technical staff from various departments but few if any senior employees. “They come from all over and are giving up a lot of other opportunities.” It was unclear who among them led the protest or whether anyone would face repercussions. He insisted the workers acted alone on catching wind of proposed job cuts.

“No announcement has even come down as of yet. But they heard about it and took it upon themselves to protest,” he said. Asked whether layoffs were in fact imminent, he replied: “There are no waves without wind,” as if to suggest that a plan was being seriously considered. He said it called for the company to lay off as many as 100 members of its staff of about 375.

The company retained its existing staff despite the construction stoppage, confident that it would be allowed to proceed in the end. But when Xiamen suspended construction on the plant at the end of May on the eve of the street demonstrations, the city froze the company’s loans with state banks, which account for nearly two-thirds of its projected 10.8 billion RMB construction budget. The lag, now in its eighth month, may have already cost the project millions of dollars in forestalled equipment orders and other outlays and more than one billion dollars in revenues, though figures are wildly disputed. If in fact the plant were moved down to the shores to a more sparsely developed peninsula in Zhangzhou, as proposed, that would push its timetable on back.

“We don’t know for sure if we will move or not, but meantime the idea for the cuts has come up because of the delay,” the company contact said.

The sit-in was miniscule compared to the protests, but nonetheless illustrated the vying interests at play when industry and infrastructure clash with neighborhoods. Beijing does not wish to set any unnecessary precedents. It needs calm if it is to deliver a verdict on PX, but none has come.

Almost immediately after media declared Xiameners victors in December, Nanjingers began making noise over a new PX operation of its own in a similarly fraught location. The area outside the city was first zoned for petrochemicals but is now home to a new Nanjing University satellite campus and other sprawling neighborhoods. But the plant belongs to a subsidiary of state mammoth Sinopec and is nearly ready to go online. Local teachers and others have mailed off letters to the capital and stormed BBSs. So far, though, Nanjing has kept the hubbub out of the papers.

Then this month, Shanghai people started taking strolls to protest plans to extend the Maglev train. Two nights ago in Beijing, in a lesser case, dozens of East Siders blocked the fourth ring after in a continuing protest plans to erect a transformer station beside their subdivision
Credibility: UP DOWN 0

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