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China's Rural Industries: Self-reliant Systems or Independent Kingdoms?

Published online by Cambridge University Press:  17 February 2009

Carl Riskin
Carl Riskin
Affiliation:
University of Michigan
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Extract

In the wake of the Cultural Revolution, a dramatic surge of rural industrialization occurred in China. Thousands of small-scale enterprises using intermediate technologies were set up in the rural hsien and communes.

Type
Research Article
Information
The China Quarterly , Volume 73 , March 1978 , pp. 77 - 98
Copyright
Copyright © The China Quarterly 1978

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References

1. “Rural industries” refers to those industries run by the rural communes and their production brigades, and state industries at the sub-provincial level, chiefly those operated by the hsien. A fairly extensive literature about this sector has grown up. See, inter alia, Riskin, “Small industry and the Chinese model of development,” The China Quarterly (CQ), No. 46 (April–June 1971), pp. 245–73; idem, “Local industry and the choice of techniques in planning of industrial development in mainland China,” in Planning for Advanced Skills and Technologies (United Nations Industrial Development Organization: New York, 1969), pp. 171–80; idem, “Intermediate technology in China's rural industries,” in E. A. G. Robinson (ed.), Appropriate Technologies for Developing Countries, forthcoming; Jon Sigurdson, Rural Industrialization in China (Cambridge, Mass.: Harvard University Press, 1977); idem, “Rural industry – a traveller's view,” CQ, No. 50 (April–June 1972), pp. 315–32; idem, “Rural industry and the internal transfer of technology,” in Stuart Schram (ed.), Authority, Participation and Cultural Change in China (Cambridge: Cambridge University Press, 1973). A group of qualified observers from the United States visited China in 1975 expressly to study rural industries, and have written a comprehensive account: American Rural Small-scale Industry Delegation, Rural Small-scale Industries in the People's Republic of China (Berkeley, Los Angeles and London: University of California Press, 1977).Google Scholar

2. Shen Li-jen, , “Lun ‘hsiao-yang-ch'un’” (“On ‘small-modern-mass’”), Ching-chi yen-chiu, No. 6 (1960), p. 27. For a fuller discussion of small industries in the Great Leap period, see “Small industry and the Chinese model,” pp. 258–66.Google Scholar

3. “Local industry in China,” Peking Review, No. 39 (24 September 1971), p. 10.Google Scholar

4. “China's small local industries make big progress,” Peking Review, No. 3 (15 January 1971), p. 11. For other examples, see Chi Wei, , “Building more local industries,”China Reconstructs, November 1971, p. 5; “Masses in Honan mobilized to self-reliantly and vigorously develop local small industries,” Jen-min ji-pao (Jen-min), 26 March 1970, in Survey of China Mainland Press (SCMP), No. 70–14, p. 113; “Rapid development of local small-scale industries in Hunan,” Jen-min, 26 December 1969, SCMP, No. 70–02, p. 45.Google Scholar

5. Writing Group of the Hunan Provincial Revolutionary Committee, “Attach importance to the initiative for operating local industry,” Jen-min, 5 May 1971, SCMP, No. 71–20, pp. 65–66.Google Scholar

6. Ibid.

7. Writing Group of the State Planning Commission, “Let us all go into action and regenerate by our own efforts,” Jen-min, 26 April 1970, SCMP, No. 70–18, p. 107. The quotation marks appear in the article and identify the phrases used by the Liuists.Google Scholar

8. “China's small local industries,” p. 11; Chi Wei, “Building more local industries,” p. 5.Google Scholar

9. Jen-min, 18 June 1959, SCMP, No. 2051, p. 3.Google Scholar

10. Su Hsing, , “Several questions concerning industrial production,” Jen-min, 7 July 1961, SCMP, No. 2541, p. 2.Google Scholar

11. Ch'eng-jui, See Li and Ch'un-t'ai, Tso, “Commune industry: its construction, consolidation and development,” Hung-ch'i, No. 8 (April 1961), p. 25, which gives a figure of 3.5 per cent of total rural labour power for commune-run enterprises in mid-1960. Brigade enterprises probably absorbed a similar amount of labour. See also Chao Tzu-yang, “Let the whole people develop agriculture energetically,” Jen-min, 23 July 1960, SCMP, No. 2319; Ch'en Yu, , “Report on work of third session of the second Kwangtung Provincial People's Congress (excerpts),” Nan-fang jih-pao, 4 December 1960, SCMP, No. 2419; “Nung-ts'un jen-min kung-tso t'iao-li hsiu-cheng ts'ao-an” (“Revised work regulations for Rural People's Communes”), September 1962.Google Scholar

