For China's Poor- Venture Capital Funds for Digital Deliverance

Filed in archive on October 23, 2006

Hangzhou based Sinomen, has received US$1 million in funding and will soon receive another US$1 million investment, according to Pacific Epoch. Sinomen is an information website for China's rural workers. The website was launched in November 2005 and provides recruitment, training, life style, and various other information for China's rural workers.

Rural laborers began to flood into cities in the 1980s looking for simple manual jobs. There are now about 140 million farmer-turned migrant workers in Chinese cities, half the workforce in the country's construction, mining and textile industries and in unpopular service work such as cleaning and garbage collection.

What's remarkable are the real signs of a peasant transformation. As millions of peasants migrate to the cities, the division between the city and the countryside has become an imaginary battle line at which the state has chosen to reach out and educate the poor and this includes bringing technology into their villages.

With this change, and as workers grow scarce, wages are going up. Indeed, over the last two years real salaries for manufacturing workers have risen faster than gross domestic product. That could have profound effects on China's economic infrastructure, since higher wages are running headlong into intense price competition.

For example, in a BusinessWeek article, it was reported a few years ago that Fang Haifeng, 27, invested $100,000 to set up a small textile factory with his parents and sisters in Hangzhou, Zhejiang province, in early 2003. One year later, the operation closed down -- a victim of rising wages among textile workers.

There appear to be many faces of globalization.