In Indonesia’s nickel belt, Chinese built smelters now produce roughly two-thirds of the world’s battery grade nickel at a capital cost 40 to 60 percent below their Western rivals and in roughly one-third the time. This is not a story of Chinese technological triumph, however. It is the deliberate replication of a distinctly Chinese economic model: one that secures dominance by systematically operating under weaker protections for workers, communities, and the environment.
China today produces nearly a third of the world’s manufactured goods and dominates 70-90 percent of global capacity in rare earths, battery precursor processing, and other critical minerals. With this level of manufacturing concentration, no global effort to improve labor conditions can ignore China. Strengthening oversight of China-linked supply chains is thus a necessary step for better worker outcomes for all.
China’s low rights model is no longer a domestic labor issue but a systemic challenge to global labor standards, supply chain governance, and fair market competition. Without a coordinated civil society response, the global baseline for worker rights will continue to fall.
I call China’s economic model a “low rights” one because it has long relied on suppressing labor costs to maintain industrial competitiveness. As a result, trade imbalances between China, the United States, and Europe are strategically linked to China’s ability to attract multinational companies through low-cost labor and policy incentives. At the same time, Chinese companies internalized the technology and management know-how of these foreign companies into their domestic systems, gradually transforming what were originally Western competitive advantages into China’s own strengths.
In recent years, China’s “low-standard, low-cost” development model has expanded beyond its borders. Through the Belt and Road Initiative, it has spread globally, exporting labor, environmental, and governance risks to host countries. Nowhere is this more evident than in Indonesia’s nickel sector, where mining and smelting contracts are so short that they function like countdown clocks, pressuring companies to recoup capital as fast as possible.
Chinese firms, including Tsingshan, have developed three battery-grade nickel plants in Indonesia for under $1.5 billion each. Construction was completed in only three years, and each facility reached full capacity within just 12 months of operation. In stark contrast, Australia’s Ravensthorpe plant required $2.2 billion and nine years to reach full production.
Wood Mackenzie estimates that the capital cost of Chinese-led projects in Indonesia is about $35,000 for each tonne of annual nickel output, while Western facilities typically require more than $100,000. This difference highlights an important reality: the rapid expansion of Indonesia’s nickel sector is largely enabled by systematically weaker protections for workers, surrounding communities, and the environment.
What appears to be a matter of cost efficiency is in fact the offshoring of a regulatory model that prioritizes speed and output over labor rights and environmental safeguards
Western carmakers and battery giants, under pressure to secure low-cost supplies for the green transition, have become willing participants in this model, often turning a blind eye to the labor and environmental shortcuts that make their net-zero targets affordable.
This “low-cost” model has been permitted to exist due to an increasingly shrinking civic space. Independent labor monitoring inside China has become dramatically harder in the past decade. Today, only a few independent organizations remain capable of conducting investigations, such as China Labor Watch. Yet, political risks deter most international funders from supporting work inside China, leaving independent oversight critically under-resourced in an area where it is needed most.
Abroad, labor organizations also face different barriers. Grassroots unions have limited resources, little institutional support and capacity, and dwindling funds. In Indonesia, we met a local union with 400 dues-paying members that could not afford an office – a common situation seen among other local unions. Meanwhile, reduced human rights and labor funding from the United States and other donors has forced many related organizations to scale down or close.
It is also important to recognize that the reach of China’s “low rights” model is expanding, affecting not only production-line workers but also certain technical roles. In recent years, some AI data-labeling and related tasks have been outsourced to China. In the absence of adequate oversight, these sectors often exhibit long working hours and opaque labor conditions, a trend that is placing downward pressure on labor standards in emerging global industries.
Overall, China’s dominant role in global manufacturing and mineral supply stands in stark contrast to the tiny amount of funding in labor and environmental oversight. The result is a regulatory vacuum in which the cheapest practices spread the fastest.
I believe that to counter this dynamic, civil society organizations must be central to any strategy for raising global labor standards. We can advance change in three key ways.
First, increase public awareness. We can collectively highlight that consumers must recognize the real costs behind low-priced products: long working hours, low pay, job displacement, low labor standards. The public must understand that declining labor standards ultimately harm every society. In reality, with wages stagnating in many Western countries, more consumers rely on cheaper products that are produced by workers who are, in fact, competing with them for similar types of jobs in the global labor market.
Second, advocate and partner with authorities for the rigorous enforcement of forced-labor laws. Import bans, labor regulations, and due diligence laws already exist. But enforcement depends on independent organizations holding authorities accountable, and providing evidence if there are enforcement gaps. It also requires sufficient and sustained funding to ensure that these laws can be implemented in practice, rather than remaining symbolic commitments.
If the low rights model continues to set the baseline for critical minerals and green technologies, the West’s own reindustrialization efforts, which are already struggling with high labor and regulatory costs, risk becoming economically unviable and could give Beijing decisive leverage over the industries that will shape the twenty-first century economy
Third, donor governments and foundations must channel unrestricted, multi-year funding to independent labor organizations in Belt and Road host countries. In these countries, unions can still operate legally and the risks of political repression are comparatively lower, enabling these organizations to serve as frontline enforcers of higher labor standards and compelling Chinese firms to confront and respond to stronger labor and governance requirements.
The EU Forced Labor Regulation and the Corporate Sustainability Due Diligence Directive (CSDDD) had their scope narrowed during the legislative process, while U.S. forced labor import enforcement remains inconsistent and lacks clear direction, making the global regulatory landscape by significant uncertainty. If global civil society does not intervene now, global labor standards will not simply stagnate; they will be redefined downward by a model built on speed, opacity, and the suppression of rights.
The question is no longer whether China’s low rights model can be contained within its borders; it cannot. The only choice left is who will write the next set of global rules: the corporations profiting from Beijing’s factory floors or a revitalized coalition of workers and watchdogs across the Global South
