Fire exposes illegal Chinese-owned factories
PRATO, Italy — The first thing the firefighters saw was the arm sticking out of the barred window on the second floor of the factory. Flames reached through the partially collapsed roof and a high column of smoke darkened the winter sky. This fire had been burning for some time.
The fire station is two minutes from the Teresa Moda garment factory, on the edge of the main industrial zone of Prato, a town outside Florence. The zone was developed for Italian textile manufacturers in the 1980s but now is predominantly Chinese.
The first squad arrived around 7 a.m. Priority No. 1 was the arm in the window. A firefighter raced up a ladder, cut through the bars and pulled out the slight, smokeblack body of a man. The operation took less than five minutes.
Each second mattered.
It was near dawn on a Sunday morning, but firefighters knew they would find more people inside. There were always people inside the Chinese factories.
The fire that destroyed the Teresa Moda factory on Dec. 1, 2013, and killed seven people, was the deadliest in living memory in Prato. It exposed the true cost of cheap clothes, laying bare the consequences of years of failed law enforcement and the pursuit of profit over safety.
Prato is the epicenter of a thriving, illicit Chinese economy that has grown in the wake of Chinese immigration. More than 40,000 Chinese live in the city, and many have replicated the habits of home and created a kind of outsourcing. Merchandise isn’t exported; China itself is.
Thousands of people have been smuggled into Italy, finding work at factories that ignore basic safety standards, while billions of euros are
“It’s like a virus, a new disease and we are now trying to figure out what it does.” Gino Reolon, provincial commander of Italy’s financial police
smuggled back to China, police investigations show. The savings on tax and labor costs have given businesses that don’t follow the law a crushing competitive advantage.
Many say illegal factories such as Teresa Moda are part of larger criminal networks in China and Italy. Police and prosecutors said they lack the tools to tackle the flow of migrants and money that fuel Prato’s black economy. The two countries do not cooperate closely in criminal investigations. The Teresa Moda factory churned out cheap “fast fashion” garments for sale across Europe. In an industry that thrives on speed, factories such as Teresa Moda have the advantage of being close to their main market. They also can trade on the cachet of the “Made in Italy” brand, though their clothes are made by Chinese workers in Chinese factories.
In the 1980s, Chinese immigrants began moving to Italy from the area around Wenzhou, a city famous for its entrepreneurs. Prato offered Chinese migrants ample subcontracting work, a steady stream of buyers and an existing industrial infrastructure. A high percentage of those migrants have gone to found businesses.
Despite the global financial crisis, the number of individually-owned Chinese businesses in Prato grew 35 percent from 2008 to 2013, while the number of European ones shrank, according to the Italian Chambers of Commerce.
Critics say that growth was possible because migrants brought a cultural disregard for regulations that do not maximize profit. Prato authorities have raided over 1,900 Chinese factories in the past 6½ years, closing 909 for gross safety and labor violations, and seized 33,427 sewing machines that were not up to code.
Chinese companies often open and close quickly to avoid tax and regulatory scrutiny, officials said.
There are trade-offs in making shirts that wholesale for less than $6. In Teresa Moda’s case, this meant forgoing not just a fire alarm, but also adequate fire extinguishers and emergency sprinklers, investigations would show.
Gino Reolon, the provincial commander of Italy’s financial police, said Prato is like a laboratory for tracking Chinese organized crime.
“It’s like a virus, a new disease and we are now trying to figure out what it does,” he said.