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Wal-Mart Endorses Unions in China

Times Staff Writers

Wal-Mart Stores Inc., which has bitterly fought organized labor’s efforts at its domestic and international facilities, said Wednesday it was working with the Chinese government to establish unions in all of the company’s Chinese stores.

The world’s largest retailer said it began talks with the All-China Federation of Trade Unions, a government body, following an announcement two weeks ago that a Chinese Wal-Mart store would become the company’s first unionized store in that country.

Since then unions have formed at four more of the company’s 60 Chinese stores.

Wednesday’s announcement shows Wal-Mart is willing to make concessions overseas, experts said.

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“It indicates that Wal-Mart is willing to conform to the social and political context of a country, if it’s made clear to them that it’s the precondition for doing business there,” said Nelson Lichtenstein, a professor of history at UC Santa Barbara and editor of the book, “Wal-Mart: The Face of 21st Century Capitalism.”

The Chinese federation “is not what most people in Europe or the United States would think of as a trade union,” Lichtenstein said. “They are in fact very closely tied to the ruling Communist Party. On the other hand, their interests are not identical to Wal-Mart management’s.”

In a statement released Wednesday, the company said it “desires to further strengthen its ties to China and our associates.”

“Our announcement today that we intend to collaborate with [the federation] and its local organizations reflects our mutual aim is to establish grass-roots unions within each Wal-Mart store throughout China,” the company said.

Retail expansion in China is an important part of the company’s growth plans, although the outlets are still a fraction of the its 6,600 stores worldwide. Wal-Mart, which has about 30,000 employees in China, has said it will open 20 stores in China in 2006.

The company also depends on Chinese manufacturing for many of its goods, which the company says comprise $9 billion in direct purchases and roughly $9 billion in goods bought from its suppliers.

Although Wal-Mart has staunchly opposed unionization efforts throughout North America, it has inherited organized labor groups and unionized workers in several of its international operations, including Japan, Brazil, Mexico, Argentina and Germany, where the company said last week it would no longer operate.

Anita Chan, a visiting fellow at the Contemporary China Center at Australian National University, said that Wal-Mart might not have wanted to establish a union precedent.

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“Because you never know, when you have an institution, workers may use it,” Chan said.

Goldman reported from Los Angeles and Lee from Shanghai.


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