SCENARIOS-How far will unrest escalate in China in 2009?

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By Chris Buckley

China's abrupt economic slowdown has prompted official warnings that the country faces a dangerous upsurge of social unrest in 2009.

But how big are the risks, how could unrest unfold, and how will official fears shape policy and the economy? Here are some scenarios of what may happen, from the most likely and least severe to the least likely and most severe.

RISING SPORADIC LOCAL UNREST

Rising unemployment, falling incomes and discontent over inequality in 2009 are likely to bring more local riots, protests and strikes — what officials call "mass incidents" — sparked by anger over corruption, land disputes and sackings.

But these local outbreaks are extremely unlikely to coalesce into a broader challenge to the government.

Surveys show that popular discontent is mostly aimed at local officials, many of whom are seen as self-serving and corrupt, while the national leadership is more respected, if not loved.

In 2007, China had over 80,000 "mass incidents", up from over 60,000 in 2006, according to sociologists at the Chinese Academy of Social Sciences. That sounds like a lot. But many involve no more than dozens of participants, and are mostly peaceful.

A rise in this unrest would not be a hurricane that could overwhelm the government; it would be more like a dust-storm threatening to distract officials and delay decisions.

Beijing may therefore slow up on reforms that could stir rural conflict, especially land reforms announced last year, intended to make farmland transfers easier.

MORE PROTESTS AND RIOTS HIT PROVINCIAL TOWNS

Some recent protests and riots in provincial towns have drawn thousands of locals into confrontations with police.

They have often been driven by widespread anger over official corruption and privilege. With mobile phones and the Internet now common even in small towns, word of a clash can travel fast, drawing onlookers who can be drawn into confrontations.

The government is seeking to defuse these threats by spending more on the countryside and small towns, and it has also told local officials to avoid relying on police to quell protests.

ANGRY WORKERS STAGE LARGER-SCALE PROTESTS

China worries that crowds of disappointed job seekers could galvanise into protests or riots, especially if the economic slowdown gathers momentum.

The government's biggest worries are the migrant workers moving from farms to find work in cities and industrial zones. Some 20 million of the country's 130 million migrant workers have recently lost their jobs, according to one official count.

The factory region of the far south and other industrial areas could see flare-ups of protests by unemployed workers. With idle job-seekers milling around, smaller clashes between officials or bosses and workers could escalate.

But migrant workers lack a tradition of unity or the union organisation that could sustain widespread strikes or protests.

The government has also vowed more support for laid-off migrant workers in hardship, and it has brought in rules to discourage surprise sackings.

Employers looking to lay off workers will have to tread carefully to avoid the anger of employees and officials.

Unless signs emerge that protests are being actively coordinated, the risks of widespread worker unrest is limited.

STUDENTS, URBAN CLASSES LAUNCH MAJOR POLITICAL PROTESTS

China passes several sensitive anniversaries in 2009 that could become the focus for political protests by disgruntled students, intellectuals and urbanites, especially the 20th anniversary of the bloody crackdown on pro-democracy protests on June 4.

The government's biggest fear is that the economic slowdown could stoke discontent among educated urban classes, fuelling overtly political protests that challenge Communist Party rule.

About 6 million university and college students will graduate later this year, and many will have a hard time finding acceptable work in the current economic environment. About a million of last year's graduates are still jobless.

But students tend to be more career-minded than two decades ago: they have the heavy tuition costs paid by their parents to think about. Academics and professionals have generally done well from China's growth and rising government revenues, and many of them would not support any upheaval that could stifle growth.

Even in 1989, protests escalated only after splits in the Party leadership broke into the open. Since then Party leaders have been careful to keep a unified front and avoid major feuds.

But to minimise the possibility of any broader challenge to its rule, the government has been tightening censorship of the media and Internet and detaining and questioning dissidents. Expect more of that throughout 2009.