From New Times (Moscow), No. 23, June 3, 1953.
Conclusion. For first installment see New Times, No. 21, May 20, 1953.
People’s China has now entered a new stage – the stage of wide-scale planned economic development. Its main feature is that the entire development of the national economy has been given a definite trend, namely, the laying of a firm foundation for the industrialization of the country, in the shape of up-to-date heavy industry.
Wide-scale planned economic development was made possible by the completion of the agrarian reform and, chiefly, by the growth and consolidation of the state-owned sector of the economy, which is socialist in character and is the driving force in the economic development of the whole country. The state-owned sector directly administers the leading branches of the economy – large-scale factory industry, transport, banking, foreign trade and domestic wholesale trade. Through the currency system, the system of government contracts and credits and wholesale purchases of agricultural produce, and, lastly, through the machinery of government wholesale and retail trade, the state-owned sector exercises increasing and effective supervision over the activities of other sectors of the economy and gradually brings them within the orbit of planned national economic development.
Describing the importance of the state- owned sector, Minister of Finance Po I-po said:
“Our state organizations have direct control over state enterprises, ensure the ever-increasing output of these enterprises and exert great effort to lead the peasant masses in developing production. They also direct the operations of the bourgeois industrial and commercial enterprises in the interests of the nation.”
The Only Correct Path
The Chinese people, led by the Communist Party, have chosen the only correct path for realizing their long-standing dream of putting an end to the economic backwardness of their country – the path of industrialization, which was pointed out by V. I. Lenin and put into practice in the Soviet Union under the guidance of J. V. Stalin. This path alone, the newspaper Jenminjihpao stresses, can swiftly secure the predominance of industrial production over agricultural production, turn China into an industrial power and pave the way for the building of socialism. Only industrialization can put an end to the country’s age-old backwardness and guarantee the powerful development of all its productive forces and a rapid improvement in the living standards of its people.
Heavy industry was practically of no significance in the old China. Chinese economists calculate that before the war, output of means of production constituted only 5.5 per cent of the value of total national industrial output (excluding Northeast China). In 1949, the ratio had risen to 32.5 per cent (including Northeast China), and in the subsequent three years, thanks to the reconstruction of industry, it rose to 43.8 per cent. But this is still quite inadequate for the industrialization of the country. Accordingly, the first five-year plan provides that the engineering, ferrous and nonferrous metals, fuel, power, agricultural machinery and transport industries shall be developed at a faster rate than others.
The fourth session of the National Committee of the People’s Political Consultative Conference, held last February, in addition to the struggle for peace in the Far East and the preparations for convening the congresses of people’s representatives of all levels, laid stress on the need to concentrate every effort on increasing output, ensuring the strictest economy, and fulfilling and overfulfilling the 1953 plan. The Chinese Communist Party is enlisting the efforts of the working class and the whole population of the country for the accomplishment of these tasks.
The Chinese people are now devoting great attention to the essential preliminary conditions for industrialization, namely, introduction of modern machinery, training of personnel capable of operating that machinery, and the finding of the necessary financial resources for industrialization.
The big new industrial plants are being equipped with first-class modern machinery supplied by the Soviet Union and the People’s Democracies. China is already employing, and will employ more widely as time goes on, powerful draglines, scrapers, bulldozers and other excavating and building machines on its construction projects, big turbines and generators at its power stations, rolling mills, perfected blast-furnace and steel-furnace equipment, highly efficient prime movers and machine tools in its mills and factories, the most scientific geological survey instruments, modern means of transport, and tractors, harvester combines and other up-to-date agricultural machinery.
Training of Skilled Personnel
Modern techniques require a high level of knowledge and proficiency in scientific operation of industry. This makes the problem of training skilled personnel an urgent one. Technically backward and feebly developed industrially, the old China naturally did not possess any large body of trained engineers and technicians or of skilled workers. Nor, of course, were there any facilities for the training of such personnel. All this has to be created from the bottom up, and personnel was, is and remains one of the most serious and complex problems in the industrialization of China.
It is being solved with the same bold, novel and revolutionary methods as are all the other problems confronting the people of liberated China.
By emancipating the hundreds of millions of working people and making them the masters of the country, the people’s democratic system has given an immense stimulus to their creative initiative. A patriotic emulation movement has spread swiftly: in the towns, for the raising of industrial output and for economizing funds; in the countryside, for increasing harvest yields. More than 683,000 workers took part in this movement in 1950, and 2,380,000 in 1951, while in 1952 over four fifths of all the factory and office workers were already participating in it.
