Magazine of Socialist Action in Australia

Vietnam shaken by wildcat strikes

Reading Time: 3 minutes

During the month to mid-January, 40,000 workers in Ho Chi Minh City?s export processing zones (EPZs) and the southern industrial parks (IP) staged wildcat strikes against sweatshop wages ? posing a major dilemma both for Vietnam?s dictatorial regime and the foreign companies that have grown fat off the super-exploitation of Vietnamese labour.
By Elin Gauffin, CWI Sweden
Demonstrating the enormous potential power of the working class in Vietnam and other low-wage economies, the strikes forced Vietnam?s ?communist? rulers to raise the minimum wage by nearly 40 percent, with effect from February, bringing wage levels up to 45-50 dollars a month. But following this concession, the goverment is now trying to cheat on the deal by postponing implementation until April. This has been met by new strikes involving tens of tousands of workers. At the same time, tempers are rising among workers employed by Vietnamese-owned companies, who have begun their own industrial action for wage increases. These workers earn even less than workers employed by foreign companies. This has shaken the government and Prime Minister Phan Van Khai had to intervene last week.

Wages cut six years ago
Capitalist globalisation, increased exploitation and the resistance of the working class has created a political crisis. Workers in Vietnam are among the most exploited in the world. Official statistics show that Vietnam attracted almost $8 billion in foreign direct investment last year, much of it from Taiwanese and Korean companies looking for cheaper labour than in China, where basic wages are currently $63 a month.

Indicating its ?investor-friendly? credentials, the Vietnamese government “adjusted” the basic wage downwards in 1999 to between $35 and $45 (depending on the location) from a level of about $45-$50, this with the explicit purpose of pleasing capitalist ?investors?. In the country?s IPs and EPZs there are 700 enterprises operating with more then 130,000 workers. They produce the stuffed animals that are sold by Hallmark, Disney and Starbucks for example. Taiwanese companies, such as Freetrend, that makes shoes for brands like Nike and Adidas, account for a big share of these foreign enterprises. The minimum wage in Vietnam is 13 percent lower then in China. Even after the last hike workers in the EPZs will earn less than two dollars a day.

Mass unemployment
The current worker unrest It is not only due to wages failing to keep pace with inflation and the rising cost of living. Poor working conditions, such as management harassment especially from non-Vietnamese managers is an important issue.
“We are always on guard at work, the officials yell and swear at us and mistreat workers” Houng, employed at Freetrend, tells Asia Times (see
Sonja Grusch from the CWI in Austria, who visited Vietnam, talked about the process of capitalist restoration there at the CWI?s international conference in December 2005:
?The so-called communist regime operates from a bourgoise standpoint,? she said, citing figures that 90 percent of households receive income from private companies. The shift to a capitalist economic system has been accompanied by high unemployment. One third of the population is unemployed or under-employed, only ten percent have a full-time job. Sonja also warned of the effects that the next economic crisis will have. The banks in Vietnam have a huge exposure to bad lones. In the crisis of 1997-98 multinational companies left the country, and that will happen again.

Independent unions needed
?There has been a social polarisation. There are illusions in capitalism but there is also a history of determined resistance,? she explained. ?The state union VGCL is more an agent of the communist party, CPV, than an organisation representing the rights of the working class. There are attempts to form independent organisations ? amongst taxi drivers, cooks and others ? taking place. The CWI wholeheartedly supports this developement.?
That has been even clearer during the recent strike wave. The strikes have unavoidably taken the form of wildcat actions and this has proved effective. It doesn?t matter that Vietnam?s labour code recognises the right to strike. Strikes are invariably declared illegal by the authorities, and the dictatioral one-party system. The VHCL, shaken by the recent movement, has said it must undertake the organisation of workers in the zones, but this of course is not with the aim of furthering the struggle on behalf of working class, It is an attempt to stop the struggle from spreading and aquiring a generalised form which could threaten the regime itself. Vietnamese workers have however felt their own strength through collective action, meaning that it will become more an more difficult for the regime to keep them in check.


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