Counterfeit Itineraries in the Global South

The human consequences of piracy in China and Brazil

Rosana Pinheiro-Machado

• Publisher: Taylor & Francis
• Year: 2017
• Print ISBN: 9781138718395
• eBook ISBN: 9781351765114
• Edition: 1
• Topic: Social Sciences
• Subtopic: Anthropology
• Index: Social Sciences

At the end of the 1970s, Chinese merchandise moved to Brazil via Paraguay, forming an on-the-margins-of-the-law trade chain involving the production, distribution, and consumption of cheap goods. Economic changes in the twenty-first century, including the enforcement of intellectual property rights and the growing importance of emerging economies, have had a dramatic effect on how this chain works, criminalizing and dismantling a trade system that had previously functioned in an organized form and stimulated the circulation of goods, money, and people at transnational levels.

This book analyses how exchange networks that produced, distributed, and sold cheap manufactured products animated a huge and vibrant system from China to Brazil, examining the process at global, national, and local levels. From a global perspective, intellectual property is a powerful discourse that governs the world system by framing the notion of piracy as a criminal activity. But at the national level, how do nation-states resist and/or endorse, interpret, and apply a global perspective? And what effect does that have on how ordinary people organize their lives around this system? Interweaving discourse on transnational traders and producers, national projects, and international institutions, Counterfeit Itineraries in the Global South presents low-income traders not as passive victims of globalization, but as active actors in the distribution of cheap goods across borders in the Global South.

Based on fifteen years of ethnographic field work in China and Brazil, Counterfeit Itineraries in the Global South will be of interest to scholars of economic anthropology, development studies, political economy, Latin America studies, Chinese studies, and socio-legal studies.

1 Introduction

The tale of a Chinese Santa

In his 1952 essay, “Father Christmas Executed,” Lévi-Strauss tells about an event that happened the previous year in Dijon, France: Santa Claus was found guilty of being false and was burned in public before apprehensive children’s eyes. The Catholic Church had warned against the distortion of religious values that was provoked by the commercialization of the character. This event happened twenty years after Coca-Cola consolidated Santa’s now-familiar features—jolly, rotund, and red—and acquired intellectual property rights over the image. In spite of religious warnings, Santa Claus remains as commoditized as alive around the world.

A cheap electronic Chinese version of Santa Claus constitutes the mythological narrative that gives sense to this book. In 1988, in Brazil, my mother gave me a “Made in Taiwan” electronic Santa, who carried a green bag, marched, sang music, stopped, and rang a bell. I thought that the modern novelty must be pricey, until I learned that it was inexpensive merchandise traded in the informal market. Chinese goods had arrived in Brazil by the end of the 1980s, after decades of military dictatorship. The opening up of politics, along with the fall of the Berlin Wall and the Soviet Union, represented a time of freedom, consumerism, the relaxing of left-wing social movements, and the triumph of the so-called New World Order. The jolly, and ironically red, Coca-Cola Santa could not be more representative of that historic moment.

Eleven years later, in December 1999, I headed to downtown Porto Alegre, the capital of Rio Grande do Sul, Brazil, to conduct fieldwork. I was researching a street market and was observing the stall of my key informant, the street vendor, Chico (28), who sold Santas that were no longer made in Taiwan, but in China. The street vendors put the toys on the sidewalk and turned them on. The result was an odd scene in which hundreds of busy people had to divert their path to avoid a bunch of noisy walking Santas. A lady offered R$5 (then ±US$4) for the toy, but Chico stuck to R$10 (then ±US$8). The customer claimed that the product came with no warranty, which Chico contested, proudly saying that his product was “good stuff” and promising to fix it in case of an unlikely breakdown. The persuasive argument to decrease the price was that the Santa’s beard was dusty. They agreed on R$7 (then ±US$5).

