FOR France, known for both its anti-globalisation sentiments and regular protests against outsourcing, the shoe may now be on the other foot. China - the famous factory to the world that has been accused of siphoning away French jobs - is set to outsource work to, well, France.

Globalisation is coming to the rescue of a country singing the blues with its rapidly rising unemployment. And to add to the historical irony, Chinese workers arriving to jump-start the project will be occupying villas and barracks built for the United States forces during the heyday of French cooperation with Nato.

In 1967, when US forces withdrew from Chateauroux Air Station, the graffiti sprayed on the wall urged 'US go home'. There is no 'Welcome China' bunting in the small town south of Paris, but French negotiators will be arriving in Beijing this month to formalise plans for the Chateauroux Business District. (Abandoning resistance to foreign languages, the special economic zone has been christened in English.)

Under an accord signed last year, 30 to 50 Chinese electronic and light manufacturing companies will set up assembly plants in the district, creating 4,000 jobs - a total of 80 per cent of which will be for French workers.

The Chateauroux region, once a centre for apparel manufacturing, lost it all to China. The planned departure of the 1,100-strong French army unit at the airbase would have dealt a further blow to the area. Against this backdrop, the Chinese government's proposal to set up an industrial park next to the former American airbase was received warmly by grateful town officials.

The Chinese plan to locate final assembly operations of many of its exports to Europe in France follows the tradition established by Japanese firms in the 1970s and 1980s. Facing rising protectionism from Europe and the US, and to benefit from low-cost and efficient supply-chain production, Japanese automakers moved much of their operations abroad. Criticism of Japan soon melted, as rising Japanese investments created jobs.

Unlike Japan, though, the Chinese would not be shifting entire factories to France. Chinese factories in China would still be producing the parts for final assembly in France, where a 'Made in Europe' or 'Made in France' label might be slapped on the products. French commentators have noted that the most important value addition for the Chinese would be the 'Made in Europe' cachet for goods often sneered at as of poor quality.

Moving the assembly and distribution of products closer to where the customers are is likely to help Chinese companies secure a long-term client base. Offering the after-sale services that their France-based operations would allow could be valuable for penetrating the continent. It is perhaps with this long-term perspective in mind that Chinese telecommunications giant Huawei recently set up a research centre in the Paris region.

The Chinese move could also yield a public relations dividend. Although scepticism prevails over the actual number of jobs the Chinese would create, the mere act of establishing a Chinese industrial park could help dampen charges that China is stealing European jobs.

French reactions to the news of this reverse outsourcing have been cautious. Conservative commentaries warn of a 'Chinese Trojan horse' in the heart of Europe. They claim these French-made goods will harm domestic production. Officials struggling with rising unemployment, on the other hand, hope the Chinese will help reverse the trend.

Allowing Chinese companies a beachhead in France would also benefit French aviation and shipping. Chinese state-owned shipping company Cosco already holds a 35-year lease on the container terminals at the port of Athens, Greece, giving China another foothold on Europe's shores.

Some French analysts worry that poor-quality Chinese products, some of which have been recalled in recent years, could damage the continent's reputation. But such worries pale before the immediate gains that China's Chateauroux deal offers. French workers, who have largely seen globalisation as a dark cloud on the horizon, might at last note a silver lining.

The writer is director of publications at the Yale Centre for the Study of Globalisation, and the editor of YaleGlobal Online.

Source - The Straits Times (http://www.straitstimes.com/Review/Others/STIStory_549621.html)