Rethinking China's Provinces

R E C T O RU N N I N G H E A D Rethinking China’s Provinces The third volume in a series examining the political impo...

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R E C T O RU N N I N G H E A D

Rethinking China’s Provinces

The third volume in a series examining the political importance of China’s provinces under reform, this book provides a survey of provinces as echelons of the People’s Republic of China. Extensively researched empirical data have been collected from cities and provinces such as Chongqing, Henan, Guangdong, Anhui, Yunnan and Heilongjiang. Through examining the history, economic, social and political developments of these provinces, the authors seek to locate the province as an administrative level of the Chinese state. Rethinking China’s Provinces identiﬁes new developments in the territorial administration of the People’s Republic in the era of reform. The emergence of the city is charted as an intermediate unit between the province and the county that provides challenges to the hierarchy of the bureaucratic state. Other related titles published by Routledge are China’s Provinces in Reform (David Goodman 1997) and The Political Economy of China’s Provinces (Hendrischke and Feng 1999). These books are a valuable resource for students of Chinese Politics and History, as well as general readers in Asian Studies. John Fitzgerald is Professor of Asian Studies at La Trobe University, Australia. His publications include Awakening China: Politics, Culture and Class in the Nationalist Revolution (Stanford: 1997), which was awarded the 1998 Levenson Prize for Twentieth Century China by the US Association for Asian Studies.

# Author

Chapter Title

Rethinking China’s Provinces

Edited by John Fitzgerald

London and New York

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iv Author

First published 2002 by Routledge 11 New Fetter Lane, London EC4P 4EE Simultaneously published in the USA and Canada by Routledge. 29 West 35th Street, New York, NY 10001 Routledge is an imprint of the Taylor & Francis Group This edition published in the Taylor & Francis e-Library, 2003. © 2002 Selection and editorial matter, John Fitzgerald; individual chapters, the contributors All rights reserved. No part of this book may be reprinted or reproduced or utilized in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging in Publication Data Rethinking China’s Provinces/edited by John Fitzgerald. p. cm. Introduction/John Fitzgerald. The province in history/John Fitzgerald. New Chongqing: opportunities and challenges/Hong Lijian. Henan as a model: from hegemonism to fragmentism/Thomas Heberer and Sabine Jakobi. Guangdong under reform: social and political trends and challenges/Peter Cheung. Discourses of poverty: weakness, potential and provincial identity in Anhui/Sun Wanning. Looking South: local identities and transnational linkages in Yunan/Margaret Swain. The political implications of Heilongjiang’s industrial structure/Gaye Christofferson. Why provinces?/Barbara Krug. Includes bibliographical references and index. 1. Provincial governments–China. 2. Provincial governments–China–History. I. Fitzgerald, John, 1951– JQ1519.A598 R47 2002 306.2’0951 – dc21 ISBN 0-203-16651-5 Master e-book ISBN

ISBN 0-203-26124-0 (Adobe eReader Format) ISBN 0–415–27007–3 (Print Edition)

2001044310

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Contents

List of illustrations Notes on contributors Preface 1 Introduction

vii xi xiii 1

JOHN FITZGERALD

2 The province in history

11

JOHN FITZGERALD

3 New Chongqing: opportunities and challenges

41

LIJIAN HONG

4 Henan as a model: from hegemonism to fragmentism

89

T H O M A S H E B E R E R A N D S A B I N E JA KO B I

5 Guangdong under reform: social and political trends and challenges

125

PETER CHEUNG

6 Discourses of poverty: weakness, potential and provincial identity in Anhui

153

WA N N I N G S U N

7 Looking south: local identities and transnational linkages in Yunnan

179

M A RG A R E T S WA I N

8 The political implications of Heilongjiang’s industrial structure

221

G AY E C H R I S T O F F E R S E N

9 Why provinces?

247

B A R B A R A K RU G

Index

277

vi Contributors

Chapter Title

vii

Illustrations

Maps Chongqing City Henan Province Guangdong Province Anhui Province Yunnan Province Heilongjiang Province

42 90 126 154 180 222

Figures 9.1 9.2 9.3 9.4

Market for decentralization: equilibrium model Market for decentralization: uniform variants Market for decentralization: non-uniform variants Four ideal forms of decentralization

251 252 253 253

Tables 3.1 Major economic indicators of Chongqing before and after separation 3.2 Major economic indicators of the four centrally administered cities 3.3 Major economic indicators of Chongqing and deputy-provincial level coastal cities, 1995 3.4 Major economic indicators of Chongqing and other western cities in China, 1994 3.5 Old Sichuan/new Sichuan: before and after Chongqing’s separation 3.6 Investment and GVIO in Chengdu and Chongqing (a) GVIO of Chengdu and Chongqing in selected years (b) Total investment in ﬁxed assets in Chengdu and Chongqing

45 45 54 55 58 60 60

viii Illustrations 3.7 5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 6.1 6.2 7.1

7.2

7.3

7.4

7.5

7.6

Party, government, and People’s Congress leadership in new Chongqing Key economic growth indicators for Guangdong and China, 1991–99 Contribution of key provinces in the Chinese economy, 1990 and 1999 GDP growth rates of selected coastal provinces, 1990–99 Provincial shares in China’s acquisition of foreign investment Economic indicators of the Pearl River Delta and ﬁfty mountainous counties, 1999 Comparison between the Pearl River Delta and the mountainous counties, 1991–99 Statistics on corruption and bribery cases handled by Guangdong’s Provincial Procuratorate, 1988–99 Visits and letters to provincial party and state organs, 1988–97 Anhui provincial GDP: progressive growth rates by sector Comparative national and Anhui provincial growth rates (%) in GDP, GAOV and GIOV Demographic characteristics of Yunnan (a) Ethnic composition (b) Minority minzu proportion of total provincial population (c) Yunnan sex ratio, 1994 (d) Birth rates, death rates, rates of natural increase, 1994 Urban–rural contrasts in Yunnan (a) Average family member income (b) Population distribution (c) Urban unemployment rate Distribution of ownership and investment in Yunnan (a) Industrial output in Yunnan (b) Investments in ﬁxed assets in Yunnan Shares of GVIO, GVAO, and farmland in Yunnan (a) Combined value of industrial and agricultural output (b) Economic output: composition (c) Percentage of natural resource reserves used, 1994 (d) Agricultural composition (e) Share of farmland (f) Rural households per capita area of cultivated land use Yunnan and provincial neighbors: comparisons (a) Gross and per capita domestic product, 1994 (b) Agricultural and industrial output, 1994 Yunnan exports and imports (a) Share of exports and trade, 1991 (b) Export trade partners, 1991 (c) Yunnan exports and imports (d) Exports: most important products, 1994

64 127 129 129 131 132 134 142 143 163 164 184 185 185 185 193 193 193 194 194 194 195 195 195 195 195 196 196 198 198 199 199

Illustrations ix 7.7 7.8

9.1

Yunnan and neighboring provinces foreign trade, 1995 Yunnan tourism (a) Annual revenues (b) Number of international visitors, including overseas Chinese Forms of decentralization

200 201 201 254

x Author

Notes on contributors xi

Contributors

Peter Cheung is Associate Professor in the Department of Politics and Public Administration at the University of Hong Kong. His research focuses on developments in southern China, central–provincial relations, and relations between the central government and Hong Kong, as well as the interface between Hong Kong and Guangdong province. His publications include Provincial Strategies of Economic Reform in Post-Mao China (1998). Gaye Christoffersen teaches at the Naval Postgraduate School and California State University, Monterey Bay, USA. She has previously been a Fulbright Professor at the Foreign Affairs College in Beijing (1998–2000) and at Far Eastern State University, Vladivostok (1992–3). Her recent publications include studies of energy politics in North Asia, for the National Bureau of Asian Research, and studies of the Tumen Project and East Asian marketization. John Fitzgerald is Professor of Asian Studies at La Trobe University in Melbourne, Australia. He teaches and researches works in the ﬁeld of modern Chinese history. His publications include Awakening China: Politics, Culture and Class in the Nationalist Revolution (1997). Thomas Heberer is Director of the Institute of East Asian Studies at Gerhard-Mercator-University in Duisburg, Germany. After completing his doctorate at Bremen University he worked for four years as translator and reader at the Foreign Language Press in Beijing (1977–81) and then as Professor of East Asian Politics at Trier University (1992–8). His recent publications include studies of corruption, minority societies, youth culture, political participation, entrepreneurship, and rural urbanization in China. Lijian Hong is senior lecturer and convenor of the Chinese Studies Program at Monash University in Melbourne, Australia. A native of Sichuan, he spent his early days in Chongqing and commenced research into Chinese local politics as a research fellow at the Institute of Political Science of the Sichuan Academy of Social Sciences. More recently his work has

xii Contributors focused on central–local relations in post-Mao China, and on regional social, political, economic and legal developments in South-west China. Sabine Jakobi teaches at the Polytechnic of Public Administration of Rhineland-Palatinate, Germany. She is completing a PhD in Political Science on political participation in Chinese villages. Her research interests include political participation, social change and gender issues. Barbara Krug is Professor of Organization Theory in the Rotterdam School of Management at the Erasmus University of Rotterdam, in Holland, where she works on problems of governance, entrepreneurship and comparative business environments. Her special ﬁeld of research is the Chinese economy, with an empirical focus on the establishment of long-term business relations in the nascent private business sector in China. Wanning Sun, a native of Anhui Province, is Lecturer in Media Studies and Communication at Curtin University of Technology in Perth, Australia. She completed a PhD in Media Studies at the University of Western Sydney in 1997. Her research interests and publications cover media, modernity and place, and gendered mobility and social change in China. Margaret Swain is Adjunct Assistant Professor in the Department of Anthropology, and Director of the Center for Gender and Global Issues at the University of California, Davis, in the USA. She received her PhD from the University of Washington in Seattle. Her research and publications cover ethnicity and gender identity, missionizing and religious conversion in colonized societies, tourism and sustainable development, and the state and indigenous peoples, with special reference to Yunnan Province.

Chapter Title

xiii

Preface

Everyone who has been involved with the project on China’s Provinces in Reform over the past six years has found it an enjoyable and broadening experience. The project is an international one. Participants from China, Japan, Korea, Europe, North America and Australia have gathered at different sites in China, on three separate occasions, to share their ﬁndings and enthusiasms with one another and with their Chinese hosts. This volume is an outcome of the third international workshop on China’s Provinces in Reform, which convened in Kunming in December 1998. On behalf of the authors, I wish to thank the hosts and organizers of the workshop, as well as workshop discussants and participants. Special thanks are due to David S. G. Goodman, who supplied the inspiration and much of the material support for all three workshops, and to Wang Yiyan, who managed the Kunming workshop and guided us throughout with exemplary skill and patience. As editor, I must also express appreciation for the patience and persistence of authors who accepted comments and suggestions without complaint, and who updated their papers on request. Particular thanks are due to Feng Chongyi for preparing statistics and maps, to Tracy Lee for help with maps, and to Ian Boyle for proof reading the manuscript and preparing the index. And on behalf of the project as a whole, I would like to thank the editors and publishers at Routledge who have published all three volumes in the series. Production of this volume is largely due to the effort and commitment of Craig Fowlie, to whom we owe a debt of thanks. John Fitzgerald Melbourne June 2001

xiv Author

R E C T O RU N N I N G H E A D

1

Introduction John Fitzgerald

This is the third in a series of volumes on “China’s Provinces in Reform” produced under the auspices of the Centre for Research on Provincial China.1 The aim of the series is to provide comprehensive narrative surveys of all provincial-level units in the People’s Republic of China. While each volume has a distinctive focus, and each embraces a different cluster of provinces, every chapter in the series is intended to provide core information on each province in turn. The ﬁrst volume in the series, China’s Provinces in Reform: Class, Community and Political Culture (Goodman 1997), covered Guangxi, Hainan, Liaoning, Shandong, Shanghai, Sichuan and Zhejiang.2 The second, The Political Economy of China’s Provinces (Hendrischke and Feng 1999), focused on the issues of comparative and competitive advantage among provinces, and on aspects of provincial identity.3 It covered Guizhou, Shaanxi, Jiangsu, Hubei, Tianjin, Shanxi and Jiangxi. The present volume focuses on the institutional history and function of provinces, and extends the series’ coverage to Chongqing, Henan, Guangdong, Anhui, Yunnan and Heilongjiang.4 In the present series, each chapter brieﬂy traces the history before surveying the economic, social, and political development of the relevant provincial unit. Beyond this, authors are at liberty to develop their disciplinary or thematic emphases as they deem ﬁt for the provincial units in question. Our volume begins with an elementary question: Why do provinces deserve our attention? The answer is not immediately apparent. Provinces are constitutionally weak institutions and geographically limited territorial units that tend to obscure, as much as they illuminate, patterns of community interaction and economic activity. For this reason, it might be argued that spatial aspects of development need to be analyzed at the level of transprovincial activities, or through the study of formal similarities among markets and communities in adjacent sets of provinces. This insight informs a number of chapters in the present volume. Nevertheless, the question of how market-led development relates to provincial-level administrative units turns not just on the degree of conformity of market space and political space but equally on the signiﬁcance of the province as a territorial unit for building and maintaining a rational, stable and predictable national state.

2 John Fitzgerald China’s history over the past century suggests that maintenance of a stable national state is a minimum condition for the predictable and efﬁcient operation of markets. The province has played an important part in that history. The opening chapter traces the history of the province as a major echelon of territorial administration from imperial times to the present. By locating the province within the spatial dynamics of territorial administration, it seeks to evaluate the role and status of the province as a distinctive administrative echelon relative to other echelons of the Chinese state. By locating the province in history, it seeks to identify new and possibly unprecedented developments in the territorial administration of the People’s Republic over the reform era. In particular, it focuses on the emergence of the city as an intermediate echelon of territorial government located between the province and the county, noting the promises and challenges of the city to a topdown bureaucratic state grappling with an expanding market economy, and exploring the implications of the rise of the city for the future of the province as a unit of territorial administration. The city of Chongqing is a case in point. Chongqing was formally declared a provincial-level city independent of the province of Sichuan in 1997. As Lijian Hong explains in the second chapter, the new city presents a curious anomaly. When the three regions of Wanxian City, Fuling City and Qianjiang Prefecture merged to form the new Chongqing they almost quadrupled the area of the old city and expanded its population seven-fold to thirty million. In area, Chongqing is two to three times the size of China’s three existing provincial-level cities combined (Shanghai, Tianjin and Beijing) and larger in area than two of China’s provinces (Hainan and Ningxia). The population of the city exceeds those of eight of China’s twenty-eight provinces and autonomous regions, and is close to the mean population for all provincial-level units in the country. As Hong nicely observes, Chongqing walks like a province, quacks like a province, but calls itself a city. Assuming that there were good reasons for splitting Sichuan in twain, why was one of the new administrative territories designated a city and the other a province? Why not two provinces? In sum, why did the idea of a new city hold greater appeal than that of a new province among territorial reformers in Beijing in the 1990s? Upgrading the status of Chongqing City was certainly not the only proposal under consideration. An alternative suggestion was to divide Sichuan into two new provinces, named Chuandong and Sanxia, and to make Chongqing a prefectural-level capital of a new province.5 Beijing rejected this proposal on a number of grounds. If Sichuan were permitted to divide into two provinces it might be difﬁcult preventing other provinces from doing likewise, especially those keen to cast off povertystricken areas. This would impede central efforts to compel provincial governments to redistribute revenue, investment and per capita income within provinces. The ﬁnancial, administrative and opportunity costs of building a new province with Chongqing as its capital also weighed against the proposal.

Introduction

3

Creating a new province would involve establishing a whole set of provincial organs in addition to those of the city, draining revenue from more productive uses. Further, assigning dual responsibility to Chongqing to manage a new province while administering the city and its immediate environs might well have exhausted the administrative capacity of Chongqing, and prevented it from playing its designated role in promoting rapid development of the upper reaches of the Yangtze and the south-western region at a critical moment in the progress of the Three Gorges Project. Lijian Hong highlights as well the legitimacy value of old and familiar naming practices. Beijing has in effect created two new provincial-level territories while passing them off under the familiar names of Sichuan Province and Chongqing City. It is also tempting to interpret Bejiing’s decision to create a city in place of a province as a sign of growing central concern that provinces may emerge as the major beneﬁciaries of state intensiﬁcation and regularization in the evolving market economy, to the point of threatening the authority of the central government. Cities presumably pose a less formidable threat. Whether the experiment is intended to serve as a model for the displacement of the province as a peak site of territorial administration remains to be seen. Why should the center be wary of provinces? In theory provinces are mere cyphers of the central government. In practice, however, even provinces noted for adhering closely to central policies have been known to waiver at critical moments. The potential for slippage between subordination and insubordination of provinces is highlighted in the chapter on Henan by Thomas Heberer and Sabine Jakobi. Through the 1950s, 1960s and 1970s, the Henan provincial leadership implemented Mao Zedong’s radical campaigns with exemplary enthusiasm. Henan was the site of the ﬁrst people’s commune, in 1958, and supplied the inspiration for Mao Zedong’s famously cryptic remark that “people’s communes are good.” The Henan provincial government produced exaggerated statistical reports on the achievements of the Great Leap Forward to satisfy its masters in Beijing, and subsequently took the lead in denouncing Mao’s enemies in the Cultural Revolution. As far as Mao was concerned, Henan was a “model province.” But the nature of relations between province and center – even the scale of the “model” that Henan represented – underwent dramatic changes in the reform era. Once the center had proposed agricultural decollectivization, enterprise reform and wider commercial adaptations to the evolving market economy, the provincial leadership was less inclined to follow Beijing’s lead. There are a number of plausible explanations for this kind of behavior. Heberer and Jakobi argue that an apparent congruence between central and provincial policies up to the time of the Cultural Revolution was a consequence not of idealized superior–subordinate relations but of negotiated outcomes. Regional patterns of collective behavior in Henan that had long predated the founding of the People’s Republic reﬂected central policy in the Mao era. Far from slavish imitation, Henan’s behavior indicated a happy congruence of interests. The center happened to promote policies that the

4 John Fitzgerald provincial leadership favored and supported. Another plausible explanation is that the provincial leadership has never waivered from a preferred relationship of dependency with the center. Aligning with the radical faction in Beijing during the period of the command economy paid off handsomely for the province in the form of investment, allocations and preferential treatment. Allying with central government market reformers, on the other hand, offered few comparable rewards as the scope of discretionary authority exercised by the centre was drastically reduced under market conditions. In any case, provincial calls for central patronage sounded out of tune with the do-it-yourself mantra of the new market ethic. If we credit this explanation, a pattern of patron–client dependency would appear to account for initial obedience to a powerful central patron and subsequent resistance to a weaker one. Both of these explanations are conﬁrmed, to a greater or lesser degree, by the case study of Nanjie Village, which concludes the chapter on Henan. Nanjie is a pre-fabricated model-in-miniature of the national collective economy of the Maoist era. While extolling the virtues of self-reliance, the village government supplies its residents with collective housing, education and health care, and distributes payments and rewards on the principles of fairness and need. Heberer and Jakobi report the village deputy party secretary boasting that Nanjie is the only communist village left in the world. Nevertheless, the model remains heavily indebted to the patronage of certain factions in the national capital who regularly dispatch prominent representatives to extol the virtues of the Nanjie model and who surreptitiously subsidize their model with generous handouts from Beijing. Still, the change in scale from model province to model village is not insigniﬁcant. Dependence on the center generally worked at the level of central–provincial relations in the Mao era. Local patterns of dependence have come to operate at lower levels of administration and settlement in the reform era. Not far from Nanjie, for example, is another model village that combines aspects of the private and collective economy, and yet another that extols the virtues of private enterprise. The coexistence of apparently incompatible models some kilometers apart in Henan is an indication of increasing provincial, regional and sub-regional pluralization – as distinct from national political pluralism – that is nicely captured by Heberer and Jakobi’s term “locally-fragmented authoritarianisms.” Once Henan had been eclipsed as a model province in the reform era, Guangdong came to feature as a provincial model for national emulation. Guangdong was put forward as a pioneering exemplar of effective political leadership that apparently took advantage of the new policy environment to “open to the outside world,” to capitalize on local comparative advantages, and to lead the way in structural reform of the economy. Economic success has not been translated into comparable administrative accomplishments. Peter Cheung argues that the path to economic success pioneered in the province presents an impasse to the regularization of government and to the

Introduction

5

institutionalization of rule of law. Throughout the reform era, the state bureaucracy grew at twice the rate of overall employment growth and more than doubled in size over the period. State sprawl was accompanied by higher levies and charges rather than by higher levels of efﬁciency. This has had implications not only for government but also for the institutionalization of the market economy. Back-door deals, “ﬂexible” regulations, and government by discretion may well serve to catalyze development in an underperforming economy but, Cheung suggests, a sophisticated market economy requires rule of law, predictable process, and a responsive administrative framework. Whether the province can develop a meritocratic, rule-abiding public bureaucracy with the same speed that it embraced economic reform two decades ago presents, Cheung remarks, “a daunting challenge.” Until then, it remains a ﬂawed model. Matching this administrative challenge, Cheung continues, is an array of social problems that have proliferated in the reform era, including growing regional inequalities, rising crime rates and frequent social conﬂicts in the province. In this respect Guangdong is not alone. The province may be exceptional among its neighbors as a destination for labor migration. But social and administrative problems arise on a comparable scale in provinces that export their labor. In Anhui, for example, peasant farmers have experienced the transition from a command to a market economy as a revolution from a relatively egalitarian society to an inherently unequal one. Wanning Sun highlights some of the changes in social expectations associated with market reforms in Anhui, including a move from valuing stability and rectitude to valuing change, mobility and wealth. Sun notes that economic reform in Anhui has nourished a reform-era elite born of a marriage of local power and privileged access to capital and opportunity. The new poor of Anhui appear to be persuaded that the reform-era elite proﬁts from its political power to obtain and deploy state and private capital, to take advantage of loopholes in the system, and to engage in bribery, embezzlement, tax evasion, smuggling and the conversion of public assets into private wealth. Popular protest against randomly levied local revenues now characterize public life in Anhui as they do in Guangdong. Seen in this light, the challenges that confront provincial governments in Guangdong and Anhui seem to be embedded in wider regional patterns of social dislocation associated with the liberalization of commodity and factor markets over the past two decades. Anhui also offers an instructive case study of provincial government responses to regional issues. A poor province adjacent to wealthier regions, Anhui has earned a reputation as “the Philippines of China.” The comparison is perhaps less accurate than suggestive. But it is suggestive on a number of counts. Anhui women are to be found working as nannies in Beijing, Shanghai and many smaller metropolitan centers along the coast. As Sun points out in her chapter, however, four times as many males as females leave Anhui each year in search of work. Again like the Philippines, Anhui is

6 John Fitzgerald highly dependent on remittances. Total income remitted by internal migrants for expenditure back home occupies a greater portion of the provincial economy than provincial government revenues and expenditures. One further similarity easily overlooked is the extent to which the provincial government behaves like a national state. In the 1990s, the government set about disaggregating its own internal regions to take advantage of their physiographic, economic and cultural connections with adjacent areas beyond the provincial borders, while at the same time trying to reintegrate these regions back into the province around historical myths of common provincial culture and ancestry.6 Anhui’s strategic plans for economic development display a rationality that might, in a national context, win plaudits from the World Bank, and its celebration of the indigenous culture of Hui merchants exposes a felt need to create an “imagined community” of Anhui provincials that would ground regional diversity in provincial unity. In the case of Yunnan Province, cross-border ﬂows of people and goods cut across national as well as provincial boundaries. Margaret Swain traces major patterns of trade, migration and infrastructure development through which Yunnan Province has developed links with the three neighboring countries of Vietnam, Laos and Burma over the reform era. Intensifying international linkages have been matched by intensifying inter-provincial networks involving ﬂows of people and commodities (some of them illegal), and by complex inter-ethnic ties, new forms of inter-provincial institutionbuilding, and a range of central–provincial initiatives that have given the province a measure of autonomy in its handling of cross-border issues. In this case, interactions among overlapping local, provincial and regional networks impact on local identities not through the imagined community of the province but through “multiple modernist imaginaries” operating at every level. Local identities are negotiated and contested, Swain argues, within hierarchical relations of the regional, national and global political economies. On the provincial level, some of the post-Mao reforms taken for granted in other provinces – such as the household responsibility system – have come to be interpreted in Yunnan as one more “Confucian civilizing project” extolling the virtues of family solidarity, loyalty, diligence and thrift. At the central level, Beijing is inclined to interpret the problems that it encounters in implementing central reforms in Yunnan as evidence of the “low cultural level” of non-Han communities in the province. And at the local level, commodiﬁcation of peoples and places in the political economy of national development erodes territorial integrity and cultural differentiation. In response, local communities have devised strategies to recover their unique identities, some by reinventing territorial myths, others by reviving or redeﬁning their proprietary cultural symbols, and in either case supporting claims to particularity against the homogenizing tendencies of national development. Similar relational hierarchies can be seen at work in Yunnan’s institutionbuilding initiatives. At a local level, cross-border links are facilitated through

Introduction

7

localized border-trading zones. At the inter-provincial and national levels, Yunnan is involved in a domestic regional network involving neighboring provinces that consult on regional issues and coordinate the south-west’s approach toward Beijing. And at the global level, Yunnan Province participates in its own right, at the invitation of the Asian Development Bank, in an international forum of states that share an interest in the Mekong River. The one thing these institutional relations have in common is Yunnan’s status as a province of the national state. Hence for all the ﬂuidity of its relational identities and institutional linkages, Yunnan is more than a transitional zone situated at the hub of south-west China or between China and three neighboring states. When all is said and done, Yunnan is a territorial unit of administration to which local communities look for recognition and redress, around which other provinces form alliances, and through which the central government looks out upon the world beyond its national borders. Heilongjiang Province presents the case of a recalcitrant provincial government that (like Henan) resisted the center’s institutional reform agenda and yet happened (like Yunnan) to be located on the cusp of a potential transnational economic region. The combination produced a distinctive outcome. In a number of other provinces, local agencies were compelled, through forceful central state intervention, distant international export markets, or the cumulative effects of a growing domestic market, to undertake structural reforms. Not so in Heilongjiang, suggests Gaye Christoffersen. The center offered Heilongjiang few incentives to undertake industrial restructuring or to reform state-owned enterprises. It did, however, offer provincial actors an opportunity to open their economy to the outside world. The provincial government of Heilongjiang responded by trying to integrate the province into the contiguous north-east Asian regional economy and positioning the province as a marketing center for the transnational territory on its borders. In situating the province within the regional political economy of northeast Asia, Christoffersen argues that its regional location has played a determining role in setting the pace, in shaping the direction, and in shaping the mix of economic reforms selected in Heilongjiang. While focusing on long-term structural transformations in the regional economy that have inﬂuenced Heilongjiang’s industrial restructuring, Christoffersen notes the effects of these developments on relations between center and province, and among areas and sectors within the province itself, paying particular attention to the way these effects are experienced and understood at the provincial level of government. Notable among these effects has been tension arising from central government attempts to set up a trans-provincial institutional framework for managing competition for international trade and investment between Heilongjiang and other provinces in the north-east Asian economic region, including Liaoning and Jilin. Provincial government attempts to cope with the demands of a trans-provincial network are complicated by intra-provincial competition for border trade that is every bit as

8 John Fitzgerald ﬁerce as competition between the provinces themselves. Signiﬁcantly, the province appears to cope with competing intra-provincial demands in much the same way that the center copes with inter-provincial competition: by breaking up the institutional bases of administrative separation and reintegrating units under its jurisdiction in new hierarchical patterns of subordination to higher echelons of government. Our volume ends as it begins with the question, why provinces? In concluding, the question is posed from the perspective of institutional economics rather than of administrative history. To a classical economist or economic geographer, Barbara Krug observes, the province does not immediately leap to mind as a useful explanatory concept that can account for regional economic variations. The explanatory utility of the province remains limited to the degree that regional interactions and regional differences cut across administrative boundaries. Even the assumption of political scientists that provinces matter because they are major players on the national political scene has limited explanatory value if it assumes that provinces act as integrated political institutions representing “provincial interests.” Drawing on the insights of the New Institutional Economics, Krug argues that provinces are important as political markets where “the demand for decentralization meets the supply of decentralization.” From this perspective, economic development is related to incentives, organizations and norms – in short to institutions – that allow the mobilization of resources, exploitation of income opportunities, and effective allocation of resources. Differences in outcomes may be said to reﬂect different institutional settings. The study of provinces, in particular, invites reﬂection on which institutional settings offer the best prospects for economic development in the political and social environment of the People’s Republic of China. The institutional approach also invites speculation on the causes and consequences of institutional change. Economic actors presumably seek institutions that allow them to pursue their own interests more effectively, and make demands along these lines from those with institutional authority in the formal political leadership. In this sense, the province is a political arena wherein the demand for change meets the supply for change. Krug then applies political-economic models derived from the New Institutional Economics to China’s provinces in the reform era, with a view to exploring the economic dynamics of provincial change and to making suggestions for advancing the research agenda on “China’s Provinces in Reform.”

Notes 1 The Centre for Research on Provincial China is a joint center of the University of New South Wales and the University of Technology, Sydney. Its founding Director is David S. G. Goodman, and its current Director, Hans Hendrischke. 2 David S. G. Goodman (ed.) China’s Provinces in Reform: Class, Community and Political Culture (London: Routledge, 1997).

Introduction

9

3 Hans Hendrischke and Feng Chongyi (eds), The Political Economy of China’s Provinces (London: Routledge, 1999). 4 Beyond this Routledge series see also Peter T. Y. Cheung, Jae Ho Chung and Lin Zhimin (eds), Provincial Strategies of Economic Reform in Post-Mao China: Leadership, Politics, and Implementation (Armonk, NY: M. E. Sharpe, 1998) which covers Shanghai, Guangdong, Zhejiang, Shaanxi, Shandong, Hainan, Sichuan and Fujian. 5 Chen Yun et al., 1997. “A strategic measure to speed up the development in the Midwest – on the birth of Chongqing Municipality,” Beijing Xinhua Domestic Service, 14 March 1997, FBIS-CHI-97–051, Daily Report. 6 For an enlightening general analysis of the relationship between provincial identity construction and strategies of regional economic development see Tim Oakes, “China’s provincial identities: reviving regionalism and reinventing ‘Chineseness’,” The Journal of Asian Studies, vol. 59 no. 3 (August 2000), pp. 667–92.

10 authors name

Chapter Title

2

11

The province in history John Fitzgerald *

History warns us to be ready and wary. We place our hope in reform! Hu Gu, Historical Boundaries and Administrative Territories in China (1995)

The issues facing China at the dawn of the twenty-ﬁrst century are so different in character and scale from anything that came before that it is difﬁcult to imagine history supplying providential warnings today. A glance at contemporary institutions and trends heightens the contrast between the old-world empire and the modern nation-state across any number of social, political, cultural and economic indicators, to the point of discouraging facile historical comparisons. An exception may be made for the most stable element in the historical annals of the Chinese state: its system of territorial administration. For all else that has changed, there remains a remarkable degree of continuity between the units, the boundaries, and the echelon hierarchy of territorial administration in the People’s Republic and those that preceded it in the Republic and the late empire. Transformations in China’s economy, demography and communications at the turn of the twenty-ﬁrst century may well compel reform of the country’s system of territorial administration. But, the administrative historian Hu Gu warns that to tamper with the deep structures of province and county without regard to the lessons of history is to court peril.1 Whether or not they provide a salutary lesson, such warnings do draw attention to the strengths and weaknesses of China’s system of territorial administration in a period of rapid change. The Chinese state has undergone far-reaching transformations many times in its history, not least over the course of the twentieth century. Yet even rebels and revolutionaries have been reluctant to tamper with the core units of territorial administration. The lowest echelon of the county is the most obvious example. Circuits (dao), prefectures (fu), sub-prefectures (ting), departments (zhou) and districts (qu) have come and gone from one era to the next but the county of the People’s Republic of China is in key respects similar to the county-level unit established in the Qin over two thousand years ago.2

12 John Fitzgerald Provinces have much in common with their antecedents as well. The province complements the county as the second most constant feature of China’s territorial administration. Although not introduced until the Yuan Dynasty, the province has proven remarkably resilient as an echelon of territorial administration immediately below the central level of government.3 The function of the province has been to facilitate central administration over substantial territories corresponding in size or population to a fraction between 1:10 and 1:30 of the polity. Signiﬁcantly, the province retains a uniquely complimentary relationship with the county in a system of local administration that has retained its equilibrium these seven centuries past. This chapter traces the history of the province as a major echelon of territorial administration from imperial times to the present day. Rather than focus on relations between provincial and central governments, it places both province and center in a broader spatial framework of political dynamics affecting various echelons of territorial administration in a large and complex state. Locating the province in this broader framework enables us to evaluate the role and status of the province as a distinctive administrative echelon relative to other echelons of the system, in a territorial state that is undergoing rapid change. One recent sign of rapid transition is the emergence of the city as a standard intermediate echelon of territorial government between county and province. The challenge that the city presents for the province, the county, and the system of territorial administration as a whole highlights some of the historical fault lines of a system under stress, and offers a signiﬁcant test of the state’s capacity to adapt to change.

Is the province worth studying? It could be said that provinces are constitutionally too weak to serve as anything but local agents for central governments, administratively too arbitrary to contain “natural” cultural communities, geographically too large to play a signiﬁcant role in administering actual settlements and yet too small to account for larger regional patterns of economic activity. There is an element of truth in each of these claims. Provinces are certainly far removed from actual settlements, and their role in local government is attenuated by geographical distance and intervening layers of administration that separate them from direct contact with cities, towns, townships and villages. With the exception of periods of disunity, they have been too weak to count for much in the greater national scheme of things either. The third and fourth claims are even more compelling. The place of the province within extra-political (cultural, social and economic) regional frameworks requires close attention if we are to justify focusing on the province as a unit of analysis. Provinces are, on the whole, fairly arbitrary administrative units with boundaries that fail to match regional and sub-regional patterns of social, cultural and economic activity. Historically, few provincial boundaries have

The province in history 13 come close to matching China’s socio-economic regions, and among those that have come reasonably close (notably Sichuan with the upper Yangtze, and Guangdong/Guangxi with Lingnan) the correspondence has been, in the words of William Skinner, “grossly imperfect.” Several provinces run across regional boundaries, including Anhui, Guizhou, Jiangsu, Shanxi, Shaanxi and Zhejiang.4 Historically, provinces have been merged, divided and multiplied, in order to sever conformity between natural regions and administrative ones. From the Ming Dynasty, at least, provinces no longer conformed directly to physiographic areas, with the result that today few provincial boundaries conform closely to pre-existing cultural and economic territories. Nevertheless, provincial identities are negotiated within patterns of government as well as those of language and culture. Once a territorial unit of government has been created at any level, it generates interactions among and between parts of the political system and elements of the social, cultural and economic environment. Over time, “communications circles” develop through negotiation among these different elements within the territorial administrative framework.5 So China’s provincial communities have been hounded and informed by a provincial press, comforted by native place associations, mobilized by provincial cohorts of reformers and revolutionaries, and nurtured, educated, transported, licensed, and taxed by an everexpanding network of provincial government agencies. Today, people of one province show little difﬁculty and less reluctance in attributing particular characteristics to people of another province irrespective of any “natural” conformity between provincial boundaries and pre-existing cultural, economic or physiographic ones. The economic argument against taking provinces as units of analysis is the most compelling of all. In the present reform era, economic growth has crystalized around the periphery of great metropolitan centers and along the major riverine, road, rail and sea links that connect the hinterland to urban and peri-urban centers on the coast. Contemporary growth patterns trace an urban trail up and down the coast and marginally inland that pays little heed to provincial boundaries. International trade and investment ﬂows follow slightly different patterns that reﬂect geographical proximity, historical ties and particular market requirements of Chinese and foreign partners. Recurrent attempts by the provincial governments of inland provinces to stimulate comparable growth have not been notably successful; nor have intermittent attempts to share growth among wealthier and poorer regions within provinces repaid the effort put into them. From a regional economic perspective, all that provinces seem to do is increase transaction costs and set up real barriers to the free ﬂow of goods, services, people and capital. For the purpose of understanding current patterns of economic development, provincial units appear far too closely tied to arbitrary lines of territorial administration to sufﬁce as units of analysis. Indeed, current patterns seem to conﬁrm the general hypotheses and regional framework developed by G. William Skinner in his analysis of urban

14 John Fitzgerald and regional development in China’s history. In his classic study of China’s spatial organization, Skinner modeled the intensive internal operations and external relations of large territorial units known as macro-regions – nine in all – made up of nested clusters of marketing centers. Skinner classiﬁed the nests of urban marketing systems within each macro-region, which start from local market-town systems at the base and make their way up through central market towns at the center of each local marketing area, on upward through regional cities and regional metropolitan centers, each sitting at the apex of a progressively larger sub-system of the macro-region. The shape of macro-regions is said to be deﬁned by physiographical factors, although the dynamism of each regional system and sub-system is indicated by market relationships reﬂecting the potential for communications, production and exchange with which its physiography endows each system. In relation to provinces, Skinner observes that it is “methodologically indefensible and generally misleading” to employ the province as a unit of comparison for urban studies and, by extension, for studies of socio-economic space more generally. From this perspective, the only meaningful way to analyze spatial aspects of economic development is to seek out trans-provincial ties or formal similarities among regions within adjacent sets of provinces.6 Even markets, however, need territorial states.7 They need strong, stable and predictable states capable of providing legal and regulatory frameworks, raising and distributing revenues, maintaining ethical norms, supporting social and other institutional networks, and building the infrastructure necessary for the efﬁcient operation of commercial centers. Market actors also expect states to stay around long enough to insure the value of contracts and currencies. The question of whether the market needs provinces, then, rests not just on issues of the conformity of market space and political space but equally on the signiﬁcance of the province for building and maintaining a rational, stable and predictable national state. China’s history over the past century suggests that maintenance of a stable national state is a minimum condition for the predictable and efﬁcient operation of markets. The province has played an important part in this history. Hence the point at issue is not simply whether the province is a market-friendly territorial unit, or even a useful tool of analysis, but whether and in what form it remains a viable or even indispensable unit of territorial administration in a continental state that is moving towards a market economy.8 States, too, may be said to have a “natural” history. In his Urban Networks in Ch’ing China and Tokugawa Japan (Princeton 1973), Gilbert Rozman presented a spatial model of urban organization that differed from Skinner’s in key respects. In contrast to Skinner’s model of market-driven urban differentiation and development, Rozman identiﬁed urban networks that developed out of the administrative structures of the Chinese empire.9 In place of positing an adversarial relationship between territorial administration and the growth of urban marketing systems, Rozman suggested a complementary relationship. Where Skinner, for example, attributed

The province in history 15 nonconformity between the two regional systems to deliberate intervention on the part of the state, Rozman was inclined to offer explanations that highlighted the complementarity of administrative, economic and social systems in China’s regional development. It was the administrative partition of the country, Rozman argued, that determined the pattern of cities throughout the empire.10 While conceding that patterns of urban settlement incorporated periodic markets and market towns, he suggested that the development of rural periodic markets was dependent on the growth of commercial agriculture, which was in turn dependent on the expansion of major urban centers as sites of consumption. Substantial urban markets had to come into existence before small rural markets could develop. Further, big urban markets developed through administrative intervention on the part of armies, courts and bureaucracies rather than through incremental commercial growth. The current term for market town in China, zhen, illustrates this development quite pointedly: During the ninth century, army ofﬁcers formed independent provincial bases. Garrisons of troops called chen [zhen] became the centers of military control in local areas. Since commanders trying to strengthen their control of supplies brought marketing functions to some chen, the term “chen” later often came to mean a non administrative city with marketing more active than in ordinary rural periodic markets.11 By the time zhen market towns and rural periodic markets came into existence, China could already claim an established urban network of administrative centers numbering in the order of 1,500 towns and cities. New networks of periodic markets and market towns were integrated into an existing urban hierarchy in which relations were ﬁrst established along administrative lines.12 The wealth and stability of the empire required both kinds of settlement because intensive commercial activity in villages and market towns assisted local administrative centers in controlling resource distribution.13 In contrast to Skinner, Rozman traced decisions on administrative boundaries (especially at sub-county level) to the rational choices of administrators seeking to minimize the costs of administration, while keeping cities and markets open.14 Needless to say, reference to an isolated point of difference distorts many points of convergence between the urban models of Skinner and Rozman. Both stressed the signiﬁcance of urban settlements in the development of social, economic and political patterns of territorial differentiation in China’s history. Both also acknowledged the importance of bureaucratic procedures for differentiating organs of the state from other institutions in local society, and for “centralizing” the state to insure bureaucratic efﬁciency, rationality and conformity within the ﬁeld administration of the empire. At base, the business of public administration in China has been a matter of linking central governments with village and urban settlements of one

16 John Fitzgerald kind and another. The capacity of territorial administration to meet and reconcile the sometimes conﬂicting and sometimes complementary interests of dispersed settlements and remote central governments is an important measure of their administrative effectiveness. Administrative effectiveness, in turn, requires a high degree of differentiation, rationalization, bureaucratization and technical “centralization,” and not only at the level of central government. When the province is situated within the broader framework of relations among settlements, on the one hand, and counties, cities and central governments, on the other, its utility can be measured by how successfully it enables state differentiation, rationalization, bureaucratization and centralization, and how well it bridges the administrative distance between widely scattered urban communities and the site of central government.

The origins of the province The bureaucratic history of the province (sheng) can be traced through the derivation of the word sheng. Referring in the Han Dynasty to the inner quarters of the imperial court (shengzhong), the term was later attached to the three boards of imperial government located at court (zhongshusheng, shangshusheng, menxiasheng). In time, the term was transferred to the territorial units of government through which the imperial boards supervised the exercise of local authority. These were initially known as the xingtaisheng (Wei and Jin Dynasties), the xingsheng (Yuan), and ultimately the sheng (Ming). To this day, the Japanese form of the word (sho) continues to refer to a central board or ministry. The Ministry of Education, for example, is titled Monbusho. Consistent with its origins in the inner workings of the central court, the major function of the province has been to mediate relations between the central government and the county (xian). As noted, the county has been the core unit of local government since the founding of the empire. Over the past two millennia, counties have varied as a fraction of territorial administration from around 1:1,000 to around 1:2,000 – too numerous for uniﬁed central governments to handle directly, too varied to allow for uniform administration and, on average, too distant to permit rapid relay of information or routine central intervention. Nevertheless, the center has characteristically retained a keen interest in the security, grain, water management and ﬁscal affairs of county governments. Successive attempts to resolve this conundrum have focused on two main issues: instituting a suitable number of echelons between the center and counties, and striking a balance between central control and local autonomy at each level. The province emerged as the most ﬂexible and reliable instrument for meeting these conditions and hence, after the county, as the second-most constant feature of China’s territorial administration. The introduction of the province addressed a recurring problem, associated with the number and autonomy of territorial echelons, that had come to a

The province in history 17 head during the Song Dynasty. Before the Yuan, most dynasties operated an intermediate echelon of territorial units (jun, fu and zhou) between county and center ranging in jurisdiction from 1:100 to 1:300 of the empire. These were frequently placed under the ad hoc supervision of central inspectorates (lu and dao) each covering between 1:10 and 1:30 of the empirium. There was therefore already something approaching a three-echelon system of local administration, of which only the second and third echelons referred to ﬁxed territories: (1) the lu or dao (2) the jun, fu or zhou and (3) the xian (county). By the advent of the Song Dynasty, a two-echelon system of local administration appeared too cumbersome for the center to manage directly. At the same time, the addition of a higher echelon to form a three-echelon system was thought to promote excessive central control and to undermine the capacity for local defense and, perhaps apocryphally, to have led to the disintegration of the empire in the Three Kingdoms and the Five Dynasties periods. The Song opted initially for a two-echelon system (zhou and xian) but yielded over time to the advantages of the three-echelon system (lu [or fu], zhou and xian) in order to assert stronger central control. On the Song model, however, it would be more accurate to term the highest of the three echelons (the lu) a lower tier of central administration rather than a peak tier of local government. The lu was neither a ﬁxed territorial unit nor a uniﬁed administrative ofﬁce. It referred to a web of imprecise territorial divisions assigned to a number of different imperial ofﬁcers whose powers were deﬁned by the functions assigned to them (for canals, granaries, security, punishment and so on) by their respective central Boards. Authority at the lu level was divided among the Boards of the imperial court. The effect was to centralize power within the imperial Boards and hence deny lower echelons sufﬁcient discretionary authority to defend the realm. The chief beneﬁciaries of the Song system, it was later concluded, were the Mongol invaders of the Yuan.15 In place of the lu, the Yuan introduced the province (xingsheng) as a responsible horizontal echelon of local administration. The Yuan initially continued the lu, zhou, xian system of the Song, with the addition of xingsheng in particular regions to meet pressing local defense needs. As the military consolidation of the Yuan consumed the better part of the dynastic era, however, and as the Mongol imperial house faced local resistance to its rule in many parts of the empire, xingsheng evolved into integral parts of the routine system of territorial administration. The powers of the provinces also gradually extended from military affairs to other aspects of local administration. While appointments to provincial positions were considered central-ranking positions at the start of the Yuan, by the close of the dynasty they were considered local ones. The remnant lu of the Song, meanwhile, were reduced in size and expanded in number to the point where they became all but indistinguishable from units of the second echelon, including the fu and the zhou. In the Ming, the lu was abolished entirely.16 Hence, from the Yuan Dynasty, the province emerged as the apex of a three-echelon

18 John Fitzgerald system of territorial administration that exercised wide authority over large ﬁxed territories. Since the Yuan, the history of the province reveals symmetry with the county in the overall balance of territorial administration in a uniﬁed polity. The county’s position as the basic administrative unit was most pronounced in periods of regime unity. After surveying periods of unity and disunity in China’s imperial history, Gilbert Rozman concluded that regional governments in periods of disunity did not always feel the need to rely on countylevel units to perform local administrative tasks. But uniﬁed imperial capitals, ruling over a vast empire, were invariably accompanied by countylevel administrative centers.17 The emergence of the province as the highest echelon of local administration was dependent on political uniﬁcation, on the one hand, and on the stabilization of the county as the basic echelon in the system on the other. Since then, province and county have been structurally related in providing between them the administrative facility and territorial reach for managing a vast and complex state. This is not to say that counties or provinces have remained stable units in themselves. Counties have remained constant in number by expanding in area and population, and provinces by expanding in population. Changes in the number or size of counties appears less closely related to population growth than to levels of state capacity, or to the degree of state intensity that successive imperial governments could muster through their ﬁeld administrations. That is to say, counties remained fairly constant in number, despite massive population increases, because central administrators showed a consistent preference for expansion in the population density rather than in the number of counties. William Skinner has noted that in the early Han, 1,180 counties administered an empire of 60 million subjects at an average per county of around 50,000 people. By the middle of the Qing Dynasty, 1,360 counties administered 425 million people at an average population per county of around 300,000. Today, they average around 600,000. Had the number of counties correlated directly with population, rather than with administrative fractions of the polity, China would have needed 8,500 counties in 1850 and 20,000 by 1990 (ten times their actual number) to maintain the population-to-county ratio established in the Qin. Neither the imperial nor the modern state could conceivably manage a ﬁeld administration sufﬁciently large to preserve Qin or early Han levels of intensity. Problems of communication, coordination and control between the imperial center and upwards of 10,000 basic units would have been “beyond the capabilities of any agrarian state.”18 Hence maintenance of regime stability and state capacity meant expanding the population density and limiting the number of counties to cope with population growth, and then containing them within the relatively large and stable administrative unit of an intermediate echelon – the province. Similarly, the province has been a fairly constant territorial echelon despite periodic inﬂation in numbers. In the fourteenth century, one central

The province in history 19 “sheng” (the zongshusheng) directly administered territory adjacent to the imperial capital and supervised the administration of ten regional “sheng” (the xingsheng) across the empire. In the succeeding Ming Dynasty, thirteen regional provinces and two provincial-level cities (Bejing and Tianjin) were known collectively as the “ﬁfteen provinces” (shiwusheng). The Qing divided three of the larger provinces into six, and managed the resulting eighteen provinces until the 1880s, when it began creating a further ﬁve provinces in Taiwan, Xinjiang, Fengtian, Jilin and Helongjiang. After surrendering Taiwan to Japan in 1895, the Qing bequeathed a total of twenty-two provinces to the new Republic. The Republican government retained the twenty-two provinces of the Qing but added four provincial-level Special Administrative Regions (tebie xingzhengqu: Jehol, Suiyuan, Chahar and Chuanbian (later Sikang Province)) with the aim of incorporating former Manchu territories and other minority/border areas into the regular administrative system. These four Special Administrative Areas were upgraded to provinces when the Nationalist Government came to power in 1928. With the addition of Ningxia and Qinghai provinces, the Nationalists supervised twenty-eight provinces at the outbreak of war with Japan. After the war, the Nanjing Government divided the three “north-eastern provinces” of Manchuria into nine provinces, and recovered Taiwan province, to administer thirty-ﬁve provinces. With the addition of one Territory (Tibet) and twelve centrally administered cities, the Nationalist Government left a legacy of forty-eight provincial-level territorial units for the new government of the People’s Republic when they ﬂed the mainland for the province of Taiwan in 1949.19 After expanding brieﬂy to ﬁfty provincial-level units over the ﬁrst few years of the PRC (thirty provinces, twelve provincial-level cities, three regions and ﬁve administrative areas), provincial numbers and boundaries stabilized in the mid-1950s around the late imperial pattern. Additional provincial-level status was initially granted to a few loyal base areas, including Pingyuan and Subei, at a time when the newly installed government operated through six supra-provincial administrative territories.20 Over the next four or ﬁve years the central government eliminated all supraprovincial units, consolidated minority provinces into larger provincial-level autonomous regions, and conﬁrmed the boundaries of remaining provinces in core Han areas more or less on the model of the Qing.21 Today, there are twenty-three provinces, ﬁve autonomous regions and four provincial-level cities, yielding a total of thirty-two provincial-level units.

