China is banning foreign companies’ accounts to allow labor inspectors to enforce government rules and take over their activities, according to a report in the state-run Global Times newspaper.
The move, first reported by the state news agency Xinhua, comes in the face of the growing crackdown on labor rights, which has intensified in the past month as protests in cities around the country and in the rest of the world continue.
The new rule is meant to improve safety and security in the construction sector, Xinhua said, citing a statement from the National Development and Reform Commission (NDRC), the government’s domestic development agency.
But it could also make it easier for the government to shut down construction companies, the paper said.
“The ruling party is trying to take control of construction, so it’s hard to predict the impact,” said Xu Yingqiang, a professor of business ethics at Shanghai University of Economics and Management.
The NDRC could not immediately be reached for comment.
China is the world’s second-largest economy, and its construction industry has grown by nearly 20% over the past three years, according for the latest figures.
The government said on Saturday it would ban foreign firms from construction contracts.
China’s construction industry is highly regulated and subject to tight oversight.
The NDRC did not immediately respond to a request for comment, but said in March it was working to crack down on the construction industry.
Last year, the NDRC banned foreign firms’ account use in the Chinese construction industry in a bid to crackdown on the labor abuses, as part of an effort to improve the safety of the industry.
But the NDLC has not been able to crack the industry, said Li Yan, the chief executive officer of the Beijing-based consulting firm Hao Guan Group.
Last month, China suspended foreign companies with over 10 million registered accounts from using the NDBC, with the NDEC taking over the operations.
It was the third time this year that China had blocked foreign firms operating in the country’s construction sector.
The foreign-owned firms are often in the business of supplying construction materials to the government.
Some have been accused of selling their products for money to foreign companies.
The companies are banned from dealing with foreign government or company representatives.
A total of 4.8 million construction workers in China work in construction.
They have been forced to work in dangerous conditions due to a lack of access to health and safety equipment, and to make sure that the materials they work on are not contaminated.
China is one of the most corrupt countries in the world.
More than 40% of the population are currently poor, according the U.N. data.