Scandal-plagued Foxconn is planning to increase its investment in Tianjin, amid latest reports that the electronics manufacturing giant is shifting some of its operations to the municipality and transfer staff from its Shenzhen plants.

The Taiwan-based company recently contacted the investment department of the Binhai New Area government in Tianjin, an official of the department told China Daily.

Foxconn is planning to increase its investment and product portfolio in the municipality, said the official who did not want to be named.

Foxconn currently has a plant in the Tianjin Economic Development Area, which is part of the Tianjin Binhai New Area. The latest discussion between Foxconn and the local government was about more investment in the New Area, the official said.

The official was responding to media reports that Foxconn is shifting some of its operations to Tianjin.

The company earlier pledged to increase its wages by up to 66 percent but has limited the raise to only those who are willing to relocate to the municipality, the Beijing-based China Times newspaper reported.

Foxconn decided to raise its wages following 13 suicide attempts by its workers in the first five months of this year that ended with 10 deaths.

The minimum wage in Tianjin now stands at 920 yuan (US$135), significantly lower than the 2,000 yuan standard Foxconn promised for its manufacturing workers in Shenzhen, a southern manufacturing hub in Guangdong Province, by October.

The Tianjin plants will take 300,000 of the 420,000 workers currently based in Shenzhen, China Times reported.

Foxconn's subsidiary plants in the southern industrial hub that assemble iPhones and iPads for Apple will not be affected by the change, the newspaper reported.

Foxconn Technology Group media office director Liu Kun did not confirm the report when contacted by China Daily and did not want to elaborate on it.

A manufacturing worker at one of Foxconn's plants in Shenzhen assembling cell phones said "loads of rumors are in the air" over the future of jobs at the company.

"People say we're going to be relocated. But I don't know where yet, I don't know when that will be, and I don't want to go to the north anyway," said the native of Shaanxi province who did not want to be named.

"The only thing I am sure of is that we're not going to get a raise that easily," the 26-year-old worker told China Daily. He now earns 1,800 yuan a month working about 70 hours a week -- more than the legally permitted 60 hours.

Gao Xingmin, a professor with the China Centre for Special Economic Zone Research in Shenzhen University, said the moving out of OEMs (original equipment manufacturers) like Foxconn might cause the local GDP to drop in the short term, but it offered a chance for Shenzhen to cultivate more high-value-added industries.

"The local government has to give up some of its vested interest to establish a more equal society, " Gao said.

Foxconn is shifting from Shenzhen, where minimum wages soared in the wake of media reports and workers' protests, to other areas in the country's underdeveloped and relatively low-paid interior.

In Henan, the country's most populous province, up to 100,000 vocational school students -- mostly in their late teens with no work experience -- were scheduled to join the world's largest contract electronics maker in Shenzhen for a three-month internship over the weekend.

A Henan official who did not want to be named told China Daily he was told that Foxconn will employ 300,000 people in Henan to work in Shenzhen. They will be transferred back to Henan once Foxconn opens plants in the province, he said.

Similarly, The Henan Daily last Thursday quoted an unnamed official from the provincial employment promotion office as saying that cooperation with Foxconn will help boost local employment and aid Henan's industrial upgrade.

Foxconn is also planning to recruit 100,000 people in Chongqing, the country's most populous city, within the next five years, China News Service reported.

Last Friday, the company signed a cooperation agreement with 119 Chongqing vocational schools, which promised to send their students to Foxconn's local plants.

(China Daily June 29, 2010)