Provinces and state-building The character and problems of provinces in China turn on two elementary questions confronting central governments, one relating to the size and number of echelons in the country’s system of territorial administration, and the other to the degree of autonomy exercised by each echelon.22 These two questions framed a basic dilemma over the late imperial period. While the

20 John Fitzgerald court equated territorial unity with the maximization of central state power, the size of the country, the regional variety of its peoples and cultures, and the range of its environmental conditions called for decentralized decisionmaking. The advent of the province in the Yuan Dynasty provided a central check on local autonomy, although at some risk to effective local government if the center controled provinces too closely, and at grave risk to the center if it failed to control them at all. Hence, imperial governments insisted on maintaining tight control of provincial appointments and revenues, and set strict limits to the provinces’ scope for independent action, while provincial governments characteristically sought sufﬁcient autonomy to insure effective local government. This tension has persisted into modern times. Every regime this century, including the Communist Party state, has illustrated an institutional contradiction between “the centralizing predilections of the rulers and the decentralizing dictates of the environment.”23 In recent history, however, the province has been instrumental not only in administering the state but in building the state. Attempts to balance the ageold demands of center and province in the twentieth century were compounded by an additional problem common to revolutionary states: the need to build new state structures on unorthodox ideological, social and economic foundations. From the last decades of the Qing, administrative reformers sought to penetrate below the level of the county, to town and village level, in order to develop state structures at sub-county level. The effort continued over the ﬁrst half of the century, when competing revolutionary regimes struggled to substitute formal administrative structures for local elite organizations, and to differentiate, rationalize, bureaucratize and centralize local government. What began as a movement for administrative reform ended up as a social revolution.24 This wider revolution had an impact on territorial administration as competing state-building regimes mobilized around existing fault lines within the territorial system. The Republican Revolution of 1911 and the “Second Revolution” of 1913, for example, each took the form of provincial secession movements. More worrying for many centralist revolutionaries was the endurance of autonomous provincial governments in the “warlord era” (1916–27) and in some cases into the mid-1930s. Some of these provincial administrations advocated an alternative federal model of territorial government that challenged the fundamental assumptions of the centralists. In other cases, notably the Nationalist Government of Guangdong in the 1920s and the Communist Government of Yanan in the 1930s and 1940s, revolutionary regimes pressed competing claims as central administrators. In sum, although the basic pattern of China’s imperial territorial administration has been retained into the modern era, successive attempts to weld the old territorial model on to a new revolutionary polity heightened the tension between central control and effective local government embedded within the model itself. The problem facing the territorial system in the modern period has involved more than reintegrating old territorial echelons around a new

The province in history 21 central government. Early twentieth-century China was both a “disintegrating” territorial state and an “involutionary” one – a state in which territorial partition coincided with a chronic breakdown in differentiation and bureaucratization of the local state apparatus.25 On the one hand, any central government that failed to retain strong control over its provincial territories ran the risk of surrendering authority to competing political, ideological and military forces. On the other, every central regime was under pressure to grant provinces sufﬁcient authority, skills and resources to enable them to oversee the greater state-building project at county, town and village levels. As a result, although each national regime sought to create a modern, differentiated and bureaucratic national state on the site of an (increasingly remote) imperial one, not all showed similar enthusiasm for surrendering sufﬁcient autonomy to provinces to penetrate the smallest units of human settlement in pursuit of local community mobilization and efﬁcient revenue collection. One measure of this problem was instability in the number and variety of territorial echelons and units over the ﬁrst half of the twentieth century. We have noted the gradual and consistent increase in the number of provinces from the Yuan Dynasty (ten provinces) to the mid-nineteenth century (eighteen provinces). This was followed by a century of rapid inﬂation to between thirty and forty provinces by the end of the Nationalist era in 1949. The earlier period of measured expansion can largely be attributed to longterm historical changes in population, prosperity and the territorial reach of the state. The later period of provincial proliferation, however, resulted from systemic problems within the system of territorial administration itself, associated with new responsibilities assigned to local government which ultimately raised questions about the number and relative autonomy of echelons within the system.26 Further, the unit at issue in earlier proposals for echelon reform tended to be the peak one – the dao of the Tang or the lu of the Song, for example – and the system was typically reformed by adding a new and more powerful echelon at the top of the system while demoting the previous occupant of that position to a lower echelon. But for much of this century it has been assumed that the highest echelon (the province) was as ﬁxed as the lowest (the county). Centralizing governments have sought instead to experiment with an intermediate echelon (fu, dao and zhou), either eliminating it entirely and governing through province and county alone, or inventing new intermediate echelons to facilitate revolutionary (often military) control at sub-provincial level. In either case the status of the highest echelon, the province, was reduced relative to the sub-provincial level. These developments are worth considering more closely. Throughout the Republic, successive central governments tried to reduce the number of administrative echelons from three to two, and to place strict limits on the autonomy of the province, with the aim of establishing more direct communications between the center and the counties. Under President Yuan Shikai, the Republican Government eliminated the prefecture (fu), and converted all

22 John Fitzgerald departments (zhou) and sub-prefectures (ting) into counties, in anticipation of implementing a simpliﬁed two-echelon system of province and county. The proposal proved impractical and was abandoned within a year of implementation. By 1914, President Yuan reintroduced an intermediate echelon of ninety-two circuits (dao).27 Sun Yatsen also favored the two-echelon model, although in his case within a system that explicitly elevated the county at the expense of the province. Sun seems to have harbored grave doubts about provinces, particularly in his later years when they commanded resources sufﬁcient to challenge a weakened national state. At one point he proposed a national government built on a confederation of counties that effectively by-passed the province as a territorial unit of any signiﬁcance. Early in the 1920s, when a rival movement for a national confederation of provinces began to gather momentum, he dismissed the idea of provincial federation as a plot hatched by warlords and imperialists to break up China.28 In October 1923 the provincial federation movement culminated in the ﬁrst formal constitution of the Republic of China.29 This was the country’s ﬁrst constitution to set out a signiﬁcant formal division of powers between the center, provinces and counties. As a precedent, it was not widely emulated. Virtually all subsequent constitutional documents, including Nationalist and Communist state constitutions, have referred matters of authority, autonomy and functions of provinces and counties to separate Organic Laws (zuzhifa) subject to the whims of the central government of the day.30 Sun answered the 1923 national constitution with a quasi-constitutional document of his own entitled Fundamentals of National Reconstruction for the Nationalist Government (Guomin zhengfu jianguo dagang), a short paper completed in April 1924 for the guidance of his alternative national government in Guangzhou. Here, provinces barely rate a mention: the business of government was a matter for negotiation between the center and the counties. Provinces were merely “intermediaries between the central and the county governments, providing for effective cooperation between them.”31 On coming to ofﬁce in 1928, the Nationalist Government implemented Sun Yatsen’s proposals to the extent of eliminating Yuan Shikai’s intermediate circuits (dao) and returning to a simple twinning of county and province. At the same time, the province was reduced to a sub-echelon of central government under a committee system (weiyuanzhi). Provincial governments exercised little authority in their own right. Their executive organs (ting) reported not to the provincial government but to corresponding ministries of the central government, and their authority over subordinate counties was limited to the extent that county bureaux (ju) were ultimately answerable to the same central ministries. Provincial commissioners (tingzhang) were appointed by the Central Executive Yuan and received their instructions from central branch counterparts in their superior ministries. The regulatory powers of the governing Provincial Committee were conﬁned to giving effect to the legislative and executive decisions of the

The province in history 23 central government. In consequence, decisions on stafﬁng, revenues and expenditure paid little heed to provincial revenue capacity or to the political impact of funding proposals on the communities that were expected to support them.32 While facilitating direct central intervention in local affairs, the committee system diminished local accountability and encouraged intense institutional rivalries at all levels of the state bureaucracy. For all its faults, the committee system worked well when central and provincial governments happened to share more or less the same political space. It was effective when a government exercised central powers within a provincial jurisdiction, or when an essentially provincial government claimed to exercise the authority of a central one. Hence it proved reasonably successful in Guangdong Province from 1925 to 1927, when the Nationalist central government (guomin zhengfu) governed little more than one province. It worked effectively in Jiangsu Province when the national capital moved to Nanjing, the major urban hub in Jiangsu. It was reasonably effective under wartime conditions in Sichuan, and in one or two neighboring south-western provinces, when the Nationalists transferred their capital to Chongqing. And it proved remarkably successful in the province of Taiwan, ruled from 1949 by a national government whose jurisdiction overlapped with that of the Taiwan provincial government. By the time the Nationalists transferred their administrative center to Taiwan, however, the limitations of the committee system had been exposed in a series of unsuccessful attempts to extend the system to provinces beyond the immediate purview of the Nationalist Government. Under the committee system, provincial governments functioned poorly in provinces that were too far from Nanjing for the central government to intervene directly in their dayto-day administration and yet too close to escape its effective military reach. Chiang Kaishek then called upon the army to establish and staff a new intermediate echelon of sub-provincial administration. In July 1932, the General Command Headquarters for Bandit-Encirclement ordered the three provincial governments of Henan, Hubei and Anhui to “partition each province into an appropriate number of districts within which to establish ofﬁces for administrative inspection personnel.” The new sub-provincial Administrative Inspection Districts (xingzheng ducha qu) were situated directly under General Command Headquarters, with lateral links to respective provincial governments. The experiment was subsequently extended to civilian authorities in neighboring provinces. In August 1932, the Central Executive Yuan introduced regulations permitting provincial governments outside the military zones to set up Inspectorate Personnel Ofﬁces (ducha zhuanyuan gongsuo) on the military model to oversee administration of counties in areas with “particular requirements,” most notably particular security requirements. The new ofﬁces were empowered to direct and supervise police and militia forces in their jurisdictions. Outside the BanditEncirclement zones, provincial governments retained effective control over subordinate districts. Hence not one but two separate systems of sub-

24 John Fitzgerald provincial administration emerged in different parts of the country in the 1930s, with formal districts under higher level military control in BanditEncirclement areas and ad hoc administrative inspection ofﬁces established elsewhere under provincial government control. The two systems were merged in March 1936. Revised regulations issued in December transferred the districts to provincial government authority.33 Experience of the Jiangxi encirclement campaigns prompted a major revision of the provincial government system in October 1936, restoring a measure of autonomy to provincial governments and investing the Chair of the Provincial Committee with considerably greater authority. The new regulations obliged each provincial commission to coordinate its work with other jurisdictional commissions at provincial level (rather than seek the approval of its central branch ofﬁce), to channel paper through a single ofﬁce of the provincial government, to submit all regulations and directives for the provincial Chair’s approval and to issue them directly through the provincial government.34 This restructuring of the committee system was not extended to all provinces due to the outbreak of the war with Japan. The policy was revived immediately after the war and elevated, in modiﬁed form, to a constitutional principle in the Constitution of 1946.35 In retrospect, it seems that the Nationalist Government denied provinces a signiﬁcant measure of formal autonomy for fear that they would become the major beneﬁciaries of intensive state-building. At times they did so. When the push for local self-government from below encountered pressure for centralized control from above, the contest on occasion unfolded in ways that strengthened the province as arbiter between center and locality. In the 1930s, for example, local initiatives in the New Life Movement at county and village level in Fujian Province invited provincial government intervention to ensure that it retained control over central initiatives. Permitting local communities and governments to oversee their own cultural “modernization” without signiﬁcant inputs from higher echelons would have deprived the province of an important rationale for its existence – the production of the modern (local) citizen. The province, needless to say, jealously preserved its civic duties.36 Overall, the Nationalist Government lacked the capacity at central level to differentiate state agencies from social institutions or to bureaucratize lower level ofﬁcials at county and sub-county levels in all but a few provinces. In consequence, local state institutionalization in the Nationalist era was conﬁned to a few provinces more or less under Nanjing’s direct control, and to a number of provinces and regions so far removed from Nanjing that they could assert their autonomy with impunity. Jiangsu and Zhejiang, immediately adjacent to the site of the national capital in Nanjing, remained under the close supervision and control of the central government.37 Next in rank on the bureaucratization scale were provinces outside Nanjing’s effective control, including Guangdong, Guangxi and Shanxi. Governments in these provinces were sufﬁciently remote from Nanjing to exercise authority in their

The province in history 25 own right, and sufﬁciently powerful to make a start in imposing new state structures on local society and in bureaucratizing local administration. In each case, it was governments at the provincial level that took the lead in local state-building.38 Elsewhere, the failure of successive attempts to implement the two echelon system and reduce the province to a cypher of central government under the governments of Yuan Shikai, Sun Yatsen and Chiang Kaishek suggest that they each overestimated the center’s capacity to communicate effectively with county and city administrations, and underestimated the problem of institutionalizing new state structures at county and sub-county level. This is one of the lessons of history that might well be recalled in considering the status of provinces in China today.

The province at the turn of the twenty-ﬁrst century Recent studies on central–provincial relations have highlighted the growth of provincial power relative to that of China’s central government in the reform era.39 A somewhat different picture of provincial power and authority emerges from analysis of the broader spatial framework of territorial administration over the history of the People’s Republic. Under the planned economy, provinces beneﬁted from a central policy of horizontal-area (kuaikuai) coordination that devolved signiﬁcant powers to provincial governments. The sub-provincial echelon of the prefecture (called zhuanqu until 1975 and diqu thereafter) was subject to a vertical-branch (tiaotiao) structure of command that enforced local compliance with directives from the province.40 The relative importance of vertical and horizontal lines of authority at different levels varied over time even under the planned economy. With the gradual introduction of market reforms in the 1980s, however, the central government strengthened horizontal-area integration at levels lower than the province and promoted the city (shi) as its favored “area” for integrated economic, social and political decision-making. In consequence, cities have been accorded greater powers as key sites of horizontal-area authority within provinces.41 Relatively speaking, the province has surrendered authority to the subordinate echelon of the city within a rapidly intensifying state. The emergence of the city as a standard unit of territorial administration foreshadows one of the most signiﬁcant reorganizations of China’s territorial administration since Yuan times. The rise of the city is signiﬁcant in its potential impact on the historical relationship between province and county, in establishing new grounds for congruence between economic space and political space, in presenting new challenges and opportunities for differentiation and bureaucratization of local government, and for the light this development sheds on the relationship between markets and governments in determining historical patterns of territorial administration in Chinese history. Indeed, the emergence of the city returns us to the questions with which we began. Can the state differentiate itself sufﬁciently from markets to ensure

26 John Fitzgerald the healthy growth of a market economy? Does the province have a continuing role in building the state, speciﬁcally in coping with new demands to differentiate, bureaucratize and centralize sub-provincial arms of the territorial system? In the main, changes in China’s urban network have been driven by the application of a “market mechanism” to the industrial sector within a policy framework favoring rural industrialization over urban renewal. As Barry Naughton has shown, the initial consequence of relaxing controls on urban development in the reform era was not a resurgence of traditional urban centers such as Shanghai and Tianjin, but great and rapid economic growth in areas surrounding existing cities. The proﬁtability of industries in older urban centers had been built on artiﬁcial prices for raw materials and ﬁnished products. New “rural” industries eroded the proﬁts of this price-supported state manufacturing sector by forcing up prices of undervalued raw materials and by lowering prices on consumer goods. As proﬁtability declined in the state sector so, too, did the proﬁts remitted as revenues from older urban centers to Beijing. At the same time, administratively contrived boundaries between city and countryside collapsed, creating space for the emergence of new semi-urban zones where “weak surveillance of economic activity” encountered “abundant economic opportunity.” While Beijing’s share of total revenues fell into decline over the ﬁrst decade of reform, the “rural” share of industrial output grew from 9 percent in 1978 to 27 percent in 1990.42 The central government moved quickly to harness and to formalize this new urban order. In an effort to recover control over unplanned urban growth, Beijing moved from the mid-1980s to grant greater autonomy to large cities, to reclassify counties as cities, and to redraft administrative boundaries of existing cities and counties so that they conformed more closely to economic regions. The rise of cities in recent decades is unprecedented not only in scale but in its potential impact on the scope of provincial and county government authority – and perhaps on the integrity of the territorial system as a whole. In imperial times, cities were administered under an appropriate territorial echelon (zhou, fu or dao) and in some cases divided between several units of the same echelon. It was not until the second decade of the Republic that cities began to emerge as territorial units in their own right. Signiﬁcantly, the very ﬁrst city to receive formal urban classiﬁcation was designated not as an administrative unit but as a “self-governing” one. In 1921, Chen Jiongming reorganized Guangzhou as a city administration in concert with a broader program for local self-government in Guangdong.43 Four years later, the succeeding Nationalist administration reclassiﬁed Guangzhou as an administrative unit under provincial jurisdiction (Guangzhoushi) and eliminated all prospect for local self-government under the rubric of “party rule.” Guangzhou nevertheless retained its city status. With the territorial expansion of Nationalist authority from 1926 to 1928, the Guangzhou style of urban designation was extended to a number of other cities, now collectively termed Special Cities (tebieshi). Beginning in

The province in history 27 1930, the Special City system was replaced by a system of urban classiﬁcation that grouped cities under central or provincial government jurisdiction. One cluster of cities, answering to the center, was known as Direct Jurisdiction Cities (zhixiashi) or Yuan Jurisdiction Cities (yuanxiashi), referring to the central government’s Administrative Yuan. Direct Jurisdiction Cities were classiﬁed alongside the province in the national administrative hierarchy. Those answering to provincial governments were termed Provincial Jurisdiction Cities (shengxiashi) and classiﬁed as county-level cities. There were six Direct (or Yuan) Jurisdiction Cities and sixteen Provincial Jurisdiction Cities at the outbreak of war with Japan. After the war, the number of Direct Jurisdiction Cities increased to twelve: Nanjing, Shanghai, Beiping, Tianjin, Chongqing, Dalian, Harbin, Hangkou, Guangzhou, Shenyang, Qingdao and Xi’an. Over the ﬁrst years of Communist Party rule there were no less than fourteen Direct Jurisdiction Cities. From 1954 these were reduced to three – Beijing, Shanghai and Tianjin – and, for a time between 1958 and 1967, to two cities when Tianjin was placed under Hebei provincial jurisdiction. Today, there are four Direct Jurisdiction Cities: Bejing, Shanghai, Tianjin and Chongqing.44 There are three levels of city in China’s current administrative hierarchy. These are, in descending order, provincial level cities under central jurisdiction (zhixiashi), prefectural-level cities (shengxiashi, colloquially dijishi) and county-level cities (xianjishi, colloquially dixiashi). There is a further sub-division at prefectural level of relatively privileged “separately planned” cities (jihua danlie chengshi), which exercise certain provincial-level economic powers denied others at the same level. Below the county-level city come towns (zhen) and, beneath towns, the “nonurban” settlement of the township (xiang) and the village (cun). At this “nonurban” level, around 900,000 villages are accommodated into roughly 45,000 townships, at an average of twenty villages per township. The position of a town or city in the urban hierarchy largely determines the scope of state activity and local authority in its domain – and the extent of its encroachment on former areas of provincial jurisdiction. Generally speaking, the higher they rise in the hierarchy the greater the authority that towns and cities enjoy. Their place on the formal urban ladder determines the scope of their administrative powers, the degree of control they exercise over investment decisions (including foreign investment), their relative access to ﬁnancial support from the state, their capacity to secure reliable food supplies from subordinate counties and, to a diminishing degree, the extent to which they qualify for subsidized food prices. Urban designation serves to limit or enhance a city’s capacity to take full advantage of the economic reform policies introduced since 1978. Thus it is to the advantage of townships to seek classiﬁcation as towns, for towns to become county-level cities, for county level cities to seek prefectural status, for prefectural cities to apply for classiﬁcation as “separately planned” cities, and for these cities to upgrade to provincial-level cities.45

28 John Fitzgerald Despite the actual demographic and economic growth of cities in the reform era, published statistics on urbanization over the past two decades tell us more about processes of administrative creep within the territorial hierarchy than they do about economic or social mobility to, from and within cities. There were ninety county-level cities on the eve of Deng Xiaoping’s return to ofﬁce in 1977. By 1995 there were over four times that number. The number of prefecture-level cities doubled over the same period, from ninety-seven to over two hundred. Expansion in the category of prefecture-level cities occurred through reclassiﬁcation of many of the ninety cities that had been listed as county-level cities in 1977. The growth of the county-level category over the past two decades appears to be explained by the reclassiﬁcation of 400 former towns as cities. Over the same period, the number of ofﬁcially designated urban towns rose from 2,850 in 1978 to around 12,000.46 In terms of administrative jurisdictions, this process of urban creep has come at the expense of both the province and the county. At provincial level, the trend is toward expanding the number of provincial-level cities (overseeing a signiﬁcant number of rural counties) that report directly to Beijing rather than to their home provinces. At sub-provincial level, prefecture-level cities have been designated sites of local area government rather than subsidiary units of provincial government. Initially, provinces beneﬁted from the renewed emphasis on horizontal-area integration and hastily reclaimed authority over areas of economic decision-making at provincial level that were no longer subject to vertical command from Beijing. In more recent years, however, urban units at and below the provincial level have been expanding their authority over areas that are no longer the province’s to command. Even at county level, there has been a rapid conversion of counties into cities and, more signiﬁcantly, a rash of new and old urban centers incorporating rural counties on the principle of “cities leading counties” (shiguanxian). In either case, provinces are uniformly and inexorably surrendering authority over large areas of territorial jurisdiction to cities, and counties are losing the right to appeal directly to provinces for assistance or redress. The ﬁrst casualty of this transfer of counties to city administration was the prefectural district (diqu), an administrative unit that was technically a regional arm of provincial government rather than an echelon in its own right. As early as 1991, provincial government prefectures disappeared from Jiangsu, Guangdong, Liaoning and Hainan Provinces under the weight of urban administrative reform.47 In each case, the displacement of prefectures by new prefectural cities, or by county cities and “cities leading counties,” signaled the transfer of authority over large fractions of provincial territory to local urban governments. The second party to be affected was the county. Initially, counties and county-level cities turned to provincial governments for help in escaping the suffocating grip of prefectural cities. The growth of the “four little tiger” counties of Guangdong, for example, was conditional on their attainment

The province in history 29 of city-level status independent of Guangzhou with the assistance of the provincial government. In contrast, adjacent counties under Guangzhou City jurisdiction were relatively slow to “take off.”48 In more recent years, however, county ofﬁcials have been heard to refer to the “cities leading counties” system as a system for “cities bleeding counties” (shiguaxian).49 Counties placed under the jurisdiction of a new urban hub resented the loss of autonomy they formerly enjoyed under relatively benign provincial rule. The third echelon to be affected was the province. It is not at all certain, however, that the province has suffered as an echelon from its relative loss of territorial jurisdiction. In one sense, the development of a sub-provincial urban echelon conﬁrms the place of the province in a twotiered system of territorial government. The pairing of province and city fulﬁlls a structural need comparable to that of province and county in imperial times – although at a higher level of state intensiﬁcation – while meeting many of the pressing needs that encouraged proliferation of intermediate sub-provincial units this century. Appeals from cities and counties to provincial governments to reconcile conﬂicts of interest among different levels of the new urban hierarchy illustrate one aspect of an emerging structural relationship. Second, under the planned economy, every provincial government had to contend with at least one prefecture-level city – the provincial capital (shenghui) – or perhaps two in the case of highly urbanized provinces. In the era of state planning, the provincial capital acted as an alternative to the province as a source of status, power and wealth for elite mobility within the party and state apparatus. Capital cities also attracted more than their share of state investment and concessionary policies. For most provincial governments, signiﬁcant advantages were to be gained from expanding the number of prefectural-level cities to counterbalance the weight of the provincial capital and hence spread some of its privileges more widely around the province. Provincial governments also stand to gain from widespread economic development within their jurisdictions and from growing intensiﬁcation of state activity at all levels within the system. State expansion at city level holds the potential to enhance the reach and capacity of the state as a whole. This appears to be conditional, however, on provinces continuing to play their historic role of institutionalizing and differentiating the state within their territorial jurisdictions – or at least on provincial governments retaining a stake in new developments within their own domains. Perhaps the greatest casualty of urban administrative creep has been the operation of the territorial system as a system. This has been affected in several ways. First, it has suffered from attempts to maintain congruence between economic space and political space in the territorial arrangements of local government, to the point of confusing the distinction between economic and administrative rationality. To be sure, there is nothing wrong with congruence in itself. Absolute congruence between economic and political space is a shared ideal of many competing political models, including

30 John Fitzgerald the socialist planned economy (Maoist China) and the pure market economy (Hong Kong). The introduction of communes in the late 1950s, for example, altered the spatial structure of communications, administrative systems and the economy at village and township levels. Flows of people, information, goods and services were determined by the administrative arrangement of space within a commune: telegraph lines, wired-radio networks, roads and bus routes radiated from commune headquarters, reducing the effective administrative distance of settlements within a commune while inﬂating the relative distance separating villages of neighboring communes. New administrative centers grew at the expense of old market towns, and commune social and economic networks converged at every point with patterns of territorial administration. The effect of the commune on social and administrative space was to establish more direct conformity between administrative space and socio-economic space than possibly at any time in China’s history.50 Much the same might be said of Hong Kong, if in reverse. In this case, the organization of the territory around the ideal of a global free market played a large part in determining its administrative arrangements as a colonial (now “autonomous”) territory. Neither political space nor economic space is corrupted, in the technical sense, when one is clearly subordinated to the other. Maintaining balance and conformity between economic and political space in a state that is moving from a centrally planned economy to a market economy can lead to maldistribution of economic and political authority. Attempts to elevate the city as a basic unit of territorial administration appear to be founded on the principle that administrative space should conform with socio-economic space.51 More particularly, they seem to be founded on the assumption that economic development should drive administrative development. Much of this is “model driven” through well-publicized initiatives taken by the central government. Beijing’s grand plan for restoring cities to their role as central places within the formal administrative system was set out in the widely publicized “Outline for the Ninth Five-Year Plan for National Economic and Social Development and Long-Range Objectives to 2010,” which detailed plans for seven economic zones spanning various provinces, autonomous regions, and municipalities, each with at least one city at its heart. A number of provincial governments followed suit.52 In many regions, however, the contours of socio-economic space have been skewed by four decades of state planning that effectively naturalized the spatial structure of the party-state as a template for regional decision-making, investment, production and exchange. Today, the boundaries of many of China’s new cities conform more closely with these old socialist administrative units than with ideal market networks; or, to put the problem more concretely, new urban marketing networks have developed around old patterns of territorial administration.53 The beneﬁciaries in every case have been the state functionaries whose plans for economic development take close account of their own administrative territories.

The province in history 31 Another point of administrative contamination is the role these state functionaries play in managing economic development. Basically, the fabric of the state is bursting at the seams with new social and economic elites that have been enriched and empowered by the “market mechanism” yet who continue to organize, mobilize and communicate around the spatial patterns and administrative institutions of local state and party structures. China’s system of territorial administration was not designed to contain the forces unleashed by market-driven urbanization. In the 1950s and 1960s, administrative planners could draw their territorial boundaries without regard to the possible emergence of social and economic coalitions that might threaten the integrity of the state; in fact, the only space for emergence of socioeconomic coalitions was within the framework of the state itself. In any case, the new party-state favored conformity of administrative and economic units in its territorial administration so long as conformity meant making economic units correspond to administrative ones. Now, however, the territorial arrangements of the national administrative system must conform to the spatial structure of an economy that remains skewed by earlier territorial arrangements, while the authority of the state remains in the hands of elites that can no longer distinguish between administrative rationality and self-interested economic gain. Differentiating between socio-economic elites and state institutions is rendered more difﬁcult still by the phenomenon of “state sprawl.” Once counties had been reclassiﬁed as cities, or incorporated into cities-leadingcounties, the local state apparatus began expanding to levels commensurate with its new responsibilities. Vivienne Shue witnessed this process at work in her study of a rural county upgraded to city status in 1986. The greater responsibilities assigned to Xinji City (formerly Shulu County) in Hebei, for managing the transition to a local market economy, led to signiﬁcant growth in the size and complexity of the local state apparatus. Elsewhere in China, much the same has been happening at township (xiang) level, where the number of ofﬁcial employees is on average two to three times higher than levels approved or funded by higher echelons of government.54 Shue classiﬁes this process at sub-provincial level as one of “state sprawl.” Others have suggested that state sprawl may be closely related to the process of “state involution” identiﬁed by Prasenjit Duara in his study of local administration in the Republic.55 Finally, the new cities blur echelon demarcation within the territorial system. The city is not an echelon but a unit (indeed the only unit) located on all three echelon levels: at provincial level (zhixiashi), at prefectural level (shengxiashi) and at county level (xianjishi). Confusion arises when the same term applies at different levels. This can have trivial consequences – in, for example, an increasing confusion of terms in local naming practices (e.g. Wancounty City, or Shacity City). More signiﬁcantly, it highlights the extent to which the hierarchical administrative system is captive to an imperfect fusion of commercial development and administrative creep. Recent proposals

32 John Fitzgerald for reform have included reserving the term “city” (shi) exclusively for urban commercial centers; reviving old echelon terms for provincial-level cities (dao) and prefecture-level cities (fu); and eliminating the term “city” in referring to county-level units in any shape or form. Were this proposal implemented, the city would cease to be classiﬁed as an administrative unit in the territorial system.56 In one sense this may be going too far, and in another not far enough. The problem, after all, is not that cities have been granted excessive bureaucratic recognition in the territorial hierarchy. Cities warrant formal acknowledgment appropriate to their social, economic and political signiﬁcance, and for this reason have been nudging their way into the system since the 1920s. The administrative system needs to take account of cities chieﬂy because cities – that is, actual urban commercial centres – have been driving economic development. The problem lies, rather, in the conﬂation of cities as dynamic commercial and industrial centers, on the one hand, and cities as arbitrarily deﬁned units in a formal system of territorial administration, on the other. This question is inseparable in turn from the role of the local state apparatus in owning and managing the burgeoning urban “cooperative” economy, which highlights a systemic failure at sub-provincial level to differentiate between state institutions and socio-economic ones. The search for a workable method for differentiating, rationalizing and centralizing the system of territorial administration appears to require a return to the “state-building” strategies of the ﬁrst half of the twentieth century. Suggestions put forward by administrative historians to change the system of urban nomenclature mark a small symbolic step in this direction, although in this case one that recalls the dao and the fu of imperial times. A more appropriate historical reference might be one that returns the city to its origins as a territorial unit of local self-government, as Chen Jiongming initially proposed for Guangzhou in 1921, within a constitutional division of powers among the center, provinces, cities and counties. The city is pushing China’s system of territorial administration to the limit because cities – real commercial ones – are not amenable to centralized administration. In cities, effective state-building perhaps requires an acceptable minimum of selfgovernment. An equally important historical precedent is the distinctive role of provinces as state-building agents over the ﬁrst half of this century, and the centrally imposed limit to provincial autonomy that prevented provinces from completing this task in the Republic. Certainly, the emergence of administrative cities as standard units of territorial administration in recent years is strikingly reminiscent of Sun Yatsen’s early plan for an alliance between the center and the counties against the provinces, or the later strategy for undermining provinces set out in Sun’s Fundamentals for National Reconstruction. In each case, the aim was to reduce the province to a transparent window for central government supervision of territorial administration. In the absence of strong provincial government (and a highly

The province in history 33 efﬁcient party structure) his successors’ attempts to implement this strategy came to very little. Whether the provinces will be allowed to perform their historic function of differentiating and bureaucratizing local state structures is an open question. The risk, of course, is that provinces may choose to do so whether they are permitted to or not.

Conclusion The province is a national unit of local administration. So too are the county and, from the mid-twentieth century, the village. Indeed, throughout the twentieth century the domain of the local (difang) was gradually extended as a site of national bureaucratic authority from the province, to the prefecture, and to counties, wards and villages. Once the village became a site of local government it became, like the province, an integral part of the national administrative system. To be sure, the number of echelon levels and the function and authority of each level within the national system were and remain matters for discussion, and at times dispute, among networks and levels of the system. Resorting to terms such as “provincialism” or “provincial separatism” to capture inter-echelon contests at the highest level can be misleading when it implies that provincial demands for a greater share of political authority threaten the integrity of the territorial state itself. They may threaten the center, certainly, but they pose no more or less a threat to the territorial state than the center itself does. The central (zhongyang) and the local are, after all, two sides of the one national system. The trend over the long twentieth century was toward increasing centralization based on an ideal of popular sovereignty. Looking back over the history of territorial administration in the Republic and the People’s Republic, it is hard to avoid the conclusion that the behavior of centralizing nationalists – from Yuan Shikai to Sun Yatsen, Chiang Kaishek and, to a degree, Mao Zedong – was informed by two basically populist assumptions. The ﬁrst was that the Chinese nation ideally comprised a great many peasant farmers and working commoners. A second was that the Chinese state should represent the people, scattered as they were over a vast number of settled communities, through a centralized administrative system that could mobilize the people at village level. The art of government appeared to lie in linking the national capital with the counties and villages to educate and mobilize the common people, extract resources, develop the country, and defend the realm. Little allowance was made either for cities or provinces as relatively autonomous units of government. From the panoptic perspective of the metropole, all intermediate echelons of territorial administration, including provinces, prefectures, special zones and cities, appeared either as obstacles in the way of consummating the special relationship between the capital and the counties, or as expedient intermediaries arising from the temporary postponement of the romance of county and metropole, people and state. In the meantime, provinces, prefectures, districts and cities were

34 John Fitzgerald granted the bare minimum of authority and autonomy thought necessary to fulﬁll the elementary administrative and security requirements of the central arms of the state. These assumptions were not just populist but also fairly realistic in the republican period. Centralizing nationalists appealed to the “people” (renmin) in the hope of forming an alliance against the powerful regional forces arrayed against them. The intransigence of provincial governments in Shanxi, Sichuan, Guangdong, Guanxi, Yunnan and the three Manchurian provinces consistently prevented central ﬁat from becoming national law. To give effect to national policy and to realize the will of the “people,” the province was circumvented as a signiﬁcant echelon in the national system of territorial administration. But this is also where the assumption came unstuck. Perhaps no centralizing political movement could have taken effective control of the country without ﬁrst eliminating the powerful regional forces aligned against it. On the other hand, no metropolitan government in the Republic could work effectively with the counties without the aid of powerful regional forces for the simple reason that very few counties in the country were functioning as effective administrative units. Intermediate echelons were indispensable for making counties work. As a territorial state, the Republic suffered two major problems: it was a disintegrating state and it was an involutionary one. The solution to disintegration, of course, was territorial reintegration. But there was little prospect of the center forming a meaningful alliance with the “people,” against disintegrative regional forces, when it lacked the institutional capacity to deal directly with sub-regional governments. Central procedures for communication, extraction, enforcement and mobilization at county and sub-county level were simply not up to the task. The solution to state involution was not territorial reintegration but rather technical centralization involving systematic penetration, differentiation and bureaucratization of the local state apparatus. The evidence to hand suggests, paradoxically, that disintegrative provincial warlord governments were just as adept as the central government in centralizing the local state in this technical sense. To compound the paradox, the evidence suggests that autonomous provincial governments were comparatively more successful in laying the foundations for a functioning local state than the weaker provincial structures set in place by the Nationalist Government in areas outside its immediate administrative reach. Indeed, given the level of state involution at the lowest levels of town and county, and the limited administrative reach of the metropole, it seems that the province was the only existing administrative echelon capable of differentiating, rationalizing and bureaucratizing the territorial state in many parts of the country. The centralizing nationalists who were largely responsible for the romance of metropole and county in the Republic failed to acknowledge one of the enduring lessons of China’s history. To ensure a functioning national polity, the province needed to exercise sufﬁcient authority to institutionalize and to oversee local government.

The province in history 35 National leaders have generally blamed provinces for China’s territorial disintegration without regard for their instrumental role in local statebuilding and in confronting the problem of state involution. Each new centralizing regime, on its accession to power, tried to constrain provincial governments but later sought to enlist them in the struggle to maintain regime credibility. So there is a detectable pattern of centralization and relaxation in central–provincial relations from the start to the end of the Republican and Nationalist periods. The Republican Government of 1912 and the Nationalist Government of 1928 each tried to establish strong central control immediately on accession before settling into a modiﬁed centralist model that eliminated some of the excesses of over-centralization. In much the same fashion, the Communists’ asserted strong central control on their accession as if to signal their determination to avoid the “errors” of their predecessors.57 In attributing the crisis that brought down the Liberal and Nationalist republics to excessive latitude towards the provinces, Beijing was possibly mistaking the symptoms for the cause of system breakdown. Relaxation of central control came very late in the life of the Republican and Nationalist regimes, in fact long after the onset of regime crisis. In each case, regime collapse was only momentarily preceded by waves of constitutional amendments devolving greater power to the provinces, ﬁrst under the Cao Kun constitution of 1923 and later under Chiang Kaishek’s constitution of 1946.58 Last-minute decentralization of authority marked a desperate attempt to avert a collapse that had been precipitated by excessive central control and insufﬁcient attention to the institutionalization of the local state apparatus. This was a case not of too much latitude to the provinces but of too little latitude too late for the survival of each regime. The historical role of the province in institutionalizing and bureaucratizing the sub-provincial state apparatus has been thrown into relief, once again, by the phenomenon of municipal state sprawl in the reform era. Beijing has tried to accommodate new markets by reclassifying its regions, redrafting administrative boundaries, and devolving authority to sub-provincial levels of administration. These initiatives have done little, however, to differentiate the state from newly emerging elites. To the extent that it resembles earlier processes of state involution in the Republican era, growing state sprawl at sub-provincial level fails to compensate for any diminution in the reach or capacity of the state apparatus at provincial level. The province is no less important for efﬁcient collection of revenues and effective delivery of services in the face of rapid proliferation of local state and quasi-state agencies. This is simply beyond the capacity of the central state. It is also beyond the scope of markets themselves. If markets need a strong regulatory environment, then they also need provinces with sufﬁcient authority to perform their historical function of overseeing sub-provincial arms of the state.

36 John Fitzgerald

Notes * The author beneﬁted from the help and advice of Feng Chongyi, David Goodman, Hans Hendrischke, Ruth Mostern, Justin Tighe, and participants at the Workshop on China’s Provinces in Reform convened in December 1998. Research toward the paper was completed with the assistance of the Australian Research Council. 1 Hu Gu, Zhongguo lidai jiangyu yu zhengqu [Historical boundaries and administrative territories in China] (Shenyang: Liaoning guji chubanshe, 1995), p. 195. 2 Bo Qingjiu, “Difang zhidu” [The local system], in Lei Feilong (ed.) Zhonghua minguo kaiguo qishinianlai de zhengzhi [Politics in the Republic of China over the seventy years since its creation] (Taipei: Guangwen shuju, 1981), pp. 686–7, 700–1. G. William Skinner (ed.) The City in Late Imperial China (Stanford, CA: Stanford University Press, 1977), p. 18. 3 Hu Gu, Zhongguo lidai, pp. 130–46; Bo Qingjiu, “Difang zhidu”; Skinner, The City, p. 18. 4 Skinner, The City, pp. 218–19. 5 Joseph B. R Whitney, China: Area, Administration, and Nation Building (Chicago: University of Chicago, Department of Geography, Research Paper No. 23, 1970). 6 Skinner, The City, pp. 218–19. 7 World Bank, World Development Report 1997 (Washington DC: The World Bank, 1997). 8 Jia Hao and Wang Mingxia, “Market and state: changing central-local relations in China,” in Jia Hao and Lin Zhimin (eds) Changing Central-Local Relations in China (Boulder, CO: Westview Press, 1994), pp. 35–36. 9 Gilbert Rozman, Urban Networks in Ch’ing China and Tokugawa Japan (Princeton, NJ: Princeton University Press, 1973). For a spirited defense of Rozman’s model as an alternative to that of Skinner see F.W. Mote, “Urban history in later imperial China,” Ming Studies, no. 34 (July 1995), pp. 61–76. 10 Rozman, Urban Networks, p. 63. 11 Rozman, Urban Networks, p. 31. 12 Rozman, Urban Networks, pp. 56, 107. 13 Rozman, Urban Networks, pp. 57–8. 14 Cf. Rozman, Urban Networks, p. 220; Skinner, The City, pp. 341–2. 15 Hu Gu, Zhongguo lidai, pp. 136–42. 16 Hu Gu, Zhongguo lidai, pp. 149–52, 158. 17 Rozman, Urban Networks, p. 57. 18 Skinner, The City, pp. 19–20. 19 Hu Gu, Zhongguo lidai, pp. 150–1, 155–7, 164–5, 173–7; Bo Qingjiu, “Difang zhidu,” pp. 686–7; Whitney, China: Area, pp. 121–4. 20 Dorothy J. Solinger, Regional Government and Political Integration in Southwest China, 1949–1954: A Case Study (Berkeley: University of California Press, 1977). 21 Gao Yan and Pu Shanxin (eds) Zhonghua renmin gongheguo xingzheng quhua shouce [Handbook of the administrative units of the People’s Republic of China] (Beijing: Guangming Daily Press, 1986), pp. 9–11; Whitney, China: Area, pp. 126–9, 168. 22 Hu Gu, Zhongguo lidai; Whitney, China: Area. 23 Whitney, China: Area, p. 166. 24 John Fitzgerald, Awakening China: Politics, Culture and Class in the Nationalist Revolution (Stanford: Stanford University Press, 1996).

The province in history 37 25 Prasenjit Duara, Culture, Power and the State: Rural North China, 1900–1942 (Stanford: Stanford University Press, 1989). 26 Signiﬁcantly, proposals have been put forward in recent times to reduce the size and double the number of provinces in the People’s Republic to the level of the late Nationalist era – that is to around ﬁfty or sixty provinces. Hu Gu, Zhongguo lidai, pp. 193–4. 27 Hu Gu, Zhongguo lidai, p. 174; Bo Qingjiu, “Difang zhidu,” pp. 679–84. 28 Prasenjit Duara, Rescuing History from the Nation: Questioning Narratives of Modern China (Chicago: University of Chicago Press, 1995); Fitzgerald, Awakening China. 29 William L. Tung, The Political Institutions of Modern China (The Hague: Martinus Nijhoff, 1964), pp. 59–85. 30 One limited exception was the Nationalist Constitution of December 1946, which signiﬁed the return of the province as a signiﬁcant political unit after two decades of neglect in Nationalist administrative planning. For an English translation see “The Constitution of the Republic of China” (1946), in Chien Tuan-sheng, The Government and Politics of China, 1912–1949 (Stanford, CA: Stanford University Press, 1950), pp. 447–64. 31 Sun Yatsen, Guomin zhengfu jianguo dagang [Fundamentals of national reconstruction for the Nationalist Government]. In Guofu quanji (Complete works of the father of the country) (Taipei: Dangshi shiliao bianzuan weiyuanhui, 1973), 6 vols, vol. 1, p. 752. English translation in Chien Tuan-sheng, The Government and Politics of China, p. 463. 32 Bo Qingjiu, “Difang zhidu,” pp. 688–9. 33 Bo Qingjiu, “Difang zhidu,” pp. 686, 696–9. 34 Bo Qingjiu, “Difang zhidu,” pp. 689–90. 35 Chien Tuan-sheng, The Government and Politics of China, pp. 447–64. 36 Sara L. Friedman, “Civilising the masses: the productive power of cultural reform efforts in Late Republican Era Fujian,” in Terry Bodenhorn (ed.) Deﬁning Modernity? Guomindang Rhetorics of a New China, 1920–1970 (Ann Arbor: Center for Chinese Studies of the University of Michigan, 2002). 37 Lloyd E. Eastman, The Abortive Revolution: China under Nationalist Rule (Cambridge, MA: Harvard University Press, 1974). 38 Many of the administrative reforms undertaken by warlord governments were similar to those introduced by the central government in areas under Nanjing’s control. Provincial and national governments both sought to differentiate and centralize state institutions in order to extend the reach of their state apparatus to county, ward and village government. See James E. Sheridan, Chinese Warlord: The Career of Feng Yu-hsiang (Stanford, CA: Stanford University Press, 1966); Donald G. Gillin, Warlord: Yen Hsi-shan in Shansi Province, 1911–1949 (Princeton, NJ: Princeton University Press, 1967); Eugene William Levich, The Kwangsi Way in Kuomintang China (Armonk: M. E. Sharpe, 1993); John Fitzgerald, “Warlords, bullies and state-building in Nationalist China: the Guangdong co-operative movement, 1932–1936,” Modern China, vol. 23, no. 4 (October 1997), pp. 398–436. 39 Shaun Breslin, China in the 1980s: Center–Province Relations in a Reforming Socialist State (New York: St. Martin’s Press, 1996); Dali Yang, Beyond Beijing: Liberalization and the Regions in China (London and NY: Routledge, 1997). 40 With the exception of a brief period in the early 1970s, when the prefecture was removed from direct provincial government jurisdiction and placed under a

38 John Fitzgerald

41

42

43

44 45 46

47 48 49 50 51 52

53

horizontal-area Prefectural Revolutionary Committee (diqu geming weiyuanhui). Hu Gu, Zhongguo lidai, p. 179. Jonathan Unger, “The struggle to dictate China’s administration: branches vs. areas vs. reform,” The Australian Journal of Chinese Affairs, no. 18 (July 1987), pp. 15–45; Kam Wing Chan, Cities With Invisible Walls: Reinterpreting Urbanization in Post-1949 China (Hong Kong: Oxford University Press, 1994), pp. 104–5; Chung Him and Tang Wing-shing, “Regionalism under Deng: localism centred around cities and towns,” unpublished paper presented to the 5th National Conference of the Chinese Studies Association of Australia, University of Adelaide, July 1997, pp. 6–7 Barry Naughton, “Cities in the Chinese economic system: changing roles and conditions for autonomy,” in Deborah S. Davis, Richard Kraus, Barry Naughton and Elizabeth J. Perry (eds) Urban Spaces in Contemporary China: The Potential for Autonomy and Community in Post-Mao China (Washington DC and New York: Woodrow Wilson Center Press and Cambridge University Press, 1995), pp. 77–82. Leslie H. Dingyan Chen, Chen Jiongming and the Federalist Movement: Regional Leadership and Nation Building in Early Republican China (Ann Arbor: University of Michigan Center for Chinese Studies, 1999), Chapter ﬁve, passim. Hu Gu, Zhongguo lidai, pp. 174–8. Chan, Cities With Invisible Walls, pp. 20–1; Chung and Tang, “Regionalism under Deng,” p. 3. Chan, Cities With Invisible Walls, p. 26; Chung and Tang, “Regionalism under Deng,” Table 1, “Bureau Releases Statistics on Urbanization,” Beijing Xinhua, English, 28 Aug 1997, FBIS-CHI-97–240. Hu Gu, Zhongguo lidai, p. 179. John Fitzgerald, “Autonomy and growth in China: county experience in Guangdong Province,” Journal of Contemporary China, vol. 5, no. 11 (1996), pp. 7–22. Chung and Tang, “Regionalism under Deng,” p. 7. Whitney, China: Area, pp. 142–3. Unger, “The struggle to dictate China’s administration.” The Anhui Provincial Government seized on the strategy to promote its own plans for urban regional development in the Wan Jiang area. In his Annual Work Report for 1996, Provincial Governor Hui Liangyu highlighted the provincial government strategy for “developing Wan Jiang as Anhui’s answer to Pudong,” and noted the success the Wan Jiang strategy had achieved in “opening up the whole province.” Governor Hui also observed that over 20 percent of the province’s population was now registered as urban, and that his government aimed to achieve a target of 35 percent urban registrations by the year 2000. This target was to be achieved by “rationally distributing urban complexes, with big and medium-sized cities and small towns supporting each other” – on a pattern of urban development characterized by administrative creep. Hui Liangyu, “Report on the Outline for the Ninth Five-Year Plan for National Economic and Social Development and the Long-Term Targets Through the Year 2010 for Anhui Province – Speech to the Fourth Session of the Eighth People’s Congress on 4 February 1996,” Anhui ribao, 12 February, FBIS-CHI-96–164. David Zweig, “Urbanizing rural China: bureaucratic authority and local autonomy,” in Kenneth Lieberthal and David M. Lampton (eds) Bureaucracy, Politics and Decision Making in Post-Mao China (Berkeley and Los Angeles: University of California Press, 1994), pp. 334–64.

