Many factories close to transport networks, commercial and technical expertise, and a large market, have become very successful. They do not have the overheads that many of the old urban industries have, and they have found it easier to adapt to the new market conditions. They have been so successful that there are more jobs than workers in the area around Suzhou; so rural labourers from poorer, more remote areas are migrating to work in these factories. They live in dormitories; while local peasants, who work in and partly own the factories, are building themselves fine two- and three-storey houses.

The Beibei Shoe Factory in Xizhang is a flourishing business, exporting half its output overseas and employing a large workforce. This used to be a very poor rural district. It is now less than two hours’ drive from Shanghai.

The programme examines how enterprises like this have grown up in the countryside (contrary to the general pattern in developing market economies). What have they contributed to the region, and why are they more successful than older-established industries in urban areas? The programme also tells the story of two people who work here — one local and one migrant worker — showing the contrasts in their ways of life. It describes the hukou (household registration system) which has been used to restrict migration from rural areas and to allocate social benefits. Under this system, people are registered in one place, usually their place of birth. Once registered, they are not allowed to move elsewhere unless they have a job in the new area. If they lose that job, they must return to their place of registration.

00.00 — 00.53

Two young women in the Beibei Shoe Factory, one from a nearby village and one a migrant worker, live very different kinds of lives. The factory has transformed the lives of people in this former farming area, and made it one of the richest towns in the region.

00.53 — 01.05

A map shows Jiangsu province north of Shanghai and the township of Xizhang.

01.05 — 02.05

This is a region of canals: originally built for trade, they now also carry tourists. Plentiful water and warm weather make the land productive, but the countryside is overcrowded. There is very little land for each family. In the past, most villagers were poor. To improve living standards, people needed more than farming. Until the 1970s farmers were restricted to working in the fields, forbidden by the Government from doing any other kind of work.

02.05 — 02.15

In 1973, under new Government rules, a group of farmers set up a small factory manufacturing pedals and inner tubes for bicycles, run collectively by the workers to earn extra money.

02.15 — 03.00

Bicycles are the most common form of transport in China. Demand for the factory’s products is tremendous, and it has become highly successful. As Government policies changed, factories like this were encouraged. Later this factory diversified to make other goods from rubber; and it began to make rubber-soled shoes.

03.00 — 03.40

This kind of company, run by the town or village for the benefit of its inhabitants, is called a ‘township or village enterprise’ (TVE) — a system unique to China. Some have been very successful. The Beibei Group employs 2,300 people and makes 16 million shoes a year. It was set up to create as many jobs as possible. Most of the work is labour-intensive, so as to maximise employment.

03.40 — 04.00

Labour is cheap, machines expensive. The manufacturing process is largely manual.

04.00 — 05.20

A local worker from a village near Xizhang worked here for over two years as a sewing worker. The work is repetitive. His mother works in the factory, checking finished products. His father also works in the factory.

05.20 — 06.00

The business and others in the area are now so successful that there is a local labour shortage. When they started making shoes for export, they had to recruit migrant workers. These now make up a third of factory staff. They work in different buildings and make different kinds of shoe under different conditions.

06.00 — 06.30

A supervisor examines shoe uppers. Pang Yinhua, a migrant worker from a province 200 kilometres away, used to help her parents in the fields before she came to Beibei.

06.30 — 07.00

Workers are paid according to the number of shoes their section produces. Local workers earn about £50 per month. Migrant workers earn up to £70 a month: they work up to 13 hours a day.

07.00 — 07.20

Most migrant workers eat lunch together in the factory canteen; local workers usually eat with their families, who bring food into the canteen.

07.20 — 09.30

The migrants live in hostels on the factory site. Yinhua can go to her dormitory at lunchtime. Ten to twelve workers share a room. The dormitories are crowded, with minimal facilities. A girl washes her hair on the balcony: there is little privacy. There is no running hot water: once a week they take a shower in another building up the road. They sleep in bunk beds and each worker has two lockers. There is a communal washroom for over 60 women. The dormitory blocks are crowded, but friendly. Boys live on the ground floor, girls upstairs. Washing hangs from balconies. Girls don’t go out often. People make their own entertainment. Being away from their homes and families is difficult. Yinhua left home two years ago and has not been back since. She hopes to visit her family later in the year.