12. Su Hsing, “Several questions,” p. 5.Google Scholar

13. “Small commodity production by urban commune industries…” Jen-min, 21 March 1961, SCMP, No. 2468; Li Ch'eng-jui and Tso Ch'un-t'ai, “Commune industry.”Google Scholar

14. I-po, Po, “For new victories in industrial production and construction in our country,” Hung-ch'i, Nos. 3–4 (1 February 1961), Survey of China Mainland Magazines (SCMM), No. 250, p. 14.Google Scholar

15. Editorial, Nan-fang jih-pao, 15 May 1962; SCMP, No. 2757.Google Scholar

16. “Seventy articles of industrial policy.” December 1961, articles 32 and 33; Po I-po, “For new victories in industrial production and construction,” p. 11; Pang-chieh, Yang, “Strictly carry out the procedures of capital construction laid down by the state,” Chien-chu, No. 5 (1963), SCMM No. 367, p. 26; editorial Nan-fang jih-pao, 15 May 1962 SCMM, No. 2757. The length of time over which these strictures were being emphasized indicates that they faced some resistance in being implemented.Google Scholar

17. Shih-shih shou-ts'e (Current Events), No. 23 (December 1962), SCMM, No. 352, p. 16.Google Scholar

18. They provided, for example, that for several years, the commune level should not operate enterprises, that no public accumulation funds should be collected from teams by the communes or brigades, and that no labour should be recruited from the countryside by industrial enterprises.Google Scholar

19. Nan-fang jih-pao, 31 August 1962.Google Scholar

20. As late as mid-1962, the Party was complaining that despite the Central Committee directive “long ago” prohibiting extra-plan construction projects, “some areas and units have adopted an indifferent attitude towards the directive, as shown by the fact that many extra-plan projects are still in progress.” (Editorial, Nan-fang jih-pao, SCMP, No. 2757, p. 1.)Google Scholar

21. “Completely settle the heinous crimes of China's Khrushchev and co. in undermining agricultural mechanization,” Nung-yeh chi-hsieh chi-shu, No. 5 (August 1967), SCMM, No. 610, pp. 23–24.Google Scholar

22. For one of many such accounts, see Nan-fang jih-pao, 18 December 1961, p. 3. See also, “Small industry and the Chinese model of development,” pp. 261–66. It should be pointed out that many small farm tool factories survived despite the contraction.Google Scholar

23. “Completely settle the heinous crimes,” pp. 20–21; Current Scene, Vol. VI, No. 22 (20 December 1968), p. 5.Google Scholar

24. “Wipe out state monopoly and promote mechanization on the basis of self-reliance in a big way,” Nung-yeh chi-hsieh chi-shu, No. 6, (18 September 1967), SCMM, No. 610; also, “Completely settle the heinous crimes,” passim, and Current Scene.Google Scholar

25. Pang-chieh, Yang, “Strictly carry out the procedures of capital construction laid down by the state,” Chien-chu, No. 5 (1963), SCMM, No. 367, p. 27.Google Scholar

26. I-po, Po, “The socialist industrialization of China,” Peking Review No. 41 (11 October 1963).Google Scholar

27. “Small hsien enterprises play a big role in China,” New China News Agency (NCNA), 11 April 1966, SCMP, No. 3678, pp. 20–21. For another example, see “China's peasants advance…,” Peking Review, No. 48 (25 November 1966).Google Scholar

28. For a description of extensive local industrial progress in Liaoning province by 1963, see “Progress of medium and small enterprises in northeast China province,” NCNA, 20 October 1963, SCMP, No. 3087. In at least one hsien – Chiyuan hsien of Honan – it is explicitly stated that the small industries closed down during the “three hard years” were reopened in that year. (See Ta kung pao, 12 November 1970 and 15 July 1969, cited in Yu, C. L., “Local industry and its impact on the agricultural development of China,” Asian Quarterly (Hamburg), No. 4 (1971), p. 131.) Other evidence of extensive progress in 1963 can be found in the following: NCNA, 30 October 1963, SCMP, No. 3094, p. 18 (Kansu); NCNA, 12 July 1963, SCMP, No. 3020, p. 17; and NCNA, 7 September 1964, SCMP, No. 3316 (Hopei); Kuang-ming jih-pao, 21 January 1963, SCMP, No. 2925, p. 1 (Honan and Shansi). A number of other articles deal specifically with the development of the local chemical fertilizer industry at this time.Google Scholar

29. Of these units, some 200 made tractors, power tools and machines, and other mechanized implements, 150 made spare parts, and 650 produced animal-drawn farm tools and machines for processing farm products. See Tseng-ts'ai, Kuo, “From nothing to something, from scarcity to plenty: a brilliant record,” Nung-yeh chi-hsieh chi-shu, No. 9 (1964), SCMM, No. 442. Kuo was Director of the Division of Science and Technology of the Ministry of Agricultural Machinery.Google Scholar