The province in history 39 54 See, for example, Shai Oyster, “Taking China’s elections to the next level,” Christian Science Monitor (3 March 2001). 55 Vivienne Shue, “State sprawl: the regulatory state and social life in a small Chinese city,” in Davis, Kraus, Naughton and Perry (eds) Urban Spaces in Contemporary China, pp. 90–112; Deborah S. Davis, “Introduction,” ibid., pp. 15–16; Vivienne Shue and Mark Blecher, Tethered Deer: Government and Economy in a North China City (Stanford: Stanford University Press, 1996); cf. Duara, Culture, Power and the State. 56 Hu Gu, Zhongguo lidai, pp. 193–4. 57 Breslin, China in the 1980s, p. 3. 58 Chien Tuan-sheng, The Government and Politics of China.

40 authors name

Chapter Title

3

41

New Chongqing Opportunities and challenges Lijian Hong

Introduction On 14 March 1997, the Eighth National People’s Congress approved a motion to separate Chongqing City from Sichuan Province and to elevate Chongqing from a sub-provincial to a centrally administered city (zhixia shi). This decision added Chongqing to China’s thirty-one provinces, autonomous regions and centrally administered cities. On 18 June, two weeks before Hong Kong was returned to China, Premier Li Peng visited Chongqing to announce the ofﬁcial change of status of Chongqing City. In more ways than one, Chongqing is unique among China’s inland cities. It was the ﬁrst treaty port opened to the Great Powers in south-west China. It was the wartime capital of Nationalist China. It was also a centrally administrated city during the war against Japan and over the early years of Communist rule, and it has been granted separate-planning status on three separate occasions since the 1950s. More recently, it was the ﬁrst city in postMao China to conduct a comprehensive program of urban industrial reform. Today, it is the ﬁrst and only provincial-level city in China’s remote western region, and it remains China’s largest industrial city on the upper reaches of the Yangtze River. The administrative area under the new city government has also expanded immensely. The three regions of Wanxian City, Fuling City and Qianjiang Prefecture were merged in the new Chongqing, almost quadrupling the area of the old city and expanding its population seven-fold to 30 million. Within China today, the city presents a curious anomaly: it is larger in area than two of China’s provinces (Hainan and Ningxia) and its population exceeds that of eight other provinces. A global comparison is equally revealing. Chongqing occupies an area similar to that of Austria and houses a population almost four times that of the European state. The city’s new status is recognized in a variety of ways, some prominent and others more subtle. Many new buildings funded by Hong Kong interests which have sprung up around the city center now overshadow the revolutionary landmark of the old city, Liberation Tower. Diplomatic commissions and foreign companies have set up ofﬁces in the city. Domestic companies

42 authors name

Chongqing City

General GDP (billion yuan renminbi [RMB]) 147.97 GDP annual growth rate 7.60 as % national average 100.00 GDP per capita (yuan RMB) 4,826.00 as % national average 73.86 Population Population (million) Natural growth rate (per 1,000) Workforce Total workforce (million) Employment by activity (%) primary industry secondary industry tertiary industry Employment by sector (%) urban rural Employment by ownership (%) state collective private self-employed individuals Wages and Income Average annual wage (yuan RMB)

30.75 4.96 16.39 58.50 15.20 26.30 18.09 81.92 9.67 2.17 2.63 6.56 7,182.00

Growth rate in real wage 12.40 Urban disposable income per capita 5,895.97 as % national average 100.72 Rural per capita income 1,736.63 as % national average 78.57 Prices CPI [Consumer Price Index] annual rise (%) Retail Price Index annual rise

-0.70 -3.50

Foreign Trade and Investment Total foreign trade (US$ billion) Exports (US$ billion) Imports (US$ billion) Realised foreign capital (US$ billion)

1.21 0.49 0.72 0.24

Education University enrollments 96,569 Secondary school enrollments (million) 1.28 Primary school enrollments (million) 2.80 Notes: All statistics are for 1999 and all growth rates are for 1999 over 1998 and are adapted from Zhongguo Tongji Nianjian 2000 [Statistical Yearbook of China 2000], Zhongguo Tongji Chubanshe, Beijing, 2000.

New Chongqing 43 based outside Sichuan have raised their proﬁle in the region by purchasing declining local state-owned enterprises (SOEs). And local residents, many of whom no longer consider themselves Sichuanese, are urged to speak Mandarin rather than their Sichuan dialect. Many, too, are gratiﬁed to see their city listed alongside the other centrally-administered cities of Beijing, Tianjin and Shanghai on the daily weather broadcasts of China Central Television (CCTV). Needless to say, the decision to upgrade the city to provincial-level status was not taken with a view to gratifying local chauvinism. Why was Sichuan sub-divided at all? Clearly not on grounds of cultural, social or economic differentation. There are many provinces in China where cultural, social, economic, historical and linguistic differentiation is greater within the province than between the province and its neighbors. Sichuan is not among them. The differences between southern and northern Jiangsu, for example, or between the mountainous regions and the plains of Zhejiang, Fujian and Guangdong, exceed anything to be found in Sichuan. Further, Chongqing has been an integral part of the province since ancient times. While its terrain certainly isolated the Sichuan Basin (known as the Red Basin) from the rest of China, within its own region the same terrain facilitated serviceable internal communications and fostered the growth of common cultural and social networks. The area around Chongqing and the provincial capital, Chengdu, can be considered an integrated cultural and economic region. What was the aim of the central government in severing Sichuan in two? Further, if Sichuan was for some reason to be divided, why was one of the two new territorial units assigned the status of a centrally administered city rather than that of a province? As noted, the new city presents an anomaly in China’s current system of territorial administration: it walks like a province, it quacks like a province, but it is branded a city. The central government has offered three reasons justifying its decision to divide the administrative territory of Sichuan. First, as China shifts the focus of its economic development strategy from the coastal to central and western regions, Beijing hopes that the industrial bases of Chongqing will come to play a key role in “propelling the economic growth of the entire south-west China region and the upper reaches of the Yangtze.” This role would be difﬁcult to play without local authorities enjoying signiﬁcant regional autonomy. Second, with the building of the world’s largest dam on the Yangtze, successful relocation of over a million residents from the planned reservoir area is a key to the entire Three Gorges Project. The center believes that “the elevation of Chongqing to the level of a centrally administered city will be helpful for the Three Gorges Project and its relocation scheme.” Third, as Sichuan is one of the most important provincial-level administrative units in China’s west, the division of the province would, the center claimed, “ease the pressure on the Sichuan provincial government in managing its over-sized population and area.”1

44 Lijian Hong In his address to the City Party Congress, Zhang Deling, secretary of the Chongqing Municipal Party Committee, conﬁrmed the center’s explanation but added that the new city would “explore a new path of using a large city to foster economic growth over a vast rural area and to promote the mutual development and common prosperity of both urban and rural areas.” At the same time, the party secretary warned that to complete these strategic tasks “we must resolve four difﬁcult problems: resettling one million migrants, helping a rural population of 3.66 million people to rise above the poverty level over the period of the Ninth Five-Year Plan, and revitalizing the old industrial base while solving the problem of environmental pollution.”2 The party secretary may have highlighted these difﬁculties to bargain for a better deal with the center. Still, the problems he listed are real ones. The central and local leadership both hope that the separation of Chongqing and the elevation of its status will give the city the capacity to solve these problems and realize its anticipated economic take-off in years to come. The Chinese government has failed to offer a formal explanation for the second question: why a new city rather than a new province? Nor has the issue been openly discussed. Nevertheless, some hint of Beijing’s reasoning can be gleaned from a number of factors that have inﬂuenced Chongqing’s position over the past half century. One is the historical status of the city. Since the 1940s, Chongqing has twice been upgraded to a centrally administered city. Indeed, as Nationalist China’s wartime capital in the 1940s, it was better known as a national capital than as an outlying provincial city. If a new province were to be created incorporating the city, it could not easily bear the name of Chongqing Province. More importantly, establishing a new province would have entailed creating many more layers of bureaucratic government than those required for a new city, with an associated inﬂation in the number of local party and government functionaries. This would have militated against the central government’s concurrent efforts to rationalize and downsize the national system of territorial administration. Third, the existing centrally administered cities of Beijing, Tianjin and Shanghai, and other regions that have enjoyed preferential policy treatment, are all located along the east coast of China. Given the center’s declared intention of shifting the focus of its development strategy to the inland regions, Chongqing may have appeared a suitable location to serve as a regional focus for implementing the new national development strategy over the decades ahead. Fourth, Chongqing has enjoyed preferential policies associated with the status of a separate planning city since the early 1980s. The extension of these preferential policies might have been placed at risk, were Chongqing to be relegated to a merely provincial capital of a new province. It seems Beijing was confronted with a choice between downgrading the city’s existing status (as a separate planning city) by nominating it as a new provincial capital or, alternatively, creating conditions under which the city would retain its existing central privileges within a new province that was otherwise denied

New Chongqing 45 Table 3.1 Major economic indicators of Chongqing before and after separation

Area (km2) Population (mn) GDP (¥bn) GVIO (¥bn) GVAO (¥bn) Actual foreign investment (US$mn)

Before

After

% Increase

23,114 4.06 74.26 95.23 23.87 527.56

82,368 30.01 101.04 119.03 40.63 544.58

256.36 639.16 36.06 24.99 70.21 3.23

Source: Chongqing Statistical Yearbook 1996, pp. 407, 408, 409, 412 (1995 ﬁgures).

Table 3.2 Major economic indicators of the four centrally administered cities Beijing Population (mn) 12.2 (3) % non-rural population 59 (2) Total area (10,000 km2) 1.68 (2) GDP (¥bn) 181 (2) Per capita GDP (¥)* 16,735 (2) GVIO (¥bn) 196.4 (3) GVAO (¥bn) 17.1 (3) Fixed asset investment (¥bn) 96.1 (2) Export (US$ bn) 2.5 (3) Actual foreign investment (US$ bn) 1.6 (3) Total retail sale (¥bn) 105.2 (2) Average income of urban employee (¥) 7,813 (2) Average income of rural household (¥) 3,762 (2) Local revenue (¥bn) 18.2 (2) Tertiary institutes 65 (1)

Tianjin 9.0 (4) 58 (3) 1.19 (3) 124 (4) 13,796 (3) 283.8 (2) 14.9 (4) 49.9 (3) 13.1 (2) 3.4 (2) 53.5 (3) 6,609 (3) 3,548 (3) 9.0 (3) 21 (3)

Shanghai Chongqing 13.1 (2) 72 (1) 0.63 (4) 336 (1) 25,750 (1) 560.6 (1) 21.1 (2) 200.3 (1) 33.5 (1) 6.3 (1) 132.5 (1) 8,439 (1) 5,277 (1) 35.2 (1) 45 (2)

30.4 (1) 20 (4) 8.24 (1) 135 (3) 4,452 (4) 128.5 (4) 44.5 (1) 37.1 (4) 0.8 (4) 0.9 (4) 50.8 (4) 5,323 (4) 1,643 (4) 7.4 (4) 21 (3)

Source: Chongqing Statistical Yearbook 1998, pp. 385–94 (1997 ﬁgures). * Per capita GDP ﬁgures are drawn from: Beijing Statistical Yearbook 1998, p. 54, Tianjin Statistical Yearbook 1998, p. 98, Shanghai Statistical Yearbook 1998, p. 21, Chongqing Statistical Yearbook 1998, p. 35.

them. This would have replicated, on a smaller scale, the range of tensions that had bedeviled Chongqing’s relations with Sichuan Province over preceding decades – tensions that were at that moment informing the decision to split the province in two. Needless to say, administrative separation and autonomy offer no solution in themselves. After Hainan was separated from Guangdong Province in 1988, for example, it came under closer central supervision and lost much of its local dynamism and economic momentum. Similarly, in the case of Chongqing there is some doubt that separation and upgrading will necessarily improve Chongqing’s economic performance.3 Such doubts are not groundless. Whether the new city is able to perform the tasks assigned by the center depends to a considerable degree on whether Chongqing is able to

46 Lijian Hong resolve problems of, and on, its own. The accompanying tables (Tables 3.1 and 3.2) show that although Chongqing has grown considerably in area and population, and in the total value of production, it remains the least industrialized and poorest of China’s four centrally-administered cities. Chongqing’s poor economic performance over recent decades offers little ground for complacency. It has continually lagged behind other cities whose industrial base was historically much weaker. Sichuan’s provincial capital of Chengdu, for example, was a city with little modern industry when the Communists seized control of the region in 1949. In 1952, Chengdu’s GVIO was roughly one-eighth that of Chongqing. By 1978, however, the GVIO of Chengdu had grown to about half that of Chongqing. The introduction of market reforms from that year did little to improve Chongqing’s performance. By 1995, the GVIO of Chengdu had grown to exceed that of Chongqing by ¥18.2 billion.4 The development of Chengdu was particularly impressive given that it enjoyed fewer preferential policies than Chongqing over the period in question.5 Chongqing is now expected to develop, as a centrally administered city, from a very low baseline. The question facing the new city administration is whether the factors that retarded its growth in the past are likely to persist despite its elevation to provincial-level status. To answer this question, we need to identify the factors that retarded its relative rate of growth, and to judge whether the city’s new status offers sufﬁcient compensating factors to overcome them.

Chongqing in space and time Geography, resources and uneven development Chongqing has often been referred to as Shancheng (mountainous city) and Wudu (fog capital), apt descriptors for the geography and climate of the urban hub. The city was built on a hilly promontory. Two famous rivers, the Yangtze from the west and the Jialing from the north, join at the foot of the mountainous city. The newly enlarged city is bounded on the east and southeast by western Hubei and north-western Hunan. To the south stands the high plateau of Guizhou. On its northern border lies the southern part of Shaanxi. From north to west, the city shares common borders with Sichuan Province. The Yangtze River runs through the entire area from the southwest to the north-east before turning east into the Three Gorges. The topography of Chongqing traces the geographic depression of an inland region. With the exception of the western part of the city, and a few narrow strips along particular sections of its major rivers, the eastern region of Chongqing consists of mountain ranges and high plateau country. The climate varies between these regions. Generally speaking, the Qinling Mountains to the north ensure that winters are usually brief and warm, with rare frosts and snows. Heavy fog characterizes all cities on the middle

New Chongqing 47 Yangtze, from October to April, affecting inland navigation, aviation, and local road transport. Like other cities along the Yangtze, Chongqing’s summers are very hot and humid – Chongqing is one of the famous “Yangtze furnaces.”6 Heavy storms and serious droughts have brought seasonal destruction of life and property in the eastern part of the city, especially in the vicinity of Wanxian.7 Chongqing is the most resource-rich of China’s four centrally administered cities. Its natural gas deposits rank among the largest in the country, and coal deposits rank among the ﬁfteen key coalﬁelds in China.8 Other minerals and resources of national signiﬁcance include barium deposits in Wanxian (second-largest in the country), strontium deposits in Chongqing (half the national total), manganese in Wanxian and Qianjiang (over 50 percent of Sichuan), rock salt deposits in Wanxian (second largest in the province) and tong oil production in Wanxian (number one in China, accounting for a quarter of national exports). There are also signiﬁcant mercury deposits in Qianjiang. Chongqing’s most valuable resource is hydropower: with a calculated potential of 6.78 million kilowatts, Chongqing ranks ﬁrst among major cities in the country. After more than 50 years of industrialization, the urban center of Chongqing has a solid foundation of “traditional” (state-led) industrial develoment. Its strength in engineering industry until recently sustained a leading position for the city in automobile manufacturing. Locally produced motorcycles dominate the national market and placed the city fourth in the world in 1995.9 Other industries in which Chongqing occupies a leading position include conventional weapons production, electronics, steel-making, aluminium production, chemical products, textiles and food-processing.10 With its strong industrial foundation and its position as the largest inland river port in south-west China, the city occupies a key position as one of the largest trade centers on the upper reaches of the Yangtze. Nevertheless, economic development in the new city is extremely uneven and has been affected by the changing government strategies over the past four decades. Generally speaking, the western part of the new city has been one of the most industrialized areas in China since the 1940s, while the eastern part was one of the poorest and least industrialized regions, not only in the south-west but in the country as a whole. After 1949, industrial development in the recently incorporated eastern region was partly affected by geographic remoteness and poor communications, and partly by lingering uncertainty about the Three Gorges Project, which led to little investment in the planned reservoir area. According to Chinese sources, the total state investment in Wanxian from 1950 to 1984 was limited to ¥0.61 billion. In 1980, 1985 and 1990, investment in ﬁxed assets in the three areas of Wanxian, Fuling and Qianjiang accounted for only 4.4 percent, 5.8 percent and 7.8 percent respectively of the provincial total.11 Agricultural production remains the most important local industry and the main source of local revenue. In the least developed area of Qianjiang, a densely populated area

48 Lijian Hong that is home to a variety of ethnic minorities, there was virtually no modern industry or electricity for almost four decades after 1949.12 Although local natural gas extraction ranked ﬁrst in the country, the industry and the revenues that it generated were tightly controlled by the central government. Only after 1980 were local governments allowed to drill gas wells of their own.13 Chongqing in history From its earliest years, the prosperity and signiﬁcance of Chongqing have been closely related to political and economic developments at the provincial and national level. The city and its surrounding area were home to the ancient kingdom of Ba. The strategic importance of Ba and its western neighbour Shu (centered on today’s Chengdu) was recognized before the Qin uniﬁed China more than two thousand years ago: “Those who control Ba and Shu will rule the world.”14 The ﬁrst emperor of China, Qin Sihuang, occupied the two kingdoms en route to unifying the ﬁrst empire. Since then Ba and Shu have been uniﬁed as a single province, comparable to today’s Sichuan, or incorporated into the imperial administrative system as two prefectures. In 1189, during the Song Dynasty, the third son of the emperor was granted the title of Prince of Gong, and enfeoffed in a prefecture with Chongqing as its capital. In the same year, the prince was enthroned as Emperor Guangzhong of the Southern Song. To celebrate this double event, the city was given the name Chong Qing, meaning double celebrations, a name it has retained to this day.15 Its favorable climate and rich soil made ancient Sichuan an ideal place for agricultural production. As early as the Han Dynasty, Chengdu and western Sichuan came to replace southern Shaanxi as the “country’s granary.” At this point, it also became known as the “heavenly kingdom.” To the east, Chongqing, on the Yangtze River, developed as a trade center linking the south-west to the rest of China. In modern times, however, the geographical isolation that formerly protected Sichuan from the political unrest and social upheavals of central China became an obstacle to local modernization. The process of industrialization started in Chongqing, the least isolated part of the province, which was forced to open to the imperialist powers in 1891 under a treaty between the Chinese and British governments. As modern industry developed so did local nationalism. Mass protests against British control of riverine transport on the Yangtze, violent clashes with French missionaries in the countryside, and strong anti-Japanese movements in the city, all demonstrated the anxieties of an inland city where opportunity blended with uncertainty. Still the process of modernization moved inexorably forward. By the time the Revolution broke out in 1911, the city contained ﬁfty-three modern factories – 45 percent of the provincial total and more than seven times the level in the provincial capital of Chengdu. Chongqing replaced Chengdu as the

New Chongqing 49 economic and trade centre of Sichuan and south-west China.16 But local comparisons can be misleading: both had fallen well behind developments in other parts of China. By the outbreak of war with Japan in July 1937, Chongqing was home to less than 2 percent of the national total of modern industrial enterprises. The remoteness and inaccessibility of the province hindered rapid modernization over the ﬁrst four decades of this century. This changed following the Japanese invasion of northern and eastern China, when the Nationalist Government ﬂed west along the Yangtze from Nanjing to Chongqing. In September 1940, the city was administratively separated from Sichuan and made the wartime national capital of China. Chongqing developed rapidly under the war economy. A great number of coastal industries moved west to Sichuan, the majority re-establishing themselves in the city of Chongqing. By 1940, 448 factories were relocated to Chongqing, more than 90 percent of all factories transferred to Sichuan.17 In the years that followed, Chongqing quickly ascended to a leading position in China’s modern military, chemical, metallurgical, engineering and power industries, propelling it to a position second only to Japanese-occupied Shanghai.18 The end of the war burst Chongqing’s economic bubble. Much of the city’s wartime industry followed the Nationalist Government back to the coastal cities. By 1947, almost half the factories that had once moved inland had left Chongqing, and 90 percent of the city’s engineering industries had ceased operation.19 The precipitate decline of the local economy left a heritage of strong anti-Nationalist sentiment in some quarters, to some extent facilitating the transition to Communist rule in 1949. Mao-era Chongqing Under the Communists, Chongqing recovered some of the political and economic position it had won during the war. For the ﬁrst ﬁve years it was directly administered by a greater regional or central government before being downgraded to a sub-provincial city in 1954. Under the economic planning system, however, the city remained under central government management more often than under provincial management: it was centrally managed for over 25 years from 1950–58, 1963–68 and 1984–97. Hence, although Chongqing was classiﬁed as a sub-provincial city, under the administrative jurisdiction of Sichuan Province, it was economically independent from the provincial government for most of the period between 1949 and its severance from the province in 1997. The early pattern of Communist occupation of Sichuan also left its traces on relations between the city and its home province. Sichuan was liberated by two People’s Liberation Army units in 1949: the Second Field Army, led by two native Sichuanese, Marshal Liu Bocheng and Deng Xiaoping, and the 18th Corps of the First Field Army, led by Marshal He Long. The main force, the Second Field Army, conquered the province from east and south

50 Lijian Hong while the First Field Army attacked from the north. Soon after Sichuan was liberated, the province was divided into four sub-provincial units under the two military forces, with the Second Field Army administering southern and eastern Sichuan (including Chongqing) and the 18th Corps controlling western and northern Sichuan. Chongqing’s position as a centrally administered city was initially preserved, due to its special position as the wartime capital of the Nationalist Government and its prominent place in China’s defense industry. Important regional party, government and military headquarters were located in the city, including the South-west Regional Bureau of the Central Party Committee, the South-west Military-Administrative Committee and the headquarters of the South-west Military Region. It then served as the effective capital of the entire south-west region, covering the four sub-provincial governments of Sichuan, and the provinces of Xikang, Yunnan, Guizhou and (in time) Tibet. Senior ofﬁcers of the Second Field Army assumed leading positions in Chongqing and south-west regional party and government institutions. The political situation changed when Deng Xiaoping, Liu Bocheng and other commanders of the Second Field Army left Sichuan for positions at the center. Once the four sub-provincial units were reorganized into the province of Sichuan, in 1952, Marshal He Long of the First Field Army succeeded to leading positions in regional party, government and military institutions vacated by Deng Xiaoping and Liu Bocheng. He Long then acquired the colloquial title of “King of the South-west.” Li Jingquan, He’s political commissar and the former leader of Western Sichuan and Chengdu, was appointed head of the new province.20 Still the Second Field Army retained control of Chongqing, which was for a time preserved as a centrally administered city. In 1954, however, when all greater regional governments were dissolved, Chongqing was returned to Sichuan and downgraded to a sub-provincial city. Despite its administrative demotion, Chongqing retained special political representation at the central level. As if to highlight Chongqing’s priority over the provincial capital of Chengdu, the party secretary and mayor of Chongqing, Yan Hongyan, was the only sub-provincial city leader from Sichuan elected as an alternate member to the Eighth Party Congress.21 The situation proved temporary. During the Great Leap Forward, the political zeal of Provincial Party Secretary Li Jingquan earned him membership of the Political Bureau of the Central Party Committee – one of only three local party ofﬁcials listed among the twenty-three top leaders in the country.22 Li’s elevation signaled a victory for the First Field Army over the Second Field Army in the local politics of Sichuan, and hence of the Second Field Army’s provincial government over the First Army’s ﬁefdom in the city of Chongqing. During Li Jingquan’s 17-year reign in Sichuan, no party or government leader from Chongqing was promoted to a top position in the provincial leadership.23 This situation persisted until after the Cultural Revolution when local leaders from Chongqing, including Lu Dadong, Jiang

New Chongqing 51 Minkuan and Xiao Yang, were appointed governors or party secretaries of Sichuan Province. Economically, we noted, Chongqing retained relative autonomy from Sichuan from the 1950s. Initially, when Chongqing was administratively downgraded to a prefectural-level city in 1954, it also surrendered its economic status as a separate-planning city and as a provincial-level economic budgetary unit within the national planning system.24 In the early 1960s, in an effort to cope with the disastrous consequences of the Great Leap Forward, the central government once again granted Chongqing the status of separateplanning city, theoretically conferring economic and ﬁnancial authority equivalent to that of the Sichuan provincial government. As the city was responsible directly to the central government, it could secure raw material supplies from the national pool and distribute its end products nationally. City leaders were entitled to attend national economic planning meetings alongside other provincial leaders, enabling them to participate in decisionmaking processes at the national level to plan for the recovery of the national economy from the Great Leap Forward.25 A second factor behind this decision was Chongqing’s key position in China’s national defense industry and regional industrialization. On the ﬁrst occasion in which Chongqing was directly managed by the center, China was engaged in war in Korea. Supplying army units in Korea required accelerated production in local military factories. Again, when Chongqing was placed under the central government’s economic administration in the 1960s, one of the aims was to rebuild the damaged economy of the region in preparation for a possible “People’s War.” Chongqing’s defense industry was directly monitored by the central government as part of its broad strategy to develop an industrial “Third Front” in inland regions. From 1966 to 1978, Beijing invested over ﬁve billion yuan in Chongqing – twice the value of investment in the provincial capital of Chengdu – and relocated many defense-related enterprises from the coastal regions to Chongqing on a model that replicated the pattern of the Nationalist Government during the Japanese war.26 Third, central management of Chongqing’s economic development was intended to compensate for the province’s inability to sustain the city’s industrial development. Sichuan was overwhelmingly an agricultural province, with a huge rural population and a limited capacity to supply the surplus of grain and raw materials that Chongqing required. This problem ﬁrst surfaced after Chongqing was downgraded to a sub-provincial city during the Great Leap Forward. The provincial government set an output target of ¥769.29 million for Chongqing industry, but could only supply materials sufﬁcient to meet 47.4 percent of the city’s requirements. In consequence, Chongqing was able to produce little over half of the target set by the province (¥396.82 million).27 Relative autonomy under the central plan did not, however, entail administrative autonomy for the city. Chongqing remained accountable to the

52 Lijian Hong province, which was initially dependent on its continuing industrial development. Throughout the 1950s, the city accounted for over half the total value of provincial industrial output.28 Further, the output value of Chongqing industry surpassed that of agriculture in 1958, a feat which took the province another 12 years to match.29 Were Chongqing to be completely excised from Sichuan, at this early stage, provincial revenues would have suffered and regional economic development would have been retarded, delaying the industrialization process of the inland provinces and slowing down the center’s efforts to achieve balanced economic growth among the coastal and inland regions. The city’s ambiguous status signaled a tenuous political compromise: Chongqing remained under provincial political administration but under central economic management.

Chongqing in the reform era: success and frustration Initial success Although a key regional centre of radical activity in the Cultural Revolution, Chongqing was also one of the pioneers of urban reform once the “10 years of chaos” drew to a close. The two events are related: when Cultural Revolution activists terrorized Chongqing they also destroyed the established power base of the Sichuan provincial faction under Li Jingquan. The new reform-minded provincial leader appointed in his place, Zhao Ziyang, acknowledged few of the loyalties that had hindered relations between the city and the province over preceding decades. The advantages for Chongqing were obvious: for the ﬁrst time in local history the city supplied two provincial governors and one provincial party secretary to the provincial administration. The city’s status as a separate-planning city was restored, for the third time, and its administrative status was elevated to that of deputyprovincial-level city, placing it on a more equal footing in its dealings with the province. Further, the Municipal People’s Congress was granted legislative authority to adopt laws and regulations for the city. As a separate-planning city, Chongqing once again recovered authority over its economic management to a degree matched by the province itself. This time, however, the city was responsible for an expanded range of economic activities, including industrial and agricultural production, transportation and communication, ﬁxed asset investment, commodity purchases and sales, energy and materials distribution, foreign trade, and local ﬁnance, among other activities.30 Local leaders were granted sufﬁcient authority to handle problems in local industry inherited from the Cultural Revolution regime and others created in the process of reform itself. Under Zhao Ziyang, the provincial authorities encouraged the city leadership to experiment with industrial reform. Chongqing then pioneered some of the earliest industrial and enterprise reforms of the post-Mao era.

New Chongqing 53 Encouraged by the success of rural reforms, Zhao Zhiyang selected several enterprises in Chongqing to serve as an “experimental base” for testing comprehensive management reform.31 One new policy introduced material incentives for workers (a practice earlier denounced as “capitalist”) and permitted state-owned enterprises (SOEs) to retain a proportion of surplus to cover bonuses for enterprising workers and to invest in expanding their production capacity beyond the limits of the state plan. They were then encouraged to market their products openly once state quotas had been met. The new policy gave enterprises the right to deal with foreign companies and to reserve part of their foreign-exchange earnings for importing new technology, raw materials, advanced equipment and other inputs for improving production. The new policy also empowered factory managers to penalize workers who failed to support the expanded production effort.32 In 1980, a more radical policy was adopted in several SOEs, allowing enterprises to “manage themselves independently, pay taxes rather than proﬁts to the state, and assume full responsibility for proﬁts and losses.”33 This early “Chongqing experience” was subsequently extended nationally, through education, training and media campaigns.34 In the aggregate, the results of Zhao Ziyang’s reforms were impressive. From 1978 to 1995, Chongqing’s GDP increased almost ﬁfteen-fold. GVIO increased 945 percent compared with an increase of 164 percent in GVAO. Fixed assets investment grew 2,280 percent from the Fifth Five-Year Plan to the Eighth Five-Year Plan, and foreign trade increased 718 percent over the decade from 1985 to 1995. The same period also saw a 107 percent increase in local revenue.35 Their effectiveness and efﬁciency has, however, been questioned. After investigating one of Zhao Ziyang’s experimental factories in Chongqing, the state-owned Chongqing Clock and Watch Factory, Byrd and Tidrick concluded that the ﬁnancial incentive system introduced into the SOEs was: weak and manipulable. Firms could change the rules of the game to their ﬁnancial beneﬁt . . . The amount of retained proﬁts and workers’ bonuses could hold steady or even increase when enterprise performance as measured by total proﬁts deteriorated signiﬁcantly . . . At the extreme, the manipulable environment degenerated into an administered system in which formal rules mean little and each matter is decided on an ad hoc, case-by-case basis. Such a system is probably little better than the pre-reform system.36 To be sure, these problems were not unique to Chongqing. But in so far as the “Chongqing experience” was promoted as a model for others to follow, it would be helpful to compare the performance of Chongqing with a range of other cities that followed it, and that complemented or competed with it.

54 Lijian Hong Chongqing’s performance relative to other cities in the reform era Chongqing’s performance in raising its GDP, GVIO and revenue levels outstripped that of a number of coastal cities at the same echelon level (deputy-provincial level), although by 1995 it still lagged far behind the others per capita. Compared with the two highly developed coastal cities of Shenzhen and Dalian, Chongqing’s per capita GDP was only 21.18 percent that of Shenzen and 40.8 percent that of Dalian. It was even further behind in per capita local revenue, generating 8.8 percent of that of Shenzhen and 10.2 percent that of Dalian (see Table 3.3). Chongqing also comes off worse in comparison with Wuhan and Nanjing, two other major cities on the Yangtze with which it is expected to cooperate in planning the economic development of the Yangtze delta over the next century. The per capita GDP of Chongqing accounted for 39.38 percent that of Wuhan (¥8,548) and 30.48 percent that of Nanjing. Similarly, the per capita GVIO of Chongqing was only 63.49 percent of that of Wuhan and 32.56 percent of that of Nanjing.37 More signiﬁcantly, even among the western cities that look to Chongqing for regional leadership, the city has fallen behind others in per capita GDP and GVIO (see Table 3.4). In 1996, Party Secretary Zhang Deling noted the discrepancy between the city’s early promise and its failure to live up to the expectations of its initial reforms. “Since 1983, the State has lent immense support for the reform, opening and development of Chongqing. Many particular and comprehensive reform policies were ﬁrst introduced in Chongqing.” The long-term results, however, had been disappointing.

Table 3.3 Major economic indicators of Chongqing and deputy-provincial level coastal cities, 1995 CQ Population (mn) 15.20 GDP (¥bn) 74.30 Per capita GDP (¥) 4,886 GVIO (¥bn) 120.10 Fixed asset invest (¥bn) 20.10 Foreign trade (¥bn) 0.50 Local revenue (¥bn) 3.40 Per capita (¥) 226 Net income for rural 1,554 Household (¥)

GZ

SZ

XM

NB

QD

DL

6.47 125.30 19,362 173.50 61.80 18.90 9.70 1,500 3,779

3.45 79.60 23,064 122.60 27.60 18.20 8.80 2,554 4,517

1.21 25.00 20,678 40.10 13.30 4.70 2.20 1,788 2,665

5.26 63.90 12,138 147.50 26.40 2.90 2.50 471 3,350

6.85 65.00 9,489 94.10 21.4 6.00 2.90 431 2,225

5.35 64.00 11,963 124.00 23.00 6.80 4.20 802 2,438

Source: Chongqing Statistical Yearbook 1996, pp. 399–402, Chengdu Statistical Yearbook 1996, pp. 269–71. Note: There are four special economic zones, and fourteen designated coastal cities, only six of which were granted deputy-provincial level status: Guangzhou (GZ), Shenzhen (SZ), Xiamen (XM), Ningbo (NB), Qingdao (QD) and Dalian (DL).

15.12 54.32 3,593 94.92 6,278 16.46 2.10 453 1010

9.60 55.83 5,816 102.63 10,691 12.79 1.40 236 1367

CD 1.66 9.90 5,964 13.77 8,295 0.90 0.50 31 133

GY 3.70 26.81 7,246 35.21 9,516 3.60 0.70 70 1281

KM 6.39 28.98 4,535 38.92 6,091 5.65 1.25 194 n/a

XA 2.66 15.59 5,861 28.13 10,575 1.55 1.55 31 1246

LZ 1.07 3.62 3,383 6.90 6,449 0.40 0.36 0.80 526

XN

0.87 4.82 5,540 5.86 6,736 1.08 0.15 48 n/a 125

YC

Source: Chinese Urban Statistical Yearbook 1995, pp. 48–51, 112–15, 128–31, 176–9, 368–71, 384–7. Note: CQ = Chongqing, CD = Chengdu, GY = Guiyang, KM = Kunming, LS = Lasha, XA = Xi’an, LZ = Lanzhou, XN = Xi’ning, YC = Yinchuan, UM = Urumqi.

Population (mn) GDP (¥bn) Per capita GDP (¥) GVIO (¥bn) Per capita GVIO (¥) GVAO (¥bn) Local revenue (¥bn) Actual FDI (US$mn) Foreign trade (US$mn)

CQ

Table 3.4 Major economic indicators of Chongqing and other western cities in China, 1994

1.40 14.05 10,035 14.74 10,529 0.56 1.05 n/a 420

UM

New Chongqing 55

56 Lijian Hong Between 1991 and 1994, the GVAO and GVIO of Chongqing fell from third to ﬁfth place among the fourteen separate-planning cities. In retail sales it fell from second to sixth. Local revenue also fell from second to sixth. The average income of urban employees slipped from tenth to twelfth, and net rural household income fell from twelfth to last.38 Although highlighting the failure of economic reform in Chongqing, the party secretary’s comments hinted at the underlying problems of a model of urban governance that placed the city’s economy under central management while keeping its administration under provincial control. From economic independence to administrative separation The poor economic performance of Chongqing, despite the preferential policies that it enjoyed, required radical solutions. One was to separate the city from the province and place it under the direct control of the central government. As noted, the road leading to eventual separation began in the early 1980s, when the central government granted Chongqing separate-planning city status, restoring the position of the early 1950s and the 1960s. The move was initially rejected by the provincial government, as Chongqing’s advanced industry was a major source of local revenue.39 Only after reaching a revenuesharing settlement with the center would Sichuan accept Chongqing’s economic and ﬁnancial separation. By this agreement, starting in 1984 Chongqing would deliver 50.5 percent of its annual revenues to the central government, transfer 12.5 percent to Sichuan in the form of a central ﬁnancial subsidy, and retain 37 percent for itself.40 At the same time, Beijing was considering the creation of a new province, to be known as Sanxia Province (the Three Gorges Province), with a view to administering the proposed Three Gorges Project. The proposed province was to be made up of ten of the poorest counties in eastern Sichuan and western Hubei. Discussion proceeded as far as establishing a preparatory group to plan the new province under Li Boning (head of the State Council’s Economic Development Ofﬁce for the Three Gorges), Wang Hanzhang (deputy governor of Hubei) and Xin Wen (director of the Sichuan Provincial Planning Committee). Zhao Ziyang is said to have raised with city leaders of Chongqing the possibility of making their city capital of the province. Despite its potential for elevating the city’s national status, the proposal was rejected by the Chongqing leadership on the ground that the city could ill afford to shoulder the burden of so wretched a province.41 The deadlock was momentarily relieved in 1986, when the center’s plan to create a new province was put on hold along with the entire Three Gorges Project. Without the new dam there was no need for a new province. With the revival of enthusiasm to build the Three Gorges Dam, in the early 1990s, the proposal to create a Three Gorges Province was revived as

New Chongqing 57 well. Early in 1992, at the Fifth Session of the Seventh National People’s Congress, He Haoju, leader of the Sichuan delegation to the National People’s Congress and deputy governor of Sichuan, ofﬁcially proposed that a province should be established to strengthen the leadership of the Three Gorges Project and coordinate its implementation.42 Competition among the key players delayed a decision for some years. The center wanted local governments to share the burden and responsibility of the project; Sichuan sought to slough off its poor eastern sector; Chongqing hoped to be separated from Sichuan but was unwilling to acquire a collection of desperately poor counties under any new provincial arrangement; and various local governments in the planned reservoir area sought maximum compensation from Beijing. Little happened for three years: as late as 1995 Sichuan was still counting on income from local industry in Chongqing in planning its Ninth Five-Year Plan.43 At the request of central government, Provincial Party Secretary Xie Shijie and Governor Xiao Yang are said to have submitted a report, in December 1995, which proposed, or agreed, to separate Chongqing from the province.44 According to this proposal a new province was to be set up, with its capital in Chongqing, and its territory comprising the undeveloped eastern Sichuan regions of Dachuan, Nanchong, Wanxian, Fuling and Qianjiang, along with Yichang in Hubei Province. A new Special Economic Zone was to be established in the Three Gorges area.45 The report was approved by the central government in June 1996, although with substantial amendment. First, in place of a province, a new mega-city was to be created under the direct administration of the central government. Second, some of the poorer areas were to be excluded from the new city, which was now deﬁned as including Chongqing, Wanxian, Fuling and Qianjiang, and excluding Dachuan and Nanchong in eastern Sichuan, as well as Yichang in Hubei. Three months later, Chongqing assumed control of these three areas from Sichuan. The decision was taken so swiftly, and so secretly, that there was virtually no time for the local leaders to bargain with the center, nor any opportunity to organize opposition. In fact, to avoid possible opposition the center imposed a news blackout: no newspaper or journal was to report the decision until it had been ratiﬁed by the forthcoming National People’s Congress.46 On 18 June 1997, new Chongqing was ofﬁcially established. Beijing also moved to allay Chongqing’s misgivings about the costs to be borne by the city under the new arrangement. It is believed that, apart from ¥18.5 billion in relocation funds allocated for reconstruction of the inundated areas, the central government also agreed to provide a one-off payment of ¥2 billion for Chongqing as a start-up fee. In addition, the center offered an annual subsidy of ¥900 million over the ﬁrst ﬁve years and extended a threeyear tax exemption to Chongqing. In return, Chongqing is said to have made a commitment to fulﬁll the tasks assigned by the central government.47 Although the new Sichuan stands to gain little from the deal cut with Chongqing, it might be thought to beneﬁt marginally from the surrender of some of its poorest counties to the new city. Overall, however, an internally

58 Lijian Hong circulated document paints a bleak picture for the province. First, Sichaun’s ranking on the national industrial and agricultural league table has fallen. Second, the province has lost most of its actual and potential energy resources as well as the bulk of its chemical, engineering, steel, and other heavy industries. In particular, it has surrendered its automobile manufacturing industry. Third, almost half of the province’s tertiary educational institutions have been transferred to Chongqing. Fourth, with the independence of Chongqing and other eastern Sichuan cities on the Yangtze, the province has been further isolated by its reduced access to riverine transport and communication. Finally, Sichuan has surrendered any hope of exploiting the preferential policies granted to cities along the Yangtze River.48 As if to conﬁrm these fears, Sichuan suffered a major political setback at the Party’s Fourteenth National Congress, when it surrendered its seat on the Political Bureau to more advanced coastal regions. Table 3.5 shows the extent of the impact of the new Chongqing on the regional economy of the rump of Sichuan Province. The separation also carries advantages for Sichuan. As noted, it reduces the burden of continued ﬁnancial subsidies to the impoverished eastern counties that now fall under the wing of Chongqing City. Further, the province is spared having to deal with the uncertainties surrounding the future of the Three Gorges Project, particularly any potential problems arising from the program of population resettlement. And, in an area of competition that is perhaps more symbolic than real, the province no longer stands out quite so prominently on the provincial population league table. The unwanted attention that comes with the title of most populous province can now be directed, instead, at Shandong or Henan. The city of Chongqing certainly celebrated the new status that accompanied its severance from Sichuan. Still the question remains: will the Table 3.5 Old Sichuan/new Sichuan: before and after Chongqing’s separation

Population (mn) Area (km2) GDP (¥bn) Primary sector (¥bn) Second sector (¥bn) Third sector (¥bn) GVIO (¥bn) GVIO (town level and above, ¥bn) GVAO (¥bn) Total grain production (mn ton.) Local revenue (¥bn)

Before

After

% Decrease

112.0 56.7 353.4 97.7 148.7 107.0 391.7 228.6 152.0 45.8 16.7

82.0 48.5 252.1 71.2 105.9 75.0 283.0 135.9 111.4 34.0 11.6

ǁ26.9 ǁ14.5 ǁ28.7 ǁ27.1 ǁ28.8 ǁ30.0 ǁ27.8 ǁ40.6 ǁ26.7 ǁ26.7 ǁ30.4

Source: Du Shougu, “The Impact of the Separation of Chongqing on Sichuan and Sichuan’s response to it,” in Policy Studies of the Major Issues of the Economic and Social Development in Sichuan, no. 6 (July 1996), p. 10.

New Chongqing 59 decision itself improve Chongqing’s position? What bearing does it have on the many factors that retarded the city’s development in the reform era?

Old hurdles for a new city Provincial-city political relations Chongqing’s painful political relationship with Sichuan has been one of the most distinctive of all negative factors. Here, we might note that one of the secrets of Zhao Ziyang’s success as provincial party secretary, early in the reform era, was his ability to deal with the Chongqing leadership during his term of ofﬁce. Soon after he left Sichuan, relations between the two governments soured despite attempts to improve matters by promoting three city leaders to senior positions in the provincial administration. It would be simplistic to attribute Chongqing’s poor relationship with the province to individual leaders, particularly when Chongqing’s painful relationship with Sichuan in the Maoist era was more closely related to political competition among different factions of the PLA ﬁeld army system. It would appear, however, that the strong and effective leadership of Zhao Ziyang was capable of offsetting some of the factional and structural problems that had bedeviled relations between the city and the province in previous years. One of these structural problems related to the administrative superiority of Sichuan over Chongqing within the national hierarchy of territorial administration. Under the Organic Law of the People’s Republic of China, governments at lower levels in the hierarchy are obliged to implement instructions issued at higher levels. Further, functional departments at a given echelon level are subordinate not only to their own echelon but also to the same functional departments of the higher echelon of government.49 As a sub-provincial city, Chongqing was obliged to implement instructions of the Sichuan provincial government. At the same time, as a separate-planning city under the Planning Committee of the central government, the city’s functional departments had to accept the instructions of both the central government and the same functional departments at provincial level. Should conﬂict arise, the city government was all but powerless, in its own right, to prevent the provincial government resolving the problem to its own advantage. Indeed, at certain times in its history Chongqing has suffered relative to the province in its dealings with the center. During the First Five-Year Plan period, for example, no investment associated with Soviet aid projects found its way to Chongqing despite the city’s historical capacity to absorb new investment and technology. By contrast, Chengdu was included on a brief list of inland cities to be favored with investment. Under the provincial leadership of Li Jinquan, Chengdu attracted four of nine new national electronics industry projects allocated around the country.50 Despite Chongqing’s historical position as an industrial center, investment and GVIO in Chengdu grew at a faster pace than in Chongqing during Li’s term

60 Lijian Hong in the provincial capital, to the point where investment in Chengdu came to match that in Chongqing (see Tables 3.6a and 3.6b). This discriminatory investment policy would have been impossible without central approval – speciﬁcally the center’s commitment to balanced economic development in the 1950s. The central government’s reform program of recent decades has resulted in the devolution of authority to lower administrative echelons. Nevertheless the basic legal framework supporting the centralized system of government has remained largely untouched. Local autonomy, such as it is, has generally been seized by local ofﬁcials, in the face of weakening central control, or granted on the instruction of individual leaders or under speciﬁc government regulations. In other words, the system that enabled Li Jinquan, some decades ago, to limit Chongqing’s economic development, has survived the reform era. At the same time, rapid local economic development over the reform era has broadened the scope for potential conﬂicts of interest among and between governments at various administrative levels. This is not peculiar to relations between Sichuan and Chongqing. Similar tensions can be discerned in relations between Liaoning Province and Dalian City, between Guangdong and Shenzhen, and between Shandong and Qindao.51 It is equally true that as the ﬁnancial power of the center has weakened relative to territorial units, so has its ability to intervene in local disputes. Hence, while reform has enhanced Chongqing’s independence from Sichuan, it has also created conditions under which Sichuan has sought greater autonomy Table 3.6a GVIO of Chengdu and Chongqing in selected years (in ¥million)

1952 1957 1962 1965

Chengdu

Chongqing

165 392 556 1,036

878 2,577 2,387 3,963

Source: Chengdu Statistical Yearbook 1996, p. 100, Chongqing Statistical Yearbook 1996, p. 28.

Table 3.6b Total investment in ﬁxed assets in Chengdu and Chongqing (in ¥million)

1950–52 1st FYP (1953–58) 2nd FYP (1959–64) 1963–65

Chengdu

Chongqing

18 400 1,610 660

144 965 1,852 631

Source: Chengdu Statistical Yearbook 1996, p. 151, Chongqing Statistical Yearbook 1996, p. 73.

