Aircraft plant shows off pace of China

Thirteen years ago there was a muddy duck pond where Taeco aircraft engineering plant in Xiamen now stands.

In remarkably quick time, the ducks have been replaced by four giant hangars and the hulking frames of Boeing 747s. Around the 747s - in the process of being stripped down and rebuilt - scurry hundreds of keen young workers.

Taeco provides a startling example of the speed at which the new Chinese economy can move.

That's not to say it doesn't take time to get through China's unique bureaucratic process. Fonterra's joint venture with Chinese dairy company San Lu is proof of that. The dairy company began joint venture talks with San Lu in 2002 but didn't get final Chinese Government sign-off for the deal until last December.

But in China when a project gets the green light, the speed of development is break neck.

The giant hangars - a sixth is already being planned - only illustrate a fraction of the scale that Taeco operates on. It has built a small town for its all of its 3000 workers and their families.

A decision was made early on that if the standards were to be truly world class the company would not employ any mainland Chinese who already worked in the aviation industry. Instead, Taeco imported experienced workers from Hong Kong and then set about recruiting its mainland Chinese staff straight from schools and universities.

It's a system that may eventually be self-perpetuating, as the company has also begun building the education facilities for its workers' children. The residential compound has its own pre-school and the company will eventually build its own primary school and possibly a high school.

It all sounds a little reminiscent of British capitalism in the 19th century when the industrial giants of the day built towns and public amenities for their workers.

Taeco was not prepared to say how much its workers earn. But they were firm in the view that the rates are well above what their workers could expect elsewhere.

There can be little doubt that a place in the Taeco system is highly sought after among students throughout the mainland. Xiamen is considered a charming seaside town by Chinese standards and the young workers are drawn from across the giant country.

Taeco is managed by Merlin Swire, one of the young heirs to the British Swire family fortune (the family holds a controlling stake in Cathay Pacific).

Swire says he is aware that the advantage of cheap labour is only a temporary phenomenon - as the economy develops wage expectations will grow.

* Liam Dann flew to China courtesy of Cathay Pacific.