I had my third encounter with Santa in 2003. I was following Chico on an excursion to buy goods in Ciudad del Este, Paraguay, on the border with Foz do Iguaçu, Brazil. It was Christmastime and, as usual, Chico was buying electronic Santas wholesale from a Chinese migrant. That year marked the beginning of a major policy of enforcement against piracy in Brazil. On the way back to Porto Alegre, our bus was stopped by police. We were detained at the police station for hours. A policeman opened our bags, kicked them, and shouted in an authoritarian manner: “This [a bunch of squeeze-friendly Santas] is criminal merchandise, smuggling, piracy, this is shit!” In the end, Chico lost part of his goods, but—at least that time—he was not arrested or sued.

My final encounter with Santa happened in 2007, when I arranged my first field visit to a factory in Shenzhen, China. Xia (32), the wealthy young man who owned the factory, invited me to go to his office upstairs because he wanted to give me a gift. I was amazed when he gave me an electronic Santa—by then a more modern and fashionable version—which I could have seen in a market in Brazil. With a Santa that wore sunglasses and drove a Harley-Davidson in my hand, I had finally completed an ethnographic trajectory through which I tracked the social life of cheap Chinese products that had arrived in Brazil at the end of the 1980s.

Yet, it was not the end. I returned to Porto Alegre in 2009 and 2014. Chico was no longer on the streets, but was now vending in a low-income shopping mall, which was the result of a formalization policy that aimed to enforce laws against the informal economy and piracy. Things that in the past were simply considered shoddy and cheap Chinese trinkets had become increasingly criminalized. The words “piracy” and “falsification,” which I had rarely come across in 1999 when I started my fieldwork, became synonymous with a wide range of products and economic practices. By being associated with organized crime, cheap Chinese goods constituted the repertoire of “the crimes of the twenty-first century”: illicit goods, piracy, and counterfeiting. Santa was condemned guilty for being false once again—at least, his Chinese version.

Cheap, copied, and ordinary, manufactured Chinese commodities, such as an electronic Santa, are the subject of this book, which examines their politics of value—how various elites and global powers try to control and limit their exchange and consumption, while popular forces try to expand them (Graeber 2001)—as well as their regimes of value—the cultural, social, and temporal milieus through which they circulate (Appadurai 1988). The banality of these commodities in the market inexorably covers several layers of sacrifice. Yet, the sacrifice does not stem merely from the extraction of workers’ surplus value, but also from the meaning of life for people who traded these commodities and whose selves were constituted in relation to them.

The book is not about a commoditized Santa per se, but the entire system that enabled its existence and worked to maintain its low cost—the invisible human experience that created a transnational commodity circuit in the Global South, and the dialectical relationship through which people and value constituted each other. Reproducing Malinowski’s words on the Kula:

This book is about people who live within this circuit, whose ideas, ambitious, desires, and vanities are very much bound up with exchange networks ... It is about people who risk life and limb to travel across huge distances to trade what appear to be worthless trinkets.

(2002, 2)

By doing so, people escaped law enforcement, created new trade routes across the globe, and changed the history of the world system. But the story presented here is also about powerful discourses—both global and national—that framed cheap goods as criminal counterfeits and targeted the circuit as a whole, reorganizing moralities, routes, and values.

At the end of the 1970s, Chinese commodities traveled to Brazil via Paraguay, forming a commodity ecumene (Appadurai 1988)—a transcultural network linking producers, importers, and retailers of cheap manufactured goods, such as toys, fashion accessories, cosmetics, gadgets, and trinkets. Products were: (1) made in the Guangdong Province’s Special Economic Zones (SEZs); (2) imported to Paraguay by Chinese immigrants; and, finally, (3) smuggled across the border by Brazilian low-income traders, who resold them in Brazil’s street markets. For decades, this transnational trade route—partially regulated, but widely organized according to its own logic—has promoted the transnational displacement of people and goods, as well as the reallocation of employment and income. It thereby animated a significant part of the globalization in the interior of the Global South, which holds China as the center of what is called the periphery of the world system.