New Chongqing 61 from the center in managing local affairs under its jurisdiction, including those of Chongqing. In the absence of a clear division of powers between central and provincial governments or between provincial and sub-provincial governments, and in the reigning confusion over demarcation of political and economic authority at every level, powerful provincial governments can take advantage of declining central authority to control the political and economic life of subordinate units. Hence, although Chongqing’s economy has ofﬁcially been beyond provincial control since 1983, the province has managed to deal with Chongqing more or less at will. The power of the province was reﬂected in its ﬁscal arrangements. In 1997 the city was obliged to forward an annual net contribution to provincial revenues of around ¥200 million, with a forecasted annual increase of 3 percent per annum in following years.52 In addition, it was forced to “contribute” on an ad hoc basis to various provincial projects. When Sichuan decided to build a main city thoroughfare in the provincial capital, Chongqing was asked to “donate” ¥200 million. Although the city government was technically at liberty to refuse, its functional departments had little choice but to obey the directives of their senior counterparts in the provincial government. Chongqing residents resented the imposition. “This road,” one local economist responded angrily, “should not be named the Capital Road of Shu (Chengdu) but the Road of Ba (Chongqing).”53 More importantly, at a time when Chongqing was being urged to undertake sweeping market reforms, the provincial government could limit the city’s access to the vast producer and consumer markets of Sichuan. After Chongqing was granted separate-planning city status, for example, it suddenly found itself frozen out of supply networks and consumer markets within the province. Some local analysts believe that the province’s capricious denial of access to its markets was a signiﬁcant factor behind Chongqing’s failure to keep pace with other cities in the reform era.54 Economic independence appeared to require a comparable measure of political autonomy. Escaping “provincial exploitation” was then the strongest local motivation for Chongqing to seek separation from Sichuan.55 The provincial government remained intransigent, arguing that since Chongqing enjoyed direct planning relations with the center it should ask Beijing to provide it with supplies and markets. This is, in a sense, what happened with the division of the province in 1997: Chongqing acquired local resources and markets and, at the same time, acquired autonomy from the provincial government. The decision did not eliminate competition between the city and the province but it did place them on a more equal footing. Intra-city politics Asked why Chongqing lagged behind Chengdu in recent years, one senior provincial ofﬁcial responded that the problem could not be attributed to the “provincial exploitation” of Chongqing, as the city was inclined to claim. It

62 Lijian Hong was due, he said, to prolonged internal conﬂicts among city leaders themselves – conﬂicts that would survive and intensify once Chongqing was separated from Sichuan.56 Such a defensive reaction on the part of provincial ofﬁcials is understandable. If true, however, the diagnosis suggests continuing problems for the city as formidable as those it faced in the past. These problems are partly related to progressive changes to the national system of appointment and preferment of local and central ofﬁcials. Direct central control of local personnel appointments was formally deregulated in 1984. According to a document issued by the Department of Organization of the Party’s Central Committee, from 1984 the center resolved to limit its appointments to the provincial and supra-provincial levels. Responsibility for appointment and preferment of sub-provincial ofﬁcials was then transferred to the provincial level of government.57 At the same time, implementation of successive reform policies reduced the ﬁnancial dependence of local governments on the center and limited the party’s capacity to exercise direct ideological control, generally loosening discipline and encouraging decentralist tendencies. These developments have intensiﬁed differences between ofﬁcial career patterns in post-Mao China.58 As Christopher Neville has noted the economic reforms have broken the top-down monopoly of the Party-state over the careers of ofﬁcials . . . offering the ambitious local ofﬁcial the opportunity to become a “big ﬁsh in a small pond” rather than simply to follow the traditional “ladder of advancement” up the Party-state hierarchy.59 Which career strategy local ofﬁcials are likely to choose depends on the level of their appointment and the connections they enjoy throughout the system. Neville observes that in a centrally administered city, such as that of Tianjin city-level ofﬁcials are much more likely to continue adhering to a ladderof-advancement strategy. Given their high position, Tianjin’s top ofﬁcials are not only under close scrutiny from the center but they have also already made a considerable investment in this career path. Local-level ofﬁcials prefer the “big ﬁsh in a small pond” strategy. The convergence of these different strategies at a particular echelon level can give rise to conﬂict between centrally appointed ofﬁcials, who link their careers with the center and follow “the traditional ‘ladder of advancement,’ ” and locally appointed ofﬁcials who pursue career paths more closely attuned to the needs of the ﬁsh in their local pond.60 The different strategies have been reﬂected in contrasting patterns of senior appointments in Chengdu and Chongqing. In the provincial capital, for example, a greater number of party and government leaders have been selected from among local people since the 1980s.61 But in Chongqing, where

New Chongqing 63 city leaders have been consistently selected by the center, ﬁve of the seven city party secretaries appointed over the post-Mao period have been “outsiders” despatched to the city by Beijing: Qian Min (1978), Ding Changhe (1978–81), Wang Qian (1981–85), Xiao Yang (1988–93) and Zhang Deling (since 1995). Three of Chongqing’s six city mayors over the same period – Qian Min (1978), Xiao Yang (1985–88) and Pu Haiqing (since 1996) – were also “outsiders.”62 It would be simplistic to suggest that, in the wake of changes to the system of appointment, sub-provincial leaders immediately switched their loyalties from the center to the province or indeed that centrally appointed ofﬁcials in Chongqing consistently disregarded provincial interests in favor of Beijing. Tensions between Chengdu and Chongqing are better understood in terms of differences among local power nodes than as a conﬂict between local nodes and the political center in Beijing. Nevertheless, faced with a choice of options in a period of rapid and destabilizing change, ofﬁcials at every level (wherever they happen to hail from) are inclined to heed those who appoint them. Who pays the piper plays the tune. The application of this principle is clearest not in relations between Chongqing and Chengdu but in political conﬂicts within Chongqing itself. Xiao Yang, formerly party secretary and mayor of Chongqing, was a Sichuan native who commenced his revolutionary career in Beijing in 1949. He did not return to ofﬁce in Sichuan until 1984, when he was appointed deputy party secretary of Chongqing. On a number of key issues involving potential conﬂicts of interest between the center and the city, Xiao invariably came out in favor of Beijing – a propensity that earned him a reputation as a “Sichuanese who can only speak Mandarin.” For example, when the center decided to build the world’s largest dam on the Yangtze, Xiao not only supported the central decision but also suggested erecting a dam higher than the one the center had originally proposed. It is generally believed that most Chongqing residents opposed the erection of any dam at all. Xiao was also said to have slavishly implemented a central directive to force a large SOE to go bankrupt. The decision left 3,000 workers unemployed, and resulted in the largest public demonstration witnessed in Chongqing since 1989. Xiao’s craven attempt to appease Deng Xiaoping at the Party’s Fourteenth National Congress was considered disgraceful by many locals.63 Despite strong opposition from local ofﬁcials of the province and of Chongqing, Xiao was rewarded for his loyalty to the center by rapid promotion to the post of provincial governor of Sichuan. His promotion frustrated city ofﬁcials in Chongqing in their subsequent handling of provincial-city and center-city relations. Judging by appointments to the new city power structure, the center appears to share the view that Chongqing’s problems are largely of its own making. In 1997 the center took a new broom to city hall, sweeping away the old hierarchy in an effort to cleanse the city of its local feuds and factions. All three peak positions in the party, government and people’s congress went

64 Lijian Hong to non-natives of Chongqing. Party Secretary Zhang Deling had served as mayor of Harbin before holding a senior position in the central Ministry of Machinery for four years (1991–95). The mayor of new Chongqing, Pu Haiqing, once held a senior post in the Chongqing Steel Corporation but from 1985 had pursued a career in the provincial government. Immediately before taking up his new position in Chongqing he was ﬁrst deputy governor of Sichuan.64 The chairman of the City People’s Congress, Wang Yunlong, was successively mayor of Taiyuan and deputy governor of Shanxi Province. The accompanying table lists the positions and origins of twenty-eight of the top ofﬁce bearers in the party, the government and the people’s congress appointed to the expanded city in 1997 (Table 3.7). The fate of former Mayor Liu Zhizhong is instructive. Liu, who was appointed mayor in 1993, was widely expected to retain the position in the revised city structure. This would have involved a promotion – the former post of mayor was a deputy-provincial-level appointment but the new position was assigned provincial-level status commensurate with the provincial status of the city. Instead of being promoted, however, Liu was moved sideways to fourth position on the party hierarchy. In his place a man who held a comparable deputy-provincial-level position in the provincial government, Pu Haiqing, was promoted mayor of the new city. Moreover, Liu Zhizhong, like many other former Chongqing leaders, did not assume a concurrent position in the city government or in the City People’s Congress. Unconﬁrmed reports suggest that Liu Zhizhong’s effective demotion had little to do with a rumored corruption case but was the result of a long-standing feud with the

Table 3.7 Party, government, and People’s Congress leadership in new Chongqing Party name/position/origin

Government name/position/origin

People’s Congress name/position/origin

Zhang Deling/s/center Pu Haiqing/ds/NSC Wang Yunlong/ds/Shanxi Liu Zhizhong/ds/CQ Wang Hongju/ds/Fuling Gan Yuping/ds/NSC Li Xueju/ds/Center Ten Jiuming/ds/CQ Zhao Haiyu/ds/CQ Chen Bangguo/ds/CQ Shui Zhengkuan/ds/Qianjiang Xing Yuanmin/ds/CQ

Pu Haiqing/mayor/NSC Wang Hongju/ds/Fuling Gan Yuping/ds/NSC Xu Zhongmin/ds/NSC Li Deshui/ds/Center Chen Guangguo/ds/Wanxian Wu Jianong/ds/CQ Cheng Yiju/ds/Non.

Wang Yunlong/chair/Shanxi Jin Lie/ds/CQ Feng Kexi/ds/Non Xiao Zuxiu/ds /CQ Qin Changdian/ds/CQ Zang Biguo/ds/CQ Li Kexi/ds/Non Chen Zhihui/ds/CQ

Source: Chongqing Daily, 2 and 11 June 1997. Note: s = secretary; ds = deputy secretary, NSC = New Sichuan, CQ = Chongqing, Non = non-Communist Party member. All non-Communist Party members are from Chongqing. Fuling, Qianjiang and Wanxian were located in old Sichuan but are now part of new Chongqing.

New Chongqing 65 new city party secretary, Zhang Deling. Indeed, Liu is said to have opposed the central decision to upgrade Chongqing for fear that the heavy responsibilities that it entailed would further delay the city’s development. Ironically, many serving ofﬁcials who favored the upgrade suffered the same fate as Liu Zhizhong. It is said that many incumbent ofﬁcials supported the upgrade in the expectation that they would retain their positions in the new city, if not win promotion. In the event, most of the center’s senior appointments show a general trend toward demoting serving officials of Chongqing. Only ﬁve of the twelve new party committee members were drawn from the Chongqing party establishment. Of the remaining seven, two were transferred from the center and two from the provincial government, one hailed from another province, and two were recruited from the incorporated counties of Fuling and Qianjiang. Signiﬁcantly, none of the ﬁve former Chongqing party ofﬁcials who stayed on were offered concurrent positions in the parallel government structure. By contrast, three of the seven recruited from outside the city assumed concurrent positions in the city government (Mayor Pu Haiqing and Deputy Mayors Wang Hongju and Gan Yuping). In the new city government itself only one of the top eight positions went to former city ofﬁcials. The mayor was transferred from the provincial government ofﬁces, one deputy mayor was drawn from the center, three deputies were transferred from Sichuan, and the other two came from Fuling and Wanxian. As if to conﬁrm their loss of status, many leading ofﬁcials of the old city were let out to pasture either on the City People’s Congress or on boards representing denatured non-Communist parties. Seven of the eight members of the standing committee of the new People’s Congress were formerly city government ofﬁcials. One former deputy mayor of Chongqing was kept on the payroll to represent approved non-Communist parties in the city.65 Much the same is thought to have occurred at lower levels. At departmental level, for example, the center is reported to have transferred more than 100 ofﬁcials from outside Chongqing to ﬁll key positions in party and government organizations. Former department heads were appointed deputy heads or transferred to other less important departments. Nevertheless, their administrative rankings generally remained unaffected.66 The disappointed expectations of general promotions for everyone who had been involved in the old city government, after upgrading to provincial status, left a residue of resentment among former local party and government ofﬁcials. It is now said, for example, that Beijing and Sichuan have taken over Chongqing, and that the city was once again ruled by “outsiders.”67 While by no means unaware of this local discontent, Beijing was inclined to stress the advantages for Chongqing of heeding central authority. Premier Li Peng fully acknowledged “the work done by the old party committee and government of Chongqing” but stressed the need for unity between different factions, and warned that the relationship between “old Chongqing” and “new Chongqing” must be handled properly. Premier Li explained that it

66 Lijian Hong was necessary to transfer some cadres from various departments of the center and from other provinces and cities in order to strengthen the new city leadership. He argued that it was to Chongqing’s advantage that leading cadres of the new city were drawn from all over the country.68 Deputy Premier Wu Bangguo put Beijing’s case more directly. Chongqing had great potential for development but, he warned, “this potential can only be realized if the central authorities’ policies are fully carried out.”69 To the extent that Chongqing’s problems in the reform era have been due to problems of local leadership, the center may be justiﬁed in arguing that central control over senior personnel appointments is necessary to control political and economic development in key areas and to curb local corruption. The center is also concerned about maintaining national unity. But local people deny that their problems are all of their own making, and argue that the center is unable to provide all of the necessary conditions for local economic growth. Detailed understanding of the local situation, and institutional incentives for encouraging local initiative, are both important for weathering intense market competition. Should conﬂict emerge between local interests and central directives, ofﬁcials responsible to the central government are likely to heed the center at the expense of Chongqing. In fact, as noted above, central-local relations in post-Mao China have not been institutionalized to a signiﬁcant degree. Instead, the center has sought to effect solutions through centrally appointed personnel changes. Given that considerable power has been devolved in the reform era, central appointments of senior local party and government leaders is one of the few remaining methods by which the center can continue to exert control over the localities. Until China’s leaders come up with an alternative, this system is likely to persist at the continuing cost of frustrating local initiatives and creating tension between central and local ofﬁcials. The recent elevation of Chongqing will not change this situation. If anything, it will enable the center to intervene continually in local affairs through its preference for centrally appointed leaders. Central economic planning Another factor that has inﬂuenced the pattern of the city’s economic development since the pre-Communist era has been excessive dependence on central economic planning. Industrialization took off in the city during the Second World War, when relocation of coastal industries upstream along the Yangtze combined with heavy central investment into the city to build a signiﬁcant local industrial base.70 At that time Chongqing was upgraded to a provincial-level city, and placed under the guidance of a Construction Planning Committee by the Nationalist Central Government to plan for the economic development of the wartime capital. The Nationalists intended to build Chongqing into “the largest city in the entire south-west of China” – “a city with an international reputation.” They placed special emphasis on

New Chongqing 67 the role of economic planning and sought to “integrate the planned economy with the market one.”71 To this end, they used their administrative authority to intervene in the local economy: imposing strict price controls on strategic commodities, controlling production in important industrial sectors such as heavy industry and mining, operating a monopoly over the distribution and marketing of industrial and agricultural products as well as daily necessities and import and export commodities, and closely supervising all aspects of ﬁnance, trade and transportation.72 After 1949, central planning continued to provide a number of favorable conditions for the remote inland city, including central funds for investment, direct supplies of raw materials and more or less guaranteed avenues for distribution. These were important advantages for an inland city. Nevertheless, although close links with the central government offered the city access to national political and economic resources that its poor home province could not provide, these links came at some cost to local autonomy. Indeed, it perpetuated a pattern of local dependence on central guidance and control. In the People’s Republic, the city’s economic development was directed toward national goals and was overseen by the central bureaucracy. During the Third Front construction period, for example, the entire Third Front project was planned, invested, operated and managed directly by the central government and its relevant functional departments. Apart from providing necessary preparation and supporting infrastructure, there was little direct economic spin-off for the city. Over the Third Five-Year Plan, investment in light industry and agriculture amounted to only 1.34 percent and 0.55 percent of total investment respectively.73 Second, Chongqing’s close link with the center made it especially vulnerable to policy vacillations associated with power struggles among central party leaders. In the early 1960s, after Chongqing was upgraded once more to a separate-planning city, it was obliged to abandon its own modest economic plan in favor of the Third Front Project. The city’s own plan, formulated under the guidance of Premier Zhou Enlai, aimed to achieve balanced economic growth with a view to improving local living standards. The central plan, promoted by Mao Zedong, aimed for rapid and uneven development of defense-related heavy industry.74 Third, the city’s history of tight central control left little scope for local leaders to promote initiatives of their own, or to develop independent critical management skills. As the local government functioned essentially as a caretaker on central projects, local government functionaries learned to value political loyalty over management initiative or the cultivation of local talent. So the city was found wanting when Beijing abruptly reversed course and retreated from its role as central planner to new role as market supervisor. Chongqing was ill-prepared for the change. When the center introduced the “market mechanism” to Chongqing it made special provision to assist the city through the transitional period. After 1978, Beijing granted preferential policies to Chongqing and, despite

68 Lijian Hong its relatively weak revenue capacity, provided ﬁnancial packages to assist the city’s reform and opening. Of the ¥800 million supplied to local defense industries in Sichuan, to help convert military industries to civil production, 90 percent went to Chongqing. In addition, departments of the central government transferred ¥300 million to their enterprises in Chongqing.75 At a time when the coastal regions looked abroad for foreign investment, Chongqing turned to Beijing to act as its intermediary. The State Planning Commission and relevant departments in Beijing purchased US$170 million of advanced foreign technologies for transfer to Chongqing, and from the late 1980s redirected US$5 million in foreign government aid to the city.76 Non-ﬁscal interventions on the part of the center, also designed to assist Chongqing, have been undermined by the relative decline in Beijing’s authority during the reform era. The central government initially exerted its authority to pre-empt the development of motor vehicle industries in cities and provinces elsewhere that would have challenged the position of Chongqing and other traditional Chinese automobile and motorbike manufacturers.77 However, Beijing’s inability to police its own policies did little to avert a crisis in Chongqing’s automotive industry when other cities and provinces started promoting development of their own automobile industries in competition with Chongqing.78 A number of provinces along the Yangtze River, including Hubei, Anhui, Zhejiang, Jiangsu and the provincial-level Shanghai, selected the automotive industry to serve as the “pillar” of their local development strategies.79 Chongqing could not compete. Automobile production in the city increased 31 percent between 1994 and 1995, but the stock of surplus unsold vehicles held by city enterprises grew by 90 percent. Over the same period, the number of loss-making enterprises among Chongqing vehicle manufacturers doubled from seventeen to thirty-three, and total losses grew three-fold. Two prominent joint ventures with Suzuki suffered losses totaling ¥450 million.80 The pattern of local dependence on central initiatives encouraged a bureaucratic approach to local development that survived into the reform era, with unfortunate consequences for particular industries in Chongqing. In the 1980s, for example, a television manufacturer based in Mianyang in northern Sichuan approached the Chongqing television factory to operate a joint venture. The responsible department of the city government rejected the proposal, not on account of misgivings about its economic viability, but simply because the two factories belonged to different bureaucratic systems within the industrial management structure. Ten years later the Mianyang factory, Chong Hong, emerged as China’s largest TV producer with close to one-third of the domestic market. Today, the Chongqing television enterprise is just one of many loss-making SOEs in the city.81 The city’s recent elevation to centrally administered status does little to correct this pattern of historical dependence. When asked why Chongqing lagged behind many cities in the reform era, despite its separate-planning status, one local economist argued that

New Chongqing 69 a separate planning city still belongs to the planned economy, where government plays a crucial role in economic activity. The rapid growth of the coastal economies is attributable to the increasingly important role of the market economy. Chongqing lagged behind many coastal cities simply because the planned economy has continued to play a leading role in Chongqing at the expense of the market economy.82 This view is shared by senior public ofﬁcials in the new Chonqing. The recently appointed mayor of Chongqing, Pu Haiqing, has been heard to remark that there are still two great planned economies in the world today. One is North Korea and the other Chongqing.83 It is difﬁcult to see what Pu can do about the problem. Indeed, economic management in China is as closely related to the system of management that applies in a given region as to the region’s economic or market potential. Central planning, after all, is not just a matter of economic planning on the part of the central government. It entails planning for the development of a region with a view to the center’s wider national agenda on issues of equity, unity, and stability. A centrally administered city lends itself to central intervention in each of these areas, even at the expense of realizing its market potential. Much as increasing enterprise autonomy is linked to high productivity in decentralized coastal cities, the limited autonomy of enterprises in centrally planned cities offers limited scope for increased productivity.84 To date, these enterprises have survived on the back of an alliance with planning authorities. According to Huang Yasheng, since 1978 the economic reform program has created a “hybrid system that still retains some of the fundamental features of a command economy, albeit on a more decentralized basis, and fuses the economy with proﬁt incentives and limited market functions.” The result is a “half-way house between planning and market.” Huang has identiﬁed four crucial decision-making areas in which the determining factor is not market forces but the role of local economic bureaucrats and managers of state-run enterprises: selection and appointment of enterprise managers, determination of output targets, determination of inputs (supplies) and outputs (sales), and control of ﬁnancial resources. While governments continue to retain signiﬁcant power in these areas, they can offer enterprise managers protection in an otherwise competitive market. This unholy economic alliance between local economic bureaucrats and enterprise managers, Huang concludes, “creates both economic and political obstacles to further economic changes.”85 This would appear to be the case in Chongqing. Although the new mayor might bemoan the legacy of central planning in the city, the upgrade of Chongqing to central-administrative status has actually extended the authority of the central government to determine the patterns of the city’s future development. In recent years, the center’s limited ﬁnancial capacity has compelled other local governments to accelerate their market-oriented

70 Lijian Hong reforms and to make Herculean efforts to link their local economies with wider regional, national and international markets. This is not the destiny that Beijing has mapped out for new Chongqing. While other local governments are committing themselves to the “market mechanism,” Chongqing will have to share the national responsibilities of the central government for the development of remote rural areas, for relocating millions of rural residents from the Three Gorges area, for maintaining loss-making SOEs by incremental improvements in their performance, and for helping the poorest western regions to catch up with the developed east. Few of these tasks are directly related to markets, as least as Beijing understands them. Their political and social signiﬁcance far outweighs their economic value. To fulﬁll responsibilities that are not local, but national, in character, Chongqing is likely to maintain its historic pattern of dependence on central bureaucratic initiative. This time around, however, it is also likely to face declining levels of central investment and support at a time when other cities and regions are prospering through participation in the market economy. Local economists have already expressed concern that the low level of marketization in the local economy has delayed Chongqing’s economic growth in recent decades.86 Another decade-long commitment to achieving central goals that have little to do with markets may once again delay Chongqing’s economic take-off in what is, today, a market-orientated country. State-owned enterprises Closely related to the planned economy is the problem of SOEs. Indeed, SOEs have been part of the city’s history since the 1940s, when the Nationalist Government built a large number of war-related industries in Chongqing. By 1940, the number of state-owned industries in Chongqing had increased by 360 percent over 1938. In three years from 1940 to 1942, at a time of relative decline of private industry, over 80 percent of government investment in Chongqing went to state-owned heavy industry.87 Metallurgical, engineering, chemical, and electronic industries, along with all military plants, were administered directly by the relevant departments of the central government. More importantly, since most SOEs were defense-related enterprises, the Nationalist Government and its relevant departments adopted a military style of enterprise management. All employees of state-owned defense-related factories in Chongqing were obliged to join the Nationalist Party, and each plant had a political instructor sent by the government to supervise workers and managers of the factory.88 As elsewhere in China, Chongqing SOEs grew rapidly at the expense of the private sector after the Communist takeover. By 1952, SOEs produced 56.77 percent of the city’s GVIO, the collective-owned sector 14.67 percent, and private ﬁrms 28.56 percent. Over the following two decades, city SOEs were the prime beneﬁciaries of the communist ideology of “socialist public

New Chongqing 71 ownership”, including balanced economic development between the coastal and western regions, and central intervention in favor of inland defense industries. By the start of the reform era, the SOE share of city GVIO was 84.73 percent. The share of collectively owned ﬁrms remained much the same as in 1952, at 15.27 percent. The private sector share was nil.89 Signiﬁcantly, two decades into the reform era SOEs were still the largest players in the local economy. Although accounting for less than 13 percent of city enterprises, they employed 61.14 percent of the workforce, accounted for 78 percent of ﬁxed assets and for 70.68 percent of GVIO in 1997. Most importantly, ¥80 out of every ¥100 collected in taxes came from SOEs.90 Nevertheless, most SOEs face a bleak future. Return on investment is very low and total liabilities very high compared with the private and collective sectors. 91 Although the central government retains a keen interest in the role the city might play in regional economic development, it has fundamentally altered the basic policy framework within which SOEs rose to prominence. Many started to feel the pinch when Beijing shifted its development strategy from one of war preparation to peaceful construction, and at the same time moved from balanced economic development to a strategy giving priority to the coastal regions and from a highly centralized planned economy to a more localized market-oriented one. Chongqing’s SOEs faced declining levels of government investment at a time when they lost access to low-price material supplies and guaranteed government orders. Their proﬁtability was limited by structural limits on productivity, and their ﬂexibility was limited by a management structure that constrained enterprise decision-making powers and was committed to ensuring lifelong beneﬁts for all employees and their families. The Third Front Project is a case in point. Under this program, SOEs were set up for military production with little regard for normal productivity measures. At the start of the reform era, these SOEs fell to 30 percent below the national average for realized output value per ¥100 invested in ﬁxed assets. The total value of ﬁxed assets in the Third Front Project accounted for 56 percent of the national total while output value accounted for only 39 percent.92 Their capital-tax rate was 40 percent below the national average and even lower relative to coastal areas. The center’s abandonment of the Third Front strategy in the reform era placed these SOEs under pressure to retool for civil production. Initially, some were able to do so on account of their relatively high levels of technology. But any advantages formerly associated with the relative technological sophistication of Third Front military industries were quickly lost to coastal industries that imported more sophisticated technologies from Hong Kong, Japan and the West. The capacity of Chongqing’s military-related SOEs to make a successful transition to civilian production declined as standards of technological sophistication rose across the country. In recent years, key SOEs under the old Third Front Project have experienced difﬁculty maintaining normal production.93

72 Lijian Hong Changing patterns of central management and investment also took their toll. The Third Front Project was heavily dependent on central investment and management. When Beijing decided to transfer responsibility for Third Front enterprises to local governments, some were ill-equipped to take up the challenge and others were handicapped by central decisions to retain proﬁtable SOEs at the center and divest unproﬁtable ones to the localities.94 The noneconomic functions of SOEs also pose serious problems for economic reform. The center has introduced reforms that allow the sale of loss-making enterprises, the merger of poorly managed enterprises with proﬁtable ones, indeed even formal bankruptcy proceedings. But these market reforms are inhibited by structural impediments to social and political reform. Although the Enterprise Bankruptcy Law was adopted in 1986, few local leaders were initially willing to implement it. Chongqing’s larger SOEs are not only production units but also administrative units, with social and political responsibilities that may outweigh their economic functions. They run their own hospitals and schools, clubs, shops and theaters, they arrange jobs for the grown children of employees, and they provide pensions and other beneﬁts for retired employees and their families. In the absence of state subsidies for these functions, as Byrd and Tidrick have concluded, “it was virtually inconceivable that the Chinese government would allow sizeable enterprises to go bankrupt.”95 Failure to compensate for the loss of these non-economic functions has on occasion led to serious social and political consequences. In 1992, for example, one of the largest SOEs in Chongqing and the third largest of its kind in China, the Chongqing Knitting Mill, was declared bankrupt. The factory’s debt liabilities were ¥82.27 million, well in excess of its ﬁxed assets of ¥42.21 million. The bankruptcy left 2,913 workers unemployed and left many of their families destitute. Angry workers blocked the main trafﬁc routes of Chongqing, where their numbers swelled to around 5,000 as they were joined by employees from other factories. Two city ofﬁcials were kidnapped. The workers claimed that the city government had declared the enterprise bankrupt in order to sell its assets at a very low price. The allegation was supported two years later, when a deputy mayor and another senior government ofﬁcial were dismissed for their part in a scandal in which a private entrepreneur reportedly bribed government ofﬁcials to sell the knitting factory considerably below its market value.96 The concentration of a large number of the SOEs in a relatively isolated inland city has also created a local political culture that is not conducive to market reforms. In return for civil loyalty, the Communist government has used SOEs to provide permanent employment, stable incomes and social welfare, and to confer social and political status. For most SOE employees, these are among the most tangible beneﬁts of China’s socialist system. As long as the government remains a communist one, it is felt, it should continue to provide similar conditions for its employees. It does not follow that all state employees are resistant to reforms. It does mean, however, that their

New Chongqing 73 support for market reform is conditional on the state continuing to supply jobs and social beneﬁts in new “market-oriented” ﬁrms. Employees thrown out of work in the reform process prefer to wait at home for the government to ﬁnd them new jobs rather than start up new businesses or take the initiative in ﬁnding jobs for themselves. In the ﬁrst quarter of 1996, for example, sixty-two SOEs were partially or fully closed in Chonqing. Over 100,000 workers were retrenched, or “temporarily out of service,” as the government terms it. They were still counted employees but were paid only a proportion of their former salaries, if at all. Virtually all of these unemployed workers preferred to wait at home for the government to ﬁnd new jobs for them rather than ﬁnd work for themselves. When work was offered in the private sector, many former state employees rejected the offers because working conditions were inferior to those they had previously enjoyed, or because the site was too far from home. They were used to living on site. One local commentator observed that a culture “of enjoying relaxed working conditions, avoiding severe competition and avoiding risk has become a major obstacle for reemployment among these workers.”97 In the event, former SOE workers have turned out to be far less competitive than young peasants migrating to the cities from the countryside.98 To be sure, this is not unique to Chongqing. But former employees of Third Front industries do present particular difﬁculties for reemployment programs. The relatively high social security beneﬁts enjoyed in defense-related industries – designed in part to minimize security risks among employees – ensured that few of these industries could survive the reform era, and that their former employees have especially high expectations of potential employers.99

The Three Gorges and the relocation program The Three Gorges Project is critical to the future of the new Chongqing. Indeed, it was one of the most important considerations for upgrading Chongqing to a centrally administered city. The project has received much attention from Chinese and Western analysts.100 Here I shall focus only on the associated relocation program and its impact on the city. The project is signiﬁcant for Chongqing on two main counts. First, twothirds of the displaced population in the reservoir area (over one million people) reside within new Chongqing’s administrative area. The new city carries a national responsibility in this regard. Second, the newly incorporated areas from eastern Sichuan were among the poorest in China. Half of the forty-three counties (or cities) under new Chongqing’s jurisdiction are formally designated as poverty areas, twenty of them falling in the Wanxian, Fuling and Qianjiang regions. Over 95 percent of Chongqing residents who live in poverty (3.42 million of 3.66 million people) reside in these three areas.101 According to one survey, per capita national income in these areas

74 Lijian Hong was ¥141 in 1991, compared with a provincial average of ¥903 and a national average of ¥1,401.102 The combined areas imposed a heavy burden on the former provincial government: in the 1980s, Sichuan Province provided an annual government subsidy of more than ¥300 million to the region.103 Current city leaders hope to eliminate local poverty by linking the relocation program of the central government with the city’s plan to promote local industrialization and general economic growth.104 These hopes rest, in part, on the implementation of the Three Gorges Project. When the project was mooted publicly in the 1980s, attention focused mainly on the ﬁnancial capacity of the government to fund it, and on its prospects for achieving targets for power generation and ﬂood control. In the hiatus created by postponement of the project, however, other issues began to emerge. Li Boning, head of the Preparation Group for Sanxia Province, conducted a series of investigations in the proposed reservoir areas that revealed extreme poverty in the region. By Li’s account, between 30 and 40 percent of the rural population was inadequately fed and clothed, and over 2.6 million people suffered serious water shortages. In Pengshui County, Qianjiang Prefecture, investigations revealed that 30 percent of peasant families lived in caves, 50 percent lacked warm clothing in the winter, and 30 percent spent the night around open ﬁres for want of adequate quilting. Over 4,000 males in the county could not afford to marry because of poverty.105 Li produced a video of his ﬁndings, called “Qiong shan de huhuan” (The Cry from the Poor Mountains), which he showed to key ﬁgures of the central government in Beijing. Li argued forcefully that the project was important not only for its technical functions or for its national signiﬁcance but also to improve the living standards of local communities. Rather than compensate people affected by the dam, he suggested that the center should invest in the area – creating new “farmable” land for local peasants to plant cash crops, and setting up modern enterprises to employ local peasants. In this way, local communities and the local economy would prosper together.106 Li’s video show and arguments made quite an impression in Beijing. Once the project was revived, the relocation program was closely integrated with plans for the economic development of one of China’s poorest areas. This plan also helped to sell the project to the Chinese people more generally: its stated aim of ridding poverty from the reservoir area had considerable appeal to communities elsewhere who might otherwise have doubts about the social impact of the project.107 For Chongqing City, however, the most attractive part of Li’s proposal was the call for greater central investment in the area. City leaders hoped to channel central investment not just to the reservoir area but to surrounding regions. Nevertheless, the problem of relocation has not been fully resolved. For a start, the number of people who will be forced to relocate remains a topic of hot debate among those for and against the project. The ofﬁcial ﬁgure is about one million people, far fewer than estimates put forward by the dam’s

New Chongqing 75 opponents. Opposition ﬁgures take into account increasing levels of sedimentation that will force the water level to rise for many decades after the dam has been erected. As a result, a further 300,000 people along the upper reaches of the river will be forced to relocate 20 years after the dam is built, and 500,000 more 50 years on. The total number in need of relocation may well number 1.4 million to 1.6 million.108 Moreover, the area to which people will be relocated, in former east Sichuan, is already overpopulated. Surplus labor represents around 30 percent of the regional labor force.109 Its critics claim that the current relocation plan will add to local population densities and degrade an already overloaded ecological system. More worrying for the government, the plan may cause not only economic and ecological damage but also bring the central government into wide disrepute, should the resettlement program go awry.110 A second major source of problems is investment capital. According to the original central government estimates, the total project cost was around ¥57 billion (1990 prices), or 0.73 percent of national GDP over the initial construction period.111 Of this, ¥29.8 billion was allocated for dam construction, ¥8.7 billion for building power lines linking the project to central and eastern China, and ¥18.5 billion for relocation.112 The estimates were wildly optimistic. According to Qiao Peixin, formerly deputy governor of the People’s Bank, the total cost is more likely to come in somewhere between ¥294 billion and ¥584 billion,113 or between ﬁve and ten times the original budget estimate. The initial relocation budget was not too wide of the mark: it is now estimated to cost ¥40 billion, or roughly double the original estimate.114 It would appear that deﬁnitions of relocation requirements are fairly elastic compared with those of construction and equipment expenses. Certainly the relocation budget has proven very ﬂexible. During the Seventh Five-Year Plan period (1986–90), the center promised to spend ¥1 billion in the Three Gorges area on relocation and development programs. The promise was not honored. Elsewhere, it was openly reported that the central government spent ¥20 million each year from 1985 on relocation and development programs, but, as Li Boning has complained, not even this target was achieved. The relocation fund was subsequently reduced to ¥10 million per annum, and has continued to shrink.115 As general project costs have increased, the relocation budget has taken a relatively low priority in the center’s investment decisions. In some cases the center has appealed to other provinces and regions to assist with relocation expenses. For example, the center was able to provide only ¥0.6 billion of the ¥2.6 billion required to relocate 576 schools from the reservoir area, leaving a funding shortfall of ¥2 billion. The State Education Commission issued a circular asking twenty-two other provinces and cities, and forty-ﬁve government departments, to make up the difference. By 1998, donations from across the country totaled no more than ¥0.03 billion of the additional ¥2 billion required.116 Beijing introduced a centralized management system for relocation funds, with a view to limiting fraud. It warned that improper use of the funds

76 Lijian Hong would be severely punished.117 But, experience would suggest, this does not prevent central bureaucrats from mismanaging funds. The central government also wants local governments and communities to make up for central funding shortfalls. To rebuild one mu of standard farmable land in the new area, for example, the center pays ¥600 toward an actual cost of over ¥900. To minimize their liability, peasants and local governments have reduced the quality standard set up by the state, and have over-reported their achievements. One local ofﬁcial used central funds to develop 6,000 mu of land but reported to the government agency that 8,000 mu of land had been built on. The government accepted his report.118 At the same time, lack of market information, of skilled workers and of good management skills have caused serious wastage of funds among local enterprises (discussed below). Although the central government claimed that it would not allow relocation funds to be used for the construction of projects not linked to the relocation plans,119 it is common practice for local governments to seize the opportunity to build luxury ofﬁce buildings or redevelop city sites on a grander scale than those they replace.120 In fact, the “developmental relocation” aspect of central government policy is said to be the most attractive part of the project for local ofﬁcials. The center promised to employ central funds to sponsor existing factories to absorb more peasants from the reservoir area. However, since most of the state-owned and collective-owned enterprises in the area were small and overstaffed, only limited numbers of resettlers were recruited for factory positions.121 Resolving this problem requires the central government to invest more heavily in new industrial enterprises to absorb the surplus rural labor. Creating new factory jobs is estimated at two to three times the cost of rural resettlement.122 Further, as already noted, Chongqing tried to link the “developmental relocation” program with a poverty-relief program for the three million and more rural dwellers in new Chongqing. According to ofﬁcial data, however, only 45 percent of the million or so displaced people in the Three Gorges area who live in the countryside are entitled to relocation funds.123 In other words, less than half a million people have formal access to the various preferential policies granted to those resettled from the Three Gorges area. The remainder of the three million poverty-stricken residents of new Chongqing miss out. Supporters and opponents of the Three Gorges Project are united in tracing the area’s slow growth rates to low government investment. This is not the only factor. Township enterprises in the Three Gorges area that have attracted investment have not always made the best use of the opportunity. In Fengjie County, for example, the government invested ¥500,000 in a township enterprise to produce alcohol from sweet potatoes. The factory began operation without undertaking a feasibility study and without the technical skills to perform the task. It closed before the year was out. In 1984, the local government of Wushan used resettlement funds to set up a brick

New Chongqing 77 factory. Total investment exceeded ¥1.6 million, of which ¥0.68 was drawn from the relocation fund. The factory started operation in 1987, after three years in construction, and closed a year later on account of poor management and misuse of funds. In 1991, the factory was reported to be still carrying debts of ¥1.96 million. In Zhongxian County, ¥1.82 million of relocation funds were invested in an alcohol factory in an already saturated market.124 Low literacy levels present an additional obstacle to economic development in the area. Surveys reveal rates of illiteracy and semi-literacy hovering around 25 percent among the total population of the Three Gorges area.125 In 1995, only 20 percent of the population had completed junior middle school or higher.126 In Wushan County, the ﬁrst task assigned to employees of a new tobacco factory was learning to write their own names.127 Relocating over a million people and reestablishing viable local communities in affected areas is a daunting long-term responsibility for Chongqing. Completion of the Three Gorges Project is estimated to take around 20 years. Over this time, the attention of the new government will largely be directed toward resettlement of local people and to reconstruction of the local economy. While many provinces and major cities in China are likely to race along the fast track of economic development over these two decades, Chongqing will have to expend most of its resources on coping with the immense social, political, environmental and economic costs of the Three Gorges Project. Finally, there is some lingering uncertainty about the center’s long-term commitment to the project. The decision to build the Three Gorges Dam was closely linked with former Premier Li Peng, widely regarded as the project’s strongest supporter in the upper echelens of the central government. Li Peng’s successor as premier, Zhu Rongji, has shown little overt enthusiasm for the project – he has, for example, made only one personal inspection. While it would appear unlikely that the center will stop the project once started, it may choose to limit its commitment to the completion of social infrastructure after the dam has been completed. Local people are already asking whether Chongqing will be able to deal with the consequences should there be any diminution in the center’s level of commitment.

Conclusion This study is limited to a few discrete questions probing the reasons behind the central government’s decision to upgrade Chongqing to a centrally administered city, focusing in particular on the implications of the Three Gorges Project. It asks why Chongqing was separated from Sichuan, why it was accorded the status of a centrally administered city rather than a province, and what bearing the decision has on prospects for the city’s economic development in the reform era. It would appear that the tensions that led to eventual separation of Chongqing from Sichuan were rooted in

78 Lijian Hong the political history of the city since 1949. The history of the city, ﬁrst as a centrally administered unit, then a provincial city, and subsequently as a provincial city with centrally designated privileges, traces in outline the problems of China’s system of territorial administration. The past two decades of reform have affected Chongqing’s position in the province and the country as a whole, but at the same time revealed systemic problems that cannot be resolved by economic or administrative separation alone. This study suggests that while the reforms have led to signiﬁcant decentralization, this process has not been matched by comparable institutional changes in central–local relations. The current legal and administrative framework supports a highly centralized system that allows party and government leaders to manipulate local development through their administrative discretion. The separation of Chongqing from Sichuan may reduce tension between city and province, but at the expense of heightening tension between the city and Beijing. Second, although Chongqing’s unsatisfactory economic performance in the reform era resulted from a variety of different factors, among the most important was the city’s historical dependence on central investment and management. This brought beneﬁts in the era of central planning but pain in the reform period. Chongqing’s rapid recovery after the war, to become the largest sub-provincial economy in south-west China, highlights the value of local government access to central political and economic resources. Indeed, local industrialization was heavily dependent on high levels of central investment, without which the modernization of an inland city such as Chongqing may have been considerably delayed. However, this study points to a negative correlation between central investment and growth in the reform era. Over the two separate occasions on which the central government made special efforts to invest in Chongqing, the center’s attention was focused on the city’s place in a national development strategy that paid little heed to the particular needs of the region, and was intended to prevent rather than to promote the development of a market economy. The fate of Chongqing was largely prescribed by its place in a planned command economy. Once planning gave way to the “market mechanism” in Beijing’s strategic thinking, Chongqing’s inherited patterns of dependence left it illequipped to cope. This chapter argues that the future of Chongqing depends on two important factors. First, if the new generation of central leaders exclusively emphasizes market forces, it will entrench a strategy that beneﬁts China’s richer coastal regions and disadvantages areas in the north and west, including Chongqing. In this event, upgrading the city’s status is likely to have little effect on the outcome. If, however, the center strikes a balance between unfettered market forces in the coastal regions and strategic infrastructure investments in the western hinterland, then Chongqing’s administrative ascendancy may provide the city with the opportunity to exploit its

New Chongqing 79 position in the south-western region. This appears to be part of the rationale underlying the development of the Three Gorges Project. Infrastructure does not account for everything. Chongqing’s capacity to take advantage of these developments depends, as well, on the capacity of its regional and local leadership. In an under-institutionalized administrative environment, relations between the center and the city depend to an unusual degree on qualities of leadership. This study suggests that recent personnel appointments in Chongqing demonstrate Beijing’s determination to insure that central policies are implemented faithfully regardless of possible negative consequences. Paradoxically, these policies include efforts to make Chongqing less reliant on central initiative and direction. As the new city mayor – a Beijing appointee – has noted: We cannot remain addicted to the old command economy, to the old system, to old models, regulations and procedures. With reform and opening, we must dare to ﬁnd a new path better suited to the actual situation in Chongqing . . . Where policies are already laid down by the central government, we must of course fully implement them, fully exploit them, never waste them. But on matters where the centre has not yet formulated a policy we must dare to try new policies, dare to break a new path. In particular, we must uphold the spirit of unremitting effort, move boldly in difﬁcult terrain, solve complex problems, and innovate.128 If the leadership can manage that, Beijing and Chongqing would presumably both be satisﬁed.

Notes 1 “Chongqing expected to be the fourth municipality,” China Daily Online, 20 February 1997; “Chongqing to become another powerhouse,” ibid., 7 March 1997. From <www.chinadaily.com.cn>. 2 Zhang Deling, “Report at the First Party Congress of Chongqing Municipality,” 27 May 1997. Reprinted in Chongqing ribao [Chongqing Daily], 5 June, 1997, p. 1. 3 During my investigations in Chengdu and Chongqing in 1996 and 1997, local party and government ofﬁcials offered differing responses to the central decision. Nevertheless, one view widely shared was that Chongqing had accumulated a heavy burden in the form of loss-making SOEs, poor infrastructure, serious pollution, and so on. It followed that unless the center was prepared to increase investment, the separation would not of itself assist the city’s bid for economic “take-off.” 4 Chengdu Statistics Bureau (ed.) Chengdu tongji nianjian [Chengdu statistical yearbook 1996] (Chengdu: np, 1996), p. 100; Chongqing Statistics Bureau (ed.) Chongqing tongji nianjian 1996 [Chongqing statistical yearbook 1996] (Beijing: China Statistics Press 1996), pp. 28, 29. Chengdu dropped below Chongqing again in 1997. Chongqing Statistics Bureau (ed.) Chongqing tongji nianjian 1998

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5

6 7

8

9 10 11

12 13 14

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[Chongqing statistical yearbook 1998] (Beijing: China Statistics Press, 1998), p. 387; Chengdu Statistics Bureau (ed.) Chengdu tongji nianjian 1998 [Chengdu statistical yearbook 1998] (Chengdu: np, 1998), p. 392. Chengdu, like other provincial capital cities in China, was granted “separate planning city” status and designated a deputy provincial-level city in 1989. It is reported that the separate planning position of the city was withdrawn in 1994 following a State Council decision, although the city retained the status of deputy provincial-level city. In many openly published materials, Chengdu is still referred to as a separate planning city. The other two cities are Wuhan and Nanjing. Information from Zhou Shunwu (ed.) China Provincial Geography (Beijing: Foreign Languages Press, 1992), p. 367; Wanxian shi Fuling shi Qianjiang zhuanqu [Wanxian City, Fuling City and Qianjiang Prefecture] (Chongqing: Chongqing Publishing House, 1996), pp. 6–7, 16–17, 27. Information below is from Luo Chuanxu (ed.) Sanxia kuqu jianjie [A brief introduction to the Three Gorges reservoir areas] (Chengdu: Chengdu Science and Technology University Press, 1993); Wanxian shi Fuling shi Qianjiang zhuanqu; and Chongqing City People’s Government (ed.) Chongqing nianjian 1996 [Chongqing yearbook 1996] (Chongqing: Chongqing People’s Publishing House, 1997). Chongqing Yearbook 1996, p. 125. Luo Chuanxu, Sanxia kuqu jianjie, pp. 82–3. Chun Guanghua, “Lianhe kaifa faifang, zhenxin sanxia jingjiqu” [Unite to open and develop, revitalise the Three Gorges Economic Zone], Quyu jingji yanjiu [Regional economic research], no. 3 (1994), p. 44; Luo Youcheng and Yang Zeming, “Kuqu fazhan hao jiyu” [A good opportunity for the development of the reservoir area], Chongqing ribao [Chongqing daily], 19 June 1997; Zhu Zhiyong, “Chongqing fupin kaifa de jiben tujing” [A basic path for Chongqing to aid and develop the poverty areas], Chongqing shehui kexue [Chongqing social sciences], no. 2 (1997), p. 25. Wanxian shi Fuling shi Qianjiang zhuanqu, p. 141. Wanxian shi Fuling shi Qianjiang zhuanqu, p. 123. Jia Daquan, “Sichuan lishi gaikuang” [A brief history of Sichuan], in Sichuan jingji nianjian 1986 [Sichuan economic yearbook 1986] (Chengdu: Sichuan Science and Technology Press, Chengdu, 1986), p. 1. Jia cited a Qin general who argued that to conquer six other warring states the Qin ﬁrst needed to conquer Sichuan. Pu Xiaorong (ed.) Zhonghua renmin gongheguo dimin cidian: Sichuan [A dictionary of the place names in the People’s Republic of China: Sichuan Province], (Beijing: Commercial Press, 1993), p. 71. Zhou Yong (ed.) Chongqing: yige neilu chengshi de jueqi [Chongqing, the rise of an inland city] (Chongqing: Chongqing Publishing House, 1989), pp. 119–21, 131–4, 138–9. Zhou Yong (ed.) Chongqing, pp. 328, 331. Yang Chao, Dangdai zhongguo de Sichuan [Sichuan in contemporary China] (Beijing: Chinese Social Sciences Press, 1990), vol. 2, pp. 49–50. Zhou Yong (ed.) Chongqing, p. 388. Chen Shisong (ed.) Sichuan jianshi [A brief history of Sichuan] (Chengdu: Sichuan Academy of Social Sciences Press, 1986), p. 290.

New Chongqing 81 20 Yang Chao, Dangdai zhongguo, vol. 2, pp. 47–8. 21 He Husheng, Li Yuedong and Xiang Changfu (eds) Zhonghua renmin gongheguo zhiguan zhi [List of party and government leaders of the People’s Republic of China] (Beijing: China Social Press, 1993), p. 26. 22 The other two were Ke Qingshi, party secretary of Shanghai, and U Lanfu, party secretary of Inner Mongolia. Two Sichuan provincial leaders also sat on the Eighth Party Congress: Party Secretary Li Jinquan and Governor Li Dazhang. 23 Liao Zhigao, former party secretary of Xikang Province, was elected alternative member of the Central Party Committee in 1958 after Li Jingquan was promoted to alternative member of the Political Bureau. Yan was moved to party secretary of Yunnan in 1959, a year after Chongqing was downgraded to a sub-provincial city. No one from Chongqing replaced Yan on the Central Committee or occupied his former position as a deputy provincial party secretary. Ren Baige succeeded Yan as party secretary and mayor of Chongqing, but his position in the province as deputy governor of Sichuan lasted only three years until 1958. Unlike Yan, Ren was never appointed party secretary of Sichuan, nor was he ever elected a member of the Party Central Committee. See Yang Chao, Dangdai zhongguo, vol. 2, pp. 770–1, 778–9; also Yang Chao (ed.) Changjiang shangyou jingji zhongxin Chongqing [Chongqing, an economic centre at the upper reaches of the Yangtze River] (Beijing: Contemporary China Press, 1994), pp. 374–5, 381–3. 24 Liu Liping, Pang Ju and Tong Xiaoping (eds) Chongqing shi jihua guanli zhi [A history of planned management in Chongqing] (Chongqing: Chongqing Publishing House, 1991), pp. 39–41. 25 Deng Liqun et al., Dangdai zhongguo de jingji tizhi gaige [Economic restructure of contemporary China] (Beijing: Chinese Social Sciences Press, 1984), pp. 648–50. 26 Yang Chao, Dangdai zhongguo, vol. 2, pp. 60, 178–9. Investment in Chengdu during the same period was ¥2.48 billion. See Chengdu Statistics Bureau (ed.) Chengdu Statistical Yearbook 1996, p. 156. 27 Deng Liqun et al., Dangdai zhongguo, p. 650. 28 In 1952, Chongqing’s GVIO accounted for 56.2 percent of the provincial total. In 1957 its percentage increased to 62 percent. See Sichuan Statistics Bureau (ed.) Sichuan tongji nianjian 1995 [Sichuan statistics yearbook 1995] (Beijing: China Statistics Press, 1995), p. 21, and Chongqing Statistics Bureau (ed.) Sichuan tongji nianjian 1996 [Sichuan statistics yearbook 1996] (Beijing: China Statistics Press, 1996), p. 28. 29 Chongqing Statistics Bureau (ed.) Chongqing tongji nianjian 1993 [Chongqing statistical yearbook 1993] (Chongqing: China Statistics Press, 1993), p. 26. China State Statistics Bureau (ed.) Quanguo ge shengshi, zizhiqu, zhixiashi lishi tongji ziliao [Historical statistics on all provinces and municipalities under the central government and autonomous regions] (Beijing: China Statistics Press, 1990), p. 696. 30 Yang Chao, Changjiang, pp. 217–18. 31 Yang Chao, Dangdai zhongguo, vol. 2, pp. 18–19, 63. 32 David L. Shambaugh, The Making of a Premier: Zhao Ziyang’s Provincial Career (Boulder, Co: Westview Press, 1984), pp. 88–9. 33 Gong Zhide (ed.) Zhonggong Sichuan difang shi zhuanti jishi: shehui zhuyi shiqi [Chronicle of major events in the history of the Sichuan local Communist Party: the socialist period ] (Chengdu: Sichuan People’s Publishing House, 1991), pp. 365–7. Yang Chao, Dangdai zhongguo, vol. 1, p. 202.

