HONG KONG: Cheap labour a bonus for HK furniture
Updated
In the ten years since the Hong Kong handover China has become a global force, and is known as 'the factory of the world'. That role is benefiting Hong Kong, where businesses are taking advantage of cheap labour available on the mainland.
Presenter: Zulfikar Abbany, in Hong Kong
Speakers: William Chiang, owner, China Art; Kenneth Lee, owner, IMIX Club; Monina Wong, executive director, Labour Action China
ABBANY: If you walk the 100, 200 odd steps, or whatever it is from Queen's Road up to Hollywood Road, don't do it like I did at midday - it's too hot. But do do iT, and you'll get up to Hollywood Road, as I say, and it's a world apart from the commercial glitz and dour unglamour of Queen's Road, the chain stores. And you're transported, or teleported up these flights to Hollywood Road which is a road full of antique shops, antique furniture shops, and there's a whole world of pieces stretching back decades from a range of provinces around the mainland, and there's quite some demand for that.
CHIANG: Yeah, I will show you something different that we do that the other people don't: this is a rustique look Shanxi piece that has a lot more natural timber, natural rustique to it … [opens and a closes drawers] …
ABBANY: William Chiang runs just one of the antique furniture shops along Hollywood Road, and that's China Art.
CHIANG: … and then you have this … it's a piece that's more country style … and then you get this strange piece … to keep warm. (FADE)
ABBANY: William Chiang sources all of his pieces in mainland China and refurbishes them in a workshop, in Panyu, Guandung province.
CHIANG: It's only about 2 hours away from Hong Kong, it's very influenced by Hong Kong culture, a lot of Hong Kong businesses go up there, they watch a lot of Hong Kong TVs, so they do have a lot of Hong Kong contact.
ABBANY: Chiang visits the Panyu workshop every week to keep that contact strong. His company has operated out of Panyu for around 15 years. And Chiang says that, having trained local craftspeople, China Art has put those craftspeople back in touch with a part of their own history and culture.
CHIANG: Through that 15 years we actually developed a pretty good pool of labour of some sophistication. On top of that, because I go back there so often that I supervise it personally, these pieces are finished differently from a lot of suppliers in China.
ABBANY: But the work they do would be unaffordable in Hong Kong. China Art's craftspeople might work to Hong Kong standards, but not to Hong Kong pay.
CHIANG: Oh, definitely not. That's the reason why we have to move to China because they have the labour advantage. We can train them, we have the same language, we have the same background, by spending time with them we can actually get them to a level where we want them to, at a price that's substantially different from Hong Kong.
ABBANY: Two doors up from China Art there's another furniture store that works on a similar principle. The Imix Club. Its pieces are new, but produced in the mainland. Kenneth Lee is the man at Imix Club.
IMIX CLUB FX
ABBANY: The Imix Club was established 2 years after the handover of 1997. In the time since, it has profitted from the mainland market that has opened up all Hong Kong businesses that will have it. But a lot has changed.
LEE: China is not the China it was before, and our workers are using their mobile phones and exchange sms messages with their peers and friends in different provinces and they exchange market information on salaries and if there are attractive offerings in other places they would just go immediately.
ABBANY: Using that theory then, surely, if they found out the prices they could ask down here in Hong Kong, they'd come down and work here in Hong Kong - if they could find the factory.
LEE: Not that simple. For instance, they have to get a permit to work in Hong Kong. And secondly the moment they move over they would see that the vegetable and rice that they've enjoying [sic] for so cheap in China is charging [sic] a lot more here. They might end up saving a lot more money working in the current situation than moving to Hong Kong.
STREET FX
ABBANY: Not far from Hollywood Road is Sheung Wan - the home of Labour Action China. Labour Action China is a non-governmental organisation that campaigns for the protection of labour rights - predominantly in southern China, where many Hong Kong businesses have workshops. The LAC's executive director is Monina Wong.
WONG: Certainly, the wage level is much, much cheaper than in Hong Kong - even than in other Asian countries. And second we're talking about indirect labour costs, meaning the level of resistance to labour abuses, and also the level of control you can have over your workforce.
ABBANY: All this might sound quite frightening against the backdrop of the Shanxi brick kiln, slave scandal. It is totally unrelated. But the way some Hong Kong businesses have moved into the mainland does highlight the reality of the 'One country, two systems' approach. The mainland is now showing itself to be a market without which Hong Kong can't survive. It's a suggestion that William Chiang of China Art says is unfair.
CHIANG: I think [if] you're running a business, there's a risk, there's a chance element in there that no one can predict. So, can we survive? I don't know. We'll have to see when that day comes. But we're definitely taking advantage of the opening up of China, the labour quality, the labour efficiency - yeah, we're taking advantage of it, I know that's for sure. Can we survive? I don't think that's a fair question.
ABBANY: Fair or unfair - it's a question that, ten years sinces handover, Monina Wong says Hong Kong businesses should be asking themselves.
WONG: They have not thought about how to globalise their investment because of the fact that there is such a big market next door. And there is such a big work force next door. So therefore you see - Hong Kong - nowadays we are capitalising on this mainland tourists coming to Hong Kong, our major land developers, they want to have a ride on this estate boom in China, rather than diversifying the industrial basis.
ROAD FX
ABBANY: The furniture traders of Hollywood Road might soon want to diversify - given that a major proportion of their client base - Hong Kong's expat community - is shrinking, fast.
ABBANY: This is Zulfikar Abbany in Hong Kong.
