Reuters IN factory towns across China's export powerhouse in the Pearl River Delta, a vicious cycle of slowing orders from the West and increasing wage pressures has led to a series of major strikes that could reverberate through the economy. From shoe factories in the east of Guangdong province, dubbed “China's world factory”, to a cluster of watch, sport and electronics plants to the south and west, hundreds, even thousands, of workers have crippled production for major Western brands. A Reuters team that visited four factory towns in the region this week saw significant signs of industrial strains despite attempts by security guards to block access to workers. The strains underline recent warnings of a looming export slowdown from a senior Guangdong official and a survey of country-wide industrial activity in November that showed the worst contraction since 2009. At Yue Yuen Industrial Holdings' giant shoe factory in Huangjiang town the mood remained tense after most of its 8,000 workers took to the streets on Thursday, blocking roads, overturning cars and clashing with police. Experts and labour advocacy groups warn an external economic slowdown in debt-stricken Europe and countries like the United States could exacerbate the risk of social upheaval in China. Besides labor disputes, Guangdong province - a crucial locomotive of China's economic growth with a GDP matching Indonesia's - has been roiled in recent months by riots over rural land grabs in Lufeng city, and abuse of power several hours drive west in the city of Zengcheng that saw angry crowds ransack government buildings. A former deputy editor-in-chief of the official party newspaper, the People's Daily, said the number of “mass incidents” in China, an official euphemism for social disorder, was consistently above 90,000 per year from 2007 to 2009. Slick, globalized supply chains mean belt-tightening in the West rapidly translates to reduced orders at Chinese factories. As leaner times provoke aggressive factory cost-cutting and wage trimming, Chinese workers increasingly lashed by persistent inflation are often in no mood to compromise. In a recent report, consultancy Exclusive Analysis said it sees growing risks of “violent labor unrest” flaring up in Chinese factories and causing property damage and losses, adding: “Real-time use of social media by striking workers and firms' decreased ability to meet workers' demands due to falling Western export demand are likely to drive this violence.” Europe's economic woes, Chinese manufacturing fragility and flat consumer spending in the United States have all raised the risk that the world is headed for a steep downturn. __