The leader of this patriotic emulation movement is the working class, the directing force of the new China. In 1951 there were over 86,500 front-rank workers. Fitters Chao Kuo-yu and Ma Heng-chang, miner Chang Tzu-fu, textile operative Ho Chien-hsiu, railwayman Li Yung and many another Labour Hero were drawing on Soviet experience and employing methods developed by Soviet front-rank workers. Labour productivity had reached levels unknown in China before: it had increased 2.4 times in the state-owned industrial plants, and 1.3 times (in the last three years) on the railways.
Now the creative activity of the masses has acquired even greater importance and assumed even greater scope. The workers take an active part in drawing up the production programs of their plants, in bringing to light unused reserves, and in achieving output targets ahead of schedule.
There is probably not a single branch of industry in China today in which the more advanced workers are not practising Soviet methods of work and organization of production. They are being constantly urged to do so by the Communist Party.
“We must persistently learn from the Soviet Union,” says Mao Tse-tung. “We must learn not only the theories of Marx, Engels, Lenin and Stalin, but also the Soviet Union’s advanced science and techniques.”
The Chinese people are enthusiastically carrying out this advice of their leader.
The number of front-rank workers who are studying Soviet experience and employing new and up-to-date methods is increasing from day to day. Sun Kia-lou and Lu Wen-ping have initiated the method of cyclical operation in the coal mines of Northeast China. High-temperature iron smelting and high-speed steel smelting are being introduced in the metallurgical industry. High-speed and multi-cutter machining of parts is spreading in the engineering industry. Large-scale construction permits the introduction of streamlined methods of bricklaying, first employed by Su Chang-yu and his team. On the railways, locomotive-driver Cheng Hsi-kung has started a movement for the high-speed running of extra-heavy freight trains.
The labour enthusiasm of the working class creates the conditions for the rapid mastery of advanced techniques and for higher labour productivity. The front-rank workers constitute a powerful reserve from which the skilled personnel required for the operation and direction of industry are drawn and trained.
The Chinese working class has already produced tens of thousands of Party, government and business executives – 7,800 factory managers and assistant managers alone. It keeps pouring more and more of its finest sons and daughters into the vanguard ranks of the economic front. More than twenty thousand of them, with three years’ experience in industry or in the revolutionary movement, are being trained in special schools, and on graduation will become engineers, technicians or factory managers.
Tens and hundreds of thousands of engineers and technicians and millions of skilled workers in various trades will be required as the five-year plan proceeds. The Central People’s Government is greatly increasing the number of higher and medium technical schools. Two new colleges– in Sian and Tientsin – have been started for the training of oil engineers alone; another will be opened in Peking this autumn. In 1952, the number of students of higher educational establishments totalled 220,000, or 69 per cent more than in 1949. About 90,000 of them were attending technical college. Medium technical personnel are also being trained: in the Northeast region alone there are already 37 technical schools, with 29,000 students, nine times more than in 1949.
Skilled workers are chiefly trained by the big mills and factories, particularly in the Northeast. Here many of them were trained in the rehabilitation period, and now a much wider program is being undertaken. The Anshan iron and steel works alone is to train thirty thousand skilled workers in five years. Throughout Northeast China 300,000 have already been trained, including 244,000 building workers. In other parts of the country, too, skilled personnel are being trained on a big scale.
Financing Economic Development
Huge funds will be required for the financing of these developmental programs. They will come chiefly from the earnings of the state-owned sector, derived as a result of improved production methods, higher labour productivity and maximum economy of government funds.
Already in 1952, the earnings of the state-owned sector were supplying the greater portion of China’s government revenue. Their importance will be further enhanced in 1953: Finance Minister Po I-po said in his budget speech that they will constitute about 60 per cent of total national revenue. Other sectors of the economy will also contribute a substantial share, through the revenue from the agricultural tax and the taxes on private enterprises.
The extra savings, above plan, effected by the devoted labour of the builders of the national construction projects will also be largely used for financing economic development. It will be the aim of the workers to bring to light and utilize the latent potentialities of their plants, to make every effort to increase output and to observe the strictest economy.
The economy campaign has already resulted in the accumulation of substantial reserves. They took the form of a budget carryover from 1952 of 30 trillion yuan. In addition, incomplete estimates (for four of the six big administrative regions) indicate that earnings in national industry over and above the plan will total another 22 trillion yuan.
These funds will be used for the financing of capital development. Appropriations for the national economy in 1953 amount to 103 trillion yuan (44.3 per cent of total expenditure), as against an actual expenditure of 73 trillion in 1952. Nearly half this sum will go to industry, chiefly for new capital development.