The goods exchanged in this trade route were some of the cheapest manufactured commodities available in the world. Their value emerged from cultural realms, human relationships, sacrifices, and privation that created and made sense of “worthless” things. The whole circuit worked to lower the price of goods: the labor-intensive regime in the factories in China, the hard work of migrant shop owners in Paraguay, and the street vendors’ “self-exploitation” in Brazil. Such an idea is well illustrated by what my key informant, a Brazilian trader named Chico, told me: “We will need to return to Brazil standing on the bus, because the commodities have priority.” Additionally, the level of lack of legal formalities employed throughout the circuit, tax evasion, and the perfect match between the value of the yuan and the dollar in South America generated unbeatable final prices at the turn of the millennium. Nevertheless, economic changes in the twenty-first century, such as the enforcement of intellectual property rights and the growing importance of emerging economies, have had a dramatic effect on how this trade route works, criminalizing and dismantling a trade system that functioned in an organized form and stimulated the circulation of goods, money, and people at transnational levels.

Relying on a long-term transnational ethnographic project, the book presents the three geographical “nodes” (Ribeiro 2010) of the trade route from a holistic perspective. That is, value construction and economic activity are treated here as total social facts that condense power, moralities, feelings, belongings, kinship, networks, labor, leisure, competition, exploitation, and solidarity. The thread of the story is my own journey in search of Santa over time and space. By doing so, my goals are twofold. First, I investigate how this transnational route functioned on a daily basis through the exchange of commodities on the margins of the law: how people structured their livelihoods, aspirational projects, supported their families, and engaged in global imaginaries and assemblies. Second, I describe how the route collapsed as a result of the major changes in the realm of the international political economy and how people were affected by such a process.

My arguments are structured around three levels of analysis: global, national, and local. From a global perspective, I argue that intellectual property is a discourse that attempts to govern the world system by labeling certain types of goods and economic practices as criminal activities. But at a national level, how do nation-states resist and/or endorse, interpret, and apply a global perspective? The analysis suggests that while Brazil considers the trading of cheap Chinese goods and the informal economy as constraints on development, China perceives them as drivers of development. From a local perspective, these national postures have affected workers’ lives and the value of commodities in a drastic manner. China’s laissez-faire attitude created the China price (Harvey 2008)—the result of an alliance between state and market elites that is justified by a nationalistic narrative that legitimizes pain and exploitation in the name of economic development. The Brazilian popular economy, for many years, benefited from such a price, until the country endorsed the intellectual property discourse and applied ostensive police enforcement against “piracy” and the informal economy. This process forced migrant shop owners and low-income traders into bankruptcy, resulting in the fragmentation of the circuit and the fostering of new trade routes structured upon new regimes of value.¹

From China to Brazil, via Paraguay

Producers in China, migrant importers in Paraguay, and street vendors in Brazil were active actors in the building of new world-system geographies, forming a commodity trade route in the Global South, which operated apart from the center of power and capital. Exchange networks of cheap manufactured products had animated a huge circuit from China to Brazil for at least three decades.

In the 1980s, at a time when the productive capitalist system was understood predominantly through the lenses of colonialism, imperialism, and the center–periphery divide, one of anthropology’s main contributions to globalization studies was to demonstrate that the world system had not expanded unidirectionally. Even if European and North American hegemony predominated in the world economy during the second half of the last millennium, that was not the whole story. For centuries before and after the sixteenth century, many and varied world economies existed in the heart of the Global South. This pointed toward the existence of other relationships of power and dependence beyond the classic sense, or what Wallerstein (2011) called the modern world system (Abu-Lughod 1991; also Wolf 2010). At least since the Silk Route, which emerged during the Han Dynasty (206 BC–AD 220), China has played a role in mixing up the hegemonic history of the world system (Abu-Lughod 1991; Sahlins 1994). In fact, scholars of dependency theory and later world system theory always had a hard time framing China, especially when the world was still described in terms of center and periphery. China occupied a place in the “semi-periphery” of the system.

Its nineteenth-century insertion into the international system was characterized by two opposing time periods: the rise and fall of control over its own maritime trade in Guangdong amid a power struggle with the imperialist nations, which were seeking easier access to fine Chinese commodities such as tea, silk, and other chinoiseries. Enjoying ideal maritime resources, topography, and infrastructure (Van Dyke 2005), the province was a Chinese window onto the world, a point of contact with people, goods, and information from outside (Fairbank 1986; Van Dyke 2005; Vogel 1969; 1989). After the “century of humiliation”—a period spanning from the Opium War in 1840 to the Communist Revolution of 1949, marked by colonization, invasions, and civil wars—the Mao era recovered national pride and sovereignty.

