China faces wave of unrest in 2009

BEIJING (Reuters) - China faces surging protests and riots in 2009 as rising unemployment stokes discontent among migrant workers and university graduates, a state-run magazine said in a blunt warning about unrest in this sensitive year.

The unusually stark report was in this week's Outlook (Liaowang) Magazine, issued by the official Xinhua news agency, which laid out the hazards facing China and its ruling Communist Party as growth falters during the global economic crisis.

"Without doubt, now we're entering a peak period for mass incidents," a senior Xinhua reporter, Huang Huo, told the magazine, using the official euphemism for riots and protests.

"In 2009, Chinese society may face even more conflicts and clashes that will test even more the governing abilities of all levels of the Party and government."

President Hu Jintao has vowed to make China a "harmonious society," but his promise is being strained by rising tension over shrinking jobs and incomes, as well as long-standing discontent over corruption and land seizures.

China is also facing a year of politically tense anniversaries, especially the 20th year since the June 1989 armed crackdown on pro-democracy protests. That anniversary has already galvanised a campaign by dissidents and rights advocates demanding deep democratic reforms.

Huang said many Chinese citizens had shed their reluctance to confront officials.

"Social conflicts have already formed a certain social, mass base so that as soon as there is an appropriate fuse it always swiftly explodes and clashes escalate quickly," said Huang.

Outlook Magazine arrived with subscribers on Tuesday and the article also appeared on Xinhua's website (www.xinhuanet.com). China's leaders are usually secretive about threats to their control and the unusually blunt public warning may be intended to help snap officials to attention.

JOBLESS AND BITTER

The biggest threats to China's stability will come from graduating university students, facing a shrinking job market and diminished incomes, and from a tide of migrant labourers who have lost their jobs as export-driven factories have shut.

Factory closures, sackings and difficulties paying social security had already unleashed a surge of protests, the report said. Officials in provinces that have provided tens of millions of low-paid workers for coastal factories have reported a leap in the number returning to their farm homes without work.

State statistical authorities estimated that close to 10 million rural migrant workers had lost their jobs, the magazine said, without specifying when the sackings happened.

Including students who graduated in 2008 and had not found work, there would be more than 7 million university and college graduates hunting for jobs this year, Huang calculated.

The government's goal of annual GDP growth for 2009 of 8 percent would generate only 8 million new jobs for the whole country, he added. In 1989, discontented students formed the core of the pro-democracy protests.

"If in 2009 there is a large number of unemployed rural migrant labourers who cannot find work for half a year or longer, milling around in cities with no income, the problem will be even more serious," said Huang.

Huang is Xinhua's bureau chief in the southwest city of Chongqing, which has long been a cauldron of unrest. Other parts of China have also seen intense but brief and localised protests over police abuses, corruption and factory closures.

Ian Bremmer, president of the prominent political risk consultancy Eurasia Group, said he foresaw no departure from that pattern and no overwhelming crisis from unrest.

"The party has built a large stockpile of domestic goodwill over the past three decades," Bremmer told Reuters in an interview this week, offering a more optimistic outlook.

"Toughening economic times will erode some of that credit, but the reserves are too deep for China to reach a crisis point in 2009."

China's economy expanded by 9.9 percent from a year earlier in the first nine months of 2008. But some economists doubt that the government can achieve its goal of 8 percent growth for 2009.

The Outlook report also stressed that China's social strains are about more than just GDP growth. Protesters were becoming increasingly politicised, making it even more difficult for officials to contain protests by force, the report said.

(Reporting by Chris Buckley; Editing by Nick Macfie and Dean Yates)