China in the Global Division of Labour: Contradictions and Class Relations

By examining the contradictions in China’s model of growth and the shifting dynamics of its place in the global division of labour, the aim of this paper is to understand the tensions in the class relations that underpin the Chinese ‘success story’. It will provide the contextual underpinnings necessary for understanding the environment in which increasingly restive Chinese labour is located. The paper will argue that China’s integration with global capitalism and global circuits of capital, particularly from the early 1990s, has been a major source of its meteoric growth, but has also sharply increased its economic vulnerability as manifested in its exposure during the 2008 crisis. High rates of growth, driven by unprecedented accumulation that outstrips private consumption, has increased China’s reliance on exports, particularly to the core capitalist economies of the United States and the European Union. Reflecting fears that this scale of accumulation is not sustainable, the government’s 12^th Five Year Plan (2011 to 2015) called for slower growth and rebalancing from investment to consumption, in part at least through higher wages. Such an approach, however, presents a threat to China’s comparative advantage based on low wages and super-exploitation. Some regions and sectors are already under strain and production has moved within China or to other cheaper economies. In addition, the combined and uneven nature of China’s development, sectorally and regionally, underpins the fractured interests of the ruling class. Finally, the presentation will point to the massive infusion of finance used to ‘soften’ the outcome of the global crisis that has produced property bubbles, which are further fuelling inequality and discontent.