While China was closed off to the world in the Mao era, the world capitalist system continued to change and expand. This process was marked by the decentralization of production networks, especially in the sector of mass-produced consumer goods. During the second half of the twentieth century, Western industries went through three migratory phases, installing factories in Asian countries that offered progressively lower production costs. As Gereffi (1999) demonstrated, the first wave of industrial expansion was to Japan in the 1950s and 1960s. The second moved into South Korea, Hong Kong, and Taiwan in the 1970s and 1980s. These three countries became known as the “Asian Tigers,” which attracted worldwide attention due to their rapid industrialization and high economic growth rates.

Taiwan signed diplomatic agreements with Paraguay in 1957, which recognized the island as a sovereign country. These agreements primarily served to facilitate migration. The opening of the Friendship Bridge in 1975—connecting the Brazilian city of Foz do Iguaçu with Ciudad del Este in Paraguay—constituted a milestone in attracting migrant traders, since there was an open thoroughfare right on the international border. In light of this opportunity, at the peak of the Taiwanese economic takeoff, immigrants ventured into the promising frontier region of Paraguay to sell “Made in Taiwan” goods, cheap goods, mass-produced in a labor-intensive regime under flexible tax regulations. Shack (2000) points out that a good deal of the business that expanded from the 1950s on in Taiwan was composed of small and medium-sized informal, unlicensed, and unregulated factories. Thus, together with immigrants from other countries (especially Muslim Arabs), one of the world’s largest free-trade zones was formed in the 1970s for small manufactured goods, initially under the “Made in Taiwan” label.

In the early 1980s, the third wave of the world system expansion took place, to mainland China. The Chinese government began to implement reforms arising from economic liberalization, restoring ties with Taiwan. The focus of development was placed on maximizing the old mercantile attributes of Guangdong’s maritime trade, which provided elements essential to today’s export-oriented economy (Fairbank 1986). Zones, cities, and entire coastal areas were opened up, which came to be considered specially reserved for production and export. The reforms implemented by Deng Xiaoping at the end of 1978 focused on the open-door policy, recuperating Guangdong Province’s role as a point of contact with the outside world, especially through its SEZs, such as Shenzhen. Chairman Deng implemented the plan of four modernizations (agriculture, industry, national defense, and science and technology). His plan included a two-step “open-door” policy: (1) a return to the policy of attracting foreign investment; and (2) the recuperation of coastal cities that had previously been pre-eminent in foreign trade.

Following the Tigers’ development model, cheap prices were the result of a mass-production model, based on intensive and non-regulated labor practices that offered unbeatable prices on the global marketplace. In this scenario, millions of Chinese migrated to Guangdong during the economic reform, especially from rural areas, while many Cantonese emigrated, forming one of the most recent waves of the Chinese diaspora toward “new countries” (Ma and Cartier 2003; Mung 2000), for the purpose of marketing, worldwide, what their country had started producing in abundance. In this context, from the 1980s on, many Cantonese went to Ciudad del Este, Paraguay, and joined the Taiwanese there. In the 1990s, there were approximately 20,000 Chinese immigrants—including Taiwanese and Chinese mainlanders—in the border region, forming a Chinese community that specialized in selling cheap Chinese goods, thus furnishing mass goods for much of South America. With the rise of the People’s Republic of China, the label “Made in Taiwan” gave way to “Made in China.”

The free-trade zone on the Brazil–Paraguay border emerged at a time when Brazil was recovering from harsh decades of military dictatorship, also known as the “lost decade” for its huge economic crises—the 1980s. Many figures indicated that around half of the population was active in the informal economy (see Malaguti 2000). Informal street markets arose everywhere in metropolitan areas in the 1990s—a period of economic opening...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Dedication
• Table of Contents
• Acknowledgements
• Note on the text
• 1. Introduction: the tale of a Chinese Santa
• PART I: South America
• PART II: China
• Conclusion: ending and changing routes
• Index