82 Lijian Hong 34 After the initial success in Chongqing, six other enterprises in Beijing, Shanghai and Tianjin adopted similar policies. Sichuan Provincial People’s Government, Sichuan sheng liyong waizi cujin jingji fazhan de yanjiu baogao [Report on Sichuan’s utilization of foreign capital for greater economic progress] (Chengdu: np, 1995), p. 226. 35 Chongqing Statistical Yearbook 1996, pp. 17–19, 73, 223, 241. 36 William A. Byrd and Gene Tidrick, “The Chongqing Clock and Watch Company,” in Willian A. Byrd (ed.) Chinese Industrial Firms under Reform (Oxford and New York: Oxford University Press, 1992), pp. 5, 105. 37 Chongqing Statistics Bureau (ed.) Chongqing tongji nianjian 1996, pp. 400–1. 38 Zhang Deling,“Zai zhonggong Chongqing shi di qi jie liu ci quanwei (kuoda) hui shang de jianghua” [Speech at the 6th plenary (enlarged) meeting of the 7th City Party congress of Chongqing], in Chongqing City People’s Government (ed.) Chongqing nianjian 1996, pp. 1–12. 39 The State Planning Commission wrote to Sichuan that the Commission was to grant Chongqing the status of separate planning city. The proposal did not receive a response from the province. Jiang Yiwei (ed.) Jingji fazhan yu jingji gaige [Economic development and economic reform] (Beijing: Economic Management Press, 1988), p. 483. 40 In 1985, the proportion changed to center 39.5 percent, province 23.5 percent, while Chongqing remained unchanged. Yang Chao, Changjiang, p. 219; also Wei Liqun (ed.) Shichang jingji zhong de zhongyang yu difang guanxi [Central–local relations under the market economy] (Beijing: China Economy Press, 1994), p. 5. 41 From an interview with a government ofﬁcial in Chongqing, 1997. 42 Huang Jiren, Sanxia gongcheng yian shi zhengyang tongguo de? [How was the motion on the Three Gorges project passed?] (Chongqing: Chongqing Publishing House, 1992), p. 97. 43 The economic development strategy of Sichuan during the Ninth Five-Year Plan was summarized as developing “two wings and two lines.” “Two wings” referred to the Three Gorges Project in the east and the Panzhihua Steel Complex Project in south-western Sichuan. “Two lines” referred to two railway lines linking Chengdu with Panzhihua and Chengdu with Chongqing. From an internal document of the Sichuan Provincial Government, August 1996. 44 From an interview with a government ofﬁcial in Chongqing, 1997. It is said that Xiao Yang, former mayor of Chongqing and then governor of Sichuan, believed that Chongqing was unable to develop under the province and that separation would assist development. 45 From interviews with the provincial government ofﬁcials in Chengdu and party and government ofﬁcials of Chongqing in June 1997. 46 Qin Lide, “Bannian qianhou, liang ge Chongqing” [Two Chongqings within half a year], Nanfang zhoumo [Southern weekend], 21 March 1997, p. 2. 47 From interviews with local government and party ofﬁcials in Chongqing in June 1997. 48 Du Shougu, Chongqing fengli dui sichuan de yingxiang ji sichuan deduiying [Impact of the separation of Chongqing on Sichuan and Sichuan’s response], Sichuan jingji shehui fazhan zhongda wenti de zhengce yanjiu [Policy studies of major issues in the economic and social development of Sichuan] no. 6 (July 1996), pp. 1–3. 49 See Organic Law of the Local People’s Congresses and Local People’s

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Government, Chapter 3, Articles 32 and 40, in Legislative Affairs Committee of the Standing Committee of the National People’s Congress (ed.) Zhonghua renmin gongheguo falu huibian [Collection of the laws of the People’s Republic of China] (Beijing: People’s Press, 1985), pp. 66, 68–9. Yang Chao, Dangdai zhongguo, vol. 2, p. 12. Ironically, an article published in Zhanlue yu guanli [Strategy and management] advocated establishing “municipal provinces” in the four cities as an experiment aimed at reforming the current system of territorial administration in China. See Ma Shulin, “Lun shengji xingzheng quhua tizhi gaige” [On reform of the provincial level administrative units], Zhanlue yu guanli, no. 5 (1996), pp. 15–16. Chen Shipu, “Chongqing ren yao zhansheng ziji” [Chongqing people must overcome themselves], Dangdai dangyuan [Contemporary party members], no. 1 (1997), p. 4. From an interview with a local economist in Chongqing in June 1997. Yang Weimin, “Woguo lao gongye jidi fazhan chizhi de yuanyin ji gaizao yu zhenxing de silu” [Reasons of the slow development of the old industrial bases in China and the considerations of how to reform and revitalize them], Jingji xuejia [The economists], no. 4 (1993), p. 75. From an interview with local academics in Chongqing in June 1997. From an interview with a retired provincial ofﬁcial in Chengdu in June 1997. Fan Tianshun and Zhao Bo, Zhongguo gongchandang zuzhi gongzuo dashiji [Major events in the organizational work of the Chinese Communist Party] (Beijing: China International Broadcasting Press, 1991), p. 392. A detailed discussion and assessment of the national reform and post-1989 changes can be found in Yasheng Huang, “Administrative monitoring in China,” The China Quarterly, no. 143 (1995), pp. 827–43; also John P. Burns, “Strengthening central CCP control of leadership selection: The 1990 Nomenklatura,” The China Quarterly, no. 138 (1994), pp. 459–91. See Christopher Earle Neville, “Private business association in China: Evidence of civil society or local state power,” The China Journal, no. 36 (July 1996), p. 37; also Lucia W. Pye, “Factions and the politics of Guanxi: paradoxes in Chinese administrative and political behaviour,” The China Journal, no. 34 (July 1995), p. 48. While Neville is concerned with different career strategies among local ofﬁcials, Pye discusses new patterns of factional activities in post-Mao China. Neville, “Private business association,” p. 38. Not all local interests involved purely personal gains. Lu Xiaobo shows that institutional gain is at least as prevalent a motive for ofﬁcial corruption in reformera China as personal gain. See Neville, “Private business association,” p. 38, n. 30. Three out of four party secretaries in Chengdu after 1979 were native Sichuanese. All of them were appointed by the provincial Party committee. The only “outsider” party secretary in Chengdu, Mi Jiansu, was in any event the ﬁrst deputy party secretary and executive deputy mayor of Chengdu from the 1950s to the eve of the Cultural Revolution. The appointments of city mayors were similar to those of party secretaries. Three out of four city mayors were native Sichuanese. Two recent city mayors were both Chengdu natives. Information compiled from Zhang Guangcheng (ed.) Zhonggong Chengdu difangshi dashi ji [Major events in the local history of the Chinese Communist Party in Chengdu] (Chengdu: Chengdu Publishing House, 1995). Yang Chao, Changjiang, pp. 377, 379, 387. Ding Changhe was originally from

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65 66 67 68 69 70 71 72 73

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the South Service Regiment group which was composed of young students from Jiangsu and Zhejiang who came to Sichuan with the Second Field Army. He was one of the deputy party secretaries who survived the Cultural Revolution. Both Xiao Yang and Pu Haiqing are native Sichuanese. They are listed here as outsiders because they had worked outside Chongqing for considerable periods before assuming their positions in Chongqing. During the Congress session, Xiao urged deputies from Sichuan to write an open letter to Deng Xiaoping expressing their gratitude to the paramount leader. This conspicuous display of political loyalty elicited a negative response from the congress itself. Xiao was elected as the last alternate member of the Central Committee, and thereby surrendered any chance of election to the Politburo. Locals considered Pu Haiqing among the most open-minded of leaders when he worked in the province. Local ofﬁcials reported that Pu’s appointment was linked to negotiations between the center and the province. Given the importance of Chongqing in the region and its complicated political and economic relations with the province, Sichuan leaders sought someone who could maintain close ties with it. After more than ten years of working in the province, Pu appeared an ideal candidate for minimizing possible conﬂict between the province and the new Chongqing. Chongqing ribao [Chongqing daily], 2 and 4 June, 1997. From interviews with local party and government ofﬁcials in Chongqing in June 1997. Similar complaints were heard from all ofﬁcials interviewed during my visit to Chongqing in June 1997. Li Peng’s instruction to Chongqing during his inspection tour in Chongqing. See Chongqing ribao [Chongqing daily], 19 June 1997. “Chongqing to assume bigger role in economy,” China Daily Online, 25 December 1996 <www.chinadaily.com.cn>. Zhou Yong (ed.) Chongqing, pp. 367–8. According to Zhou, over 80 percent of wartime government loans were made to industries in Chongqing. Liu Liping, Pang Ju and Tong Xiaoping (eds) Chongqing shi, pp. 29–38. Zhou Yong (ed.) Chongqing, p. 369. He Haoju (ed.) Dangdai Sichuan jiben jianshe, 1950–1985 [Capital construction in contemporary Sichuan, 1950–1985] (Chengdu: Sichuan Academy of Social Sciences Press, Chengdu, 1987), pp. 416, 418–19. Percentages reﬂect the author’s calculations. The original Third Five-Year Plan was devised under the inﬂuence of moderate leaders Liu Shaoqi and Zhou Enlai. It was soon abandoned in favor of Mao’s radical plan based on the assumption that a new world war was inevitable. Liu Liping, Pang Ju and Tong Xiaoping (eds) Chongqing shi, pp. 6, 8–9. Wang Xiaogang, “Woguo sanxian gongye zhengce de tiaozheng” [Adjustment of third front industries in our country], Zhongguo gongye jingji yanjiu [Studies in Chinese industry], no. 5 (1989), p. 60. Liu Zhizhong (ed.) Chongqing [Chongqing] (Beijing: China City Press, 1993), pp. 24–5. The central government helped Chongqing to build three joint ventures with the Japanese motor vehicle manufacturers Honda, Yamaha and Suzuki. By 1994, Chongqing had become the largest motor-bike producer in China, with an annual output accounting for more than one third of the national total. See Chongqing

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City People’s Government (ed.) Chongqing nianjian 1996 [Chongqing yearbook 1996] (Chongqing: Chongqing People’s Publishing House, 1996). Zhang Guangliang, “Chongqing gongye” [Chongqing industry], Dangdai dangyuan [Contemporary party members], no. 5 (1997), p. 14. Chen Wanzhi, “Chongqing ruhe duidai yanjiang sheng shi gongye jiegou qutong?” [How will Chongqing deal with the trend toward similar industrial structures among the provinces and cities along the Yangtze River?], Dangdai dangyuan [Contemporary party members], no. 1 (1997), p. 14. Chongqing City People’s Government (ed.) Chongqing nianjian 1996, p. 125. Chen Shipu, “Chongqing ren,” p. 6. From an interview with a local economist in Chongqing in June 1997. Pu mentioned this comment repeatedly on different occasions, notably at city governmental meetings. From interviews with local academics in Chongqing in June 1997. Frances Perkins, Productivity Performance and Priorities for Reform of China’s State-Owned Enterprises (Canberra: Research School of Paciﬁc and Asian Studies of the Australian National University, 1996), pp. 1, 30–1. Perkins refers to the productivity performance of Shenzhen, Xiamen, Guangzhou and Shanghai. Huang Yasheng, “Web of interests and patterns of behaviour of Chinese local economic bureaucracies and enterprises during reforms,” The China Quarterly, no. 142 (1992), pp. 431–2. From interviews with local academics and government economical planners in Chongqing in June 1997. In his article, He Guanying argued that the more backward the region, the more that local administrative power would play a leading role, in turn affecting the development of local markets. He Guanying, “Lun fazhan zhongguo xibu jingji bixu yi zhongqing wei zhichengdian de biranxing” [On the inevitability of using Chongqing as a supporting point to develop the economy of China’s west], Chongqing shehui kexue [Chongqing social sciences], no. 3 (1997), p. 44. Han Yuhui (ed.) Kangzhan shiqi de Chongqing jingji [Economy of Chongqing during the war of resistance against Japan] (Chongqing: Chongqing Publishing House, 1995), pp. 62, 79, 85. From interviews with local academics in Chongqing in June 1997 Chongqing Statistics Bureau (ed.) Chongqing tongji nianjian 1993 [Chongqing statistical yearbook 1993] (Beijing: China Statistics Press, 1993), p. 91. Zhou Shixun, “Chongqing shi di san ci gongye pucha guoyou jingji zongkuo fengxi” [A general analysis of the third general industrial survey of the stateowned sector of the economy], Chongqing shehui kexue [Chongqing social sciences], no. 2 (1997), p. 69. Zhou Shixun, “Chongqing shi,” p. 70. Lin Lin and Li Shugui (eds) Zhongguo sanxian shengchan buju wenti yanjiu [Study of the problems of distribution of third front production in China], (Chengdu: Sichuan Science and Technology Press, 1992), p. 149. A total of ¥100 million was to be spent as a “maintenance fee” per year at least to 1990. Wang Xiaogang, “Woguo sanxian,” p. 60. The above section is a summary of ideas expressed by Lin Lin, Li Shugui and Wang Xiaogang. See the two notes preceding. Byrd and Tidrick, “The Chongqing Clock,” p. 105.

86 Lijian Hong 96 Lu Yuegang, “Zai diceng” [On the bottom rung], Zhongguo zuojia [Chinese writers] no. 3 (1996), p. 26. 97 Zhong Yaoqi, “Qiye xiagang renyuan fengliu nandian fengxi” [Analysis of the difﬁculties in re-employing workers who leave their positions], Chongqing shehui kexue [Chongqing social sciences], no. 1 (1997), p. 22. 98 There were several open discussions in local media about the re-employment of former state-owned enterprise workers. From these discussions, it appears that former SOE workers were not well favored by managers of new enterprises. 99 Zhao Xiaoling, “Chongqing ren, ni fusu ma?” [People of Chongqing, do you accept defeat?], Dangdai dangyuan [Contemporary party members], no. 1 (1997), p. 18. 100 See, for example, Margaret Barber and Gráinne Ryder (eds) Damming The Three Gorges: What Dam Builders Don’t Want You to Know, A Critique of the Three Gorges Water Control Project Feasibility Study (London: Probe International, 1993); Shiu-Hung Luk and Joseph Whitney (eds) Megaproject: A Case Study of China’s Three Gorges Project (Armonk, NY: M. E. Sharpe, 1993). 101 Zhu Zhiyong, “Chongqing fupin,” pp. 24–5. 102 Jin Xiaoming, Fengyu sanxia meng [Wind and rain among dreams of the Three Gorges] (Chengdu: Sichuan People’s Publishing House, 1992), p. 199. National and provincial ﬁgures are drawn from China State Statistics Bureau (ed.) Zhongguo tongji nianjian 1992 [China statistical yearbook 1992] (Beijing: China Statistics Publishing House, 1992), pp. 32, 37. 103 Lu Yuegang, “Changjiang Sanxia, zhongguo de shishi” [The Three Gorges of the Yangtze, a Chinese epic]. In Yu Minghui and Cao Ying (eds) Guangrong yu mengxiang [Glory and dreams] (Beijing: Tuanjie Press, 1993), p. 366. 104 Zhang Deling, “Report,” and “Zai zhonggong.” 105 Lu Yuegang, “Changjiang Sanxia,” p. 367. 106 Li Boning, “Sanxia kuqu yimin you tiaojian anpai hao” [Conditional arrangements for resettling migrants from the Three Gorges area]. In Su Ye (ed.) Sanxia de tiaozhan [Challenge of the Three Gorges] (Beijing: Economic Daily Press, 1992), p. 77. 107 Zhou Aiguo and Zhang Xuntang, Sanxia bushi meng [The Three Gorges project is not a dream] (Beijing: China Workers Press, 1992), pp. 165–7; Lu Yuegang, “Changjiang Sanxia,” pp. 365–9. 108 Sun Yueqi et al., “Guanyu sanxia gongcheng lunzheng de yijian he jianyi” [Opinions and suggestions regarding the feasibility research of the Three Gorges project], in Dai Qing (ed.) Changjiang, changjiang, sanxia gongcheng zhenyi [Yangtze, Yangtze: controversies over the Three Gorges Project] (Guiyang: Guizhou People’s Publishing House, 1989), p. 15. 109 Tian Fang and Lin Fatang, “Population resettlement and economic development in the Three Gorges Reservoir area,” in Shiu-Hung Luk and Joseph Whitney (eds) Megaproject, p. 189. 110 Sun Yueqi et al., “Guanyu sanxia,” and Li Rui, “Sanxia gongcheng ershiyi shijie zai ding” [The Three Gorges project should be postponed to the 21st century], in Dai Qing (ed.) Changjiang, p. 59. 111 Chen Kexiong, “Before and after the Three Gorges project: an interview with Qian Zhengying,” in Su Ye (ed.) Sanxia de tiaozhan, p. 63. 112 Ibid., p. 64. 113 Qiao Peixin, ‘There is a big hidden cost in the Three Gorges project budget,” in

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114

115 116 117 118

119 120

121 122

123

124 125 126 127 128

Dai Qing (ed.) Changjiang, p. 85; Tian Fang and Lin Fatang, “Population resettlement,” p. 131. Zhu Zixiang, “Pojie shijie nanti” [Solving a world-level difﬁculty], Dangdai dangyuan [Contemporary party members], no. 5 (1997), p. 9. Wang Zhuyao has also conﬁrmed that, based on May 1993 prices, total investment increased to ¥95.4 billion (¥38.4 billion more than the original budgeted estimate). The relocation program fund exceeded ¥30 billion. See Wang Zhuyao, “Considerations on the development of the Three Gorges economic zone,” Chongqing shehui kexue [Chongqing social sciences], no. 3 (1997), p. 29. Lu Yuegang, “Changjiang Sanxia,” p. 369. China Daily Online, 23 January 1997, <www.chinadaily.com.cn>. China Daily Online, 28 January, 1997, <www.chinadaily.com.cn>. Jiang Di, Sanxia baiwan yimin chulu he zai [Where are we to relocate a million migrants from the Three Gorges] (Chongqing: Chongqing University Press, 1992), p. 45. China Daily Online, 28 January 1997, <www.chinadaily.com.cn>. Wanxian County, for example, planned to rebuild a new city twenty times bigger than the submerged area, and fueling one that was thirty times larger. Jin Xiaoming, Fengyu, p. 200. Jun Jing, “Rural resettlement: past lessons for the Three Gorges project,” The China Journal, no. 38 (July 1996), p. 85. According to ofﬁcial ﬁgures, agricultural jobs on new land cost ¥6,491 each while jobs in new factories cost ¥16,400. See Philip M. Fearnside, “Resettlement plans for China’s Three Gorges dam,” in Margaret Barber and Gráinne Ryder (eds) Damming the Three Gorges, pp. 53–4. Zou Jiahua, “Guanyu tiqing shenyi xiujian changjiang sanxia gongcheng de yian de shuoming” [Explanation for the proposed motion to build the Yangtze Three Gorges dam], in Su Ye (ed.) Sanxia de tiaozhan, p. 20. Jiang Di, Sanxia baiwan yimin, pp. 56–8. Jiang Di, Sanxia baiwan yimin, p. 62. Zhu Zixiang, “Pojie,” p. 9. Jiang Di, Sanxia baiwan yimin, p. 62. Pu Haiqing, Chongqing ribao [Chongqing daily], 11 June, 1997.

88 authors name

Chapter Title

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Henan as a model From hegemonism to fragmentism Thomas Heberer and Sabine Jakobi *

Introduction Henan is China’s most populous province.1 It has long played a strategic role in Chinese history and in more recent decades has played a prominent part in the country’s politics as well. In this chapter we explore aspects of the history and political culture of Henan, paying particular attention to the collective memory or consciousness of its people and to trends in its recent political history. We focus on speciﬁc cultural features and local patterns of socio-economic development, partly to highlight important features of provincial life, and partly to provide an interpretive strategy for approaching recent developments in the province. In identifying speciﬁc cultural features, we focus heavily on the egalitarian heritage of the province – in some cases bordering on communitarianism – and note how this heritage relates to a deeply-rooted sense that Henan has lost its central role in China’s national life. These two patterns converge, today, to produce a phenomenon of “modelism” in Henan – a tendency to identify and promote apparently unique local social and political structures as though these provided models for the rest of the country to emulate.2 There is a paradox here. From 1949, Henan was a model province in every national political campaign, and was home as well to numerous model units that attained national prominence. The two models – the provincial and the local – basically reproduced a uniform national model of socialist development. Since the start of the reform era, Henan no longer counts as a model province for others to follow. It ranks instead among the less-developed provinces that are called upon to follow the lead of others. At the local level, however, Henan still goes on producing models. This time around there are key differences in the local production of developmental models. First, some of Henan’s local models now offer explicit alternatives to the free-wheeling market ideals currently promoted in the coastal provinces. The local community of Nanjie is especially interesting in this regard: Nanjie is promoted as a contemporary counter-model for an older and more familiar kind of socialism. Second, local models are no longer uniform or hegemonic across the province as a whole. Nanjie is just

90 Thomas Heberer and Sabine Jakobi

Henan Province

General GDP (billion yuan renminbi [RMB]) 457.61 GDP annual growth rate 8.00 as % national average 105.26 GDP per capita (yuan RMB) 4,894.00 as % national average 74.90 Population Population (million) Natural growth rate (per 1,000) Workforce Total workforce (million) Employment by activity (%) primary industry secondary industry tertiary industry Employment by sector (%) urban rural Employment by ownership (%) state collective private self-employed individuals Wages and Income Average annual wage (yuan RMB)

93.87 7.72 52.05 63.60 17.50 18.90 17.17 82.83 8.98 2.62 1.19 7.34 6,194.00

Growth rate in real wage 10.90 Urban disposable income per capita 4,532.36 as % national average 77.42 Rural per capita income 1,948.36 as % national average 88.15 Prices CPI [Consumer Price Index] annual rise (%) Retail Price Index annual rise

-3.10 -3.80

Foreign trade and investment Total foreign trade (US$ billion) Exports (US$ billion) Imports (US$ billion) Realised foreign capital (US$ billion)

1.75 1.13 0.62 0.52

Education University enrollments 185,486 Secondary school enrollments (million) 5.69 Primary school enrollments (million) 11.87 Notes: All statistics are for 1999 and all growth rates are for 1999 over 1998 and are adapted from Zhongguo Tongji Nianjian 2000 [Statistical Yearbook of China 2000], Zhongguo Tongji Chubanshe, Beijing, 2000.

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one of several models of local development currently promoted within Henan, and its socialist ideals are countered in turn by other development models that apparently demonstrate the virtues of free-market capitalism. In this sense, Henan is evolving from a hegemonic or one-dimensional political system to a fragmented one. Third, in any given local community only one developmental model is tolerated. Nanjie, for example, is not just a local model but a closed local community that allows neither exception nor dissent. Hence, at the local level, Henan’s fragmented provincial political system reproduces the hegemonic practices that once characterized the province and the country. At the level of the township and the village, authoritarianism reigns. We do not argue for one pattern of cultural inheritance in Henan – even for a single and unique pattern of egalitarianism. Nor do we claim that Henan is unique, as several of the features we identify are also to be found in other provinces in central China, including Anhui and Shaanxi. Rather, it is the combination of features in Henan that appears to produce a provincial pattern of hegemonic and fragmented “modelism.”

The geographical dimension: Yellow River, loess and natural calamities Henan is rich in natural resources, and for this reason served as a granary for the empire. But it is also a home to frequent natural disaster. Nine hundred and eighty-two large-scale disasters are listed as affecting Henan in Chinese annals over the past 2100 years.3 Today no year passes without drought in one part of the province or serious ﬂooding in another: on average, onetenth of all cultivable land in the province is affected by ﬂood and famine each year. Locusts and sand storms also plague the province. The frequency of natural disasters is connected to the geographical and climatic conditions. A period of heavy cloudbursts in June and July is followed by a rainless period of 8 months. Further, the region’s fertile loess soil requires regular maintenance of a sophisticated irrigation system. Even then, sophisticated irrigation systems cannot always compensate for the ﬁckle meandering of the Yellow River – often called “China’s sorrow” – that has changed course many times along its lower reaches threading through Henan.4 The river has changed course twenty-one times in recorded history, generally from natural causes. The lower reaches of the river are loaded with loess and sediments – 1.6 billion tons pass along the river each year of which around 25 percent is deposited along the lower reaches – which raise the river bed around 10 cm per year. The lower reaches are protected by a connecting dike 1,356 km in length. Still, every high tide on the river poses a potential threat. Flood and drought have often resulted in famine, with disastrous consequences for the people of the province. In the provinces of Shanxi, Shaanxi, Hebei, Henan and Shandong, between nine and thirteen million people died from famine between 1876 and 1879, and from 1892 to 1994 a further million people lost

92 Thomas Heberer and Sabine Jakobi their lives. From 1942 to 1943 between two and three million people died of starvation in Henan alone.5 Henan’s history of natural calamities and economic misfortunes led to the development of extensive community-based security systems, and fostered the collective organization of hydraulic engineering and ﬂood control. Although such forms of cooperation are by no means conﬁned to Henan, they nevertheless pervade community life in that area to a special degree. But nature cannot be blamed in every instance. In 1642, during the peasant uprisings of the late Ming Dynasty, a rebel army under the leadership of Li Zicheng laid siege to the city of Kaifeng. After several attempts to break through the city’s defensive lines, Li’s engineers opened the dikes of the Yellow River to ﬂood the city, killing 900,000 people.6 Other disasters have resulted from sins of omission. During the Taiping uprising in 1853, a breach occurred in the dikes due to neglect of the extensive system of water control. The Daqin River absorbed the Yellow River, carrying it to the Bohai Gulf. Millions of people suffered in consequence, with devastating effects on patterns of life and economic activity on the North China plain. More recently, Chiang Kaishek ordered the local Sector Commander to blow up a dike near Huayuankou to stop the Japanese advance in 1938. The resulting torrents destroyed eleven cities and 4,000 villages, rendering 12 million people homeless and ruining the harvest in three provinces. Approximately 890,000 people died as a direct result of this vain attempt to halt the Japanese advance.

Historical and cultural dimensions: Henan as “cradle” of Chinese culture and ancient center of power Henan natives make a number of strong claims about the centrality of their province in Chinese history. Henan is said to be the originating source of Chinese culture and civilization: speciﬁcally, the home of the Chinese script, the source of Chinese family names, and the font of the major martial arts traditions. Henanese claim to be descendants of the Yellow Emperor (Huangdi), the ﬁctive founder of the Chinese genealogical line. In fact, many emperors and historical personalities did hail from the province: famous philosophers including Laozi, Zhuangzi, Han Fei, Lü Buwei and Cheng Yi; politicians such as Shang Yang and Li Si; military leaders including Yue Fei and Si Mayi; leaders of peasant movements, for example Cheng Sheng, Wu Guang, Wang Xianzhi and Shen Buhai; poets such as Li He, Du Fu and Bo Juyi; writers and painters such as Han Yu and Wu Daozi, as well as the astronomer Zhang Heng and the medical specialist Zhang Zhongjing. The prosaic name the province bears today (Henan: literally, South of the River) derives from the province’s location south of the Yellow River. But 2,000 years ago it was known as Zhongzhou (literally, central prefecture), or the prefecture at the center of the nine prefectures that made up China at that time (then known as Zhongguo, or Middle Kingdom, a term later

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applied to all of China).7 Henan’s topography afforded its inhabitants strategically favorable conditions. Several mountain ranges and rivers form a natural boundary to the south, west and north-west, while the plain in the east could be employed to produce two or three grain harvests a year. These conditions help explain why Henan was chosen as the site for one or another imperial capital for no less than nineteen dynasties in China’s history. The three cities of Anyang, Luoyang and Kaifeng account for more than half of China’s imperial capitals between them – indeed for almost all of them until the mediaeval period. Henan was one of the most densely populated areas in Neolithic “China.” The Neolithic cultures of Yangshao and Longshan were located in today’s Henan, and the last capital of the earliest historical dynasty, the Shang (sixteenth to eleventh centuries BCE), has been excavated at Anyang. The Eastern Zhou dynasty (770–221 BCE) was founded in the city of Luoyang, which served for a time as its capital. Luoyang remained important for many subsequent dynasties because of its proximity to the principal grain-growing areas of the era. Luoyang served as capital for a number of states over the Spring and Autumn period (770–481 BCE) and the Warring States period (475–221 BCE). The Han emperors moved their capital to Luoyang in 25 CE, and following the demise of the Han Dynasty the city served as imperial capital of the Wei (200–65), Jin (265–420) and Sui (581–618) Dynasties. Under the Tang emperors (618–907) Luoyang was a secondary capital. Nevertheless, it remained a key cultural and economic center. The second major capital of ancient times, Kaifeng, is also situated in today’s Henan. Kaifeng was capital of the Wei Dynasty during the Warring States period, and served as a capital in the Five Dynasties (907–60), in the later Liang Dynasty (when it was known as Dongdu, literally Eastern Capital; 555–587) and in the Northern Song period (960–1127). Various accounts from the Song era suggest that Kaifeng was a thriving cosmopolitan metropolis. The famous painting, “Qingming festival on the riverside” (qingming shanghe tu) gives a vivid impression of Kaifeng (then named Dongjing, lit. Eastern Capital) as a bustling and ﬂourishing capital city. Kaifeng was also home to a substantial Jewish community until the late nineteenth century. The province’s location between north and south China insured that it was a strategic heart of the empire. Many great battles were fought on Henan territory from the Spring and Autumn period through to the Warring States era – cited in the Three Kingdoms story cycles – and into the twentieth century, when key battles were fought in the warlord era, in the war against Japan, and in the Civil War of the 1940s. During the war against Japan, the Nationalists requisitioned more grain and recruited more soldiers from Henan than from any other province. Over the course of the twentieth century, the province also earned prominence as a railroad junction for major national trunk-lines that converged on the provincial capital of Zhengzhou. Historically speaking, however, Kaifeng never quite recovered from the Jürched invasion and sacking of the city in 1126. Thereafter, the

94 Thomas Heberer and Sabine Jakobi center of political power shifted north to Beijing, which became the preeminent imperial capital of the Chinese empire from the thirteenth century. In early modern and modern times, Henan was no longer the “central prefecture” of the empire.8 Although Kaifeng had passed its prime by the turn of the twentieth century, it still presented an impressive sight to the foreign visitor. In 1907, the Russian sinologist V. M. Alekseev noted of the city: Passing through [Kaifeng], we discover that it covers a huge area and has many shops. The buildings are grand, as in Peking, but even more beautiful . . . . It was already dark when we returned to our hotel. Still the center of Kaifeng, where we are staying, is illuminated bright as day and bustling with life. It reminds me of the City of London.9 Although traces of Jewish community life had largely vanished by the time Alekseev visited Kaifeng, he gave testimony to a still vivid cultural and religious life expressed in Muslim, Daoist, Buddhist, Confucian and other religious rites and festivals. He also mentioned a Catholic mission station staffed by an Italian priest.10

The rebellious dimension: secret societies and banditry The religious traditions with the greatest impact on Henan’s modern history have been the many streams of heretical folk religion that surfaced as chiliastic popular movements in the late imperial period and continue to invite suspicion in Beijing to this day. These movements have tended to emerge in times of ﬂood, drought and war, of which Henan has had more than its share. Religious sects that promise relief from want or that hold out hope for a better future have always ﬂourished in Henan province. In trying to trace the source of Henan’s socio-economic “backwardness” today, urban intellectuals and party cadres often criticize the underlying Confucian (Rujia) orientation of the local people. Perhaps the Confucian values of female chastity and ﬁlial piety present obstacles to the smooth and efﬁcient modernization of local communities; cadres certainly highlight folkConfucian practices that allegedly inhibit local economic development, including the erection or restoration of ancestral temples, and the use of arable land for burial plots.11 But Confucianism is only one of many viable religious traditions in Henan. A plurality of traditions work together to constitute a mentality of which Confucianism is only a part – and which together make up a cocktail of “feudal superstition” that is roundly condemned by authorities in Beijing. These include Daoist practices relating to agricultural production and health care; Buddhist religious practices involving prayers and sacriﬁces; the Christian House movement, with its common rituals and services; and heterodox religious and social organizations with a strong local ﬂavor.

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Although groups of believers rarely received ofﬁcial sanction they showed an impressive ability to mobilize their members across state lines. In the imperial era, some groups in Henan managed to organize pilgrimages of hundreds and thousands of adherents that lasted from 1 to 3 months at a time. At times these pilgrimages crossed provincial borders. In 1793 such a case came to the attention of the court in Beijing, which noted: “This [practice of pilgrimages] holds true in general for Chihli, Shantung, Shansi, Shensi, and particularly Honan.”12 Evidence of Daoist and Buddhist practices can, of course, be found everywhere in China. By contrast, the Christian House movement and a number of local heterodox social organizations have distinctive features in Henan that deserve close attention. Henan has the reputation of being one of two principal bases, along with Anhui, of the Christian House Church movement.13 Characterized by an admixture of Christian with Daoist and Buddhist practices, this movement is regarded by the central government as one further sign of Henan’s provincial “backwardness.” All chapters of the church – large and small – are subject to state attempts to regulate and control them and, as far as possible, to contain their local inﬂuence. The sect was forced underground during the Cultural Revolution but re-emerged in response to the more liberal policies of the Deng Xiaoping era. Even then, however, the sects were viewed with suspicion. An oft-cited example of repression of the group is the arrest of members of the Shouters sect in Henan, in 1983, and an immediate ban on all associated group activities.14 Another related community is the Jesus Family (Yesu jiating), founded by Jing Dianying in 1929 (some sources say 1920) in Shandong. The Jesus Family soon spread to Henan, where it retains signiﬁcant numbers of followers to this day.15 More recently, the arrest of Xu Yongze and other leaders of the New Birth Church, near the provincial capital of Zhengzhou, has focused international attention on religious persecution in Henan.16 As American and other foreign missionaries retain strong unofﬁcial contacts with these local Christian sects, the central government ﬁnds ready justiﬁcation to keep a close eye on their activities.17 Local heterodox social organizations also had distinctive features in Henan. Here, we refer in particular to a variety of underground societies with a religious orientation, and, to a lesser degree, to organized banditry.18 Early examples include the second-century Yellow Turbans (huangjin), a messianic movement of Daoist inspiration, and the Red Turbans (hongjin) a chiliastic movement dating from the fourteenth century that awaited the appearance of the Buddha Maitreya (Milefo). In more recent times, Henan was a rallying point for the Heavenly Order sect (Tianlijiao), for the White Lotus sect (Bailianhui),19 for the Nian movement,20 for the Heavenly Bamboo movement (Tianzhujiao), for the Society of Elder Brothers (Gelaohui), for the Green and Red Gangs (Qinghongbang), for the Persistent Way (Yiguandao) and for the Big Sword Society (Dadaohui), to name a few.

96 Thomas Heberer and Sabine Jakobi These groups tend to emerge in times of crisis, when membership expands through recruitment of impoverished and uprooted peasant farmers or demobilized soldiers. Over the century past, they also drew on regional networks of “traditional” transport workers, many of whom lost their jobs following the construction of two railway lines through Henan.21 They generally promised more than job security, however. Most secret societies promised their members return to an idealized social order, or promised to build a new egalitarian society on the principles of morality and higher justice.22 Often they anticipated the end of the world or some kind of apocalypse as a prelude to the arrival of an other-worldly or heavenly order.23 They also resorted to illegal or violent measures such as conﬁscating grain or land from wealthy families and assaulting public granaries. They referred to these actions as “food equalization” (jun liang).24 Henan also has a long-standing tradition of banditry.25 A strong lülin ethic of “Greenwood heroes”26 developed around the poorer western and southern areas of Henan in the nineteenth and early twentieth centuries, when banditry proliferated in remote parts of the province. The historical convergence of banditry, secret society organization and millenarian religious belief was responsible for the great popular rebellions that shook Henan in the mid-seventeenth and mid-nineteenth centuries. Henan played a central role in the late Ming rebellions, and suffered immensely from the great rebellions over the period 1861–63.27 One of the last large-scale peasant rebellions to occur in Henan occurred during the Sino-Japanese war, in 1944, when starving peasants attacked Chinese troops and disarmed approximately 50,000 soldiers.28 To protect villages against attacks of bandit groups, uprooted peasants and soldiers, local communities formed self-defense groups known as “village braves” (xiang yong). This holds true in particular for the mid-nineteenth century, when the Nian rebellion ravaged the province. Village braves were also responsible for erecting earth and brick walls around their villages, giving Henanese settlements a characteristically martial appearance.29 These groups later developed into paramilitary organizations that crossed village and even county borders. One of the many names used for these groups was “Red Spears” (hongqiang), to whom their activities were often attributed. The history of organized rebellion continued into the ﬁrst decade of the People’s Republic. The Red Spears organized anti-Communist activities in the early 1950s, and over the last ﬁve years of the decade an independent movement grew up in Henan around the claim that an 18-year-old emperor had appeared who would rescue the country from the Communists.30 Today, Henan is listed among the provinces where secret societies and folk religion still exercise the strongest appeal.31 A report prepared by the security authorities in the early 1990s concluded that Henan is one of the provinces where sects and secret societies are “deeply rooted,” nourished by poverty and superstition, and highly active.32

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The political dimension: history of a revolutionary model Developments after the founding of the PRC The Communist government in the early 1950s moved the provincial capital from Kaifeng to Zhengzhou, which soon developed from a railroad juncture and a small city to a major industrial hub. By establishing Zhengzhou as the capital of the province in 1954, the leadership emphasized its objectives for the province. They chose a new, socialist city, dominated by the modern industrial sector to undermine the orientation to the old historical–cultural centers and to embody the spirit of the new age. As the result of construction of colleges, universities and research institutes in the new provincial capital, Kaifeng lost its old position as the cultural center of the province (although Henan University remained there). Luoyang and Anyang also were patterned after the Communist notion of development, and built up as industrial production bases. This development, however, did not lead to a comprehensive modernization, but produced great intra-provincial socio-economic disparities, which survive to the present day. In the countryside, several attempts were made to reshape rural life from the ground up. Below, we address the major campaigns that occurred in the Maoist era. We will demonstrate how the historical disposition towards egalitarianism and communitarianism facilitated the introduction of certain radical agrarian policies, before we turn to the rural policies adopted in the Deng era. Originally, the land reform in Henan was intended to proceed at a moderate pace. Party documents warned against revolutionary impetuousness, and Deng Zihui, the propaganda chief of the army, declared shortly before the foundation of the People’s Republic that it was not land reform but rather “bandit suppression, equitable taxes, and a settling of accounts with the bullies” that were the main tasks of party work in Henan. Only a small minority of people were to be committed to the “class struggle.”33 This cautionary note reﬂected that CCP’s relative weakness in Henan at a time when it had not yet consolidated its authority. This moderate position, however, was criticized later when the land reform movement in Henan became extremely violent. Wu Zhipu, later party secretary of Henan, was responsible for its implementation.34 Not only landlords, but also rich and middle-class peasants were stripped of all their property, including movable property. Beatings and murders were widespread. The term “rich peasants” was interpreted so broadly that many middle-class peasants were included in the category.35 The First Five-Year Plan and massive central support led to considerable industrial growth relative to agricultural improvements.36 Although the agrarian sector was to be stabilized by large-scale irrigation projects, planning encouraged the industrial sector at the expense of agriculture. With the increase of collectivization, the role of Henan as a grain base and the control over the rural areas and the peasantry were intended to be strengthened,

98 Thomas Heberer and Sabine Jakobi particularly as, despite the transformation of the villages into cooperatives, the gross output value of agriculture was not much higher than in the ﬁrst year of the Five-Year Plan (1953: ¥3.154 billion; 1957: ¥3.57 billion).37 In each of the collectivization movements, Henan was more or less a revolutionary model. As in other parts of the country, lower-level cooperatives were established in 1955 and higher-level ones in 1956. By the end of 1956, 99.4 percent of peasant households in the province were organized in cooperatives, 98.7 percent of them in higher level ones, at the behest of the provincial party leadership. The year of 1956 was one of heavy losses in the agrarian sector. Collectivization destroyed the peasants’ initiative and undermined their ability to make decisions regarding cultivation and tilling. Party meddling in agrarian practices had lasting consequences. Harvest yields and the number of cattle decreased or stagnated almost everywhere. A reduction in the range of permissible private activity, in the collectivization movement, made it difﬁcult for peasants to switch to non-agrarian sources of income. There were bottlenecks and supply problems in many ﬁelds. The incomes of the peasants decreased dramatically. These difﬁculties were increased by extremely bad weather conditions and ﬂooding. Tens of thousands of people migrated from the starvation areas of Henan to northwest China and to other central Chinese provinces. Liberalization of rural policy was imperative in Henan if peasants were to recover from the chaos of the Great Leap Forward. Large numbers of peasants withdrew from agricultural cooperatives.38 Henan Party Secretary Pan Fusheng witnessed the difﬁculties caused by excessively large cooperatives, and fathomed peasants motives for abandoning them. Pan was reported to have expressed the view that the main contradictions in the countryside were not those between capitalist and socialist tendencies but, more signiﬁcantly, were contradictions “between the willingness and unwillingness of peasants to produce.” Pan criticized cadres for forcing the peasants into higher and higher forms of collective organization. He also argued that Henan Province differed from Beijing or Shanghai, and should adopt policies that reﬂected Henan’s particular needs. Beijing’s call for class struggle was, in Pan’s view, isolating the wrong people in Henan when it targeted middle-class peasants. In addition, Pan opposed the country-wide movement against so-called “rural rightists” in 1957. For voicing these opinions he was later criticized and dismissed during the Great Leap Forward. He was accused of exaggerating the difﬁculties of the cooperatives, of attempting to turn back the process of collectivization, and of denying the superiority of collective farming.39 In political campaigns Henan was also in the forefront. The Anti-Hu Feng Movement of 1955, which was primarily directed against intellectuals, was carried out very rigorosly in Henan. It led to the replacement of all chairmen of local writers’ unions. Ofﬁcial documents list 5,770 arrests in the Sufan “counter-revolutionary” movement of 1955–56. The number of

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people who were questioned and criticized was nevertheless considerable. In all, 600,000 people were affected by the movement; 200,000 letters of denunciation were received; and 80,000 people were forced to admit their errors.40 The Sufan Movement chieﬂy targeted urban intellectuals and “democratic personalities.” As Henan’s urban population at the time stood somewhere between 3.7 and 4.4 million people, the participation and criticism rate revealed in these ofﬁcial ﬁgures appears very high. During the Anti-Rightist Campaign, Henan was again one of the most active provinces. Henan’s radical character persisted in the movements to establish People’s Communes and during the Great Leap Forward from 1958 to 1960. In January 1958, the provincial Party Committee decided to irrigate and drain all the cultivable land, a step that required enormous mobilization of collective labor; to completely root out the “Four Basic Evils” (namely, ﬂies, mosquitoes, mice and sparrows); and to double or even triple grain output per mu. As against 1957, the last year of the First Five-Year Plan, it was planned that the gross industrial output of local industry at the end of the Second Five-Year Plan (1962) would increase by twenty-two times and gross agricultural output by forty-ﬁve times. It was also planned that steel output would increase more than 1,000 fold, from 4,000 to 5 million tons, and grain yields from 11.8 million to 100 million tons. These projected ﬁgures were inﬂated again at the start of 1959. Ownership of people’s communes was to be transferred to the state over the same period.41 Various production units outdid each other in claiming false and exaggerated levels of “success.” These reports of unprecedented “success” received wider publicity when the provincial Statistics Bureau was placed under the propaganda department of the provincial Party Committee. The Henan Daily reported in September 1958 that the daily production of steel in Henan now amounted to 28,000 tons. At an annualized rate, this would have represented an increase from 4,000 tons in 1957 to 10.22 million tons in 1958. In October, 1958, the prefecture of Xinxiang alone was said to have produced 1.2 million tons of steel per day – yielding an annual ﬁgure for the county that was roughly equivalent to total world production of steel in the 1950s. In August 1958, Mao visited the Qiliying people’s commune in Xinxiang county where the ﬁrst collective farm had already been founded. Here, he is reported to have made his famously cryptic remark that “people’s communes are good.” A few months earlier, the ﬁrst people’s commune (the Weixing or “Sputnik” Commune) was established in China, in Suiping prefecture in Henan. Henan was thus lauded as the ﬁrst province to implement Mao’s concept of rapid socialization and the ﬁrst to demonstrate that Mao’s program presented an achievable strategy for socialism. Henan came to be known as the “Holy Land of the People’s Commune Movement.”42 After Mao openly approved of the establishment of people’s communes – combining the functions of industry, agriculture, trade, education and defense in organized rural communities – Henan was the ﬁrst province to establish communes on a province-wide basis in August 1958. At the same

100 Thomas Heberer and Sabine Jakobi time, an egalitarian remuneration system was introduced for commune members. Before September was out, all peasant households in Henan were reportedly organized into communes. The fact that Henan took the lead in establishing people’s communes was attributed at the time to Henan’s particular need for rural collective services, including a functioning irrigation system in the catchment area of the Yellow River (for irrigation and drainage) and protection against natural disasters.43 The problems these two sets of collective services were intended to address were especially important in providing impetus to the establishment of communes, because several times between 1956 and 1958 Henan barely managed to escape ﬂood disasters, and only then by collective large-scale operations. In addition, the provincial leadership believed a large and wellorganized irrigation system would result in a signiﬁcant increase in grain yields and thus improve the status of the province. Although Henan was China’s leading grain producer, it only reached self sufﬁciency. The Party Committee argued accordingly: “If we get the problem of water conservancy straightened out, we can expect a wheat production increase of 1,000 percent.” But the implementation would require extensive efforts at county and town level.44 At the same time, people’s communes facilitated control of the rural population and thus the consolidation of party power. Henan was at the forefront not only in establishing rural communes, but also in founding urban ones. The ﬁrst urban commune in China was developed in Zhengzhou.45 Salaff argues that, as this city had just been industrialized, its workers retained strong agrarian roots. The labor force consisted mainly of worker-peasant migrants who brought their collective rural ideals to the city.46 By August 1958, when 173 urban communes had been set up in Henan, the province became the principal center of the national urban commune experiment. Owing to inefﬁciency and the lack of requisite materials, however, the urban communes were abolished after a short period.47 Henan was among the last of China’s provinces to restrict the “Communist Wind” of the Great Leap Forward, to give up collective canteens in which peasants consumed common meals, and to reduce the scope of people’s communes in the early 1960s.48 As early as 1958, Henan had experimented with paying wages according to work performed, and freely distributing goods.49 In the 16 September 1958 issue of Red Flag (Hongqi), the theoretical organ of the CCP, the party secretary of Henan described the practices of his province with respect to the free distribution of goods. Some communes provided their members with free rice and meals, others also provided free clothing and lodging in addition to medical care and education. In still others, members were provided with fuel, haircuts and cultural services free of charge.50 The campaign against critics of Great Leap policies went further in Henan than in other provinces. At the same time, Henan paid a higher price than others for acting as Mao’s model province. It recorded the highest

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starvation rate in the country during the famine that followed the Great Leap Forward. The provincial leadership was not deterred by its own failures, continuing to report fantastic economic achievements to Beijing even as hundreds of thousands were starving and as villages were rapidly depopulating. Almost one-third of the population of Chayashan People’s Commune, in Suiping County, starved to death by the end of 1960.51 Ofﬁcial ﬁgures show a population decline in Henan of 1.2 million people in 1960.52 Chen Yizi, former adviser to Zhao Ziyang, is reported to have claimed that the actual decline in Henan’s population was in the order of 7.8 million people.53 Something approaching a holocaust occurred in Xinxiang prefecture, where the local leadership declared war on peasants across scores of communes and several counties. A regime of terror held sway. House-to-house searches were conducted to conﬁscate foodstuffs as local cadres sought to accumulate and report “record” outputs. Any hint of criticism or dissent (or holding “Rightist” views) and any suspicion of hiding food was penalized by beating, torture and execution. Cannibalism was widespread. Hundreds of thousands of people are thought to have starved, to have suffered execution, or to have died under torture in Xinxiang prefecture alone. Still, the local leadership rejected offers of food aid from central authorities on the ground that the prefecture was still reporting record harvests. The situation grew so desperate that, in 1961, 30,000 PLA soldiers were dispatched to the prefecture in order to bring an end to the terror and starvation. Within a short while, 130,000 local cadres were brought under investigation and ordered “to reform their work style.” Very few were actually punished.54 In 1959 many hungry peasants returned to family cultivation without authorization. In some regions this development was tolerated by local party ofﬁcials. Provincial authorities were less forgiving. In the same year, peasants who returned to family farming were criticized by the provincial party leadership as “Right-Opportunists.”55 As a result of the famine, criminal activities and anti-party activities underwent a noticeable increase. In 1960, the local press reported cases of guerilla forces organized by peasants numbering up to 10,000 people. They stormed grain stores and redistributed grain to hungry villagers.56 In April 1962, Tao Zhu, ﬁrst secretary of the party’s Central-South Bureau, convened a conference of Henan provincial secretaries in Zhengzhou to discuss plans to invigorate the provincial economy. The conference issued a “Six-Year Plan for Recovering and Developing Agriculture in Henan.” Among other things it contemplated the introduction of household output quotas, the distribution of land by contract, and the lease of collective land. Under this plan, private use of up to 20 percent of the arable land was permissible. For a short time Henan became a sort of experimental province for the sanzi yi bao market reform policy. Under this policy, more farming plots were designated for private use, more free markets were planned, and more enterprises were encouraged to accept responsibility for their own proﬁt or loss. In addition, output quotas were ﬁxed on a household basis.

