Intensified WTO competition has negatively impacting on certain Chinese enterprises resulting in these enterprises laying-off employees who may increasingly take their frustrations out on foreign companies.
One Chinese, supplier, fearing bankruptcy when a foreign-funded company instituted an open bidding process to cut costs, issued threats of violent protests, industrial action and sabotage in a bid to force compensation from the company.
Foreign-funded enterprises are perceived to have limitless financial resources, making them lucrative targets for strikes, compensation claims and extortion. Companies can employ progressive human resources policies, plant security and close government relations to protect themselves but these measures are only part of an effective risk management strategy.