30. Ts'ung-t'ai, Yueh, “Local machine building industry should wholeheartedly serve agriculture,” Jen-min, 18 August 1965, SCMP, No. 3531.Google Scholar

31. Wei, Wang, “Modernizing China's agriculture,” Peking Review, 1 March 1963.Google Scholar

32. “Communes in northeast begin mechanizing farming,” NCNA, 20 September 1963, SCMP, No. 3067, p. 20.Google Scholar

33. “East China province mechanizing farming,” NCNA, October 1963, SCMP, No. 3088, p. 10.Google Scholar

34. See Jack Gray, , “The economics of Maoism,” in Richard, Baum (ed.), China in Ferment, for a good account of this debate. See also “The conflict between Mao Tse-tung and Liu Shao-ch'i over agricultural mechanization in Communist China,” Current Scene, Vol. VI, No. 17 (1 October 1968).Google Scholar

35. Louise Strong, Anna, “Interview with Po l-po on economic readjustment,” Ta kung pao, 15 January 1964, SCMP, No. 3152.Google Scholar

36. One later article stated specifically that Liuists closed the small nitrogenous fertilizer plants “because [these plants] had not, for the time being, solved some of their technical and economic problems.” (“Growth of small nitrogenous fertilizer plants,” Peking Review, 13 June 1969, p. 34.)Google Scholar

37. Peking Review issues of 13 June 1969 and 15 January 1971; Hong Kong Ta kung pao, 17 April 1969.Google Scholar

38. For discussion of this model, see Jack Gray, “The economics of Maoism,” loc. cit.; Gurley, John, “Capitalist vs. Maoist development,” in Friedman, and Selden, (eds.), America's Asia (New York: Random House, 1971); Wheelwright, and McFarlane, The Chinese Road to Socialism (New York: Monthly Review Press, 1971); Riskin, “Small industry and the Chinese model of development,” loc. cit.; and “Maoism and motivation: work incentives in China,” in Nee, V. and Peck, , (eds.), China's Uninterrupted Revolution (New York: Pantheon, 1975).Google Scholar

39. Chiang Lei, , “Chi-chi fa-chan nung-ts'un hsiao-hsing shui-tien chan” (“Actively develop rural small-scale hydro-electric stations”), Hung-ch'i, No. 3 (1972). See also NCNA, 9 October 1972, SCMP, No. 72–43, p. 30; J. Sigurdson, “Rural industry – a traveller's view,” loc. cit.Google Scholar

40. “Big step forward made in steel, iron production,” Ta kung pao (Hong Kong), 7 October 1971. Small and medium iron and steel enterprises increased their outputs in 1972 by 19 and 16 per cent respectively over 1971, down from much higher increases in the previous two years. Moreover, growth in 1972 was specifically attributed to technical improvements rather than to new construction. It would appear that this sector settled down to more moderate expansion, possibly due to the much slower growth of coal production. See NCNA, 3 January 1973; Foreign Broadcast Information Service (FBIS), Daily Report, People's Republic of China, 5 January 1973, p. B7.Google Scholar

41. Interview with Wang Yun-ke, head of Production Department of Tsunhua Hsien Revolutionary Committee, recorded by the author, 17 August 1972.Google Scholar

42. “Masses in Honan mobilized to self-reliantly and vigorously develop local small industries,” Jen-min, 26 March 1970, SCMP, No. 70–14.Google Scholar

43. These data are from my notes taken at Tsunhua in August 1972, and from the extensive notes of Jon Sigurdson, taken during his stay there in 1971. I am grateful to Jon Sigurdson for making available a copy of these notes.Google Scholar

44. Sigurdson, J., “Rural industry and the internal transfer of technology in China,” loc. cit. p. 208. The gradual overcoming of transport bottlenecks will also increasingly give an advantage to large-scale, centralized production in those industries that feature significant economies of scale or in which high quality is attainable only in large-scale plants. Cement and chemical fertilizer are possible examples. The importance of the transport factor is stressed in the report of the American Rural Small-scale Industries Delegation.Google Scholar

45. “Local industry in China,” Peking Review, No. 39, 24 September 1971.Google Scholar

46. “The masses in various localities throughout the county practice self-reliance and vigorously develop medium and small industries…,” Jen-min, 7 February 1972, SCMP, No. 72–10, p. 158.Google Scholar

47. See Lardy, Nicholas R., “Economic planning in the People's Republic of China: central-provincial fiscal relations,” in China: A Reassessment of the Economy (Washington: Government Printing Office, 1975).Google Scholar

48. For the pertinent data for the 1950s, see Riskin, , “Workers' incentives in Chinese industry,” in China: A Reassessment of the Economy, p. 209. Lardy's data support this assertion for the 1960s as well.Google Scholar