102 Thomas Heberer and Sabine Jakobi The Sanzi yi bao program was later criticized as “revisionist,” whereupon the Henan experiment with private production and market reforms was abandoned.57 A few years later, the provincial leadership was once again praised for its revolutionary eagerness. During the Socialist Education Movement from 1964 to 1965, the province attracted favorable attention for having successfully overcome capitalism and feudalism and for having raised the class consciousness of the peasantry.58 Henan, it was said, had mastered the “struggle between the two roads” and had given “all the power to the poor and lower-middle peasants.” Continuing resistance on the part of local cadres to the radical line of the provincial leadership must have been considerable. In the latter half of 1964, around one-quarter of all basic-level local cadres in Henan were reported to have come under criticism from higher authorities, and about 10 percent were reported to have been dismissed, expelled from the party, or punished.59 The Cultural Revolution was initiated with the ﬁrst big-character poster campaign at Beijing University in June 1966, and at Zhengzhou University and other universities in Henan around the same time. As in earlier campaigns, Henan carried out the Cultural Revolution with greater enthusiasm and violence than many other provinces. Mao Zedong commended Henan for its efforts. At one point in October 1966 he remarked that “only Henan has the character ‘boldness’ in mind. The majority [of provinces] have the character ‘fear’ in mind.”60 Some of the most active critics of Mao’s enemies among the “top Party leaders in authority” hailed from Henan. The ferocity of criticism of Mao’s enemies emanating from Henan may have accounted for the selection of Kaifeng as the site for imprisoning the “Arch Unrepentant Capitalist Roader,” President Liu Shaoqi. Liu died in his Kaifeng prison cell. After the Revolutionary Committee of Henan Province was established in 1968 and the Red Guards were driven from political life in the province, the situation was reversed. The Red Guards were reported to have retreated to the mountains to engage in “armed struggle.”61 Nevertheless, Henan recruited and promoted higher numbers of Cultural Revolution activists than other provinces. Between October 1973 and April 1974, 180,000 Cultural Revolution activists were admitted to the party, and 66,000 Cultural Revolution cadres secured promotions. This pattern of party recruitment may explain why the Leftist campaign against the “evil wind” (sha yaofeng) developed most violently in Henan and endured longer than elsewhere. For example, in 1975 ultra-Leftist forces at the party center and in the provincial leadership launched a country-wide campaign against “revisionist tendencies” by citing the 1973 suicide of a middle school pupil in Tanghe county in Henan. The pupil had been criticized by her teacher for expressing opposition on her English exam paper to the teaching of foreign language courses. Like other provinces, in 1975 and 1976 Henan faced a serious economic crisis. Ofﬁcial statements indicate that agricultural output, industrial output, and ﬁnancial income were 7.1, 19.5 percent and 32.7 percent lower in 1976,

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respectively, than in 1975.62 Many enterprises were no longer able to pay wages and salaries to their employees. Discontent expressed itself for instance in the unrest of April 1976, which spread from Beijing to Zhengzhou. As in other provinces, peasants spontaneously returned to family cultivation. Rural poverty and supply problems left the population with little choice. Return of the peasants to family cultivation began ﬁrst in Anhui, Sichuan and Henan, although the provincial party leadership in Henan at ﬁrst opposed this development.63 In Henan the purge of supporters of the Gang of Four and the implementation of central reform policies proved very difﬁcult. It was regarded as one of the most heavily-disputed provinces during the Cultural Revolution and one of the Cultural Revolutionary strongholds. Henan’s connections to the Gang of Four were very strong. At one meeting, Henan’s party secretary promised “mutual support” to Jiang Qing. Each key position in the province had been ﬁlled with adherents to the Cultural Revolution. After his second dismissal in the spring of 1976, Deng Xiaoping and his followers were heavily criticized in Henan.64 The most famous propaganda ﬁlm produced at this time by the Gang of Four, “Counterattack,” was produced and set in Henan. Some reports indicate that it had an “extremely bad inﬂuence” on Henan and caused “great harm” to the population.65 In the course of the Cultural Revolution, we noted, the provincial party organization had been purged of old members and occupied by young Cultural Revolution activists. The new cadres enjoyed a clientelist relationship with their central patrons, complicating reformist intervention in the province. As the Renmin Ribao reported at the beginning of 1979, “several rounds of intense struggle” were necessary to crush the power of these extensive clientelist alliances.66 Resistance to reformist intervention in Henan extended to the central leadership in Beijing. Two members of the so-called “Little Gang of Four” who were dismissed at the beginning of the 1980s started their careers in Henan. Wu De had been party secretary of Pingyuan, an independent province from 1950 to 1952 before it was reunited with Henan. Ji Dengkui had been party secretary of Xuchang67 and Luoyang prefectures in the 1950s. From 1966 to 1971, Ji was a member of the secretariat of the provincial Party Committee. In 1968, he became deputy chairman of the provincial Revolutionary Committee. From 1971 to 1973, Ji was secretary of the Party Committee while occupying his position at the center as an alternate Politburo member from 1969 to 1973. From 1973 to 1980 he was a full member of the Politburo.68 With such powerfully placed Cultural Revolution activists from Henan exercising inﬂuence in Beijing, reform in Henan was stymied. In 1978, the Henan party leadership was replaced in full, in part because it had been slow to conduct the necessary purges on its own account, partly because central reforms were implemented only half-heartedly, and ﬁnally, because no measures had been taken to redress urgent problems facing the

104 Thomas Heberer and Sabine Jakobi inhabitants of the province. As late as 1978, for example, the after-effects of a major ﬂood that struck the province three years earlier were still being felt. More particularly, the provincial leadership failed to provide the inhabitants of the disaster areas with even a minimum of food aid. Thus, Radio Henan claimed at the close of 1978: “Since not much has been done for those people who are living in desperate poverty, the masses have become extremely discontent.”69 In October 1978, complaints were still heard regarding the considerable difﬁculties in eradicating the followers of the Gang of Four in Henan.70 In July, 1979, Henan Ribao reported that supporters of the Gang of Four retained their positions in one-quarter of all party and administration units at the provincial level.71 Only in August of 1981, according to Renmin Ribao, was the Cultural Revolution brought to an end in Henan.72 In fact Renmin Ribao spoke too soon. In March 1982, Radio Henan reported the dismissal of Cultural Revolutionary ofﬁcials who had not changed their views over the intervening year.73 The problem continued to surface for many years, and criticism of Leftist tendencies continued unabated.74 For example, during the Fourth Provincial Party Conference in August, 1984, it was reported that many units neglected to purge cadres who had ascended the ranks in the Cultural Revolution.75 Signiﬁcantly, similar levels of opposition are reﬂected in attitudes toward collectivization and decollectivization. Long after the Gang of Four has disappeared from the scene, reports from the countryside continue to note opposition by cadres to far-reaching economic reforms in the province. In general, rural reforms in Henan have relied on an egalitarian modus vivendi. Our own observations in that respect are further conﬁrmed by empirical data gathered in a study undertaken in 1994 in eighty villages in the provinces of Zhejiang, Henan, Jilin and Jiangxi. This modus vivendi usually comprises a distribution of land on an equal basis, regardless of gender, age, or number of work points in the former collective system, and which provided for regular land redistribution to adjust for demographic changes. The authors of the eighty village study also point out that land transfer rights were most tightly controlled in Jiangxi and Henan, and that in both provinces governments retain the strongest grip on the land to be found in China. They argue that scarcity of land and low productivity are the main reasons for these egalitarian policies.76 However, we would also like to draw attention to the long tradition of egalitarianism prevailing in Henan, which we believe also helps to explain these tendencies. Today, the system of “township cadres being responsible for villages” (xianggan bao cun zhi) is still widely practiced in Henan, suggesting that villages remain under the control of regional authorities despite central government promises to grant them greater autonomy. A change for the better occurred only at the beginning of the 1990s when Hou Zongbin, who had been sent by the party center in Beijing, became party secretary. Over this period, Henan ﬁnally ceased to be a conservative Communist hegemonic model. Hou had extensive experience in various

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provinces. He appointed a younger and more professional staff of cadres. He acquitted himself quite well as Henan party secretary, which may account for his promotion to deputy secretary of the CCP Central Discipline Inspection Commission in October 1992. In December of that year his deputy, Governor Li Changchun, assumed the party secretary position in Henan. Henanese intellectuals, however, are said to be suspicious of the central government’s intentions towards their province. They covertly accuse central authorities of hindering provincial development and preventing Henanese politicians from building strong leadership positions in the provincial government.77 However, even today the despotism and arbitrariness of cadres in Henan is marked. In 1988, Nongmin Ribao reported that the relationship between the cadres and the masses was very tense, and that there was little chance of local people defending themselves against the cadres’ abuse of their positions. The local implementation of edicts from the central government afforded the cadres the opportunity to exert dictatorial power. On one occasion, for example, a document from Beijing ordered the cadres to convince the peasants of the necessity of selling higher grain quotas to the state. According to the newspaper, village cadres then posted a sign at the ofﬁce of the village Party Committee that read: “The children of peasants who are not able to raise grain-purchase quotas are not allowed to attend school. Such peasants will be denied permission for births, and will have their contracted land allotments withdrawn.”78 Poverty, cadre despotism, and ofﬁcial corruption have increased the potential for protest, which had, we noted, always been strong in Henan. In a 1991 report of the State Council, Henan was classiﬁed as a politically and socially unstable province, in which protest actions could be expected from time to time.79 Henan was also listed among those provinces with the highest incidence of organized crime in the ﬁrst half of the 1990s.80

Henan’s economic development Although Henan has followed the general outlines of the central reform program, implementation of particular reforms has proven more problematic than in the coastal provinces. This holds true for much of central China. As late as 1998, the China Daily cited Chinese economists to the effect that “Central China must still break free of the shackles of the old economic structure,” in this context referring to the shackles of the centrally planned economy.81 This certainly applies to reform of the ownership system. Like the state-owned sector all over China, enterprises in Henan entered a period of crisis early in the 1980s. Owing to technological backwardness and lowquality standards most of Henan’s enterprises could not compete with enterprises in the coastal areas. In Henan the crisis was particularly profound. In 1995 alone, 57 of 177 state enterprises were closed or partly closed in Kaifeng, one of the province’s major industrial centers.

106 Thomas Heberer and Sabine Jakobi The erosion of the state sector in the 1980s stimulated rapid growth in the non-state sector over the following decade. By 1995, the non-state sector accounted for 68 percent of the province’s gross industrial output.82 Privatesector development in Henan grew at rates above the national average. Between 1992 and 1997 the national private sector (individual and private enterprises) increased by 84.2 percent (for enterprises) and 151.6 percent (for labor), and by 132.2 percent and 168.5 percent, respectively, in Henan.83 The province’s small individual enterprises (getihu with less than eight employees) increased from 420,000 units employing 570,000 workers and staff in 1983, to 1.8 million with 3.232 million workers and staff in 1997. The number of larger private enterprises (siying qiye with more than eight employees) expanded from 3,467 employing 58,000 persons in 1987 to 34,203 units with 484,840 persons in 1997.84 The impetus for ofﬁcial support of private-sector development was laborforce pressure from rural areas, chieﬂy in consequence of the reversion to family farming and the associated rise of surplus labor in agriculture. This factor is particularly strong in Henan, where a larger share of the labor force is engaged in the agricultural sector than in many other provinces. In 1996, one-third of all counties were still regarded as “poor counties.” The provincial government, lacking necessary investment capital, is not able to fund a largescale antipoverty program. The private sector is therefore expected to contribute to a reduction in provincial poverty levels. In any case, the provincial leadership has been persuaded by the erosion of the state-owned sector and the lack of capital for restructuring state-owned enterprises that it must support the nonstate and private sectors. As large enterprises are relatively few in Henan, and state-owned enterprises are for the most part small- and medium-sized labor-intensive industries, the provincial government has opted to privatize most of these enterprises. In this case, the provincial government followed the lead of the central government. By the summer of 1998, 1,496 out of 2,157 small- and medium-sized state enterprises were privatized through outright sale and rent. Others were closed or merged with larger operations.85 Privatization and shutting down state-run enterprises led to a signiﬁcant increase in unemployment.86 According to the People’s Daily, in May 1997, the state-owned sector had only about four million employees, of whom 800,000 were counted as “surplus laborers” and 350,000 were already “set free.”87 However, resistance from within the bureaucracy was remarkably strong. The different positions and attitudes of the bureaucracy resulted in frequent policy oscillations. On one occasion, a pronouncement was made that the private sector was too big and should be restricted. On another occasion, it was said to be too small, and to be in need of development and enhancement. Even in 1996, ofﬁcials continued to declare that private enterprises in Henan should proceed towards “mixed-ownership enterprises” (hunhe suoyouzhi); that is, towards enterprises with mixed private and nonprivate

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ownership shares.88 Such uncertainties had the effect of inhibiting entrepreneurial reinvestment and encouraging higher private consumption.89 As state-owned enterprises shed labor and local authorities faced increased risks of social conﬂict, local governments in Henan tried to develop the private economy by any and all means. These included reverting to old habits of the planned economy. Our research ﬁndings from Luohe City in 1996, for example, demonstrate that local authorities ordered 20 percent development of the private sector each year. Under a special program, 100 private enterprises with a turnover of at least ¥1 million were to be established or developed every year. The responsible ofﬁcials were assigned ﬁxed quotas to attain this objective. Payment of bonuses correlated to fulﬁllment of the quotas. A new campaign was waged in 1999 under the title “Have deep love for Henan, add splendour to the Central Plains” (reai Henan, zenghui Zhongyuan).90 The aim was to integrate Henan’s population by strengthening their sentiments of provincial identity and focusing their efforts on provincial development. This, too, might be considered an expression of regionalism. It stands in contrast to central efforts to concentrate everything at the national level. The core of this campaign, placing Henan ﬁrst, means that the province has to develop regional policies suited to its particular characteristics, even if these policies differ from those put forward by the center. Why did Henan became a Maoist model province? We do not accept Domenach’s argument that the center in Beijing pulled the strings, and that Zhengzhou was politically “only a suburb of Beijing.”91 Domenach’s argument does not explain why Henan, in particular, became a Maoist model. Provinces in fact had the opportunity to implement centrally approved policies in a relatively independent way. These policies could be carried out radically. On the other hand, the provinces could choose to carry them out in a moderate manner. Far from being imposed upon, Henan forced its policies on the center by establishing the ﬁrst people’s communes, by popularizing these communes, by propagating highly exaggerated output quotas (demonstrating the unprecedented achievements of the Henan model during the Great Leap Forward), and by blowing strongly with the “Communist Wind.” In each of these ways, Henan directly inﬂuenced Mao’s policy choices and contributed to the radicalization and reception of his ideas, particularly regarding collectivism. There is no doubt that the provincial leadership played an important role in creating the Henan model. The main supporter of the “Maoist” model during the 1950s and early 1960s was Wu Zhipu. A native of Henan, Wu joined the Communists as a student in Kaifeng in the 1920s, and in 1926 was sent to the Peasant Movement Training Institute in Guangzhou for party training. At the institute Wu met Mao Zedong – who was one of his lecturers – and came into contact with Mao’s ideas on revolution and the peasantry. After his return, Wu and other party members from Henan were

108 Thomas Heberer and Sabine Jakobi instructed by the party to inﬁltrate the Red Spears and win them over to the CCP. Wu was so successful that he became a regional leader and commander of the Red Spears. But he was suspended from the party in 1927 when, under the inﬂuence of the Comintern, the Central Committee became highly critical of the Red Spears and their activities, and criticized party members for cooperating with the organization.92 This criticism was directed against Mao Zedong, among others, and their shared fate resulted in Wu becoming a ﬁrm adherent of Mao’s strategy and tactics. Wu’s suspension was a crucial experience in his life. Once his membership was restored he was conﬁrmed in his former political opinions. After the Nationalists ceased cooperating with the CCP in 1927, Wu joined other cadres in the mountain areas of Henan and participated in the establishment of the Communist base at Eyuwan. Before setting off for the mountains, Wu and other members of the Red Spears swore a blood oath of brotherhood in Kaifeng. Wu used his contacts with members of the Red Spears to strengthen the base in Eyuwan. When he became governor of Henan, in the 1950s, he could count on a strong and extensive network of grassroots supporters, including members of the Red Spears as well as his contacts in Eyuwan and fellow students from Kaifeng. Wu turned his local network to advantage in an on-going struggle with Party Secretary Pan Fusheng. Pan was a native of Shandong with few local connections in Henan. From 1950 to 1952 he had served as deputy party secretary of the newly created province of Pingyuan before his promotion to Henan. When Pan was dismissed from his post during the Great Leap Forward, Wu succeeded him as party secretary. But Wu himself was demoted to the level of second party secretary in 1961, when his “ultra-Left” policies were held to account for the excesses of the Great Leap Forward in Henan. Undeterred by his demotion, Wu adhered to his views, for which he was once again criticized as “Leftist” in 1964. He lost his life in Guangzhou three years later, possibly at the hands of Red Guards. In retrospect, Wu’s standing in the province and his extensive network of local allies appear to have facilitated implementation of his political ideas and promoted their acceptance via his networks long after he had been forced from the political scene. His personal career partly explains how and why Henan became a “model province” illustrating the virtues of Mao Zedong Thought.93 Wu, however, was only partly responsible for the fate of the province in the Mao era. People’s communes and the “Communist Wind” could not have taken off without a measure of support from numerous functionaries and perhaps from the majority of the people. China was not so completely totalitarian that the leadership could afford to ignore the peasantry, whose potential for opposition to unpopular measures could not easily be ignored. It would appear that local collectivist traditions, in concert with peasant expectations that social uncertainty could be minimized by collectivization, eased the introduction of radical measures.94 Moreover, as Henan had been relatively isolated since the end of the Song Dynasty, and was relatively

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untouched by foreign inﬂuences up to the twentieth century, elements of the egalitarian peasant vision were retained largely intact. Thus R. H. Tawney’s description of Henan in the 1930s still rang true many decades later. Henan, he observed, was economically primitive, [with] a population of agriculturalists engaged in a desperate struggle with nature, and taking refuge, when the strain becomes intolerable, in banditry, war or migration to Manchuria, with neither the surplus resources nor the mentality required to support a modern state.95 The rebellious traditions of the Henan peasantry, vented continuously in heteredox organization and collective action, were not immediately amenable to direct party control. As it happens, the Communist movement was not ﬁrmly entrenched in Henan before the founding of the People’s Republic. The Communists’ base areas were located at the frontiers of the province and many of their leading ofﬁcials were imported from elsewhere. Under these circumstances, the party could extend its effective control by adopting collective forms of social organization such as higher level cooperatives and people’s communes.

Fragmentated authoritarianism? A case study of Nanjie model village In recent years, the single hegemonic model of local development that characterized the Maoist era has been superseded by a variety of local models, suggesting a growing pattern of political fragmentation. Paradoxically, Maoism itself has retained much of its appeal. Among the new model villages that have emerged in rural areas are a number inspired by nostalgia for collective farming and by revulsion against the market-oriented reforms of recent decades. Among the better known of these model villages are Liuzhuang in Qiliying township96 (site of the famous people’s commune in Xinxiang County that Mao visited in 1958), Zhulin village in Gongxian County,97 and Nanjie village in Linying County. In these particular villages, private economic activities are either outlawed (in Liuzhuang and Nanjie) or restricted (in Zhulin). Property is held collectively, and the village collective provides a number of social beneﬁts. Nanjie, a national model village since 1997, illustrates some of the interesting features of present-day Henan model villages.98 Nanjie (literally, Southern Street) is located on National Highway 107 connecting Beijing and Shenzhen. In 1996, the village was home to 800 households with 3,130 inhabitants. In 1995 and 1996 the village possessed twenty-six modern enterprises employing over 12,000 people and yielding a gross industrial output value of 1.16 billion. Seventy-ﬁve percent of equipment was computer controlled. The largest industry is food processing, including operations for processing dairy products, instant noodles and frozen food, as well as facilities

110 Thomas Heberer and Sabine Jakobi for brewing beer. By and large, these products are processed from locallygrown materials. The average per-capita income in 1994, excluding social beneﬁts provided by the village, was ¥1,800. This compares favorably with the national rural average of ¥1,221 per capita in the same year, and is twice the provincial average of ¥910 per capita within Henan itself. To be sure, there are a great many villages in China’s coastal regions which have been catapulted into the headlines by their economic success. Nanjie tries to offer more. As the deputy party secretary of Nanjie explains, “We are the only Communist village in the world. Everything is collectively owned. We are a model village that develops according to the Mao Zedong Thought.”99 Mao Zedong Thought could not have produced Nanjie unaided. For a start, the village is heavily dependent on the opening of the labor market and on increased freedom for inter-village migration. Little more than 10 percent of the employees in Nanjie enterprises are natives of the village. The rest are drawn from thirty-six counties in eight provinces. In general, local people assume white-collar occupations while nonlocals perform manual labor and other tasks considered socially inferior, including provision of services. Piecework dominates the organization of labor. Turnover is quite high as nonlocals often tire of the pressure of work and Maoist ideology. The appeal of the collective model in Nanjie can also be traced to postMao reforms. Before 1985 Nanjie qualiﬁed as a “poor village.” The introduction of contracted family farming in 1981 contributed little to solving problems of poverty in the village. According to the deputy party secretary, many families continued to live below subsistence level because increased revenues from family farming could not keep pace with increasing costs and levies. Consequently, more and more people switched from agricultural to other pursuits, or chose to migrate to the cities. Surplus land was then leased to nonnatives who were more concerned with short-term gain than with long-term investment in agriculture. Grain output also declined. In 1985, the village reached the lowest level of grain output in decades: 500 jin per mu against 1,000 jin per mu in 1978.100 Social breakdown and agrarian decline were accompanied by growing stratiﬁcation in the village. Some people became rich through private economic activities while others, who relied mainly on farming, remained poor. Those who migrated to the cities were primarily the younger and most capable people, leaving behind the women, children and elderly. The combination of out-migration of the young villagers, aging within the village, disintegration of families, and increasing nonlocal control over productive land came to be seen by the villagers as symptomatic of a deep-seated social and economic crisis affecting the life of the village. Something had to be done. In the mid-1980s the village leadership addressed these problems through a change of policy. From 1986 the leasing of land to nonlocal people was forbidden, as was permitting land to lie fallow. Families that failed to utilize allocated land were obliged to return it to the village for redistribution, in return for free grain. In addition, village enterprises leased to private persons

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were to be returned to the village. As the proportion of households generating income from the nonagricultural sector grew, a greater number of households began to return their land to the village collective.101 When plans to expand the village’s collective enterprises were thwarted by reluctance on the part of banks to supply loans, the Party Committee collected ¥3,000 from party members. Eventually the Party Committee persuaded other villagers to contribute money as well. This voluntary levy provided the capital foundations for the large modern enterprises of today, according to the deputy party secretary.102 And the larger policy shift from laissez-faire capitalism to collective provided the basis for what is known as the “Nanjie Model.” The “communism” of Nanjie: patterns of distribution An assortment of collective beneﬁts and wage payments were instituted in Nanjie in 1986. Since then, the range of items distributed gratis has expanded by one or two items each year. In 1996 the following goods and services were provided free to native residents: apartments of about 90 square meters with standardized furnishings, refrigerator, heating, color TV and other electrical appliances; hot water twice a week; air conditioning; a standardized set of clothing; medical care and retirement insurance; bathing in the public bathing house; haircuts; electricity, gas, water and coal; thirty-one foodstuffs as well as food in the public canteen; kindergarten and other education through university; cultural activities; life insurance; agricultural fees and taxes; and a porcelain statue of Mao Zedong. The village pays for these items in full. In 1995, the village leadership allocated a total of ¥2.8 million for beneﬁts of this kind. Wage payments were kept low to sustain a high level of collective beneﬁts. Thus in 1996, manual workers received a monthly average wage of ¥180, with a maximum of ¥250. The deputy party secretary reports that wages were graded with ﬁxed upper limits. This was also true for village cadres, although the salaries of scientiﬁc and technical personnel were set at higher levels – between ¥500 and ¥4,000 – to attract suitably qualiﬁed urban professionals. The wages of nonlocal workers were 20 to 30 percent higher than those of native workers because nonlocals were entitled to fewer collective services. There were no bonuses or overtime allowances. Local cadres justify this mixed system of community services and private wages by reference to China’s current stage of development. On a national scale, the deputy party secretary observes, China is in a lower socialist stage of development that requires distribution according to work. The “advanced communist spirit” of Nanjie, however, affords opportunities to supply goods and services according to need. The objective of communism was the elimination of private ownership. This had not yet been achieved. Nevertheless, Nanjie, he noted, led the way in preparing for this ﬁnal stage. And Nanjie provided ample evidence that the larger communist project was still attainable.

112 Thomas Heberer and Sabine Jakobi The name of Mao Zedong is deeply etched in Nanjie “communism.” On the occasion of Mao’s 100th birthday, in December 1993, the village spent ¥260,000 to erect a huge marble statue of the former leader in the village square. Members of the uniformed village militia form a guard of honor around the clock. At ﬁxed hours, revolutionary songs praising Mao from the 1960s and early 1970s are broadcast through loudspeakers all over the village. As the village leadership insists that Mao Zedong Thought is the guiding principle for their success, so the statue and its associated rituals are intended to carve the merits of Maoism into the memory of every inhabitant.103 Material and symbolic support in Nanjie The leadership of Nanjie remains silent about the source of much of the capital investment that has been used to industrialize the village. Ofﬁcials from the administrative city of Luohe told us unofﬁcially that ﬁnancial credit to the value of around ¥420 million was provided by banks on instruction from conservative forces in the Beijing leadership. Nanjie was to be built up as a “counter-model” to the foreign and market-oriented Special Economic Zone of Shenzhen. The village’s proximity to markets and access to favorable rail and highway links may have played an important part in the selection of Nanjie for this role. Measured by the number of prominent visitors who have made the pilgrimage to the village, the Nanjie model carries considerable symbolic signiﬁcance. The list of visitors is impressive. It includes the older party and military veterans Song Ping, Li Desheng, Yang Rudai, Zhang Aiping, Wang Enmao and Xiao Ke, along with current party and state leaders such as Qiao Shi, Zhu Rongji, Li Lanqing, Luo Gan and Song Jian. Qiao Shi, chairman of the National People’s Congress, echoed Mao’s comments on the people’s communes of Henan by declaring to the people of Nanjie: “You are doing well, the way is right!” Following his visit, former Defense Minister Zhang Aiping appealed for propagation of the Nanjie model throughout the country. Song Ping, a former member of the Politiburo, proclaimed that the village was “The Yan’an of today’s China.” And the veteran general Li Desheng remarked that in Nanjie he had, at last, seen communism (and it worked). Two of these national visitors had direct links with Henan: Luo Gan, secretary of the State Council, was deputy governor of the Province from 1981–83 and secretary of the provincial Party Committee in 1983. Hou Zongbin, deputy secretary of the Commission for Discipline Inspection of the Central Committee, was party secretary of Henan in the early 1990s. Luo Gan possibly used his key position on the State Council to set the agenda on the Nanjie model, and to arrange for pilgrimages to Nanjie by important party and state leaders. Luo and Hou are also likely to have played important roles in securing central intervention with the banks to insure that Nanjie received the capital investment it needed to serve as a model.

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Objectives and mechanisms of enforcement in Nanjie The motto of Nanjie village is “Inside the village a collective economy and outside, a market economy.”104 Objectives on the “inside” are to develop a collective economy and eradicate remnants of the private economy, to develop a materially prosperous community, to maintain a highly civilized culture, to create a community that loves the party and the nation, and to insure liberty, equality and happiness for all. Pursuing these objectives in face of the radically different “outside” objectives of the market economy calls for clear boundary marking and severe discipline in Nanjie village. The behavior of villagers is assessed according to a ten-point system, with ten stars denoting optimal behavior, and progressive penalties imposed for each infringement that results in a lost star. The ten points refer to ideology and morality (sixiang pinde), respect towards teachers and esteem for education (zun shi zhong jiao), a positive attitude towards labor, high moral and ethical behavior, good relations among neighbors, compliance with birthcontrol measures, proper conduct towards the environment and in matters of hygiene, and commitment to the well-being of the village community. For every star (or point) lost, a family surrenders one of its cost-free beneﬁts such as free provision of coal, electricity, gas, water or food. In this case, lost goods and services have to be purchased from the collective at relatively high prices. Any violation of regulations governing labor discipline or community affairs attracts re-education by one of three methods: by criticism and selfcriticism, by assignment to a “study course for spiritual civilization,” or by re-education through performing a “ﬁlm show.” Re-education by “ﬁlm show” involves the offender standing on a platform in front of a village audience, and publicly proclaiming the circumstances of his or her wrongdoing. Village cadres believe that this method brings great psychological pressure to bear on the offenders. As one noted, “even your own children won’t look at you for days.” The inhabitants of Nanjie seem to fear this punishment most of all as it involves public loss of face. Villagers eagerly study the works of Chairman Mao in the hope of “avoiding mistakes” and averting punishment.105 A good memory is amply rewarded: indeed, one condition for landing work in Nanjie is to be able to recite a few quotations of Chairman Mao. Memorization is expected.106 Punishment is designed to effect behavior modiﬁcation. For example, should a man repeatedly beat his wife he would not only have to practice self-criticism but also be obliged to correct his relationship with his wife. Similarly, neighbors who frequently quarrel may be instructed to pull down the wall between their apartments to force them to confront one another directly. And women who squabble over their children may be ordered to perform several “ﬁlm shows” until they correct their behavior.107 These methods, explains the party secretary, correspond to rustic concepts of customary law.108 Indeed, in speaking of law, the village community in Nanjie refers to the violation of village law, not to the violation of state law. With the approval

114 Thomas Heberer and Sabine Jakobi of higher authorities, state law is subordinated to customary law in Nanjie. Ofﬁcial state policy is also circumvented. In keeping with the policies of the reform era, the national Constitution explicitly guarantees the right to engage in private economic activities. When asked what would happen to someone who wished to establish private enterprise in Nanjie, however, one local ofﬁcial responded that “nobody has any such intention here.” If they did, they would have to leave the village. Mao Zedong Thought is the ultimate arbiter in Nanjie, standing high above local regulation, state regulation and national policy. When asked what would happen should someone transgress the principles of Mao Zedong Thought, the deputy party secretary responded: “I don’t know what would happen under state law. But here they would be punished.” On the Nanjie model, local regulations are nevertheless thought to be closely bound up with national law and policy in the sense that the locality (in this case Nanjie) is imagined as the organic unit of the national state. In this way, a local vision of village law is bound up with a national vision of social discipline. Education and re-education are directed to a similar purpose – to inculcate “ideals of socialism and communism” (namely “to love the collective” and “to sacriﬁce oneself in the interest of the community”), obedience to village discipline, adherence to Mao Zedong Thought (as interpreted by the village leadership), and to inculcate “civilization.”109 Instruction in Mao Zedong Thought and “civilization” are directed to achieving the prescribed ideals of socialism and communism, and to effecting strong local discipline. Education thus serves to maintain order in the village community, and to instruct people to subordinate their personal interests to those of the community. These are said to be the traditional values of village life, and the foundation of a well-ordered state. The village party secretary put the case quite simply: “Without rigorous [enforcement] there exists no order. Order in the state begins with the villages. If you want to have order in the state, you ﬁrst have to enforce it in the villages.” The village leadership proudly declares Nanjie a crime-free zone. No criminal offence has occurred in the village for many years running. What is more, “decadent phenomenon” such as discos, karaoke clubs, bars and saunas have no place in Nanjie. There is said to be no market for decadent urban culture. Instead, the thinking of Mao predominates under a locally proclaimed “dictatorship of the proletariat.”110 The village’s strong commitment to law and order (and public morality) received national recognition in 1997 when Nanjie was honored as “a model village in terms of civilization” by the Propaganda Department of the Central Committee of the Chinese Communist Party.111 The Mao cult as religion in Nanjie From 1984, the residents of Nanjie engaged in “three great activities” (san da huodong): great study of the works of Mao Zedong, great singing of revolutionary songs and great study of Lei Feng. In fact, the study of Mao

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dwarfs the other two greats. The village-owned printing factory publishes works of Mao to be read and discussed by villagers, as well as by workers from outside the village who come together in special study groups organized and supervised by enterprise management. Every worker and employee is obliged to submit “written experience reports” at ﬁxed intervals, to learn at least one revolutionary song per month, and to perform a minimum of two good deeds each month. In the process of economic development, it is said, people need “faith” to keep them going. The local Mao cult has elements of religious observance. Village Party Secretary Wang Hongbin proclaimed at the ceremony marking the erection of the Mao statue: “Through the illumination of his ideas, the people are led from darkness to the light, from poverty to wealth.” Mao Zedong Thought and the Mao monument are both locally referred to as “the Red Sun that enlightens Nanjie.” All villagers have to pass the monument at least once a day in order to ensure they remain “enlightened.”112 It is openly declared that the people of Nanjie perceive Mao as a god who protects the village (baohu shen). If Mao were not present, the people would feel “uneasy in their hearts.” Many carry an amulet with a picture of Mao around their neck. The Mao cult appears to be a distant cousin to the many local deities and chiliastic movements that have long peppered the history of Henan Province. Religious movements, we have noted, tend to surface at times when traditional norms and relationships are eroded. The Mao cult presents an eschatological egalitarian ideal that serves as a useful counterpoint to signs of decay and social disintegration in rural China today. At the same time, however, the Mao cult is not quite as millenarian as some of the other religious revivals currently under way in rural Henan. In this sense, it presents a secular alternative to the many popular religious cults that attest to the crisis of faith currently affecting the Chinese Communist Party and the Chinese state. Nanjie: a model directed from above? Nanjie’s development has, we have noted, been promoted by inﬂuential conservative forces in the party elite at the central and provincial levels. Nanjie was explicitly promoted as a counter-model to the Special Economic Zones in the coastal areas, where foreign economic inﬂuences appeared to predominate, and to inland models such as Wenzhou, in Zhejiang, that were closely associated with the private sector. As a counter-model, Nanjie was intended to prove the continuing viability of social cohesion under indigenous collective economic development. Still, it would be misleading to attribute the Nanjie model to higher initiatives alone. Higher support for the market model contributed to the initial break-up of the traditional village, to the commercialization of the village economy, and to the unwelcome consequences of rapid economic development – including collapse of the subsistence economy, widespread out-migration, and the gradual decay of traditional social structures and values. The rigid system

116 Thomas Heberer and Sabine Jakobi of village order introduced under the Nanjie model attracted grassroots support on the same account: it offered social security on a scale unheard of in other villages; it offered material security through relatively high wages and welfare provisions; it offered access to professional positions with social prestige, and public access to education; and it promised relief from crime.113 The appeal of Nanjie can be traced to a variety of factors affecting rural villagers in the reform era. First, there is a desire to take advantage of modernization without destroying the social integration of village communities. Nanjie is put forward as a model of economic prosperity achieved without the social polarization that accompanies development elsewhere. Peasants are transformed into nonagricultural workers without risk to the cultural or social cohesion of the village community. Second, the model signals a protest against growing income disparities, and against the hegemony of an apparently decadent and corrupt urban culture that is popularly linked with discos, bars, pornography, prostitution and individualism. It also represents a rejection of city dwellers’ discrimination against rural folk. Third, the model is a form of “symbolic opposition”114 to the dominance of the cult of individualism that is widely connected with the economic reforms of Deng Xiaoping. In Nanjie everyone is supposed to get rich together: the community, not the individual, is the active subject of development. At the same time, the model appeals to those local cadres who suffered a severe authority crisis when market reforms were ﬁrst introduced. The elimination of communes and the implementation of the household responsibility system in the countryside deprived local cadres of many of the institutional levers and administrative instruments through which they customarily controlled village life. The Nanjie model of collective responsibility and strong local enforcement restores to party cadres a measure of the power they enjoyed under the commune system. In addition, Nanjie symbolizes local resistance to an earlier model of state socialism that favored state-owned enterprises in the cities at the expense of rural villages. Rural cadres and peasants were never well served by the network of social welfare beneﬁts enjoyed by employees in urban state-owned enterprises. With the scaling-back and in some cases the collapse of the state industrial sector, peasants could no longer even aspire to make the transition to a cosy state-sector job. In this sense, the development of Nanjie may be read as one more rural protest against a history of urban exploitation of the countryside, whereby cheap agrarian resources and semi-ﬁnished products ﬂowed into the cities and rural dwellers received little in return. The Nanjie model marks a backlash. It turns village resources to village purposes, sells ﬁnished products to the cities, and grants villagers and local cadres some of the privileges that were once the birthright of state-sector employees in the cities.115 The question remains, of course, why the Nanjie model is not more widely emulated in China if it truly presents a viable alternative to the anomie of rural dislocation and industralization in an evolving market economy. As a

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rule, popularization requires two conditions. First, a model needs to be more than a showcase. In fact the Nanjie success story would have been impossible without massive inputs from elsewhere, sanctioned by higher authorities. Needless to say, the sources of such support are limited and can only be tapped in particular cases – chieﬂy to showcase a model for instrumental political ends. Second, the vast majority of China’s peasant farmers feel little nostalgia for the collective economy due to their negative experiences under Mao Zedong from the mid-1950s. On the whole, peasants appear to prefer family farms. Nanjie is, however, something of a model for public relations. In addition to well-publicized pilgrimages by highly placed national ﬁgures, over a quarter of a million more modest visitors toured Nanjie each year from the mid- to late 1990s. There were 246,000 visitors in 1995 and another 180,000 over the ﬁrst 9 months of 1996. It may be that peasants who do not want to see a return to collective farming in their own communities nevertheless harbor some respect for villagers who do. Nanjie is not simply an economic model, after all, but also a moral one. It offers a trip down memory lane into an idealized past where visitors can witness old-fashioned discipline, respect, order, morality, hygiene, egalitarianism, indigenous technological modernization, and some of the signs (if not the reality) of local self-reliance. Nanjie is also a model for those who would like to stage a symbolic reaction against the pace of social change in their own village communities, and perhaps strike a blow against the crisis of legitimacy in China today.

Conclusion The Nanjie case suggests that China can no longer be understood – if it ever could – as a single homogeneous entity. Locally, different models of development now stand side by side. Not far from Nanjie there is another village that presents itself as a model of privatized economic activity. The coexistence of two apparently incompatible models is an indication of China’s growing pluralization, at least measured by the spectrum of development models with different objectives now on display. The pluralization of models offers a vivid example of the realization of “one country, two systems” demarcated locally within China’s domestic polity. Nanjie illustrates the fragmentation of politics in China today, or the emergence of locally-fragmented authoritarianisms found in idealized competitive models.116 From this perspective, villages such as Nanjie do not simply repeat the history of model-building in the People’s Republic. They mark a new development. In the ﬁrst place, the Nanjie model is premised on prosperity rather than on poverty. Second, Nanjie presents a reaction against social change rather than a stimulus for social change. Third, the Nanjie model is acted out in a wider environment of market forces hostile to its collective-egalitarian ethic. Finally, and most signiﬁcantly, Nanjie is only one model among others now promoted in the province, all of them

118 Thomas Heberer and Sabine Jakobi competing for public attention, for political approval, and where possible for state largesse. In the process, Henan has evolved from a Maoist-unitary model in which “people’s communes are good” (as Mao himself remarked of the ﬁrst Henan model) to a kind of model pluralism in which all variety of models are “good” for those who opt for them. At the same time, the Nanjie model hints at some of the tensions at work in the relationship between province and center in the People’s Republic. This relationship is not simply one of hierarchical superordinate–subordinate relations, but an interactive process, in which both sides endeavor to achieve their respective goals. The center determines the framework, and provinces react this way or that, placing pressure on the center when the larger policy framework does not appear to suit local conditions. In fact, central policy may be opposed at the province, prefecture, city, county or village levels. Nanjie’s policies, for example, could be interpreted as opposing the policies of Deng Xiaoping on the village level. This would appear to be consistent with the history of provincial relations with Beijing. The provincial leadership was never a creature of the center. Pan Fusheng, we noted, opposed policies of rapid socialization, and in the wake of the Cultural Revolution, the Henan leadership held out for many years against reforms advocated by the center. Provinces exercise authority at an intermediate level between the center and sub-provincial administrative units such as prefectures, cities, counties, townships, and villages. The center must rely on the support of the provincial leadership to get its way at sub-provincial level. This often entails compromises.117 The particular factors that inﬂuence provincial decision-makers in dealing with the center include an historical-cultural dimension, manifest in the cultural imaginary of particular communities, as well as particular demographic and economic features of the region. The recent military and political history of the province needs to be taken into account as well. Much of this history, it might be added, has still to work its way through in Henan.

Notes * This paper is based on a literature review and on extensive ﬁeldwork untertaken in the summer of 1996 in Henan Province by Thomas Heberer, and several longterm research visits by Sabine Jakobi in 1991, 1995–96, and over the summer of 1996. Fieldwork sources are supplemented by documentary sources to 1999. While both authors cooperated in writing and editing this paper, Thomas Heberer is solely responsible for the section on Nanjie. 1 Until recently Henan was outranked by Sichuan Province in population. The administrative separation of Chongqing City from Sichuan Province pushed Sichuan below Henan on the population league table. See the accompanying chapter by Hong Lijian in this volume. 2 The authors are aware that their political-culture argument regarding the Henanese disposition towards egalitarianism and the inhabitants’ special cultural awareness requires more systematic empirical research. The reader therefore

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should regard our argument as an hypothesis deriving from ﬁeldwork in that area. Jean-Luc Domenach, The Origins of the Great Leap Forward: The Case of One Chinese Province (Boulder, CO: Westview Press, 1995), p. 5. Inhabitants of this area conceive of the Yellow River both as the ‘sorrow’ and the nourishing ‘mother’ of China. We will come back later to the prominent role of the river in the formation of an attitude oriented towards egalitarianism. Cf. Jacques Gernet, Die Chinesische Welt (Frankfurt: Insel, 1979), pp. 515–17; Israel Epstein, China. Von Sun Jat-Sen zu Mao Tse-Tung (Berlin: Volk und Welt, 1950), pp. 300–1. The city wall, which was rebuilt in the twelth century under the Jin Dynasty, proved to be strong enough to resist attack. Thus, after several futile attempts to enter Kaifeng, the rebels turned to this as a last resort. For an account of this event, see James Bunyan Parsons, The Peasant Rebellion of the late Ming Dynasty (Tuscon: University of Arizona Press, 1970), pp. 96–104. Other sources speak of 300,000 victims and assert that it was the defenders themselves who opened the dikes hoping desperately to both be safe behind the city wall, and to surprise the attackers with the ﬂood. See for example Qu Chunshan (ed.) Kaifeng lüyou zhinan [Travelguide to Kaifeng] (Beijing: Zhongguo lüyou chubanshe, 1988), pp. 14–15. Cf. Ferdinand Freiherr von Richthofen, China. Ergebnisse eigener Reisen (Berlin: Dietrich Reimer, 1882), 2 vols, vol. 2, p. 509. Wang Guangpeng (ed.) Fenjin de Henan [Vigorous Henan] (Zhengzhou: Henansheng tongjiju, 1994), p. 7ff.; Huang Liangyi, Sun Baoding and Chen Dang, Henan shengqing gailun [Outline of Henan’s provincial situation] (Beijing: Zhongguo tongji chubanshe, 1995). V. M. Alekseev, China im Jahre 1907: Ein Reisetagebuch (Leipzig: Müller und Kiepenheuer, 1989), pp. 188, 200. Original published in Russian in 1958 in Moscow (Izdatel’ stvo vostocnoj Literatury). This and all following quotations are translated into English by the authors. Alekseev, China im Jahre 1907, pp. 192–204. This argument was often heard in talks with rural and urban cadres in 1995–6. Note in this respect also that the novels of the classical compilation “Twentyfour historical examples of ﬁlial piety” are very popular in the Henanese countryside. For example, in 1996 Sabine Jakobi visited two villages near Luoyang which both claimed to be the historical setting of the novel of Wang Xiang. Sheng-hsün, Kao-tsung, 261/17a-18a; Shih-li (1908), 399/2a, cited in KungChuan Hsiao, Rural China: Imperial Control in the Nineteenth Century (Seattle: University of Washington Press, 1960), p. 230. The Qing government suspected these pilgrimages might present possibilities for organizing social and/or polical unrest and soon banned this kind of activity. The custom, however, could not be uprooted. There are reports of pilgrims from Henan being arrested in Beijing between 1824 and 1834. Hsiao, Rural China, p. 231. For an overview of the history of the Christian House Church movement in China see Barbara Nield, “China’s House Churches,” Renewal Journal, no. 3 (1994), p. 4860. The ban was justiﬁed under the law prohibiting ‘disturbing public order’. See Amnesty International [Henceforth AI], “China: Protestants and Catholics detained since 1993.” AI Index: ASA 17 June 1994. The members of the Jesus Family lead a communitarian life without central authority structures. They practice their religion not in church buildings, but reserve an area in their houses for worshipping. Since they also propagated

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economic self-sufﬁciency, they were partly beyond governmental control. They claim to have reached high productivity in agriculture. Throughout the famine in 1942, they are said to have given 90 percent of their harvest away for relief, while still being able to feed themselves. This is not the place to argue whether we are here confronted with a episode in a long tradition of miracles or if this event really occurred to the degree claimed. For a detailed account on the communitarian life of the founding community in Shandong Province and a description of the measures adopted by the state, see also Amnesty International, “China. The imprisonment and harassment of Jesus Family members in Shandong Province,” AI Index: ASA 17/31/94. Note also in this respect that public security agents usually blame members for leading a “collective” life and, consequently, prohibit common meals. See China Rights Forum (ed.) Religion in China: Regulating the Opium of the People (New York: China Rights Forum, 1995). The New Birth Church, founded in the early 1980s, teaches that followers have to cry for 3 days before being reborn as Christians. For more information see also the following newspaper articles: Cary Huang, “Christian’s arrest ‘not suppression’,” Hong Kong Standard, 24 June 1997; Daniel Kwan, “Church leader ‘to be released’?” South China Morning Post, 9 June 1997; Daniel Kwan, “Christian accused of heresy,” South China Morning Post, 24 June 1997. Daniel Kwan, “Security agents stepping up to ﬁght against foreign religious activists,” South China Morning Post, 17 June 1997. We do realize that in general there are differences between these two groups in objectives and organization. However, we refrain from elaborating on these differentiations due to space considerations. Furthermore, reports and studies reveal that these two groups often intermingled and that the line between them is not easy to draw. For a long time the White Lotus sect threatened imperial control of rural Henan. As a result, thirty-nine illegally built temples were destroyed by government troops in 1893 alone. See Hsiao, Rural China, p. 233. Elizabeth J. Perry, Rebels and Revolutionaries in North China, 1845–1945 (Stanford: Stanford University Press, 1980), pp. 100–51. In 1907 Alekseev also noted on his journey that the railroad from Kaifeng to Luoyang was being built by a French–Belgian company. Furthermore, all staff in the train and in the train stations were either French or Belgian. Alekseev, China im Jahre 1907, p. 209 Lin Qing and Li Wencheng, two rebel leaders of the early nineteenth century, provide a good example of the rationale behind movements of this type. They introduced a system of graded membership fees according to which land would later be assigned to group members should the rebellion succeed in taking control in a certain area. Hsiao, Rural China, p. 471. Note in this respect also that, despite scarcity of land in densely populated Henan, land-ownership in the western part of the province was distributed widely among peasants. Ibid., p. 407. Jean Chesneaux, Weisser Lotus and Rote Bärte, Geheimgesellschaften in China. Zur Vorgeschichte der Revolution (Berlin: Rotbuch, 1976); C. K. Yang, Religion in Chinese Society (Taipei: SMC Publishing Inc., 1994), pp. 220–2; Jean Chesneaux (ed.) Popular Movements and Secret Societies in China, 1840–1950 (Stanford: Stanford University Press, 1972). This term is cited in an imperial edict from 1835, regarding the activities of groups of “religious bandits” (jiaofei) in Henan and other provinces. Hsiao, Rural China, pp. 200, 447. Traveling through Henan in 1907 Alekseev noted in his diary that the

Henan as a model

26 27 28

29 30 31 32 33 34 35 36

37 38

39 40 41

42 43 44 45 46 47

121

magistrates ordered soldiers to escort him and his travel companion, to ensure a safe passage from one county seat to another. He especially emphazised the poverty and the poor equipment of the soldiers, who were peasants, recruited only in times of unrest. Alekseev, China im Jahre 1907, pp. 224–42; cf. Perry, Rebels and Revolutionaries, pp. 62–4. Odoric Y. K. Wou, Mobilizing the Masses: Building Revolution in Henan (Stanford: Stanford University Press, 1994), p. 15. See Parsons, Peasant Rebellion, pp. 36, 244 and Introduction; Hsiao, Rural China, p. 482. The rebellion occurred during a long period of terrible famine when the Chinese troops started requisitioning peasant property. Theodore E. White and Annalee Jacoby, Thunder Over China, German edition (Hamburg: Rowohlt, 1949), pp. 196–210. Hsiao, Rural China, 1960, pp. 296, 302. Elizabeth J. Perry, “Rural violence in socialist China,” The China Quarterly, no. 103 (1985), pp. 422–4. Cf. Renmin ribao [People’s daily], 5 August 1995 and 6 July 1996. Cf. the special issue of Shengming yu zaihuo [Life and disaster], Huidaomen [Superstitious sects and secret societies], no. 1, (December 1993), pp. 1–3, 51–6. Wou, Mobilizing the Masses, p. 383. Jasper Becker, Hungry Ghosts: China’s Secret Famine (London: John Murray, 1997), p. 120. Jack Grey, Rebellion and Revolution: China from the 1800s to the 1980s (Oxford: Oxford University Press, 1990), p. 290. Cf. Manfred Kies, Entwicklung und regionale Disparitäten in China. Der Einﬂuß der Entwicklung von Industrie und Landwirtschaft auf die wirtschaftsräumliche Differenzierung in der Provinz Henan (Bochum: Studienverlag Dr. N. Brockmeyer, 1981), pp. 21–3. Cf. Henan tongji nianjian 1996 [Henan statistical yearbook 1996] (Beijing: Zhongguo tongji chubanshe, 1996), p. 290. In 1956 about 20 percent of peasant households were said to have sought approval to withdraw from the co-operatives. Cf. Dali L. Yang, Calamity and Reform in China: State, Rural Society, and Institutional Change Since the Great Leap Famine (Stanford: Stanford University Press, 1996), p. 32. Cf. Frederick C. Teiwes, “The purge of provincial leaders 1957–58,” The China Quarterly, no. 27 (1966), pp. 17–19. All data drawn from Domenach, Origins of the Great Leap Forward, pp. 37–9. Cf. Roderick MacFarquhar, The Origins of the Cultural Revolution, vol II: The Great Leap Forward 1958–60 (Oxford: Oxford University Press, 1983), p. 42, 351–2; Becker, Hungry Ghosts, pp. 123–5. Domenach, Origins of the Great Leap Forward, p. 144. Cf. Lin Min, Der Rote-Fahne-Kanal (Beijing: Foreign Language Press, 1974), pp. 13–14. Roy Hofheinz, “Rural administration in communist China,” The China Quarterly, no. 11 (1962), pp. 151–3. Roderick MacFarquhar, The Origins of the Cultural Revolution, vol. II, pp. 43–4. Janet Salaff, “The urban communes and anti-city experiment in communist China,” The China Quarterly, no. 29 (1967), pp. 89–91. D. E. T. Luard, “The urban communes,” The China Quarterly, no. 3 (1960), pp. 75–7; Franz Schurmann, Ideology and Organization in Communist China (Berkeley, CA: University of California Press, 1966), pp. 387–9.

