The iPod -- the iCon of Chinese capitalism | The Daily Star
12:00 AM, June 10, 2011 / LAST MODIFIED: 12:00 AM, June 10, 2011

World Business

The iPod -- the iCon of Chinese capitalism

Walking past Apple's sleek shop along London's Regent Street on Sunday, my wife asked me what I wanted for Father's Day.
“An iPad?” I ventured, half-jokingly.
“Are you sure you want one? Don't you care how they're made?” came her disapproving reply.
She was, of course, referring to the rash of suicides among Chinese workers at Foxconn, the Taiwanese manufacturer of Apple's much desired iPads and iPhones.
The deaths prompted the company to raise salaries and cut working hours but lingering concerns over conditions for its over 1 million workers in China were underscored by a plant explosion last month that killed at least 3 people.
Workers like those who live and work in Foxconn's sprawling Chinese facilities have long been the backbone of the country's vast manufacturing sector which churns out a torrent of consumer goods for export.
But the recent labour unrest that has erupted in parts of China suggests that this low-cost export-fuelled growth model may be wheezing towards its expiry date.
Even as the world's largest contract cellphone maker, Foxconn is loss-making, its margins squeezed by rising production costs and falling gadget prices.
Younger Chinese workers are turning out to be more demanding employees, their bargaining power strengthening as a result of the growing labour shortages due to the country's strict birth control policies.
Noted currency guru Stephen Jen thinks the rapidly greying population may have already pushed the Chinese labour market past the crucial inflection point outlined by Nobel Prize-winning economist Arthur Lewis that will see wages and inflation continue to rise indefinitely.

Tong is a London-based senior correspondent tracking investment flows across borders and asset classes with a particular focus on emerging markets.

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