49. “Differential rent” refers to that part of the output of a piece of land attributable solely to its advantage in fertility over the least fertile land being cultivated. The difference in output between two production teams that are identical in amounts of labour, land and capital, but differ in natural fertility, would be due to differential rent.Google Scholar

50. Yu, Ho, “Correctly deal with the economic differences existing in the rural communes,” Hung-ch'i, No. 23 (1 December 1961), SCMM, No. 292, p. 35.Google Scholar

51. Ch'eng-chang, Chung, “On differential rent in China's rural communes,” Hung-ch'i, No. 23 (1 December 1961), SCMM, No. 292, p. 48.Google Scholar

52. Ibid. and Ho Yu. See also “Discussion of the question of differential rent” in the same issue of SCMM.

53. Lardy makes a strong case for such a redistributive role in Centre-provincial relations and presents some evidence for it on the sub-provincial level as well. See his “Economic planning in the People's Republic of China,” loc. cit. and “Regional growth and income distribution: the Chinese experience,” mimeographed.Google Scholar

54. This interesting proposition, as well as much of the preceding paragraph, is based upon Jon Sigurdson, “Rural industry and the internal transfer of technology in China,” loc. cit.Google Scholar

55. Chiang Hung, , “Mobilize all positive factors to develop medium and small mines,” Hung-ch'i, No. 1 (1 January 1972), SCMM, No. 72–1, p. 63: “In the case of certain cities and counties lacking resources, through over-all planning, we provide them with mining bases in order to effectively mobilize their initiative to make full use of the province's [Kiangsu] mineral resources.”Google Scholar

56. For example, it was featured in the important and widely reprinted article, “China's road of socialist industrialization,” by the Peking Municipal Revolutionary Committee, available in Peking Review, 24 October 1969; in “Way of development for local small industries,” by the Writing Group of the Honan Provincial Revolutionary Committee, Jenmin, 28 May 1970, SCMP, No. 70–23, p. 1; in the authoritative article by the Heilungkiang Provincial Revolutionary Committee Writing Group, “Tuo k'uai hao sheng ti fa-chan ti-fang kung-yeh” (Greater, faster, better and more economical development of local industry), Hung-Ch'i, No. 6 (May 1970); and in the equally important article by the Writing Group of the State Capital Construction Commission, “Simultaneous development of large-size and medium and small-size enterprises,” Jen-min, 24 August 1970, SCMP, No. 70–35, p. 67.Google Scholar

57. “Small industries in Chincheng County,” Peking Review, No. 20 (14 May 1971), p. 18.Google Scholar

58. See “Local industry in China,” Peking Review, No. 39, (24 September 1971); Wei, Chi, “Building more local industries,” China Reconstructs, November 1971.Google Scholar

59. Chien-wei, Kuo, “Cheng-ch'üeh ch'u-li chi-pen chien-she kung-tso chung chi-ko kuan-hsi” (“Correctly handle several relations in capital construction work”), Jen-min, 8 June 1972.Google Scholar

60. “Simultaneous development of large-size and medium and small-size enterprises,” loc. cit.Google Scholar

61. Writing Group of Honan Provincial Revolutionary Committee, “Way of development for local small industries,” Jen-min, 28 May 1970, SCMP, No. 70–23, p. 11. The article goes on to warn, “Unless [this revisionist system of management] is thoroughly destroyed, it will be impossible to develop local small industries with greater, faster, better and more economical results.”Google Scholar

62. Investigation Group of K'ang-pao Hsien Revolutionary Committee, “Guarantee sufficient labour for the agricultural forefront,” Jen-min, 3 August 1972. See also “Agriculture must not be neglected in developing hsien and commune-run industries,” Jen-min, 6 August 1972, SCMP, No. 72–33, p. 114; “Wusih hsien guarantees sufficient manpower for the first line of agriculture,” Jen-min, 6 September 1972, SCMP, No. 72–38, p. 19.Google Scholar

63. Cheng, Ts'ai, “Less money must be spent and more things done in capital construction,” Jen-min, 20 July 1971, SCMP, No. 71–31, p. 63.Google Scholar

64. “Wusih hsien guarantees sufficient manpower,” p. 19.Google Scholar

65. See Rural Small-Scale Industries in the People's Republic of China; and J. Sigurdson, Rural Industrialization in China.Google Scholar

66. Writing Group of the State Planning Commission, “Let us all go into action and regenerate by our own efforts,” Jen-min, 26 April 1970, SCMP, No. 70–18, p. 110.Google Scholar

67. For a discussion of rural industrial developments since the early 1970s, see Riskin, Carl, “Political conflict and rural industrialization in China,” World Development April 1978.CrossRefGoogle Scholar