Aid from the Soviet Union and the People's Democracies
As in the rehabilitation period, the Chinese people will rely in the carrying out of their broad program of economic development on the friendship, mutual cooperation and all-round assistance of the Soviet Union and the People’s Democracies. It is well known that no capitalist country could render the People’s Democracies such effective and technically superb aid, and so cheaply, as the Soviet Union is rendering them. The reason is that this aid and cooperation springs from a sincere desire to help one another and to promote the economic progress of all.
In his message to J. V. Stalin on the occasion of the third anniversary of the signing of the Soviet-Chinese Treaty of Friendship, Alliance and Mutual Assistance, Mao Tse-tung said:
“Not only has the genuinely disinterested assistance rendered by the Soviet Government and the Soviet people to the New China expedited China’s economic recovery and development; it will also be of great value in the implementation of China’s first five-year plan of large-scale national development.”
In March of this year the Soviet Union and China signed protocols defining the volume of trade and credits in 1953, also agreements providing for Soviet assistance to China in extending existing and building new power stations. The volume of trade is to be enlarged and the Soviet Union is to supply China with equipment for the metallurgical, mining, machine-building, chemical, power and other industries, with materials for manufacture and transport, and with modern agricultural machines, pedigree livestock, seed and other items. The newspaper Jenminjihpao wrote:
“Now that our country is undertaking a big program of economic development, the Soviet Union has again signed protocols and agreements with China governing the trade between our two countries and providing for assistance in our national development. The Soviet Union will enlarge its trade with us considerably and will supply a wide range of equipment and materials required for our economic development.”
Industrial equipment is also being supplied China by European People’s Democracies – Czechoslovakia, Poland and Hungary – with whom it has barter agreements.
The Chinese press stresses the fact that, besides supplies of equipment, a very important factor is the technical assistance rendered by Soviet experts. They not only draw up the plans and help in the construction of industrial plants; they also train the workers in the operation of the latest Soviet machinery and help them master advanced Soviet techniques.
The 1953 Plan
The volume of capital construction work this year will he 41 per cent above 1952. The increase in basic industries and the machine-building industry will be 47 per cent, and in the fuel industry as much as 86 per cent.
The developmental projects are being spread all over the country, but will be conducted on the biggest scale in Northeast China – where already in the spring construction work was started on industrial plants and dwelling houses with a total floor space of between 3,000,000 and 3,500,000 square metres – and in Northwest China, where the volume of construction will be six times as large as in 1952, and where work is in progress on 170 big industrial plants simultaneously. In Southwest China 98 major industrial units are in course of construction; most of them are to be ready for operation by the end of this year.
The basic industries and the machine-building, ferrous, nonferrous and chemical industries are to receive priority in 1953. Thirteen relatively big plants are to be reconstructed and enlarged and eight new plants built, including a big iron and steel works in Central China. Fifteen existing machine-building works will be reconstructed and extended, and nine new ones built. These include heavy-machinery, electrical equipment and automobile plants, shipyards, etc.
Nine thermal power stations will be reconstructed or newly built, and three hydro-electric and twelve thermal-electric stations will be enlarged. Total allocations for power development will be five times greater than last year.
Big efforts are being made to ensure sufficient supplies of fuel and raw materials. Prospecting is being carried out on a big scale, and new ore mines are being sunk and existing ones expanded. Ascertained mineral reserves have increased considerably, as, for example, iron ore in Lungyen (Chahar) and Tayeh (Hupeh); coal in Fushun (Liao-tung), Tatung (Shansi), Chiaotso (Honan), Chungliangshan (Szechwan) and in the valley of the Hwai; nonferrous metals in Southwest and South China. In addition, a number of new important deposits have been discovered.
The geological parties get considerable voluntary assistance from workers and peasants. In three provinces of Northeast China alone, local inhabitants drew attention to over three thousand mineral locations. Information sent in by private citizens has led to the discovery of 115 nonferrous metal deposits. Jenminjihpao in one month received 75 letters from readers reporting mineral deposits, some of the letters being supplied with detailed charts and diagrams. Knowledge of these deposits had been secretly handed down from generation to generation, but now the people are gladly revealing their whereabouts to the government.
Geological surveying will be greatly extended in 1953. Prospecting for ferrous and nonferrous metals and coal will increase in scale 23 times; prospecting for oil – 10 times. Scores of prospecting parties, after careful preparation, are scouring the country searching for minerals with the help of the most modern instruments and advanced survey methods. In Southwest China three thousand persons were trained last winter for participation in twenty nonferrous-metal, coal and iron-ore prospecting parties and for a large number of oil prospecting parties. Nine lectures by Soviet experts were delivered at a conference of geologists held in Peking in February of this year.
