Wal-Mart might have gotton a (collective) bargain

WikipediaThe relations between Wal-Mart and China's only allowed trade union ACFTU got quite some headlines over the past few weeks, as both parties were able to secure a two-year collective agreement, including an annual pay rise of eight percent.
Here is the news as seen by Forbes.

Dan Harris, a U.S. attorney who represents small businesses in foreign markets with his firm Harris & Moure and writes the widely respected China Law Blog, says an 8% pay increase this year made sense. But the same amount next year sounds "strange," since there's no telling what inflation will be a year from now, he adds.

To be honest, I do think that the collective agreement is a historical one, but what the ACFTU got out of it sounds pretty meager. According to the National Bureau of statistics today, urban salaries had already gone up 18 percent during the first six months of this year. While real average do not exist in a country like China, where local difference can be huge, it looks that Wal-Mart got itself a very cheap bargain. The ACFTU might still have to work out a way to settle itself as a real trade union.