The costs of doing business: Nike in Vietnam

The problem with being a global brand, Nike -

More than 20,000 Vietnamese workers have walked off the job at a Taiwanese-owned plant that makes shoes for Nike Inc., demanding higher pay to keep pace with skyrocketing prices, officials said Tuesday.

The workers at Ching Luh plant, in southern Long An province, went on strike Monday. They want a 20 percent bump to their $59 average monthly salaries along with better lunches at the company cafeteria, said Nguyen Van Thua, an official with the province’s trade union.

I’m no economist, but this sounds to me like the way by which a country’s living standards improves… assuming, that is, that Nike accept their demands and that others in the region get similar ideas. And, of course, assuming Nike doesn’t quickly relocate to somewhere cheaper – but to that prospect I ask, how many significantly cheaper places for them can there be in the coming years?

Many of the workers, by the way, are women from rural areas – presumably displaced by their own experience of poverty coupled, I suspect, with land-grabs going on by those in power, hungry for timber, coffee, tea, palm oil and biofuel profits.

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2 Responses to “The costs of doing business: Nike in Vietnam”

  1. wanderer7 Says:

    there’s only so many poor people you can exploit … soon they will all be employed, and the wage inflation will begin. Then bang ! no more easy profits.

  2. drfrank Says:

    Quite. Thanks for commenting, wanderer7 – you seem like an interesting soul – and a good musical composer!

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