Parallel with the prospecting work, large- scale preparations are being made this year for the industrial exploitation of newly discovered deposits. Fourteen coal mines are being sunk in Northeast China, and open-cut workings near Fuhsin, the biggest in China, will shortly start operation. In other parts of the country, 26 coal mines are to be reopened and a number of new ones built, notably in the rich coal basin of the Hwai River, where new deposits estimated at 1,000 million tons, 50 to 70 per cent of which is first-rate coking coal, have recently been discovered. The first big mechanized mine south of the Yangtze has already been opened in the Pingsiang coal field, Kiangsi province.
With the construction and reconstruction of so many industrial units, output will increase greatly. Compared with 1952, output of pig iron this year will increase 14 per cent, steel ingots – 23 per cent, power – 27 per cent, oil – 42 per cent, nonferrous metals – 39 to 54 per cent, factory and mine equipment – 153 per cent, machine tools – 34 per cent, cement – 17 per cent, cotton yarn – 9 per cent, textiles – 16 per cent, paper – 6 per cent.
Output increases will be greatest in Northwest China, where the state-owned and joint state-and-private industries will produce 70.9 per cent more in value than last year. Output of the big state-owned industries in Northeast China will increase 23 per cent.
Construction of big industrial units – the Fuhsin coal mines, the Anshan iron and steel works, the Taiyuan heavy machinery works – was begun earlier. The Fuhsin coal field is one of the biggest in the world. The thickness of the vein in places reaches 60 metres, and it is covered by only a 20-metre layer of soil. The deposits will be worked by the open-cut method. For this purpose, 560 million cubic metres of soil and rock will have to be removed and transported a distance of 10 kilometres. The work is being done by powerful electric excavators, bulldozers and electric locomotives supplied by the Soviet Union. The workings are being rapidly opened by a comparatively small number of skilled workers who have been trained to operate these first-class machines. When the top soil has been removed these same machines will be used for getting out the coal, which is to commence already in July of this year.
After rehabilitation, the Anshan iron and steel works attained the highest output level in its history. It is now being reconstructed. The first automatically controlled blast furnace has already been started. Two big rolling plants, now in construction, will produce heavy and light rails, beams, steel tubes and other rolled goods. The rail plant will start operation at the end of the year. It is being equipped with highly efficient Soviet machinery, will have an annual capacity of hundreds of thousands of tons, but will be staffed by only 640 workers.
Construction of the Taiyuan heavy machinery works began two and a half years ago. It will produce rolling mills, coking and metallurgical plant, powerful cranes and other large equipment. The forge, die-stamping and riveting shops are partially completed. Construction of a foundry and assembly shop was begun this spring. The volume of work this year will be twice as great as that completed so far.
China’s industries are increasingly supplying the country’s mills and factories with new and perfected types of machinery. Factory No. 1 in Northeast China is already turning out medium-capacity precision lathes; a machine-building works in Northwest China, several types of modern grinding machines; Factory No. 25 in Northeast China, Soviet type seed-drills; the Fushun mining machinery works, rigs capable of drilling to a depth of 2,000 metres.
The machine shops of East China formerly used to undertake only machine repairs; now they are producing mining machinery, machine tools and other equipment, and this year will begin turning out large steam turbines, Diesel motors, precision lathes, heavy cranes, etc. The Asia Steel Works in Shanghai is producing new grades of steel, and the Taiyuan steel works, thin sheet steel. From all over the country come reports of production of items which were not produced, or even imported, by China before.
Such are the first results of the tremendous democratic changes
carried out under people’s rule, results which are already visible to
the' whole world, and which are laying in this formerly semi-colonial
and backward country the foundations of a new society free of
exploitation and oppression.
Addressing the fourth session of the National Committee of the People’s Political Consultative Conference, Mao Tse-tung, Chairman of the Central People’s Government, urged the Chinese people to redouble their efforts for peace, persistently to study the advanced methods of the Soviet Union, and resolutely to combat bureaucracy. His appeal has inspired the people in the battle to overcome the difficulties encountered in converting China into an industrially advanced country. It is an arduous and exacting task, but one that is greatly lightened by the cooperation and mutual assistance which prevails in the socialist camp.
Solidly rallied around the Communist Party and led by it, the Chinese people are successfully working for the great aim of converting their country into a mighty industrial power.
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