Rallies Against State Privatization Reported in Wuhan

By Fong Tak-ho, in the Hongkong Standard, 1 October 1997, p. 6

China's just-announced bold plan for the massive privatisation of state enterprises ignited a spate of demonstrations in the central industrial city of Wuhan in the past week, according to a human-rights group.

At least five rallies have been held since the 15th Party Congress ended on 19 September, the Hong Kong-based Information Centre of Human Rights and Democratic Movement in China says. President and party chief Jiang Zemin announced in his keynote speech at the congress that Beijing was to allow hundreds of thousands of loss-making state firms to go bankrupt, be sold out and merged in a program to restructure the chronically ailing sector.

Scores of redundant workers petitioned Wuhan city hall, asking the government to address their grievances which ranged from housing problems to unpaid pensions, the group said. It said the demands included a comprehensive scheme to help them get new jobs and a preferential policy for those going into business, such as a moratorium on profit tax for at least three years.

Armed police were on standby while the demonstrations dispersed peacefully, group spokesman Frank Lu said. There were no arrests, he added.

Mr Lu claimed the demonstrations occurred after the municipal government decided to trim down the debt-ridden public sector to echo Beijing's call for reform of state companies, the group quoted a witness as saying. But some state-run businesses had already laid off workers even before the congress, he said.

The group said the workers had delayed their demonstrations to avoid for fear of breaching the peaceful atmosphere of the congress, which could have led to forceful suppression.

The group quoted an unidentified Beijing economist who warned that nearly 10,000 state enterprises would be closed in the five years, leaving tens of millions of workers redundant. Laid-off workers say they can barely survive on the pension which is only 15 per cent of their original salaries. The group said President Jiang's joint-stock partnership reform was a convenient excuse for local governments to shirk their responsibilities to take care of the retired workers, while some might sell state firms at an unreasonably low price. If the government fails to prevent local authorities from selling public properties for their own interest, they could trigger even larger demonstrations, such as the case of the 1989 Tiananmen pro-democracy movement, Mr Lu warned.

It is estimated that there are more than 100 million workers in the public sector, with 30 per cent of the state firms losing money. President Jiang announced the go-ahead at the congress for a joint-stock partnership scheme which, some analysts said, would effectively turn socialist China into a capitalist country.