122 Thomas Heberer and Sabine Jakobi 48 In his speech at the Lushan Conference in July, 1959, Mao praised Henan because, unlike other provinces, 90 percent of public canteens were still in operation. Stuart Schram (ed.) Mao Tse-tung Unrehearsed: Talks and Letters, 1956–71 (Harmondsworth: Penguin, 1974), p. 140. 49 The model regulations of the Weixing people’s commune are set out in People’s Communes in China (Beijing: Foreign Language Press, 1958), pp. 61–77. 50 Hongqi [Red Flag], 16 September 1958. See Gilbert Etienne, Chinas Weg zum Kommunismus (Wien: Europa Verlag, 1963), p. 157. 51 Yang, Hungry Ghosts, pp. 76–7. 52 Mo Qi, Zhongguo renkou: Henan fence [China’s population: Henan volume] (Beijing: Zhongguo caizheng jingji chubanshe, 1989), p. 32. 53 Cf. Becker, Hungry Ghosts, pp. 272 and 128. 54 Ibid., pp. 112–15. 55 Yang, Hungry Ghosts, pp. 39, 58. 56 Peter P. Moody, Opposition and Dissent in Contemporary China (Stanford: Hoover Institution Press, 1977), p. 89. 57 Bjung-joon Ahn, Chinese Politics and the Cultural Revolution: Dynamics of Policy Processes (Seattle: University of Washington Press, 1976), pp. 57, 83. 58 See Draft Resoulution of the Central Committee of the Chinese Communist Party on Some Problems in Current Rural Work (the “First Ten Points”). Reprinted in Richard Baum and Frederick C. Teiwes, Ssu-ch’ing: The Socialist Education Movement of 1962–1966 (Berkeley: University of California Press, 1968), Appendix B, pp. 58–71. 59 Cf. Richard Baum, Prelude to the Revolution: Mao, the Party, and the Peasant Question, 1962–66 (New York: Columbia University Press, 1975), pp. 139, 194, fn 2. 60 Mao Zedong, Selected Works of Mao Tse-tung, German edition (München: Carl Hanser Verlag, 1982), vol. 6, pt.1, p. 223. 61 Ibid, p. 435. 62 Henan tongji nianjian, pp. 93, 96 and 491. 63 Cf. Wang Guichen and Lu Xueyi (eds) Nongcun jingji biange de xitong kaocha [Investigation of the rural economy’s reform structure] (Beijing: Zhongguo shehui kexue chubanshe, 1984), pp. 34–5; Dali L. Yang, Hungry Ghosts, p. 159. Local cadres often secretly gave way to the peasants’ drive for decollectivization. A good example occurred in the spring of 1978 in the village of Yangsancai. Here, peasants proposed to the party secretary of the brigade that the village’s date trees should be divided among peasant households. They promised to deliver 60 percent of the annual harvest to the brigade and keep only 40 percent for themselves. The party secretary of the brigade consulted the commune secretary, who ﬁnally agreed, with the words: “O.K. Do it your way. But do not tell the others.” Cited in Kate Xiao Zhou, How the Farmers changed Communist China, PhD dissertation, Princeton University, 1994, p. 170. 64 Alan P. L. Liu, “The politics of corruption in the People’s Republic of China,” American Political Science Review, vol. 77 (1983), pp. 614–15. 65 China aktuell, December 1976, pp. 670–1. 66 Liu, “The politics of corruption,” pp. 614–15. 67 Xuchang was well-known for its radical land reform at the end of the 1940s and was used as a model demonstrating optimal implementation of Maoist agrarian policy in the 1950s. Domenach, Origins of the Great Leap Forward, pp. 32–4.

Henan as a model

123

68 Wolfgang Bartke, Biographical Dictionary and Analysis of China’s Party Leadership 1922–1988 (München: K. G. Saur, 1990), p. 74. 69 Jürgen Domes, Politische Soziologie der VR China (Wiesbaden: Adademische Verlagsgesellschaft, 1980), p. 66. 70 Wolfgang Bartke, “Das Schicksal der Kader aus der Zeit vor der Kulturrevolution,” China aktuell, October 1978, p. 643. 71 Cf. Renmin ribao, 23 July 1979. 72 Renmin ribao, 26 August 1981. 73 BBC, Summary of World Broadcasts, 19 March 1982. 74 China aktuell, June 1984, p. 306. 75 China aktuell, August 1984, p. 431. 76 Shouying Liu, Michael R. Carter and Yang Yao, “Dimensions and diversity of property rights in rural China: dilemmas on the road to further reform,” University of Wisconsin-Madison, Department of Agricultural Economics, Staff Paper No. 395, May 1996, pp. 15, 16, 27. 77 Die Zeit, 8 April 1998, p. 13. 78 Nongmin ribao [Peasant daily], 9 December 1988; cf. China aktuell, October 1988, pp. 758–9. 79 Luo Bing, “Juemi wenjian zhong de bu wen diqu” [Unstable regions according to a secret document], Zhengming, January 1992, pp. 8–9. 80 Cf. Sebastian Heilmann, “Das Potential für soziale und politische Unruhen in der VR China,” China aktuell, May 1994, p. 479. 81 China Daily, 19 February 1998 (Internet version). 82 Jiang Li and Zhang Jing (eds) Henan jingji fazhan lun [On the development of Henan’s economy] (Beijing: Zhongguo jingji chubanshe, 1996), pp. 163–6. 83 Authors’ calculations according to Gongshang xingzheng guanli tongji huibian 1992 [Collection of statistics of the administration for industry and commerce 1992] (Beijing: Guojia gongshang xingzheng guanliju jingji xinxi zhongxin, 1993), pp. 52, 53, 68 and 69 [Henceforth CSAIC]; CSAIC 1997 (Beijing: Guojia gongshang xingzheng guanliju bangongshi, 1998), pp. 68 and 75. 84 Data supplied by Henan Administration of Industry and Commerce, 3 October 1996; and CSAIC 1996 (Beijing: Guojia gongshang xingzheng guanliju bangongshi, 1997), pp. 68 and 75. 85 Renmin ribao, 19 July 1998. 86 Renmin ribao, 12 June 1998. 87 Renmin ribao, 4 May 1997. 88 Jiang Li & Zhang Jing, Henan jingji fazhan lun, pp. 194–6. 89 Ibid., pp. 191–4. 90 Cf. Zhongguo gongshang bao [China’s industry and commerce], 6 April 1999; Henan ribao [Henan daily], 31 March and 4 April, 1999 (Internet version). 91 Domenach, Origins of the Great Leap Forward, p. 158. 92 On this discussion among the party leadership see Stuart R. Schram, “Mao Tsetung and secret societies,” The China Quarterly, no. 27 (1966), pp. 1–3. 93 Quoted from Bartke, Biographical Dictionary, pp. 242–3; Domenach, Origins of the Great Leap Forward; MacFarquhar, Origins of the Cultural Revolution, vol. 2; Wou, Mobilizing the Masses. 94 Hofheinz argues that Henan’s large population and varied terrain contributed historically to a common belief that social uncertainty could be minimized by collective action. Hofheinz, “Rural administration in communist China,” p. 154.

124 Thomas Heberer and Sabine Jakobi 95 R. H. Tawney, Land and Labour in China (London: Allen and Unwin, 1937), p. 170. 96 Lu Xueyi (ed.) Gaige zhong de nongcun yu nongmin [Villages and peasants in reform] (Beijing: Zhonggong zhongyang dangxiao chubanshe, 1996), pp. 196–222. 97 Ibid., pp. 272–310. 98 The following section is based on a visit in Nanjie in October 1996. 99 Deputy Party Secretary Yao Tonglin, 6 October 1996. 100 We doubt the correctness of these data, as 500 jin per mu in 1985 would have been quite high. The average in 1995 was 765 jin per mu for the whole province. 101 For this development cf. Deng Yingtao, Miao Zhuang and Cui Zhiyuan, “Nanjie jingyan de sikao” [Considerations on the experiences of Nanjie], Canyue wengao [Manuscripts for reading], January 1996, pp. 10–12. The secret history of Nanjie, i.e. its informal history, is unknown to us. 102 The question of how a small, poor village like Nanjie could manage to invest many million Yuan, which was the real basis for these enterprises, was not answered by the deputy secretary but will be addressed further below. 103 Lixiang zhiguang [The brightness of an ideal], vol. 1: Nanjie ren tan gongchanzhuyi xiao shequ jianshe [People from Nanjie on the building of a communist small community] (Luohe: Linying xian Nanjie cun bianxie zubian, 1996). 104 Lixiang zhiguang, vol. 1, p. 3; interview with party deputy secretary on 6 October, 1996. 105 Ibid., vol 1, p. 45. 106 Ibid., vol 1, p. 19. 107 Here it has to be considered that not every form of deviance is punished, but only acts that due to their severity and continuity have a major impact on the stability of the village community. 108 Ibid., p. 44. 109 Interview with the party deputy secretary on 6 October 1996. 110 Ibid. 111 Renmin ribao, 26 March 1997. 112 Lixiang zhiguang, vol 1, pp. 15–17. 113 One may ask what will happen to the “model” if social welfare could not be maintained due, for instance, to an economic crisis. 114 James C. Scott, “Protest and profanation: agrarian revolt and the little tradition: part 1,” Theory and Society, 4 (1977), p. 17. 115 See Thomas Heberer, The Power of the Fait Accompli: The Peasantry as the Motive Force of Change in the People’s Republic of China, Occasional Papers No. 3 (Trier: Centre for East Asian and Paciﬁc Studies of Trier University, 1996). 116 For a discussion of “fragmented authoritarianism” in contemporary China, see Kenneth Lieberthal and David M. Lampton (eds), Bureaucracy, Politics and Decision Making in Post-Mao China (Berkeley, CA: University of California Press, 1992). 117 This is demonstated by Linda Chelan Li, “Towards a non-zero-sum interactive framework of spatial politics: the case of center-province in contemporary China,” Political Studies, vol. 15 (1997), pp. 49–65.

Chapter Title

5

125

Guangdong under reform Social and political trends and challenges Peter Cheung*

Introduction As a pioneer in Deng Xiaoping’s reform program, Guangdong’s development experience has received extensive scholarly treatment.1 Studies of the province’s economic success generally underscore its pioneering and effective political leadership, the early conferment of special policies by the central government, a favorable geographical location, a market-oriented development strategy that capitalizes on comparative advantages, as well as a decentralizing reform program that enhances the autonomy of sub-provincial governments.2 Insightful as they are in accounting for the province’s achievements, these observations cannot account for the shortcomings and limitations of provincial development. In the 1990s, the internal and external environments for development in Guangdong both underwent signiﬁcant change. This chapter offers a preliminary analysis of key social and political changes in Guangdong in the 1990s with a view to their implications for the comprehensive development of the province.3 We begin with an overview of major changes in Guangdong’s economy and proceed to analyze salient social and political trends that emerged in the reform era, namely intra- and inter-provincial disparities, a deterioration in public order, the proliferation of social conﬂicts, administrative abuses and corruption, changes in civic awareness, and new developments in interest articulation. In concluding, we brieﬂy explore Guangdong’s prospects in view of these developments.

Guangdong’s economy under reform: an overview With 73 million people, or about 5.8 percent of China’s total population, Guangdong is the fourth most populous province in the nation.4 Nonetheless, its territory measures only 180,000 square kilometers, less than 2 percent of the national total. The province has the longest coastline among China’s provinces, providing excellent access to aquatic resources and maritime transport. Through millions of overseas Cantonese, Guangdong enjoys unparalleled social and economic ties with Hong Kong, Macau, Southeast

126 Peter Cheung

Guangdong Province

General GDP (billion yuan renminbi [RMB]) 846.43 GDP annual growth rate 9.50 as % national average 125.00 GDP per capita (yuan RMB) 11,728.00 as % national average 179.49 Population Population (million) Natural growth rate (per 1,000) Workforce Total workforce (million) Employment by activity (%) primary industry secondary industry tertiary industry Employment by sector (%) urban rural Employment by ownership (%) state collective private self-employed individuals

72.70 9.92 37.61 41.20 26.20 32.60 29.14 70.86 11.73 3.22 5.20 8.45

Wages and Income Average annual wage (yuan RMB) 12,245.00

Growth rate in real wage 12.80 Urban disposable income per capita 9,125.92 as % national average 155.89 Rural per capita income 3,628.95 as % national average 164.18 Prices CPI [Consumer Price Index] annual rise (%) Retail Price Index annual rise

-1.80 -3.30

Foreign trade and investment Total foreign trade (US$ billion) 140.34 Exports (US$ billion) 77.69 Imports (US$ billion) 62.66 Realised foreign capital (US$ billion) 12.89 Education University enrollments 220,810 Secondary school enrollments (million) 4.44 Primary school enrollments (million) 9.21 Notes: All statistics are for 1999 and all growth rates are for 1999 over 1998 and are adapted from Zhongguo Tongji Nianjian 2000 [Statistical Yearbook of China 2000], Zhongguo Tongji Chubanshe, Beijing, 2000.

Guangdong under reform

127

Asia, North America and Australasia. Once an economically backward province, Guangdong has embarked upon rapid economic growth since 1978. In the 1990s its GDP grew at 15 percent per annum, about 5 percent higher than the national growth rate (see Table 5.1). Its gross output value of industry (GOVI), total investment in ﬁxed assets, total retail sales, acquisition of foreign investment, and exports increased between 15 and 26 percent per annum, higher than the national norm. The province’s agricultural growth, however, fell slightly below the national average. Guangdong’s economy has undergone a radical transformation in the reform era. The province has achieved rapid growth in both the industrial and the tertiary or service sectors. Over the 1979–99 period, the industrial (including construction) and tertiary sectors grew at an annual rate of 21 percent and 15 percent respectively. The relative signiﬁcance of agriculture has declined drastically, with the agricultural sector growing by only 6.6 percent per annum during this period.5 In the pre-reform era, over 70 percent of the workforce engaged in agriculture. After two decades of reform, agricultural employment fell to 41 percent while employment in the industrial and tertiary sectors jumped to respectively one third and more than one-quarter of total employment.6 With the rapid expansion of foreign investment and the stagnation of state industries in the 1990s, the state sector contributed no more than one-ﬁfth of industrial output whereas the foreign sector (mostly Hong Kong and other overseas Chinese investment) accounted for nearly 50 percent of industrial production.7 Guangdong’s economic transformation cannot be fully comprehended without reference to its close economic ties with Hong Kong and the world economy. Foreign capital contributed about 13 percent of Guangdong’s total Table 5.1 Key economic growth indicators for Guangdong and China, 1991–99 (unit = percent) Guangdong Province

National average

Gross domestic product

15.1

10.1

Gross industrial output value

24.7

18.0

6.7

7.1

Total investment in ﬁxed investment

25.9

23.3

Total retail sales

20.8

17.6

Export

14.9

13.6

Actualized foreign investment

24.4

19.9

Gross agricultural output value

Source: Guojia tongjiju (ed.) Zhongguo tongji nianjian 2000 [China Statistical Yearbook 2000] (Beijing: Zhongguo tongji chubanshe, 2000), pp. 22–9; Guangdongsheng tongjiju (ed.), Guangdong tongji nianjian 2000 [Guangdong Statistical Yearbook 2000] (Beijing: Zhongguo tongji chubanshe, 2000), pp. 58–65.

128 Peter Cheung investment in ﬁxed assets in 1991, but this share further jumped to 20 percent by 1999.8 Despite the province’s efforts to diversify its export market and sources of foreign investment, Hong Kong remains its most dominant trading partner and investor. The number of foreign-funded ﬁrms (mostly with Hong Kong funds) rose four-fold from 12,200 in 1990 to over 53,000 in 1999.9 More than 1.4 million people were directly employed by these ﬁrms. Twothirds of Guangdong’s foreign trade goes through Hong Kong and about 80 percent of actual foreign investment is secured from Hong Kong.10 Consequently, Guangdong’s economy is the most tightly linked with the world economy among all of China’s provinces. Guangdong’s phenomenal growth in the 1990s has further consolidated its position as a key player in the Chinese economy. Since 1992, the province’s GDP has surpassed Shandong as the number one among the provinces. In 1999, Guangdong’s GDP per capita already reached ¥11,739, exceeded only by Beijing, Shanghai, Tianjin and Zhejiang.11 Because of its proximity to Hong Kong and its skills in utilizing the special policies granted by the central government, the province has attracted the largest amount of foreign investment (US$14.5 billion in 1999), more than 27 percent of the national total. Since 1986, the province has overtaken Shanghai as China’s leading exporter. In 1999, Guangdong’s exports made up about 40 percent of the national total and were larger than the total exports of Shanghai, Jiangsu, Zhejiang, Fujian, and Shandong combined.12 Guangdong has been transformed from an average province in the Mao era to an economic powerhouse in the age of reform, accounting for about 10 to 12 percent of China’s GDP, industrial output, investment in ﬁxed assets, and retail sales.13 Compared with China’s other provinces, Guangdong ranked number one in GDP, total industrial output, total retail sales, total investment in ﬁxed assets, export, and acquisition of foreign investment.14 The people in Guangdong have also become much more afﬂuent in the reform era. In 1999, the per capita real income of Guangdong’s urban residents reached ¥9,206, which was not only 56 percent higher than the national average of ¥5,889, but also the highest among the provinces and second only to Shanghai City, which earned a per capita income of ¥10,989.15 Similarly, the per capita net income of the province’s rural residents rose to ¥3,629, about 64 percent higher than the national average of ¥2,210, which placed the province behind only Shanghai, Beijing, and Zhejiang. After two decades of rapid growth, living standards among Guangdong residents were comparable to if not higher than those of other prosperous coastal provinces such as Jiangsu and Zhejiang. Guangdong’s share in the national economy expanded from 8 to 10 percent in the 1990s (see Table 5.2). With the exception of Liaoning, whose share in the national economy dwindled, three leading coastal provincial units – Shanghai, Shandong, and Jiangsu – all increased their relative shares in key sectors of the Chinese economy such as industrial production and investment in ﬁxed assets. Although the above ﬁgures still show that

Guangdong under reform

129

Guangdong is an economic heavyweight among China´s provinces, several developments in the 1990s deserve closer scrutiny. Several points are worth noting here. First, Guangdong’s extensive growth in the 1990s, which was mainly driven by a rapid inﬂux of investments, is no longer sustainable because of the inefﬁciency of such investments and the decreasing availability of easy credit. Other leading coastal provinces such as Shanghai, Jiangsu and Shandong achieved a very strong and steady record

Table 5.2 Contribution of key provinces in the Chinese economy, 1990 and 1999 (unit = percent)

GDP

GOVI

Total retail sales Investment in ﬁxed assets

Shanghai

Jiangsu

Shandong

Liaoning

Guangdong

(a) 4.2

(a) 7.4

(a) 7.5

(a) 5.5

(a) 8.3

(b) 4.9

(b) 9.4

(b) 9.3

(b) 5.1

(b) 10.3

(a) 6.8

(a) 11.6

(a) 9.2

(a) 6.7

(a) 8.0

(b) 8.6

(b) 12.2

(b) 9.5

(b) 4.6

(b) 14.3

(a) 4.3

(a) 7.2

(a) 6.9

(a) 5.5

(a) 8.8

(b) 5.1

(b) 7.7

(b) 7.4

(b) 5.4

(b) 11.7

(a) 5.1

(a) 8.1

(a) 7.5

(a) 5.9

(a) 9.1

(b) 7.5

(b) 7.1

(b) 5.9

(b) 4.0

(b) 10.5

Source: Guojia tongjiju (ed.) Zhongguo tongji nianjian 1991 and 2000 [China Statistical Yearbook 1991 and 2000] (Beijing: Zhongguo tongji chubanshe). Notes: Data in (a) series are 1990 ﬁgures and data in (b) series are 1999 ﬁgures. GOVI = gross output value of industry.

Table 5.3 GDP growth rates of selected coastal provinces, 1990–99 (unit = percent) China

Shanghai

Jiangsu

Shandong Liaoning

Guangdong

1991

9.2

7.1

12.5

14.6

6.1

17.3

1992

14.2

14.9

26.0

16.9

12.1

22.0

1993

13.5

14.9

20.7

18.5

14.9

22.3

1994

12.6

14.3

16.5

16.3

11.2

19.1

1995

10.5

14.1

15.4

14.2

7.1

14.9

1996

9.7

13.0

12.2

12.2

8.6

10.7

1997

8.8

12.7

12.0

11.2

9.0

10.6

1998

7.8

10.1

11.0

10.8

8.3

10.2

1999

7.1

10.2

10.1

10.1

8.1

9.5

Source: Guojia tongjiju (ed.) Zhongguo tongji nianjian [China Statistical Yearbook] (Beijing: Zhongguo tongji chubanshe) and Guangdongsheng tongjiju (ed.), Guangdong tongji nianjian [Guangdong Statistical Yearbook] (Beijing: Zhongguo tongji chubanshe), various years.

130 Peter Cheung of economic growth over the same period (see Table 5.3). While the growth rates of most coastal provinces slowed down after the introduction of the retrenchment program in 1993, Guangdong suffered more than most with a sharp drop in growth of almost 10 percent between 1994 and 1997. Its growth was fueled mainly by a massive injection of investments, some of which were diverted to speculative investments in real estate. For instance, the growth of Guangdong’s investment in ﬁxed assets in 1991–6 was 35 percent per annum, more than double that of its GDP growth.16 Such investment in ﬁxed assets began to level off to between ¥210 and ¥233 billion in 1993–6; in 1997, the ﬁgure actually dropped by 4.4 percent.17 Such investment only began to pick up again at an annual growth rate of 15 percent in 1998–9.18 Second, Guangdong no longer enjoys signiﬁcant advantages from special treatment by the central government. Nor can it count on the continuing inﬂux of capital from overseas Chinese, especially from Hong Kong. In the 1990s, Hong Kong investment was diversiﬁed to other parts of China to take advantage of new investment opportunities fueled by ﬁerce inter-provincial competition, which resulted in lower production costs, a wider spread of preferential policies, and the emergence of new markets. Once the star performer in China’s reform and development, Guangdong has been overshadowed by Shanghai since the mid-1990s, when the city received greater preferential treatment from the central government and embarked upon rapid growth. Guangdong’s share in total foreign investment acquired by China rose from about 20 percent in 1990 to 28 percent in 1999.19 However, the success of other coastal provinces in attracting foreign direct investment (FDI), which accounted for the bulk of foreign funds acquired by China, was equally impressive (see Table 5.4). Tianjin, Shanghai, Jiangsu and Fujian signiﬁcantly increased their shares in the acquisition of FDI. Guangdong’s share of FDI fell from 42 percent to 29 percent of China’s total FDI, a reduction of 13 percent. While the province’s share of total foreign investment and FDI remains substantial, it is evident that other coastal provinces will soon erode its once dominant position if current trends continue. Given the growing cost of production and business in Guangdong, and the emergence of other socio-economic problems discussed below, the province will need to compete even harder with other coastal provinces or overseas countries for foreign investment in future years. Third, compared with other coastal provinces, Guangdong does not enjoy an edge in research and development (R & D) or human resources, two critical assets in the era of the new economy. For example, the share of R & D in Guangdong’s GDP was only 0.2 percent whereas the ﬁgures for Beijing and Shanghai were 5 percent and 1 percent respectively.20 Signiﬁcantly, the number of technicians per 10,000 people in Guangdong is 12 percent below the national average. R & D expenditure of provincial enterprises is also low by national standards. Despite the rapid inﬂow of investment in ﬁxed assets, the volume of investment in technical renovation in Guangdong has been lower than that in other coastal provinces over recent years. In 1999, for

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Table 5.4 Provincial shares in China’s acquisition of foreign investment (unit = percent) Total Foreign Investment

Shanghai

(a) 1990

3.1

2.4

2.2

0.95

4.1

ǁ19.6

(b) 1999

6.7

14.3

5.8

4.2

9.5

ǁ30.4

(a) – (b)

3.6

11.9

3.6

3.25

5.4

ǁ10.8

(a) 1990

5.0

3.6

4.3

1.0

8.3

ǁ42.0

(b) 1999

7.0

15.1

5.6

4.4

10.0

ǁ29.0

(a) – (b)

2.0

11.5

1.3

3.4

1.7

ǁ13.0

Jiangsu

Shandong Tianjin

Fujian

Guangdong

Foreign Direct Investment

Source: Guojia tongjiju (ed.) Zhongguo tongji nianjian 1991 [China Statistical Yearbook 1991] (Beijing: Zhongguo tongji chubanshe, 1991), p. 631 and Zhongguo tongji nianjian (2000), p. 609.

instance, Shanghai spent more than Guangdong in overall technical renovation, while Hebei, Jiangsu and Shandong spent between 70 and 90 percent more than Guangdong on technical renovation in the manufacturing sector.21 Although Guangdong has committed substantial resources to upgrading its transportation and telecommunication infrastructure in the 1990s, its investment in R & D and human resources needs to improve signiﬁcantly if it is to remain competitive.

Social and political trends in the 1990s Guangdong’s rapid economic growth has engendered social and political consequences that present new challenges to the provincial government.22 Among important social and political trends that emerged in the 1990s are growing intra- and inter-provincial inequalities, a deterioration of public order, a proliferation of social conﬂicts, evidence of maladministration and corruption, signs of changing civic awareness among the people, and new developments in interest articulation. Intra-provincial inequalities Guangdong, like other big provinces, is marked by distinct regional disparities. The province contains twenty-one prefecture-level cities, seventynine counties (including county-level cities, counties, and autonomous counties), and forty-three urban districts.23 The province’s economic growth is mainly driven by the dynamic Pearl River (Zhujiang) Delta.24 The Delta

132 Peter Cheung Table 5.5 Economic indicators of the Pearl River Delta and ﬁfty mountainous counties, 1999 (A) Pearl River Delta Population

(B) Percentage of Guangdong

(C) Mountainous counties

(D)Percentage of Guangdong

22.6

31.0

29.6

40.7

GDP

643.9

76.1

162.2

19.2

GOVI

1106.6

72.3

185.3

12.1

GOVA

38.8

39.7

47.6

48.7

Fixed investment

210.6

69.6

33.1

10.9

TRS

248.7

68.0

54.4

14.9

Revenue

49.7

65.0

3.8

5.0

Expenditure

60.6

62.7

9.6

10.0

625.4

85.1

86.1

11.7

Savings

Source: Guangdongsheng tongjiju (ed.) Guangdong tongji nianjian 2000 [Guangdong Statistical Yearbook 2000] (Beijing: Zhongguo tongji chubanshe, 2000), pp. 58–70, 281, 596 and 604. Notes: unit for population = million; unit for other ﬁgures = billion yuan; GDP = gross domestic product; GOVI = gross output value of industry; GOVA = gross output value of agriculture; TRS = total retail sales; savings = household savings.

comprises fourteen cities and counties, including Guangzhou, Shenzhen, Zhuhai, Foshan, Jiangmen, Zhongshan, Dongguan, Boluo, Huizhou’s urban district and three counties under its jurisdiction, Zhaoqing’s urban district, Gaoyao, and Sihui.25 With an area of about 41,698 square kilometers, the Pearl River Delta is the economic core of the province (see Table 5.5). In 1999, the Delta housed a total of 23 million people, or about one-third of the province’s population, but contributed 70 percent of its GDP, total industrial output, revenue and total investment in ﬁxed assets. 26 The people of the Delta also accounted for 85 percent of the household savings of the province. In the period from 1981 to 1993, the Delta’s GDP grew at a rate of over 17.5 percent, considerably faster than the growth rate of the province as a whole and indeed faster than the East Asian NICs during their economic take-off.27 In the 1995–9 period, the GDP growth rate of the Delta remained within the range of 13 to 20 percent per annum, about 3 to 5 percent higher than the provincial average.28 Some of the most dynamic cities in the Delta, including Dongguan, Zhongshan and Shunde, developed at an annual rate of over 20 percent in the ﬁrst half of the 1990s. Overseas businessmen and scholars alike once characterized the Delta as the emerging “Fifth Dragon.” In celebrating the province’s successes, most observers have ignored the ﬁfty poorer counties located in mountainous areas of eastern, northern, and western Guangdong.29 While accounting for 65 percent of the province’s land area and about 41 percent of the population (with roughly 30 million

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people), these mostly rural counties contributed less than 20 percent of provincial GDP and about one-eighth or less of its gross industrial output, revenue, and total investment in ﬁxed assets (see Table 5.5). The differentiation of per capita income offers a useful example to illustrate the inter-regional gap.30 The average per capita wage of staff and workers ranged from above ¥9,000 to ¥20,000 in the afﬂuent Pearl River Delta and from ¥8,000 to ¥9,000 in the middle-income areas in the province. The lowest wage area concentrated in the poorer counties in eastern, western, and northern Guangdong earned between ¥5,500 and ¥6,500. In 1999, Shenzhen’s average wage (¥20,714), the highest in the province, was more than three times that of Huilai county (¥5,817) in eastern Guangdong. The wages in these poor areas were not only signiﬁcantly lower than the provincial average of ¥12,245 but also below the national wage average of ¥8,346.31 In fact, the average wage levels in twelve of Guangdong’s twenty-one prefectural-level cities fell below the national average. In other words, wage levels in less afﬂuent areas of Guangdong were similar to those in less developed provinces such as Guangxi or Guizhou. To be sure, the per capita net income of peasants in poorer counties rose three-fold over the period from 1991 to 1999. But the 1999 ﬁgure of ¥3,177 still fell below the provincial average of ¥3,628, a ﬁgure comparable to those of Guangxi and Hunan.32 The gap between the prosperous Pearl River Delta and the poorer mountainous counties has attracted the attention of the provincial government since the mid-1980s. When Guangdong began to embark upon rapid growth after implementing the preferential policies granted by the central government, it was obvious that the coastal Pearl River Delta region began to forge ahead much faster than the rest of the province. To deal with this disparity, a number of strategies have been employed by the provincial government since 1985. First, ad hoc conferences on the problems of mountainous areas, initially championed by former provincial Party Secretary Lin Ruo, have become annual events. This annual meeting aims to bring together ofﬁcials from all regions of the province to explore new ways of developing the economy of the mountainous areas. The issue remained on the agenda of the provincial leadership in the 1990s. Second, eight of the richest cities, namely Guangzhou, Shenzhen, Zhuhai, Shantou, Foshan, Zhongshan, Jiangmen, and Dongguan, and dozens of provincial government departments, were assigned to support less fortunate counterparts in mountainous areas. Finally, other fund-raising schemes were adopted to raise funds for poor areas.33 Such efforts have contributed to some degree to the economic development of the ﬁfty mountainous counties since the mid-1980s. Nevertheless, available data on growth rates in the 1990s indicate that despite notable progress in poor mountainous areas, the relative gap between wealthier and poorer regions has widened rather than narrowed. After Deng Xiaoping’s southern tour in 1992, the ratio between the two areas in GDP and GDP per capita rose from 1.9 to 3.9, and from 3.0 to 5.2 respectively (see Table 5.6).

134 Peter Cheung The mountainous counties did experience rapid economic growth of about 20 percent per annum in the ﬁrst half of the 1990s.34 In 1995–9, these counties were also able to maintain a GDP growth rate in the range of 9 to 13 per cent per annum.35 Further, the number of people in these areas who fell below subsistence level declined from 4 million in 1985 to about 800,000 in 1994 and 600,000 in 1996. By 1997, it was reported that virtually all people in poorer regions had reached a basic subsistence level.36 Nonetheless, sixteen poor counties in 1999, accounting for over 310,000 households, reported a per capita rural income of ¥2,000 per annum or less.37 Thus, the poor counties were still poor, in absolute terms and by Guangdong standards. Many obstacles bar these poor areas from bridging the economic gap with the rich areas in the Pearl River Delta. Most importantly, the environment in the mountainous counties is not conducive to the acquisition of foreign investment, which remains a key driving force in Guangdong’s economic development. Their disadvantageous geographical location, lack of adequate infrastructure support, poor communication facilities, low educational standards and workforce skills, and lack of experience in dealing with foreign businesses generally place these counties at a distinct disadvantage in competing with other areas within and beyond Guangdong. When overseas investors look for low-wage labor, for example, they can look elsewhere in Guangxi, Hunan or other provinces where investment conditions might be more favorable. People’s deputies from these poor areas consistently argue for preferential treatment from the provincial government only to discover that preferential policy measures are not always implemented effectively. Antipoverty schemes have mainly been implemented through administrative

Table 5.6 Comparison between the Pearl River Delta and the mountainous counties, 1991–99 Gross domestic product (A) Pearl (B) MC River Delta

Gross domestic product per capita (C) Ratio A/B

(D) Pearl River Delta

(E) MC

(F) Ratio D/E

1991

64.4

34.4

1.9

3,823

1,295

3.0

1995

389.9

107.2

3.6

18,243

3,890

4.7

1999

643.9

162.2

3.9

28,465

5,477

5.2

Source: Guangdongsheng tongjiqu (ed.), Guangdong tongji nianjian 1996 [Guangdong Statistical Yearbook 1996] (Beijing: Zhongguo tongji chubanshe, 1996), pp. 93–4; Guangdong tongji nianjian 2000, pp. 596 and 604. Notes: GDP = gross domestic product (billion yuan); GDP per capita (yuan). The ratio is calculated by the author. Data for GDP and GDP per capita of mountainous counties (MC) for 1991 include only 49 counties while data for 1995 include 50 counties. GDP per capita data of the Pearl River Delta (PRD) in 1991 do not include that of Baoan County. These minor differences do not alter the overall pattern. The PRD refers to the PRD Economic Area, which includes fourteen counties and cities.

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ﬁat, with the result that poverty relief funds and programs are handled at many different levels of government, from the province to the county, expanding the opportunities for misappropriation at each level.38 Finally, while the provincial leadership has consistently paid attention to the plight of the poor areas in recent years, it is unclear whether such a focus can be sustained. Even if the absolute number of poor people might be reduced in the meantime, the widening gap between these counties and other more afﬂuent areas are unlikely to be narrowed in the near future. It might be easier to reduce the absolute level of poverty and achieve some designated targets at one particular moment than to implement a strategy that enables these areas to catch up with the rest of the province over the long run. To maintain a decent economic growth rate for the poorer mountainous areas will continue to be a prominent policy challenge for Guangdong because the intra-provincial disparities and the sense of relative deprivation arising from such gaps could threaten social stability. Inter-provincial disparities and their social consequences Despite its own internal problems, Guangdong leaped ahead of neighboring provinces in the reform era. The urban and rural incomes of provinces bordering Guangdong, such as Hunan, Jiangxi, and Guangxi, were close to national averages at a time when Guangdong headed the provincial league tables. As late as 1999, the Delta’s GDP was still greater than that of other leading provincial units such as Shanghai, Zhejiang, Hebei or Liaoning.39 One of the most important consequences of the economic gap that emerged between Guangdong and neighboring provinces was the attraction of migrants from less developed areas. Internal migration has beneﬁted the people in Guangdong. Migrants offered cheap labor and allowed the Cantonese to take on more proﬁtable jobs. Commonly referred to as the “blind ﬂow” (mangliu), the bulk of migrant workers came from Fujian, Hainan, Hunan, Jiangxi, Guangxi, and Sichuan. These workers were only part of the larger transient or “ﬂoating” population, which included people entering the province for visits and other motives. Attracted partly by expectations of earning quick money in the south, and driven out by conditions in their home villages, millions of migrants have poured into Guangdong since 1989. According to census ﬁgures, the transient population of Guangdong was already 7 million, or about one-tenth of the total population, in 1990.40 A majority of the transients, estimated at between 5 and 6 million, were working as migrant workers in the Pearl River Delta.41 In some areas in the Delta, notably Dongguan, the migrant population reached twice the size of the local population.42 The scale of migration heightened levels of social tension and presented an administrative nightmare for provincial and local governments. Migrants were usually paid one-half or less of the salary of local people. In many cases they were also conﬁned to their quarters and subject to strict

136 Peter Cheung labor discipline. Due to their tight daily schedules and their lack of resources, most had neither the time nor the money to enjoy a normal social life. Industrial casualties in the Delta, including poisonings, ﬁres and other accidents, took a further toll on immigrant health and well-being.43 Conﬂicts have also erupted between migrant workers and local communities. Villagers and townspeople often point to migrant workers as suspects in cases of stolen household items or missing company property. Towns with a large concentration of migrant workers have organized their own village guards to patrol their localities or enterprises. In one case late in 1995, a bloody clash broke out between over 2,000 Hunanese migrant workers and the local public security police in a town in Shenzhen. Many were killed and scores injured. The incident was apparently sparked by the interrogation of several migrant workers suspected by the locals of stealing construction materials.44 The number of “vagabonds” among the transients in Guangdong (i.e. people without a certiﬁcate of identity, a ﬁxed residence, a regular job, or source of income) was estimated to be at least 600,000. These people, mostly drawn from other provinces, were considered the most serious threat to social stability.45 Internal migration and the subsequent employment of millions of migrants in Guangdong presented a serious policy challenge in the 1990s. One source of concern was whether Guangdong could continue to depend upon labor-intensive manufacturing beyond the decade. Second, were the economy to slow down at a time when reform of state-owned enterprises increased local unemployment, the provincial government would need to give greater priority to natives rather than outsiders in employment. Third, according to conventional wisdom migrant workers remain in the province for 4 to 5 years and then move back to their home provinces, taking their substantial savings with them. In the event of a sudden downturn, migrant workers might need to be administratively compelled to leave at short notice, else they would stay in the province for some time until convinced that there was little further opportunity in the Delta. In fact, the provincial government has paid more attention to short-term measures, such as improving public order in big cities and transporting migrant workers back home during spring festivals, than to long-term social problems arising from internal migration. One reasonable prognosis is that even if Guangdong’s economic growth should slacken, the economic situation in the province would still be perceived as better than that pertaining in Jiangxi, Hunan, Guangxi, or Sichuan, the provinces from which the bulk of migrants are drawn. In fact, urban and rural incomes in these provinces are at least 70 to 80 percent below those in Guangdong.46 Hence, it is unlikely that the manifest and latent socioeconomic problems caused by the inﬂux of millions of migrant workers can easily be resolved. Given the volume of surplus labor in China’s countryside and the likely slowdown of Guangdong’s economic growth over coming years, a long-term solution to the social problems caused by the migrant population is probably overdue.

