IHT:

QINGDAO, China: Scores of South Korean-owned factories are closing surreptitiously in eastern China as their owners flee rising costs, leaving behind embittered workers like Li Hua. Li and more than 200 colleagues have been fighting for a year to get the six weeks’ wages they were owed when the owner of the toy factory where they worked fled during the 2007 Lunar New Year holidays…

Qingdao mirrors, on a smaller scale, what is happening in the Pearl River Delta near Hong Kong. There, thousands of factories, mostly run by Taiwan and Hong Kong companies, are moving inland or abroad or are simply closing as rising costs undermine the assumption that China is the world’s cheapest manufacturing location.

In Qingdao, Sung Jeung Han, manager of the Korean Society and Enterprise Association said 20 percent to 30 percent of the 6,000 South Korean firms in that eastern port city were losing money. “The wage rise, yuan appreciation and higher input prices are the main reasons,” he said by telephone. The minimum wage in Qingdao has risen 43 percent in the past three years…

That 43% represented an increase in wages to about $107 a month.

This entry was posted on Friday, April 4th, 2008 at 5:16 pm and is filed under China, business. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.