Albion Monitor

Call for Nike Boycott

by Farhan Haq

Collaboration with dictatorships, sexual harassment charges in Vietnam, workplace abuses in Indonesia, low wages throughout Asia: the U.S.-based shoe giant Nike has faced all these accusations in recent months.

From its $100-plus sneakers to its high-priced spokespeople, including basketball star Michael Jordan, Nike has become a symbol of glamor in the sportsware market, as exemplified today by the opening of a $250 million Niketown store in New York. But dozens of protestors denouncing Nike's business practices in Asia point to the other side of the success story.

"Companies like Nike make use of repressive regimes like Indonesia's and China's to suppress worker efforts for better wages and working conditions," argues Frontlash, a youth organization of the American Federation of Labor-Congress of Industrial Organizations (AFL-CIO). "No savings are passed on to consumers despite the low wages paid workers abroad."

All of Nike's athletic shoes, and some 80 percent of its shoes overall, are made in Asia

In countries where Nike operates, workers are paid minimal wages and must contend with heavy production quotas and abusive treatment from subcontractors, adds Jeff Ballinger of the New Jersey-based activist group Press for Change.

All of Nike's athletic shoes, and some 80 percent of its shoes overall, are made in Asia, according to data from Nike. Indonesian subcontractors account for 36 percent of all athletic shoe production, and Chinese firms produce 34 percent of Nike's athletic shoes, with South Korea, Thailand, Taiwan and Vietnam accounting for the remainder.

For decades, Nike has argued that its practices in Asia have helped boost development in countries like Japan and South Korea. But even as Nike boasts $550 million in profits for 1996 and launches new projects like the Niketown store, accusations about Nike subcontractors in Asia are hurting the U.S. firm's corporate image.

The U.S. television network CBS noted in a recent report on its "48 Hours" program that 15 workers in Vietnam have complained of beatings at one factory making Nike shoes, while other Vietnamese women workers have accused factory bosses of sexual harassment.

Indonesian workers have argued that Nike subcontractors have responded to a raising of the minimum wage in that country (to the equivalent of $2.40) by increasing production quotas, speeding up production lines, and requiring longer working days. Some Indonesian women have reported to Press for Change an increase in verbal abuse and slaps to make them assemble shoes more quickly.

Nor have Asian workers reaped the benefits of Nike's $6.5 billion revenue for 1996.

Only last month Nike set up a Labor Practices Department to investigate charges of worker mistreatment by Nike subcontractors

John Cavanagh of the Institute for Policy Studies in Washington notes that Michael Jordan, whose current multi-year contract with Nike to appear on the company's advertisements is worth $20 million, makes more money from Nike than all the firm's mostly young and female Indonesian workforce put together.

"Exorbitant profits are coming at he expense of overworked and underpaid workers," the Rev. Jesse Jackson contended on a July visit to Indonesia, where he decried practices by Nike and another major shoe conglomerate, Reebok.

The Asian charges have saddled Nike Chief Executive Officer Phil Knight with an unsavory reputation, landing him on a list of top "corporate criminals" compiled by filmmaker Michael Moore in his new book, "Downsize This!"

Knight has not taken the charges lying down. "Whether you like Nike or don't like Nike, good corporations are the ones that lead these countries out of poverty," Knight told the Washington Post recently. He argued that ever since Nike started investing in Asia in 1964, it has helped countries like Taiwan and Japan develop through Nike partnerships with local owners.

"We watched it happen all over again in Taiwan and (South) Korea, and now it's going on in Southeast Asia," Knight told the Post.

Ballinger disagrees: "It's a little disingenuous" to say Nike improves Asian economies, he counters. "They're on a search for cheap labor. When labor becomes not so cheap, they're on their way out."

He argues that all the countries Nike has used -- from Japan in the 1960s to Vietnam and Indonesia today -- are places where labor costs are low. In addition, he said, Nike has only last month set up a Labor Practices Department to investigate charges of worker mistreatment by Nike subcontractors. (Dusty Kidd, director of the Labor Practices Department, was unavailable for comment.)

But Nike defends its record of monitoring workplace conditions overseas. "There are 800 Nike staff members in Asia alone, who visit subcontractors on a daily basis," a Nike spokeswoman said.

She added that Ernst and Young, a U.S. firm hired by Nike to oversee compliance with the company's code of conduct, continues to investigate, not only workplace abuses, but subcontractor compliance with Nike policy on adequate lodging and healthcare facilities for workers.

"The average wage (in Indonesia) is about double the national minimum wage," she added. The spokeswoman conceded that some subcontractors in the past paid unskilled workers lower "training wages," but she maintained that the problem has been stamped out.

Ballinger dismissed those claims. "They don't tell you that workers are working 50 to 60 hours a week to get to those wage levels," he said. Press for Change data indicates that, even after three or four years of employment, workers at Nike subcontractors in Indonesia still only earn the minimum hourly wage rate, he added.

© 1996, InterPress Third World News Agency (IPS)

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