How to pass Chinese characters as command-line arguments?

[kj]

I want to pass Chinese characters as command-line arguments to a
Python script.  My terminal has no problem displaying these
characters, and passing them to the script, but I can't get Python
to understand them properly.

E.g. if I pass one such character to the simple script

import sys
print sys.argv[1]
print type(sys.argv[1])

the first line of the output looks fine (identical to the input),
but the second line says "<type 'str'>".  If I add the line

arg = unicode(sys.argv[1])

I get the error

Traceback (most recent call last):
  File "kgrep.py", line 4, in <module>
    arg = unicode(sys.argv[1])
UnicodeDecodeError: 'ascii' codec can't decode byte 0xe8 in position 0: ordinal not in range(128)

What must I do to get Python to recognize command-line arguments
as utf-8 Unicode?

FWIW, my os is Darwin, my shell (zsh) runs on Terminal, and none
of my locale (LC_*) variables is set.

TIA!

kynn