09.30 — 09.55

A local girl, Zhu Wei Long, lives near by in a small hamlet in heavily built-up countryside. She travels to and from the factory on a moped — a 10-minute journey. Most of the locals now earn enough to build themselves large and comfortable houses.

09.55 — 11.10

The family house was built 1989. It is made of brick and cement. They previously lived in a small single-storey house made of simple materials held together by mud. They now have better facilities — washing machine, television, refrigerator — and large airy rooms. The house is huge by Chinese standards. Zhu Wei Long shares a bedroom, but her twin sisters are away at college. The good wages paid by the factory mean that the family can afford this comfortable lifestyle.

11.10 — 11.45

The family retains a little farmland, but they do not harvest enough to live on. They work in fields in the evenings after factory work. Although the factory is now run along disciplined commercial lines, at harvest time workers are allowed time off to bring in their crops.

11.45 — 12.01

At Zhu Wei Long’s grandmother’s house near by, older women reminisce about the past.

12.01 — 12.30

The grandmother used to live in a house made of straw and mud, with few rooms. Life was hard, and most people were very poor. Now most live comfortably.

12.30 — 13.00

The family cooks a meal with new equipment.

13.00 — 13.20

While local workers enjoy the evening with their families, the migrant workers are still hard at work in the factory. They are keen to save as much money as possible.

13.20 — 13.40

Yinhua talks about her job (inspecting shoes) and her wish to return home in a year or so.

13.40 — 14.00

In China it is almost impossible for migrant workers to settle permanently away from their home district. They need official permission to work away from home, and if they lose their job they must return home. Their home villages are usually remote, with few job opportunities.

14.00 — 14.30

Beibei Factory is in an ideal location: shoes have ready access to millions of customers. A container lorry is loaded with shoes from the factory, destined for export to Japan, four days away. Beibei is on a good road network.

14.30 — 14.50

A map shows Xizhang in relation to the deepwater port at Shanghai, entry port to markets such as Japan and the USA, and the Yangtze valley, where most of China’s population lives: Xizhang is ideally suited for both the export and the domestic markets.

14.50 — 15.30

Half of Beibei’s customers are Chinese. There are nearly 3 billion feet in China.

15.30 — 16.00

Raw materials enter the port of Shanghai: rubber from Malaysia by ship; coal by barge along the canal network from Shandong province 400 kilometres away; cotton cloth and leather sourced locally. Beibei’s location only one and a half hours from Shanghai also gives access to business and commercial contacts.

16.00 — 16.22

Distribution agents can fly into Shanghai International Airport from Hong Kong to discuss trade.

16.22 — 16.50

The president of the factory explains that this used to be a rural area, with limited skills in factory processes and technology, no electricity, no expertise. Experts are brought in from nearby cities to develop these skills. It is important to be near a large industrial centre, and to keep up with fashion and with technological advances.

16.50 — 17.25

Other factories in this area make a wide variety of goods. There are ten large and successful TVEs in the area, operating as individual businesses, but owned collectively and controlled by local government. Together, their profits have funded huge developments for the 27,000 people of Xizhang.

17.25 — 17.50

Very few single-storey houses remain. The main street is new and most housing is private. From the profits of the factories local government provides roads, telephones and sanitation.

17.50 — 18.25

The system is changing: Beibei is being privatised. In the past, the Government controlled investment in the business, and their policy sometimes conflicted with that of the management. To fund spending, the Government could take out as much money from the business as they wished. Now the business does not pay out as much to the town.

18.25 — end

These changes may mean that the schools receive less money, and that less is available for improving local infrastructure. The TVE, meanwhile, will have more money to spend on re-equipping the factory. This should be good for the factory — but will future generations benefit from this success as much as the present generation has?