PEOPLE'S REPUBLIC OF CHINA In the copyright area, China has agreed to join the Berne Copyright Convention by October 15, 1992. In connection with this, China has agreed to protect all computer software as a "literary work" under Berne. It will protect all existing works of members of the Berne Union when it accedes to Berne. It will join the Geneva Phonograms Convention by June 1, 1993. In the interim until China joins these two multilateral conventions, the two governments agreed to establish bilateral copyright relations, beginning 60 days after the signing of the MOU, which will protect U.S. works at the standards now in the Chinese law. China also agreed to make best efforts to pass a trade secrets law by January 1, 1994. Both governments committed to providing effective enforcement measures, both at their borders and internally, to stop violations of intellectual property rights. In exchange for the commitments the Chinese Government made in the MOU, the U.S. Government agreed to terminate its investigation of China's intellectual property practices and to remove it from identification as a Priority Foreign Country under "Special 301." China's 1982 Constitution provides for "freedom of association," but the guarantee is heavily qualified by references to the interest of the State and the leadership of the Communist Party. Although union membership is voluntary for individual employees, it is compulsory for each enterprise. China's only union organization, the All China Federation of Trade Unions (ACFTU), while nominally independent, is closely controlled by the Communist Party. The Government does not allow independent trade unions, and none operate openly. There is no right to strike, however organized walkouts over safety issues are tolerated. The International Labor Organization (ILO) continues to question the Government about the fate of some 130 workers reported by the International Confederation of Free Trade Unions to have been imprisoned, and some tortured and executed, following the events of 1989. b. The Right to Organize and Bargain Collectively The Government does not permit collective bargaining. Without legal status as a collective bargaining body, the ACFTU's role has been restricted to a consultative one in the decisionmaking process over wages and wage reforms. Worker congresses generally meet only once a year, however, and appear to act primarily as rubber stamps on agreements worked out between factory managers, party secretaries and union representatives. Other than in a few cases where laid-off workers' "living wages" were in jeopardy, trade unions have limited themselves to channelling workers' complaints. PEOPLE'S REPUBLIC OF CHINA c. Prohibition on Forced or Compulsory Labor China is still considering ratification of ILO Convention 105 on forced labor. China's longstanding practice is that all prisoners, including those we would consider political prisoners, work. Some prisoners, even after they have officially been released, are obliged to continue to work at or near their former prison. There is growing evidence that some prison products are exported, including to the United States, although China has stated it is against government policy to export the products of prison labor. d. Minimum Age for Employment of Children Regulations promulgated in 1987 prohibit the employment of school-age children who have not completed the compulsory nine years of education. In September 1988 the Ministry of Labor issued a circular designed to curb pervasive child labor problems and reiterated the instruction in 1991. It imposes severe fines, withdrawal of business licenses, or jail for employers who hire child laborers under 16 years old. However, enforcement of the provisions of the circular is spotty and the employment of child labor is still fairly common, particularly in rural areas. China does not have a labor code. The terms and conditions of employment, including wages, are unilaterally determined through administrative regulation. There is no minimum wage law. Regulations set a basic "living wage," which operates essentially as the minimum unemployment benefit and varies from city to city. The maximum work week is 48 hours, of which a half or full day each week is devoted to the study of political and current affairs. Safety conditions are generally poor and the absence of a national labor code makes enforcement of safety regulations difficult. f. Rights in Sectors with U.S. Investment Worker rights practices do not appear to vary substantially among sectors. In general, safety standards are higher in U.S. invested companies. There are no confirmed reports of child labor in the Special Economic Zones or foreign-invested sectors. Workers in Chinese-foreign joint ventures are guaranteed the right to form unions (which then must affiliate with the ACFTU), and joint venture managers report significant union activity and the need to bargain with these unions over wages and benefits. In addition, some municipal trade union regulations, such as those in Shenyang and Shanghai, give the unions substantial clout in the dismissal process. In 1990 the Ministry of Labor issued a regulation which stipulates that wages paid to workers in foreign-invested joint ventures generally may not exceed 120 percent of the wages paid to workers in state run enterprises or if profits are high 150 percent of state enterprise wages (though in the latter case the salaries must be approved by the local labor bureaus). However, there have been no reports of attempts to enforce the regulations. - (D)-Suppressed to avoid disclosing data of individual companies Source: U.S. Department of Commerce (unpublished) Bureau of Economic Analysis, August 1991 HONG KONG 1/ 2/ Consulate revised projection. Includes wholesale, retail, import/export trades, restaurants, hotels, transport, storage and communications. Includes banking, insurance, real estate and business 3/ 9/ Oct 1984-Sept 1985; CPI (a) covers urban households with monthly expenditure of HKD 2,000-6,499 (approximately 50 percent of households. 10/ U.S. Department of Commerce, Bureau of Economic Analysis 11/ The foreign exchange holdings of the Hong Kong government exchange fund are confidential. 12/ The Hong Kong government does not keep statistics on capital, interest, dividend or royalty flows, making it impossible to construct a balance of payments table. 1. General Policy Framework The Hong Kong government pursues a policy of minimum interference in the economy. This applies to trade in goods, services and investment, making the territory's markets arguably the most open in the world. No import tariffs and duties are levied. Taxes are collected on tobacco, cosmetics, non-alcoholic beverages, liquors, methyl alcohol and some hydrocarbons. These taxes are levied equally on local manufactures and imports. There is no protection nor are there subsidies for manufacturing. There are some restrictions on services of foreign professionals in the legal and medical fields. Government-sanctioned monopolies control aspects of telecommunications and aviation-related services. Hong Kong has a freely convertible currency and allows complete freedom of capital movement. Taxes are low and are currently set at 1.5 percent for corporate profits, 15 percent maximum on personal income. Property is taxed; interest, royalties, dividends, capital gains and sales are not. The Hong Kong government welcomes foreign investment in the territory. It makes no distinction in law or practice between foreign and domestic companies. There are no restrictions on foreign ownership, nor are there export performance or local content requirements. Profits can be freely converted and remitted. Hong Changes in domestic money supply are largely dictated by balance of payments flows; the Government's role is restricted to influence over interbank liquidity and thus short-term interest rates. The maintenance of a foreign exchange rate link to the U.S. dollar constrains overall interest rate movements to a narrow band around overseas dollar rates. Kong has no central bank as such, although the monetary affairs branch undertakes most central bank functions with the exceptions of note issue, bank clearing house, and providing a discount window. There is no rediscount rate, reserve requirement, or system of open market operations. Money |