Types of ZSR

Migrants and social change

How ZSR can be implemented:

  • Measures should be put in place to ensure equal treatment of migrants and locals, regardless of ethnic background, for example in recruitment, pay and provision of services. 
  • Migrants should have the same rights as locals to residence in the area to which they migrate, and the option to settle in the area should they wish to stay. 
  • Locals from communities in and around the SEZ should be supported to develop migrant-serving economic activities, such as constructing and letting rooms, retail, catering and leisure activities, to support sustainable livelihoods change and facilitate inter-community relations.

Overview of the problem:

The availability of jobs in SEZs, and employers’ preference for non-locals in factory recruitment, leads to large-scale in-migration. This is typically from poorer regions and sometimes even neighbouring countries, and is often by young people of ethnic backgrounds that are different from those of the zone’s local communities. This pattern can have significant impacts on livelihoods and social cohesion, and can contribute to increased inequality both among locals and between locals and migrants, complicating the effective integration of migrants into the areas around SEZs and leading to social and ethnic tensions.  

 

Growing inequalities, differentiated forms of exploitation (including both preferential employment of migrants over locals and inflated rents charged by locals to migrants) and rapid shifts in internal migration dynamics tend to exacerbate ethnic differences and inter-tribal competition. Migrants of ethnicities that differ from those of local communities find it harder to integrate socially in the destination areas and may face discrimination and/or abuse from locals. Where settlement occurs, this may be in ethnically-based shantytowns and informal settlements, leading to long-term segregation. Enhanced ethnic tensions may be a particular risk when countries are emerging from protracted ethnic conflicts. 

 

Migrants may find it hard to survive on factory wages, especially when local communities charge high rents to migrants and those from non-local ethnic groups. In the worst case, migrants may resort to theft or other crime to make ends meet, exacerbating tensions with local communities. 

 

Many migrants stay only temporarily in the SEZ area for work, eventually returning to their hometowns and villages to seek other occupations and/or to marry. Some, however, decide to settle in the area around the SEZ, marrying locals or other migrants and contributing to urban growth. In some cases, the increased pool of marriageable young people and local consumption boost is are viewed positively by local populations, whereas in others settlement and the perceived taking of resources is resented. Local legal and welfare frameworks play an important role in influencing settlement decisions and their consequences.

 

Examples:

A study of Ethiopia’s Eastern Industrial Zone in Dukem suggests that large-scale, systematic labour migration has not yet occurred (Fei, 2018). This may in part be because of lack of accommodation for migrant workers in and around the SEZ. A major housing shortage in Dukem itself prevents migrants from finding affordable rooms to rent privately, and factory or zone accommodation within the SEZ is also in short supply (Tanku and Woldetensae, 2023). On-site accommodation is seen as advantageous by long-distance migrants because such housing is typically cheaper than private room rental and everyday transport costs are minimal. On-site housing also provides security in case of conflict, such that migrants can continue working within enclosed premises without losing their wages. For women, secure housing can help convince families to permit them to work. However, potential disadvantages include more exploitative conditions of work, with workers on call 24 hours a day, as well as excessive restrictions on freedom of movement and/or employer-related surveillance.  

Declining agricultural incomes, climate change and lack of government support have led to the migration of thousands of young women from small towns and rural areas to find work in Ethiopia’s Hawassa Industrial Park (Mains & Mulat, 2021). However, the high cost of housing around Hawassa has fuelled a high level of worker turnover, with negative impacts for the SEZ’s firms. Because of the shortage of affordable housing near the zone, migrants have tended to settle on the city’s outskirts, driving the rapid urban sprawl of Hawassa’s built-up area and creating challenges for infrastructural provision. (Haas, Kritikos & Lippolis, 2020).

The former residents of Lolabé village, displaced Cameroon’s Kribi Port SEZ was set up in 2010, were disappointed when the port and SEZ did not hire local people. China Harbour Engineering Company (CHEC), the firm responsible for building the port, filled most available jobs through online public recruitment, with no preferential policies for those affected by the SEZ’s construction (Schenkel, 2018). As a result, most of those hired were migrants from other parts of Cameroon. This method of recruitment contrasted with that of French firms operating in the area, which tended to visit villages to advertise jobs and to prioritise filling positions with locals. These differentiated hiring practices created tensions between former Lolabé villagers and incoming migrants who were perceived to have stolen jobs (Schenkel, 2018).    

Most factory workers in Nigeria’s Lekki Free Zone near Lagos are migrants from other states of Nigeria. Though many migrate spontaneously in search of jobs, tribal and ethnic ties also play a role in recruitment strategies of firms, especially those with specific local linkages or who hire through local recruitment agents. For example, the Dangote oil refinery, owned by Nigerian businessman Aliko Dangote, appears to hire primarily from Hausa communities in Kano State, his own place of origin. These dynamics of in-migration and preferential recruitment have led to resentment among local people, especially since the promise of job creation was a major incentive for locals to vacate lands for construction of the SEZ (Goodburn, Knoerich, Mishra & Calabrese, 2024).

