Despite questions from U.S. President Joe Biden’s foreign policy team about the lack of local benefits for countries along the Belt and Road, China and Chinese companies are serious about upskilling and employing more locals on overseas projects.
China is so serious that it is setting up a network of vocational colleges around the world, called Luban Workshops after Lu Ban, a mythical figure revered as an inventor. The workshops train students in dozens of countries in technical areas such as industrial sensors, control and robotics technologies, machinery equipment manufacturing, and high-speed rail technologies.
This is not mere altruism. The students will be trained on Chinese technology with Chinese standards as part of a full court press to globalize Chinese tech. It is a component of a bigger effort to tighten the economic linkages between China and the Global South, which Beijing sees as key to competition with the United States.
Beijing is also answering the demands of partner countries, which are insisting that Chinese projects employ more locals.
Until recently, this localization effort had been led by Chinese companies. In response to pressure from local societies and governments, Chinese firms adapted by upskilling locals to work on their projects. As we show in a recent paper for the Carnegie Endowment for International Peace, Chinese companies in Central Asia have trained thousands of locals to staff their projects and overcome chronic skills shortages in Central Asia. Numerous studies show similar localization trends in other parts of the world.
Now China’s government is following its firms. As with many Chinese government programs, Luban Workshops began as a provincial initiative. The government of Tianjin opened the first Luban Workshop in Thailand in 2016. So far, 1,125 Thai students have reportedly graduated from the workshop, and over 8,000 exchange students from other Southeast Asian countries have undergone training programs there. The facility has expanded from 232 square meters to 2,000 square meters, with its offerings increased from four practical teaching courses to 15, from one technical major to six.
Tianjin’s initial plan seems to be for the workshops to serve the interests of state-owned and private firms from the city, facilitating local training and employment, which increases competitiveness and brand recognition of these firms in the host country. At the same time, they also serve the interests of the Chinese government as an instrument of soft power, one that goes hand in hand with its global geoeconomic policy, and one that developing countries find attractive.
As such, Luban Workshops have subsequently been co-opted by China’s central government and gone global. In May 2021, the Tianjin Daily reported there were 18 Luban Workshops worldwide. Like Confucius Institutes, Luban Workshops are usually housed within a local institution, usually a vocational college, in the host country. They focus training on skills shortages in that country.
More Luban Workshops are on the horizon. The Tianjin government signed additional agreements in 2020 which, when finalized, will bring the number of workshops to 24. In May 2021, China’s foreign minister said in a meeting with his five Central Asian counterparts that the Chinese government will establish a Luban Workshop in each Central Asian country. Then in September, Chinese President Xi Jinping said that China would establish 10 Luban Workshops in the countries of the Shanghai Cooperation Organization (some of those will invariably overlap with the previous announcement regarding Central Asia).
If these workshops are established, there would be over 30 globally. The workshop in Thailand has trained over a thousand people a year. If other workshops operate at a similar rate, these workshops will train tens of thousands per year globally. Further announcements about the establishment of more workshops are likely.
Of course, questions remain over the quality and the connection of skills to demand. Reports from the workshops themselves may overstate their achievements. But China’s overseas economic policy has proven adaptable, and these workshops could well evolve with the changing needs of emerging economies.
The key here is that the Chinese government has been willing to listen to host countries involved in the Belt and Road Initiative and marshal plans to transfer industrial skills to these economies.