There has been large-scale in-migration to central Uganda’s Liaoshen Industrial Park, from poorer northern parts of Uganda as well as from surrounding countries, leading to rapid population increase in the villages surrounding the park. Some migrant workers are refugees from war-torn regions. Local estimates suggest that the area’s population has doubled or even tripled over the past decade (Goodburn, Knoerich, Mishra & Calabrese, 2024). Although most factory workers migrated spontaneously to the zone for work, it was also reported locally that the park’s landowner mobilised workers from northern Ugandan tribes to provide labour, which is located in the heart of Buganda, the home of the Baganda tribe. Tensions between northern and southern ethnic groups in Uganda date back to the colonial period, when northern tribes were relied on primarily as surplus labour and military recruits (Wyrod, 2019). Current labour recruitment thus has the potential to reproduce and possibly exacerbate long-standing ethnic tensions. 

Some villagers complained of thefts of crops from their land by migrant workers, who found it difficult to exist on the low wages paid in the zone’s factories. Violent crime also increased, with fights between young migrant men particularly common (Goodburn, Knoerich, Mishra & Calabrese, 2024). However, many locals were delighted by the large increase in consumers for agricultural produce, the opportunities for rental income, and the addition of new potential marriage partners for villagers. In-migration has also led to increased availability of labour in local businesses and homes, since those who fail to make a sustainable living in Liaoshen’s factories tend to find alternative local work rather than return-migrating (Goodburn, Knoerich, Mishra & Calabrese, 2024).

The population of Gaborone has increased due to rural-urban migration resulting from industrial growth of the area, with migrants living in nearby towns such as Tlokweng, Gabane, Gaborone North and Phakalane, and commuting for work (Sebego & Gwebu, 2013). The transformation of traditional homesteads has had positive effects on local populations, enabling them to obtain new sustainable sources of income that have allowed them to cease work as maids, cleaners or manual labourers in Gaborone. (Kalabamu & Bolaane, 2014). However, uncertainty and conflict over rights to land, as well as congestion and overcrowded, slow, public transport have characterised the area’s development, while stark contrasts have appeared between sub-standard housing for internal migrant workers and elite accommodation for affluent international expatriates (Kent & Ikgopolong, 2011). 

Labour migration to India’s Sri City SEZ has been heavily influenced by the state’s preferential quotas for Andhra Pradesh locals in all industrial jobs (Economic Times, 2019). Most of the migrants who work on factory assembly lines are thus from within the state, rather than from other regions of India as common in other Indian SEZs. This migration of predominantly intra-state workers may have helped to avoid conflicts relating to ethnicity, language or culture.

However, long-term settlement near the SEZ remains out-of-reach for most migrant women, whose accommodation in restrictive factory hostels prevents any form of integration into the local community (Crane et al, 2022). Instead, migrant women overwhelmingly return to their villages to marry after two or three years of factory labour. Low acceptability of women working outside of the home in rural India and restrictive patriarchal family structures thus limit the emancipatory gains to be made from migration (Goodburn & Mishra, 2024). 

In electronics factories inside Uttar Pradesh’s Noida SEZ, as well as in the many supply chain factories surrounding the zone, the preference for hiring migrants over locals is made unusually explicit. Job advertisements specify “location” as a hiring criterion, and recruiting managers check the national identity cards of all applicants to ensure their listed home addresses are at least 200-300km away (Mishra, forthcoming). Locals are not hired for fear that they may “cause trouble”. Many other Indian SEZs operate a similar policy of preferential hiring of migrants, albeit usually less explicit and not listed in recruitment materials. While many Noida locals can now make higher incomes by letting rooms to migrant workers, those without the necessary capital to construct rooms to let – such as those who did not own land and therefore did not receive compensation when land was acquired for industrial development – resent their exclusion from factory employment and may struggle to make a living (Das & Kumar, 2022). 

Most of the workers in factories and port-related industries inside Gujarat state’s APSEZ are migrants from Uttar Pradesh, Bihar, Rajasthan, Orissa and other central-eastern states. Local Kutchi people are mostly not recruited for manual jobs, with majority of jobs going to migrants across the zone and port (Asher & Oskarsson, 2008). The state of Gujarat has a history of hostility towards migrants since at least the 1960s and 70s, with migrants having been attacked by local villagers in parts of Gujarat as recently as 2018 (BBC News, 2018). In Mundra, a strict demarcation of boundaries between migrant and local settlements is visible, with some local landlords intentionally leasing land outside their own settlements to build temporary accommodation for labour migrants (Asher & Oskarsson, 2008Shah, et al., 2012Shah et al., 2020). 

The agreement between local village governments (panchayats) and the private developers of Mahindra World City SEZ in the Indian state of Tamil Nadu included a first preference to be granted to locals for jobs, but no penalty was included in case of non-compliance (Subramanyam & Kudva, 2020). This meant that the agreement was not legally enforceable. Most of the factory jobs appear to have been taken by migrant workers, with locals settling into the rentier economy providing services to migrants and companies. During Covid-19 lockdowns, however, low-income inter-state migrant workers, who lacked registered local residence and related protections, fled the area to escape unemployment as factories closed (Subramanyam & Kudva, 2020). This had a knock-on effect on locals in migrant-serving sectors. 

In India’s Polepally SEZ (formerly in Andhra Pradesh, and now in Telangana state) the permanent jobs promised to dispossessed locals in 2001 at the rate of at least one per household failed to materialise, and unused farmland was not returned to villagers as agreed. Although many assembly line positions have been created by the SEZ’s mainly pharmaceutical factories, most of these have gone to migrant labourers not locals. Those locals who have found wage labour in the zone are primarily on informal contracts in the lowest wage positions, as sweepers, janitors, construction workers, and gardeners. The lack of formal factory jobs led to dispossession and debt among the locals, with those from lower castes and other marginalised communities worst affected (Agarwal, 2018)

The case of China:

In the early 2000s, many young rural Chinese migrated to SEZs and other industrial areas for work, staying for several years before returning to their villages to marry. Over time many migrants chose to remain in the city, often marrying another migrant or even an urban resident (Fang, 2013; Goodburn, 2015). Emancipatory effects of such migration and urban settlement have been found, especially for young rural women, who gained greater say in household spending, spousal choice and childrearing. Marrying in the migration destination brought further benefits, for example diminishing Chinese women’s traditional dependence on their husband’s kin and enhancing the role of their own parents in providing childcare support (Zhang, 2009).  

 

However, the restrictive household registration (hukou) system that bound citizens to their original place of residence made it more challenging for migrants to relocate to cities permanently. Established in the 1950s as part of Mao Zedong-era resource allocation and surveillance, the hukou system allocated every Chinese citizen a place of permanent residence and a status as either “agricultural” or “non-agricultural” (Chan, 2009). Those with agricultural hukou registrations were not permitted to move to non-agricultural employment in urban areas without authorisation by the state, and spontaneous rural-urban migration was extremely difficult, since urban food, housing, employment, schooling, healthcare and other resources were all allocated through the state “work unit” system. From the 1980s, migrants could move to China’s new SEZs and other cities only with a formal employment contract and a temporary residence permit. If they were caught in a city or SEZ without such documents, they would be detained and then deported back to the countryside through a nationwide system of “custody and repatriation” that operated until 2003 (Zhu, 2006). 

 

Even after “custody and repatriation” was abolished, it was difficult for Chinese internal migrants to settle long-term in their destination areas, since state resources – including education and health insurance – continued to be available only to those with locally-registered hukou. Transfer of one’s hukou was limited to a small number of mostly highly-educated professionals and state employees, especially in China’s megacities where strict quotas for hukou transfer apply (Dong & Goodburn, 2020). A large number of informal schools and clinics sprang up across Chinese cities to cater to migrant settlers from the countryside, but these were frequently shut down by the state on grounds of low-quality facilities (Goodburn, 2009). Since the late 2000s, China’s central state has encouraged local urban governments to include migrants in their provision of resources, but this has been resisted by many of the most popular migrant destination areas. 

 

Not only Chinese state institutions but also urban locals may discriminate against migrants in their destination areas. Often distinguishable from urbanites in terms of accent or dialect, dress, occupation and/or cultural practices, rural migrants may be regarded as “backward”, lower-skilled, lacking in manners or social sophistication, or suspected of criminal intent.  

However such crude stereotyping may be more prevalent in the traditional megacities and less so in SEZs and other regions with a high proportion of migrants relative to locals (Mu & Lee, 2024).

 

China-associated zones overseas

While it remains to be seen whether China-associated SEZs overseas will stimulate the same scale of labour migration that has characterised China’s own SEZ-based development, it appears that in many developing countries, where regional inequalities are typically high and formal waged employment opportunities few, Chinese zones create an additional incentive to in-migration through the large numbers of jobs created. SEZs with dormitories in contexts where other forms of housing are scarce, such as in Ethiopia, may attract additional migrants (Made in Ethiopia, 2024). 

Further reading

Sanders, Scott R. and David L. Brown. 2012. The Migratory Response of Labor to Special Economic Zones in the Philippines, 1995-2005. Population Research and Policy Review 31:1, 141-164. 

 

Park, S. 2016. Special Economic Zones and the Perpetual Pluralism of Global Trade and Labor Migration. Georgetown Journal of International Law, Vol. 47, No. 4, 2016

 

Cotula, L., and Mouan, L. (2018). Special economic zones: engines of development or sites of exploitation? https://www.iied.org/sites/default/files/pdfs/migrate/17481IIED.pdf