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Deterioration of public order In the 1990s, public order in Guangdong deteriorated to the point of attracting intense attention from inside and outside the mainland, especially from Hong Kong, where an increasing number of visitors and businessmen had fallen victim to blackmail, homicide, kidnapping, and other violent crimes. Cross-border smuggling and criminal activities presented a common range of problems for Hong Kong and Guangdong. Although criminal statistics in the province are not thoroughly reliable due to underreporting, the following ofﬁcial data can be used to illustrate developments over the period.47 According to data from the Guangdong Provincial Procuratorate, the number of criminals apprehended jumped sharply from 27,210 in 1991 to over 94,000 in 1999.48 The number of criminal gangs uncovered rose from 1,284 in 1988 to 7,220 in 1991, and to over 12,000 in 1999.49 In the 1990s, Hong Kong and Guangdong newspapers regularly featured reports on the serious decline of public order in south China. For instance, the largest armed bank robbery and the most substantial case of narcotics trafﬁcking in China, involving 600 kilograms of heroine, both took place in Guangdong in 1995 and 1996.50 Despite regular crackdowns on thousands of highway gangs in recent years, large segments of State Highway 107, the Guangzhou–Shenzhen highway, the Shenzhen–Shantou highway, and the Guangzhou–Shantou highway, all of them major routes on Guangdong’s highway system, were plagued by violent gangs that systematically robbed and wounded drivers.51 Over the same period, prostitution spread beyond the Pearl River Delta to poorer and more remote areas in the province. The extent of the problem is revealed by numerous anecdotal tales told by male visitors, especially to the Special Economic Zones and other parts of the Pearl River Delta, about being approached by pimps and prostitutes in local hotels.52 To compound the problem, popular Hong Kong newspapers carry explicit columns on tips for prostitution and sex services in Guangdong. According to a study by two researchers from the Guangdong Provincial Public Security Bureau, the number of people involved in prostitution rose from 464 in 1980 to over 24,000 in 1990.53 In 1993, according to ofﬁcial statistics, over 32,000 prostitutes and their patrons were apprehended in 1993, and over 49,000 in 1999.54 More than 70 percent of prostitutes were estimated to be under 25 years of age. As the decade progressed, prostitution became more open, more sophisticated, and increasingly under the control of criminal gangs. Nevertheless, the overwhelming majority of prostitutes serving time in the Guangzhou Women’s Rehabilitation Center indicated that they had turned to prostitution of their own volition. Drug trafﬁcking and use increased signiﬁcantly over the same period. The sale and use of narcotics was a minor problem in Guangdong in the early 1980s. By the mid-1990s the problem had grown to such an extent that the provincial government resolved to launch a major campaign on drug abuse.55

138 Peter Cheung The reported number of drug addicts rose sharply from 1,200 in 1990 to over 27,000 in 1994, and to 50,000 in 1995.56 The growth trend did not abate over the second half of the 1990s, when roughly 50,000 drug addicts were arrested each year.57 Cross-boundary collaboration between Guangdong and Hong Kong criminal elements is now thought to be prevalent in the booming drug trade in south China. Smuggling emerged as a problem from the early 1980s, when Guangdong was granted preferential economic policies by the central government. In this case the central government maintained a keen watch on criminal behavior, as smuggling impacted on central Customs revenues. Smuggling in the province attracted an immediate crackdown by the central government early in 1982, only to be followed by the notorious automobile-smuggling scandal on Hainan island, in 1984–5, when Hainan was still under Guangdong jurisdiction.58 The problem grew more serious still in the 1990s. By 1995, the total number of smuggling cases uncovered had reached 3,844, and the value of smuggled goods was estimated to be a daunting ¥2.1 billion.59 The situation further deteriorated in the second half of the 1990s. Back in 1991, former Governor Ye Xuanping had frankly admitted that smuggling in Guangdong was difﬁcult to wipe out because of the involvement of cadres and public-security personnel at basic levels.60 Smuggling was especially widespread in eastern and western Guangdong, where economic opportunities were less plentiful than in the Pearl River Delta. In May 1996, the smuggling of illegal cigarettes through eastern Guangdong had grown so rampant that the central and provincial governments decided to send work teams to recover authority over antismuggling operations from local governments. In some areas smuggling that involved local ofﬁcials, such as township party secretaries and public-security ofﬁcials, was carried out in the name of enriching and developing local communities.61 Rather than stopping and arresting smugglers, for example, many government departments in Huidong county (ranging from the industrial and commercial bureau to the public security bureau) were involved in extracting penalties from offenders. Between 1994 and 1995, they released over 16,691 smuggled vehicles and 109,000 tons of contraband goods valued at ¥440 million, while collecting local penalties of ¥45 million.62 In 1998, the value of smuggled cars, cigarettes, petroleum and other goods reached ¥1.23 billion.63 Even this was just the tip of the iceberg. In 1998–9, under pressure from the central government, the Guangdong provincial authorities conducted major antismuggling campaigns in a number of regions of the province. The value of contraband goods and of bribes involved in these cases amounted to a hefty ¥10 billion. These raids also resulted in the execution of the Customs director in Zhanjiang, the imprisonment of the city’s party secretary and deputy mayor, and the indictment of dozens of ofﬁcials in other areas.64 Since the 1990s, the issue of public order has arisen every year in the Provincial People’s Congress, reﬂecting not only the scale of the problem but also the extent of public concern. One Hong Kong delegate to the

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139

Guangdong Political Consultative Conference pointed out that the decline in public order presented a serious threat not only to public safety and security, but also to Guangdong’s investment environment.65 Nonetheless, the provincial government and its sub-provincial counterparts have thus far proven unable to stem the crime wave. Proliferation of social conﬂict Collective action by particular social groups against other groups, or against state agencies, has mushroomed in Guangdong since 1978. According to former Guangdong Party Secretary Xie Fei, some of the key factors shaping social instability have included the limited capacity of people to accommodate economic reform (chengshouli), disruptions arising from the redistribution of income and assets – including land acquisitions, disputes over land and forest boundaries, and labor problems – excessively bureaucratic behavior and ofﬁcial corruption, and various problems related to maintenance of public order.66 Statistics on social conﬂicts were seldom systematically reported. Nevertheless, ofﬁcial data from Guangdong dating from 1988 reveal 48 counts of petitions and demonstrations, 28 cases of obstruction of the duties of tax ofﬁcers and other public ofﬁcials, 44 cases of labor strikes, and 107 ﬁghts over hills, land, mines, and religious activities, involving 70,000 people in all, and resulting in 19 deaths and 539 injuries over the year.67 Ofﬁcial data for 1990 reveal that Guangdong’s local governments intervened to stop 200 cases of conﬂicts and ﬁghts over the use of land, mines, and other resources.68 To put a positive spin on things, one ofﬁcial report documented the resolution of 109 armed conﬂicts among the “masses,” 23 demonstrations, and 387 work stoppages or related labor disputes in 1993.69 Detailed reports from the local level are revealing, if perhaps unrepresentative. In Huiyang, a county-level city with over 4,000 enterprises and 170,000 workers, there were some 683 labour disputes, 82 petitions by workers and 114 strikes over the period from 1990 to 1994.70 We might reasonably speculate that hundreds if not thousands of cases of collective action have occurred each year since the start of the reform era. Three types of social conﬂicts warrant examination here. The ﬁrst is communal conﬂict between different social groups, especially among villages in the countryside. One study suggested that decollectivization and the destruction of the three-tiered commune system since 1978 have strengthened natural villages, local identities, and “supra-village lineage networks.” The revival of ancestral cults and lineage hierarchies has been widely observed, as the weakening of political control over rural society encouraged the return of pre-1949 practices and customs.71 Some villages fought over fengshui (for example in relation to grave sites), while others clashed over property or business disputes. One important source of property conﬂicts was lack of delineation of property rights, especially in relation to common resources. As new opportunities emerged for turning farmland into industrial or residential sites, the scope for conﬂict over the delineation of boundaries and

140 Peter Cheung the protection of property rights expanded accordingly. In fact, most of the boundaries separating sub-provincial territorial units were based upon informal convention, not formally delineated demarcation.72 The ambiguity of such boundaries caused considerable conﬂicts among localities, and led to destruction of common property. Yangcun and Yunfu counties, for instance, disagreed over claims to a scenic underground cave. Provoked by the behavior of Yangcun residents, villagers from Yunfu bombed the scenic park in late January 1993, causing damage estimated at ¥4 million. A second major form of social conﬂict involves labor disputes. Many ﬁrms operating in the Pearl River Delta are known to impose harsh labor discipline and to provide low salaries and poor working conditions. Published reports of working conditions in Taiwan-funded enterprises provide evidence of military-style regimentation.73 In 1995, about 2,800 cases of labor disputes involving 45,000 people were handled by the labor dispute arbitration agencies in the province.74 By 1999, the number of these disputes had risen to 37,000, affecting 230,000 workers.75 The scale of these labor disputes can be quite considerable as well. In the two cities of Shenzhen and Zhuhai, some half-dozen strikes involving more than 1,000 workers took place between 1993 and 1994.76 Given the heavy concentration of export-processing operations in the province, it is unlikely that such disputes will fade in number or signiﬁcance in the near future. A third type of conﬂict involves disputes between residents and their local governments, and takes the form of demonstrations, riots and petitions against unpopular measures by government agencies. In April 1994, a massive riot broke out in one village in Zengcheng, when 3,000 villagers surrounded the city government building and held up trafﬁc in protest against the local government’s acquisition of land without compensation to villagers.77 The riot was only quelled when hundreds of riot police ﬁred tear gas and dispersed the demonstrators. In January 1996, about 1,000 taxi drivers in Zhuhai staged a strike in order to protest against arbitrary charges and harsh penalties imposed by local trafﬁc police.78 In the context of rapid economic growth, widespread social dislocation, ill-deﬁned property rights and an underdeveloped legal system, the eruption of collective action and communal conﬂicts presents a signiﬁcant challenge for provincial and city governments. Administrative abuse and corruption In addition to the social problems emerging in the reform era, Guangdong has to cope with a wide range of political and administrative challenges including administrative abuse and corruption. The rapid growth of the economy and the decentralization of economic authority and ﬁscal responsibility to the localities have provided ample opportunity for administrative abuses and corrupt practices. Guangdong has certainly stolen the march on other provinces in economic reform. But the administrative and legal frame-

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work operating in Guangdong has failed to develop at a pace to match its economic development. Some administrative abuses affect people directly. In October 1993, for example, the provincial government called upon local authorities to annul thirty-eight types of fees and modify another twenty-seven categories of charges on peasant farmers. Even after these reforms had been put into effect, however, peasants still had to pay over ﬁve dozen types of fees for administrative services such as securing licences.79 In one town in eastern Guangdong, peasants were each charged a ¥150 contribution toward construction of a government building, and teachers were required to extend loans of ¥2,000 per head to the town education commission.80 Such levies had become so commonplace by the 1990s that the provincial government launched a number of campaigns calling on local authorities to reduce or cancel them. From late 1993 to 1995, campaigns against arbitrary fees (luanshoufei) resulted in the elimination of some 4,600 levies imposed on people and enterprises, with reputed savings of ¥600 million.81 After the provincial government launched a further major crackdown in 1998, it was revealed that arbitrary fees and surcharges on peasants cost them around ¥120 million, but that fees, charges and illegal extractions from local enterprises now totalled the enormous sum of ¥11.4 billion.82 Enterprises are particularly vulnerable to levies and extortion because they operate within a dense web of ofﬁcial authorities through which they need to seek permissions and approvals. For instance, one cement factory required the approval of over 100 units under twenty governmental departments, over a period of three years, to carry out a project on technical renovation.83 A printing plant had to pay over ¥300,000 in administrative fees in order to build a workers’ quarters that cost only ¥2.5 million to construct. It would appear that Guangdong’s provincial government departments are little different from those found elsewhere in their predatory rentseeking behavior towards enterprises. Enterprises suffer from a lack of transparency in administrative procedures, an over-abundance of bureaucratic approvals, and frequent imposition of arbitrary charges. Bribery and corruption present another range of problems for enterprises. The rapid transition toward a market economy that marked the 1990s multiplied opportunities for corrupt behavior on the part of party and state ofﬁcials in Guangdong. The provincial Anti-Corruption and Bribery Bureau that was set up in 1989 appears to have made little impression. If anything, the situation has deteriorated since its creation. While no systematic statistics on ofﬁcial corruption and bribery are publicly available, the following ofﬁcial data provide a glimpse of the extent of the problem. Between 1983 and 1988, 5,263 party members were punished for corruption and bribery.84 The number of cases handled by the Provincial Procuratorate jumped from below 500 cases in 1988 to between 1,600 and 2,000 cases per annum in the 1990s. By 1999, the incidence of such cases had risen to over 4,700 (see Table 5.7). The number of cadres at county/division level or above who were

142 Peter Cheung Table 5.7 Statistics on corruption and bribery cases handled by Guangdong’s Provincial Procuratorate, 1988–99

1988 1990 1995 1999

Number of cases handled

Number of cadres at county/division level or above prosecuted

486 2,192 2,107 4,718

49 67 97 192

Source: Guangdong nianjian bianzuan weiyuanhui (ed.) Guangdong nianjian (1989–2000) [Guangdong Yearbook] (Guangzhou: Guangdong Nianjian chubanshe, various years).

prosecuted also increased signiﬁcantly, and the number of reports made by people to the procuratorial system regarding corruption and bribery almost trebled from 7,288 in 1991 to over 20,000 in 1997.85 The seriousness of the situation was underscored by the case of Ouyang De, a former vicechairman of the Provincial People’s Congress and a former party secretary of Dongguan City, who was widely known for his close connections with Hong Kong businessmen. In 1996, he was sentenced to 15 years in prison for accepting more than half a million yuan in bribes.86 The collapse of the Guangdong International Trust and Investment Corporation (GITIC) in late 1998 further revealed the inability of the provincial government to carry out effective ﬁnancial and managerial supervision of its own investment ﬁrms. The above data, while reﬂecting the gravity of the situation, reveal only part of an entrenched problem affecting the province after two decades of rapid growth under decentralized economic management. Flexible interpretations of “central” and “provincial” offered an avenue for circumventing the centrally planned economic system in the early days of reform. However, Hong Kong and foreign businessmen are now complaining about the low efﬁciency and irregularities of the many levels of government in Guangdong. The widespread administrative abuses and corrupt behavior in Guangdong are evidently not conducive to the strengthening of the rule of law and the establishment of the sound administrative framework necessary for the effective operation of a market economy.87 While the province has begun to champion the rule of law and to introduce civil service reforms since 1993, in line with other parts of the country, the problem of producing a meritocratic and rule-abiding public bureaucracy continues to present a daunting challenge for the provincial government. Growing civic consciousness? In response to the many social and economic changes affecting their daily lives, the people of Guangdong have become more pro-active in voicing their

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concerns, both individually and through their “representatives” in the political system, such as people’s deputies. The people of Guangdong have characteristically been regarded as too self-centered, indifferent, or lacking in regard for the public good to be taken seriously as political agents.88 But recent data suggest that interesting changes are under way in levels of civic awareness. Although no systematic studies have been undertaken into the changing political culture of Guangdong, sufﬁcient evidence is available to warrant tentative observations about the changing patterns of political behavior. Enough records are available, for example, to enable us to chart levels of popular dissatisfaction with administrative abuses as these are reﬂected in formal complaints and enquiries forwarded to different branches of the provincial government (see Table 5.8). From this table, it would appear that the number of letters (xinfang) and visits (laifang) to the Standing Committee of the Guangdong Provincial People’s Congress rose sharply from 5,100 in 1990 to almost 9,000 in 1994, and to 11,700 in 1997. The number of unsolicited visits and letters to the judicial and procuratorial systems declined over the same period, reﬂecting new provisions for formal legal assistance through those channels.89 Increased use of the judicial system indicates a greater willingness to turn to the judicial system as an institutionalized channel for settling differences and conﬂicts. So the number of civil and economic disputes handled by Guangdong’s judicial system rose from 64,240 to 140,939 and from 22,675 to 97,293 respectively, in the 1987–99 period.90 These data indicate not only levels of dissatisfaction with

Table 5.8 Visits and letters to provincial party and state organs, 1988–97 SCGPPC

GJ

GP

1988

n.a.

347,203

41,870

1989

n.a.

215,932

58,112

1990

5,104

190,101

41,365

1991

5,428

n.a.

32,193

1992

6,100

n.a.

27,114

1993

7,166

129,335

25,192

1994

8,969

n.a.

22,375

1995

12,634

180,812

28,281

1996

11,747

n.a.

32,214

1997

11,794

85,568

n.a.

Source: Guangdong Nianjian Bianzuan Weiyuanhui (ed.) Guangdong Nianjian (1989–2000) [Guangdong Yearbook] (Guangzhou: Guangdong Nianjian chubanshe, various years). Note: SCGPPC = Standing Committee, Guangdong Provincial People’s Congress, GJ = Guangdong’s judicial system; and GP = Guangdong’s procuratoral system.

144 Peter Cheung government agencies but also a relatively benign political atmosphere in south China that tolerates popular grievances being expressed through formal channels. Another avenue of complaint is telephone hotlines, which are commonly resorted to by people in Guangdong to report on administrative abuses and other problems. In 1986 Guangzhou became the ﬁrst city in Guangdong to champion a mayoral hotline. The number of calls to this service in Guangzhou rose from about 8,000 complaints in 1988 to over 16,000 in 1999. 91 Similarly, the number of tip-offs on corruption and bribery in Guangdong jumped signiﬁcantly from about 7,000 in 1988 to over 20,000 in 1997.92 And the number of letters and visits made by people intent on reporting disciplinary problems among Communist Party members to the Party’s Disciplinary Inspection Commissions in Guangdong increased from 54,000 in 1992 to 86,000 in 1998.93 These preliminary data seem to suggest that people in Guangdong are possibly becoming more aware of their own interests, and increasingly willing to take action in lodging complaints with the government. Interest articulation and role of the People’s Congress As individual people in Guangdong began to make greater use of ofﬁcial channels to voice their concerns, from the late 1980s, their deputies in the Guangdong Provincial People’s Congress (GPPC) also started engaging in formal interest articulation. To be sure, Guangdong’s political reform did not match the pace of its economic reform, and the supervisory role of the GPPC over the provincial government was, by the delegates’ own admission, quite limited. Nevertheless the GPPC played a notable role as a forum for interest articulation within the province. While none of the delegates went as far as to criticize the Communist Party, they did not hesitate to highlight burning issues that emerged in the reform era and to speak on behalf of their constituencies. Limited as they are, records of discussions within the GPPC provide a useful window on to growing differentiation of interests and increasing assertiveness on the part of delegates in using the meetings to articulate different views and criticize the provincial government.94 One of the key themes on the agenda of the GPPC from the early 1990s concerned the widening gap between rich and poor areas in Guangdong. Since the late 1980s, delegates have asked for preferential policies akin to those in the Pearl River Delta to be conferred on poorer mountainous areas. Delegates from these poor areas also pointed out that preferential policies applying in their cases were seldom implemented effectively.95 Other delegates complained that ﬁnancial departments were unwilling to offer loans to poor counties, even though the province provided quotas for low-interest loans. Still others called for the granting of import tax exemption for poor counties. In recent years, delegates from the poor areas have suggested that provincial promises to support these localities amounted to little more than hot air, and have repeatedly urged the provincial government to offer concrete support.

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A second concern raised consistently by GPPC delegates concerned economic irregularities that accompanied the period of rapid growth from the late 1980s. Starting then, delegates began to voice concern that prices had grown so high that they made life difﬁcult for cadres, teachers, doctors, and ordinary citizens in these regions. People on ﬁxed incomes in peripheral areas were expected to pay prices that reﬂected incomes in more prosperous core areas. 96 These complaints grew in number and stridency through the early 1990s. A third economic issue put to the GPPC forum concerned lack of attention to agriculture. In 1988–89, delegates had already pointed out the need to pay attention to grain production, low grain procurement prices, land erosion, and environmental pollution, caused variously by indiscriminate mining, the reduction in available arable land, and lack of state investment in agriculture.97 Between 1994 and 1996, delegates criticized the widespread appropriation of cultivated land for nonfarm use (especially real estate development), low efﬁciency in agricultural production, inadequate support for technicians and technology in agriculture, and degenerating facilities and infrastructure. They urged the government to reclaim farmland that was not cultivated and to invest more resources in agriculture.98 Difﬁculties facing state-owned enterprises were a fourth area of concern for delegates to the GPPC. In the mid-1990s, about 40 percent of stateowned enterprises in Guangdong were experiencing losses. Delegates then urged the provincial government to take care of workers who might be laid off, and to implement social security reform. Others recommended that the provincial government should increase the share of foreign investment in these enterprises and revamp the entire enterprise management system. A ﬁfth area of concern was protection of the interests of minority groups, including ethnic minorities and overseas Chinese. Delegates argued for effective implementation of government policy toward overseas Chinese, especially in relation to the return of homes expropriated in the 1950s, but also in relation to provision of support for overseas Chinese associations and poor overseas Chinese.99 In 1992, delegates from two different ethnic minority counties pointed to a need for more funding and policy support.100 In 1994, two delegates spoke on behalf of the private sector by arguing that the governor’s report did not pay sufﬁcient attention to the important role performed by private businesses, which contributed more than 10 percent of provincial revenues.101 Education and public order were among the most frequently discussed social issues in the GPPC. Delegates had long complained about chronic shortages of funds for education. As early as 1988, delegates pointed out that Governor Ye Xuanping’s annual report lacked speciﬁc measures to make good his promise to attract quality teachers. Only by offering better salaries and beneﬁts, they argued, could good teachers be recruited.102 In subsequent years, delegates argued that increasing educational funding was imperative for laying a ﬁrm foundation for economic development. At the same time, they criticized deteriorating public order in the province. In 1990,

146 Peter Cheung delegates upbraided local leaders in the province for failing to pay sufﬁcient attention to curbing smuggling, noting in particular that illegal activities had become more overt and widespread in eastern Guangdong.103 In 1994, a number of Hong Kong delegates urged the provincial government to do more about corruption, and to set up an anticorruption body along the lines of Hong Kong’s Independent Commission Against Corruption and strengthen the supervisory role of delegates themselves.104 Finally, delegates lobbied for greater administrative authority for their localities. In 1990, one delegate observed that Guangzhou City lacked the power to deal with the unruly behavior of units of the central and provincial governments, or of the People’s Liberation Army, while another delegate suggested that Guangzhou should exercise greater administrative control over the issuing of industrial and commercial licences.105 Delegates also pressed for better provincial deals over loan quotas and the provision of electricity and energy. These examples highlight problems of immediate concern to provincial delegates and to people in general. Several tentative observations are in order. First, delegates were quick to argue that central or provincial policies were ineffectively implemented in speciﬁc instances. Second, they focused on what they felt were inadequacies in the governor’s report to the Congress, speciﬁcally the absence of measures for achieving important policy outcomes in areas such as education and agriculture. Third, delegates did not refrain from voicing criticism of administrative abuses and corrupt behavior.106 Fourth, delegates did not shy away from raising issues that reﬂected adversely on the public image of the province, including rampant smuggling and deteriorating social order. Fifth, a number of matters of general public concern such as price ﬂuctuations and public order were repeatedly raised in the Congresses. Finally, some delegates acted as advocates for special sectors or groups, including the agricultural sector, Hong Kong interests, and overseas Chinese. Discussion in the Congresses reﬂected not only conﬂicts of interest across different segments of society but, signiﬁcantly, an increasing willingness on the part of deputies themselves to articulate interests in a public political forum. To be sure, this articulation was not matched by government action. Indeed, few of the above-mentioned opinions and suggestions put by delegates were adopted by the Congress. At the second meeting of the Eighth GPPC in 1994, for example, delegates put forward 122 suggestions, criticisms, and opinions, as well as 130 proposals. But only ﬁfteen of the 130 proposals were approved by the Presidium as business items on the agenda, and the remaining 115 were merely treated as suggestions.107 In sum, the People’s Congress is not at this stage an effective monitoring mechanism of provincial government, nor is it accountable to any electorate through direct, open and competitive elections. Limited though they may be, discussions in the Congress have nonetheless generated lively debates over serious policy issues in the province and bode well for the possible strengthening of the legislature.

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Conclusion This chapter has characterized Guangdong as a polity and society undergoing a series of rapid adjustments that present pressing challenges to its government and its leadership. In 1999, Jiang Zemin urged Guangdong to take the lead in achieving modernization ahead of other areas, and hence map out new trails for the country as a whole.108 In response to such directives, Guangdong’s provincial government decided to promote its Special Economic Zones and the Pearl River Delta as two key areas for spearheading a new modernization drive, in a comprehensive development plan for the decade to 2010. This grand objective will indeed be a key challenge for the province. In view of the many problems examined in this chapter, the question of whether the provincial government and its subordinate local units can meet the challenge remains an open one. Several issues that touch on Guangdong’s future prospects merit attention. First, after two decades of high-speed growth, Guangdong is entering into a period of consolidation. Its economic development is unlikely to be as rapid as in the early 1990s, when many businessmen and reporters looked upon the province as a model for China.109 For instance, the consumer products which were once the pride of Guangdong are now produced by a dozen provinces, ranging from Sichuan to Fujian, all of which are eager to carve out a share of this proﬁtable market. In any case, light industrial products and consumer durables are unlikely to lead the next phase of the consumer revolution in China. More importantly, the province can no longer rely on easy credit or huge inﬂows of foreign investment, competitive assets in which it once enjoyed an advantage. Other developing countries and other parts of China are equally keen to compete for these resources to speed up their own modernization. Whether Guangdong’s own production can compete effectively with the products of other provinces and imported goods remains to be seen, especially after China’s entry into the World Trade Organization. In light of these challenges, and the many social and political problems outlined above, Guangdong appears to have reached a crossroad. Given the rising cost of production in the province, and the new opportunities created elsewhere for investors following Deng Xiaoping’s southern tour in 1992, Hong Kong investors have already been investing in Shanghai, Beijing, and other parts of China, and in some cases are moving labor-intensive plants to other less expensive provinces or countries. Beijing’s decision to develop the west may also divert some of these investments inland. Guangdong’s real challenge in the coming decade is to establish an economic structure that will make it more competitive vis-à-vis other areas and sustain its economic development in a globalized world economy. Second, as we have seen, the rapid changes under way in Guangdong have produced an increasingly complex society. The gravity of social and administrative problems call for better public administration, regulation, and legal protection. Whether the province can build a sound regulatory and legal

148 Peter Cheung framework in tandem with its economic growth and marketization thus constitutes a key challenge for the provincial government. Such a framework would be important not only for its further economic development but also for social and political stability in the longer term. Last, but not least, the return of Hong Kong to China has signiﬁcant implications for Guangdong’s future. Should Hong Kong’s social and political stability be disrupted through squabbles over domestic politics in the territory, or social conﬂicts triggered by economic stagnation, it would be hard for Guangdong to insulate itself from the consequences due to the close social and economic ties that bind the two regions. If Hong Kong remains economically prosperous and politically stable, on the other hand, contacts between the two areas will in all likelihood increase and ﬂourish. Increasing interactions between Hong Kong and neighboring areas have already inﬂuenced the pattern of political and public management within Guangdong, most notably in Shenzhen.110 However, despite their extensive links, neither area has yet reached a consensus or formulated a clear strategy for working with the other effectively beyond 1997. Developing a mutually beneﬁcial relationship that facilitates management of cross-boundary issues such as environmental pollution and public security, and promotes economic development for the entire south-China region, is critical to the future of both.

Notes * Research for this study was partly sponsored by a grant from the Research Grants Council of Hong Kong, China (Project no. HKU7131/98H). The author would also like to express his gratitude to John Fitzgerald and other participants in the Kunming workshop for their valuable comments on an earlier draft of this chapter. 1 For a bibliography of recent works on Guangdong under reform, see Peter Cheung, “Bibliography on Guangdong Province,” Provincial China, no. 3 (March 1997), pp. 50–63. For a very useful and comprehensive bibliography, see Graham E. Johnson and Glen D. Peterson, Historical Dictionary of Guangzhou and Guangdong (Lanham: Scarecrow Press, 1999). 2 For a study that emphasizes the role of provincial leadership, see Peter Cheung, “The Guangdong advantage: provincial leadership and strategy toward resource allocation since 1979,” in Peter T. Y. Cheung, Jae Ho Chung and Zhimin Lin (eds) Provincial Strategies of Economic Reform in Post-Mao China: Leadership, Politics, and Implementation (Armonk, NY: M. E. Sharpe, 1998), pp. 89–144. For an analysis that highlights the importance of central policy and the politics between the center and the province over special policies, see Peter Cheung, “Changing relations between the central government and Guangdong,” in Yeung Yueman and David Chu (eds) Guangdong: Survey of Province Undergoing Rapid Change (Hong Kong: Chinese University Press, 1998), second edition, pp. 23–61. Studies that emphasize the importance of local development strategies and local autonomy include John Fitzgerald, “Autonomy and growth in China: county experience in Guangdong province,” Journal of Contemporary China, vol. 5

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3 4

5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22

23 24

25

26

149

(1996), pp. 7–22, and Ezra Vogel, One Step Ahead in China: Guangdong under Reform (Cambridge: Harvard University Press, 1989). For other useful surveys of south China in the reform era, see Joseph Y. S. Cheng (ed.) The Guangdong Development Model and Its Challenges (Hong Kong: City University of Hong Kong Press, 1998); Stewart MacPherson and Joseph Y. S. Cheng (ed.) Economic and Social Development in South China (Cheltenham: Edward Elgar, 1996). Owing to the limitation in space, this chapter can only offer a preliminary analysis of the many social and political trends and challenges confronting Guangdong. Guangdong nianjian bianzuan weiyuanhui (ed.) Guangdong nianjian 2000 [Guangdong yearbook] (Guangzhou: Guangdong nianjian chubanshe, 2000) p. 114. Guangdongsheng tongjiju (ed.) Guangdong tongji nianjian 2000 [Guangdong statistical yearbook] (Beijing: Zhongguo tongji chubanshe, 2000), pp. 58–61. Guangdong tongji nianjian 2000, p. 127. Guangdong tongji nianjian 2000, p. 311. Guangdong tongji nianjian 2000, p. 157. Guangdong tongji nianjian 1997, pp. 128 and 421; Guangdong tongji nianjian 2000, pp. 128 and 512. Guangdong tongji nianjian 2000, p. 508. Guangdong nianjian 2000, p. 597. Guojia tongjiju (eds) Zhongguo tongji nianjian 2000 [China statistical yearbook 2000] (Beijing: Zhongguo tongji chubanshe, 2000), p. 601. Guangdong tongji nianjian 2000, pp. 100–1. Guangdong nianjian 2000, p. 597. Zhongguo tongji nianjian 2000, pp. 319 and 333. Guangdong tongji nianjian 1997, p. 73. Guangdong tongji nianjian 1997, p. 158; Nanfang ribao [Southern daily], 16 March 1998. Guangdong tongji nianjian 2000, p. 158. Guangdong tongji nianjian 2000, p. 101. The following ﬁgures are from Guangdong tongji nianjian 1997, p. 21–2. Zhongguo tongji nianjian 2000, p. 192 and 196. Issues such as environmental protection, housing, and welfare have been extensively examined elsewhere. See, for example, the relevant chapters in Yeung and Chu (eds) Guangdong. This chapter cannot tackle all of the major social and political changes that impact on Guangdong, and excludes a number of issues such as social stratiﬁcation and mobility, the bureaucracy and the legal system, and the inﬂuence of overseas values. Guangdong tongji nianjian 2000, p. 49. See, e.g., Peter Cheung, “Pearl River Delta development,” in Joseph Y. S. Cheng and Maurice Brosseau (eds) China Review 1993 (Hong Kong: Chinese University Press, 1993), pp. 18.1–18.29; George C. S. Lin, Red Capitalism in South China: Growth and Development of the Pearl River Delta (Vancouver: University of British Columbia Press, 1997); Yun-wing Sung et al., The Fifth Dragon: The Emergence of the Pearl River Delta (Singapore: Addison-Wesley, 1995). The deﬁnition of the Delta follows that of the Pearl River Delta Economic Region (Zhujiang sanjiaozhou jingjiqu) for the sake of simplicity. See Guangdong tongji nianjian 2000, p. 596. Guangdong nianjian 2000, pp. 604, 590 and 591.

150 Peter Cheung 27 Guangdongsheng tongjiju and Zhongguo gongshang yinhang Guangdongsheng fenhang (eds) Guangdong quyujingji tongji ziliao huibian, 1980–1993 [Compendium of regional economic statistics for Guangdong province] (1995), p. 6. 28 Guangdong tongji nianjian 1996, p. 93; Guangdong tongji nianjian 1997, p. 511; Guangdong tongji nianjian 1998, p. 578; Guangdong tongji nianjian 1999,p. 606; Guangdong tongji nianjian 2000, p. 596. 29 Vogel’s study is probably the one exception among the major studies of Guangdong in English. 30 Guangdong tongji nianjian 2000, pp. 146, 653 and 654. 31 Zhongguo tongji nianjian 2000, p. 144. 32 Guangdong tongji nianjian 2000, pp. 263 and 604. This ﬁgure was higher than the national average of ¥2,210, although higher prices in the province should also be taken into account. Zhongguo tongji nianjian 2000, p. 333. 33 Nanfang ribao, 19 July 1996, p. 1. 34 Guangdong tongji nianjian 1995, p. 119. 35 Guangdong tongji nianjian, various years. 36 Zhong Wenqing et al., Deng Xiaoping gongtong fuyu lilun yu Guangdong shanqu jianshe, pp. 53–5; Guangdong nianjian 1997, p. 713; Guangdong nianjian 1998, p. 126. 37 Guangdong nianjian 2000, p. 100. 38 For instance, in a town in Yangcun city, a poverty relief fund of half a million yuan was misappropriated for buying government facilities, funding business operations, and paying for other consumption expenses. Nanfang ribao, 11 August 1996, p. 1. 39 See Zhongguo tongji nianjian 2000, p. 64. 40 The number of people who would stay for at least one year was 3.29 million, about 5.24 percent of the population, but those who stayed for less than one year was estimated to be two million. Pang Faqiang, “Guangdong liudong renkou xiankuang” [The current situation of Guangdong’s ﬂoating population], Nanfang renkou [Southern population] no. 3 (1992), p. 24. Another estimate suggested that the province had thirteen million transients in 1995, about one-ﬁfth of the provincial population. Guangdong gonganbao [Guangdong security journal], 13 September 1995. 41 The ﬁve to six million ﬁgure is based on Yun-wing Sung et al., The Fifth Dragon, p. 118. The actual number may be considerably higher. 42 For a recent account of the plight of these migrant workers, see Anita Chan, “Regimented workers in China’s free labour market,” China Perspectives, no. 9 (January–February 1997), pp. 12–16. 43 This author visited several towns in Dongguan in December 1994. The following discussion of circumstances at this time is informed by the visit. 44 Apple Daily, 6 December 1995. 45 Nanfang ribao, 11 June 1996. 46 Zhongguo tongji nianjian 2000, pp. 319 and 333. 47 The following statistics are taken from the sections on public security work in Guangdong nianjian bianzuan weiyuanhui (ed.) Guangdong nianjian 1989, 1991 and 1995 [Guangdong yearbook] (Guangzhou: Guangdong nianjian chubanshe, various years). 48 Guangdong nianjian 1992, p. 187; Guangdong nianjian 2000, p. 148. 49 Guangdong nianjian 2000, p. 148.

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50 Nanfang ribao, 25 June 1996, p. 1. 51 Ming Pao, 4 January 1996, p. A2. 52 While this problem has existed for a long time ago, it evidently became more serious in the 1990s. Reports on this topic can be found virtually every day in any Hong Kong newspaper. 53 The authors of this study concede that their ﬁgures may underestimate the scale of the problem. See Nanfang qingxiaonian yanjiu (June 1992), pp. 14, 25–6 and 36. The following discussion draws from these materials. 54 Guangdong nianjian 1994, p. 171; Guangdong nianjian 2000, p. 148. 55 The initial campaign ran from April to September 1995. Nanfang ribao, 27 April 1995. 56 Wai-kin Che, “The drug problem in Guangdong province: an unexpected byproduct of development,” in Joseph Y. S. Cheng (eds) The Guangdong Development Model, p. 352. 57 Cf. the section on public security in Guangdong nianjian for various years. In 1999, over 53,000 drug addicts were arrested: Guangdong nianjian 2000, p. 148. 58 See Peter Cheung, “Changing relations between the central government and Guangdong,” in Yeung and Chu (eds) Guangdong. 59 Nanfang ribao, 24 January 1996, p. 1. 60 Express Daily, 30 March 1991. 61 Ming Pao, 10 April 1996; Wen wei pao, 28 May 1996, p. A3. 62 Nanfang ribao, 26 July 26 1996, p. 1. 63 Guangdong nianjian 1999, p. 181. 64 Guangdong nianjian 2000, p. 147. 65 Nanfang ribao, 4 February 1996, p. 2. 66 He also cited the hostile intervention of external forces as a source of instability, but did not elaborate on this point. Nanfang ribao, 12 March 1994, pp. 1–2. 67 Guangdong nianjian 1989, p. 92. 68 Guangdong nianjian 1991, pp. 188–9. 69 Guangdong nianjian 1994, p. 175. 70 Nanfang nongcunbao [Southern village news] 19 May 1995. 71 I Yuan, “Center and periphery: cultural identity and localism of the southern Chinese peasantry,” Issues and Studies, vol. 32 , no. 6 (June 1996), pp. 1–36. 72 Nanfang ribao, 13 August 1996, p. 1. 73 See Chan, “Regimented workers.” 74 Guangdong nianjian 1996, p. 679. 75 Guangdong nianjian 2000, p. 474. 76 “Zhujiang sanjianzhou gongren quanyi zhuangkuang” writing group, Zhujiang sanjiaozhou gongren quanyi zhuankuang [Rights and privileges of workers in the Pearl River Delta] (HK: Asian Monitor Research Center, 1995). 77 Ming Pao, 11 April 1994, p. A2. 78 Ming Pao, 16 January 1996, p. A3. 79 Nanfang ribao, 18 October 1993, p. 2. 80 Nanfang ribao, 20 November 1995, p. 1. 81 Guangdong zhengbao, no. 51 (1995), p. 1522. 82 Guangdong nianjian 1999, p. 169. 83 Nanfang ribao, 10 May 1996, p. 1. 84 Wen Wei Pao, 25 August 1989, p. 1. 85 Guangdong nianjian 1998, p. 180.

152 Peter Cheung 86 Nanfang ribao, 6 July 1996, p. 1. 87 For a study that examines Guangdong’s recent efforts in promoting the rule of law, see Linda Chelan Li, “The ‘rule of law’ policy in Guangdong: continuity or departure – meaning, signiﬁcance and processes,” The China Quarterly, no. 161 (March 2000), pp. 199–220; also “Guangdong: from ‘Machiavellian’ ﬂexibility towards the rule of law,” Provincial China, no. 5 (March 1998), pp. 1–17. 88 Vogel, One Step Ahead, pp. 423–4. 89 Guangdong nianjian 1996, p. 189. It should be noted that the province introduced the service of legal assistance for citizens from the late 1980s, which may partly account for the decline in unsolicited letters and visits. 90 Guangdong nianjian 1988, p. 105 and Guangdong nianjian 2000, p. 152. 91 Nanfang ribao, 31 December 1995, p. 1; Guangzhou nianjian bianzuan weiyuanhui (ed.) Guangzhou nianjian 2000 (Guangzhou: Guanghzou nianjianshe, 2000), p. 82. 92 The following data are from Guangdong nianjian 1989, p. 95 and Guangdong nianjian 1998, p. 180. Comparable data are not available for 1998 and 1999. 93 Guangdong nianjian 1993, p. 154 and Guangdong nianjian 1998, p. 169. 94 Reports of GPPC sessions in the public media are not adequate to offer a systematic and in-depth analysis of the body’s evolution. During the annual conference held each year, only a summary of the opinions of the people’s delegates is reported in the ofﬁcial Nanfang ribao. None of the conference newsletters or summaries of small group discussion are publicly accessible. Reports on People’s Congress meetings in this section draw from Nanfang ribao and Renmin zhisheng [Voice of the People], 1995 and 1996 issues. In a number of recent cases, the GPPC has criticized government departments for maladministration, an interesting development that deserves detailed analysis in its own right. 95 Nanfang ribao, 25 and 26 January 1988, p. 2. 96 Ibid. 97 Nanfang ribao, 25 and 26 January 1988, 7 March 1989, p. 2. 98 Nanfang ribao, 21 February 1995, p. 2; Renmin zhisheng, 1 April 1996, p. 4. 99 Nanfang ribao, 16 May 1990 and 15 January 1992, p. 2. 100 Nanfang ribao, 13 January 1992, p. 2. 101 Nanfang ribao, 23 February 1994, p. 2. 102 Nanfang ribao, 26 January 1988, p. 1. 103 Nanfang ribao, 14 May 1990, p. 2. 104 Nanfang ribao, 23 February 1994, p. 2. 105 Nanfang ribao, 16 May 1990, p. 2. 106 Nanfang ribao, 9 March 1989, p. 2. 107 Guangdong nianjian 1995, p. 165. 108 Guangdong nianjian 2000, p. 90. 109 See, e.g., Ming Pao, 7 December 1992, p. 8. 110 For an analysis of this interesting issue, see Lo Siu-hing, “Hong Kong’s political inﬂuence on south China,” Problems of Post-Communism, vol. 46, no. 4 (July/ August 1999), pp. 33–41.

Chapter Title

6

153

Discourses of poverty Weakness, potential and provincial identity in Anhui Wanning Sun

Introduction Mention Anhui Province in China and people immediately think of poverty and hardship and of a people famed for their grit and determination. Even the symbols that promote the province reinforce this impression. Anhui’s quintessential folk opera and dance, the Fengyang Flower Drum (huagu), originated as a busking performance by beggar-peasants who lived amid the haunting reality of regular ﬂooding along the unruly Huai River around Fengyang. More recent memories conﬁrm a similar impression. The association between Anhui and poverty was reinforced in the 1960s and 1970s, when beggars from Anhui made their way to Shanghai, Jiangsu and Zhejiang, and in the 1980s and 1990s when the province began to supply a never-ending supply of menial servants and maids (bao mu, or ayi) who roam the country in the service of middle-class families from more prosperous regions. Anhui has earned a reputation as the Philippines of China – a poor area located within a far richer one, with hard-working men and dedicated womenfolk who have no choice but to abandon their place of birth and roam the country to keep body and soul together. The image was recently encapsulated in a ﬁlm about Anhui maids, The Maid from Huang Shan (Huangshan lai de guniang), that reinforced an impression of provincial poverty even in the booming 1980s. Today, Anhui maids perform the Fengyang Flower Drum song all over the country. In spite of this prevailing impression of Anhui as a land of poverty, the problem of poverty itself has not engendered a general or theoretical explanation of Anhui’s place in the political economy of late twentiethcentury China. Instead, particular and contingent explanations abound. Some would emphasize the province’s “inland peasant” mentality. Others adopt a “Great Men in History” view that attributes blame to failures of leadership, and others again point to the residual inertia of an old command economy or environmental conditions that alternate between drought and ﬂood. Yet there remains an underlying assumption – not least among the provincial leadership – that Anhui’s position would improve considerably if only the source of its problems were identiﬁed and the problems themselves were rectiﬁed. Hope is a common feature of the discourse of poverty that characterizes analysis of Anhui Province in the People’s Republic of China.

154 Wanning Sun

Anhui Province

General GDP (billion yuan renminbi [RMB]) 290.86 GDP annual growth rate 8.10 as % national average 106.58 GDP per capita (yuan RMB) 4,707.00 as % national average 72.04 Population Population (million) Natural growth rate (per 1,000) Workforce Total workforce (million) Employment by activity (%) primary industry secondary industry tertiary industry Employment by sector (%) urban rural Employment by ownership (%) state collective private self-employed individuals Wages and Income Average annual wage (yuan RMB)

62.37 8.60 33.13 60.60 15.40 24.00 17.76 82.24 8.42 2.17 1.67 10.19 6,516.00

Growth rate in real wage 9.10 Urban disposable income per capita 5,064.60 as % national average 86.51 Rural per capita income 1,900.29 as % national average 85.97 Prices CPI [Consumer Price Index] annual rise (%) Retail Price Index annual rise Foreign trade and investment Total foreign trade (US$ billion) Exports (US$ billion) Imports (US$ billion) Realized foreign capital (US$ billion)

-2.20 -3.40 2.65 1.68 0.97 0.26

Education University enrollments 133,025 Secondary school enrollments (million) 3.40 Primary school enrollments (million) 6.42 Notes: All statistics are for 1999 and all growth rates are for 1999 over 1998 and are adapted from Zhongguo Tongji Nianjian 2000 [Statistical Yearbook of China 2000], Zhongguo Tongji Chubanshe, Beijing, 2000.

Discourses of poverty in Anhui 155 This chapter seeks to examine an array of discourses – ofﬁcial, academic and popular – and a variety of narratives these discourses deploy – historical, cultural, structural and governmental – with a view to explaining Anhui’s less-than-satisfactory performance over the reform era. Without wishing to privilege one particular discourse or explanation over others on the issue of poverty, the intention here is to present Anhui in the reform era as an example of a disjuncture in the age of the global economy. Anhui’s position testiﬁes to the sharply uneven distribution of economic and political resources among China’s provinces as China enters the era of globalization. Identity politics plays an important part in local responses to unequal distribution and to processes of globalization. Highly localized images of the Fengyang Flower Drum or of the Anhui maid represent Anhui as a particular site of poverty in a national landscape that is otherwise losing much of its cultural particularity. The operation of a globalized economy operates on deterritorialized and memoryless ways of thinking. At the same time, the emergence of global culture creates a desire and a need to assert local identities that are time-bound and place-speciﬁc.1 Attempts to reconstruct local histories, narratives and myths, to construct a local collective identity, may be a strategy to capitalize on the desire of the global market for local “authenticity.” In other cases, however, it is a way of resisting the homogenizing impact of global cultural production and consumption, and of mobilizing a local mentality or cultural tradition thought to be necessary in an increasingly globalized economy. Identity politics lies at the nexus of the global and the local, of modernity and tradition. Understanding identity politics offers a point of entry into the study of social change at the local and provincial levels in China’s reform era.

The politics of boundaries and histories It is widely acknowledged that Anhui needs to exploit its geographic, economic and cultural links with neighboring provinces if it is to integrate with national and international markets and take full advantage of recent market reforms. Governed by this rationale, Anhui’s current leadership argues the need to maximize the comparative advantage of each of its many geographically and economically diverse regions. Ofﬁcial deﬁnitions of Anhui’s current position demonstrate the leadership’s acute awareness of the potential for economic growth, its recognition of the importance of comparative advantage of particular regions, and its willingness to imagine provincial geography in terms of cultural and economic complementarity rather than purely administrative demarcations. As an administrative unit, the province takes little account of natural geography or cultural contiguity. Anhui is an inland province situated in the south-east of China and sharing borders with Shandong in the north, Henan in the north-west, Hubei in the south-west, Jiangxi in the south, Zhejiang in the south-east, and Jiangsu in the north-east. Geographically, the province

156 Wanning Sun can be subdivided into four distinctive areas: the plains north of the Huai River, which have inferior soil quality and low yields and are suitable for cotton and grain production; a hilly area between the Yangtze River and the Huai River; a fertile rice-growing area along the middle and lower reaches of the Yangtze River; and a mountainous area to the south. Culturally, a number of these areas have less in common with one another than they do with adjacent sub-regions of neighboring provinces. People in northern Anhui, for example, share a preference for bread and noodles with the people of Shandong, Henan and Subei, and speak northern dialects like people in those adjacent provinces and regions. People in southern Anhui, on the other hand, eat rice and speak Wu dialects akin to those spoken in Zhejiang and Jiangxi. Attempts by the provincial government to redeﬁne the sub-regions in term of comparative economic advantage and cultural afﬁnity, rather than administrative boundaries, are matched by an equally conscious political initiative to “recover” a unique provincial identity. Cross-border cooperation is not to be achieved at the expense of the administrative integrity of the province. Hence there has been a conscious search in recent years for a political symbol that can capture ofﬁcial thinking about the “spirit” of Anhui. One candidate for this provincial symbol is the image of the Huangshan Pine, a tree that grows on the rock-face at the summit of sacred Huangshan Mountain in Anhui. This image symbolizes the capacity to grow in the face of adversity and to face challenges from every direction. Calls to adopt the spirit of the “Huangshan Pine” are ritually incanted in the ofﬁcial press, but the symbol does not appear to have taken root outside the arid political discourse of the provincial state. A richer source of provincial symbolism is to be found in recent local histories, which shed light on a variety of issues in contemporary Anhui identity politics. One is the claim to historical longevity. Anhui did not become a province until the seventeenth century. Nevertheless, works such as Important Events Which Shaped Anhui’s History (1995) trace a venerable provincial pedigree that stretches back to the beginning of the imperial state two thousand years ago. Another set of themes focuses on political turbulence, territorial warfare and social upheaval. It is widely recalled that Anhui (along with southern Shandong and eastern Henan) was the site of a famous battle in 206 BCE between Liu Bang of the Han state and Xiang Yu from the state of Chu, early in the formative Han Dynasty. Over the period of transition to the Later Han (25–220), the modern territories of Anhui and Henan were major sites of many of the decisive battles that took place among the Three Kingdoms (Wei, Shu and Wu). This history has important implications for provincial identity. First, the territory of Anhui is situated near the center of the ancient Chinese state, and is sacred to its memory. Second, Anhui has always suffered on account of its centrality, sacriﬁcing its particular interests for the wider beneﬁt of the Chinese state. There is some truth to both of these claims. The fate of Anhui is comparable to that of the neighboring Subei region of northern Jiangsu,

Discourses of poverty in Anhui 157 where the strategic importance of the area for war, politics and revenues generally outweighed considerations of local development and prosperity within the imperial bureaucracy.2 Within Anhui, in any event, it is claimed that wars of national resistance and national reuniﬁcation have been waged at the expense of irrigation, improved farming methods, social stability, and the livelihood of communities and individuals. These wars have led to frequent mass migration, have severely damaged ecological systems, and have discouraged regular maintenance of local economic infrastructure. The same story is held to explain why Emperor Kangxi, on one of his imperial tours, should have described Anhui as a place “full of bald mountains and foul waters, and populated by rude women and shrewd men” (qiongshan ershui, pofu diaomin).3 Anhui is one of the most populous and densely populated of China’s provinces, with an ofﬁcially registered population of over 60 million people. Around 16 percent are registered as urban dwellers.4 Through the 1960s and 1970s – and to some extent the 1980s – a Leftist inheritance among middleand lower-level cadres exacerbated the effects of a disaster-prone natural geography, to inhibit economic growth. During these decades, the provincial leadership doggedly adhered to a policy of “taking grain-as-the-key-link” (yi liang wei gang) at the expense of what was later termed “comprehensive development” (quanmian fazhan). Up to 1995, grain production occupied about 50 percent of the gross value of agricultural output.5 An emphasis on grain production inhibited the growth of sideline agricultural development and resulted in massive deforestation, land erosion and the choking of lakes and rivers. The focus on grain also subjected provincial agricultural production to the whims of a hostile climate. Owing to its unique topography, Anhui also has its fair share of natural disasters. Traversed by the Yangtze and Huai Rivers, and situated at a point where the temperate and subtropical zones meet in the eastern part of China, the area is a meeting place for cold and warm currents from the coast and inland. Unpredictable water precipitation and temperatures render crops vulnerable. The Huai River runs through the Northern Huai plain, the main agricultural production area and the most densely populated rural area in the province. Since the twelfth century, the Huai has been recorded as the source of numerous ﬂoods and the cause of many droughts. The notorious poverty of Fengyang, for instance, is largely attributable to its vulnerable position in relation to the Huai River. Lack of proper water conservancy facilities, land erosion and deforestation as a result of consistently universal single-crop farming has greatly damaged the capacity of rivers, lakes and dams to store and discharge ﬂoodwater in the region. Each year since 1949, about 18 million mu (120 million hectares) of land in the province has suffered from either drought or ﬂood. The rate of ﬂooding, in particular, has increased with the intensity of grain farming. There was one ﬂood in the Huangshan region during the 1950s and three ﬂoods in the 1970s, but four torrential ﬂoods since the 1980s.6

158 Wanning Sun In the provincial discourse of poverty, these difﬁcult circumstances are turned to good effect in accounting for the province’s proud history of popular rebellion against class oppression, social and economic injustice, and authoritarian rule. As early as 209 BCE, local destitution and oppression resulted in the ﬁrst recorded peasant uprising in China, led by Chen Shen and Wu Guang. The uprising took place in Dazexiang village, in Suxian County, which is now located in northern Anhui. It is claimed to have produced the ﬁrst peasant government in Chinese history. Although the Qin regime suppressed the uprising, the event precipitated the demise of the Qin Dynasty two years later. Less well known is the Huizhou Peasant Uprising that took place in Shexian County, in modern Huizhou, during the transition from the Ming to Qing dynasties. Powerful landlords in Huizhou operated a distinctive caste system, based on local lineage and surname groupings, and they exercised extensive property rights over their employees, slaves and servants. In 1645, thousands of slaves, led by Song Qi, rebelled against their Huizhou landlords, demanding recovery of their indenture and personal freedom. The rebellion was crushed by the new Qing Dynasty within a few months of the uprising. Nevertheless, the antislavery struggle continued, going underground for another 30 years and posing a serious threat to the caste system of the Huizhou area – and eventually resulting in a series of conciliatory measures on the part of the Qing government.7 The story continues into the modern history of Anhui. From 1928 to 1932, Communist organizers led a series of peasant uprisings in northern and western Anhui against the new Nationalist Government. These uprisings preceded establishment of a revolutionary base in the vicinity of Dabie Mountain, known as the Er-Yu-Wan Border Region (Hubei-Henan-Anhui). During the anti-Japanese War, Anhui was a base for the New Fourth Army led by Liu Shaoqi. It was also the site of the infamous Wannan Incident, in which Nationalist forces broke their alliance with the Communists by ambushing and annihilating units of the New Fourth Army under Ye Ting and Xiang Ying. Anhui again became the site of important battles during the Civil War, when Liu Bocheng and Deng Xiaoping led troops from the Jin-Ji-Lu-Yu base area to launch the famous Huai-Longhai Battle in northern Anhui. This turned out to be a decisive battle against the Nationalists in the ﬁnal phase of the Civil War. The precariousness and severity of the environment in northern Anhui gave rise to a particular conﬁguration of economic, social and political interactions that shaped patterns of popular grievance and group aggression that were ultimately exploited by the Communist Party.8 Land reform went some way toward meeting peasant expectations. Where hopes remained disappointed, however, the scope for peasant resistance was limited by the extension of party authority into the countryside. Following the land reform movement of the 1950s, farming communities came to appreciate that their survival and prosperity depended on the prevailing political climate no less than on the natural environment. Both turned out to be unreliable.

Discourses of poverty in Anhui 159 Throughout the early decades of the People’s Republic, the livelihood of Anhui peasants hinged on the whims and desires of a predominantly leftwing leadership that consistently allied itself with radical forces in Beijing. Admittedly, the devastating effects of these policies were at times recognized and corrected. Zeng Xisheng, party secretary of Anhui throughout the 1950s, was responsible for a series of “Left” measures that devastated the provincial economy over that period. Shortly after he left Anhui to take up the position of party secretary of Shandong Province in 1960, Zeng was struck by the damage his leadership had wrought on Anhui. The following year he resigned from his position in Shandong and offered to return to Anhui to repair the damage. He devised a “responsibility land system” that gave peasant farmers greater production incentives. This radical local initiative was initially endorsed by Mao Zedong, following an inspection of the Anhui countryside. But Zeng fell out of favor with Mao just as peasants were beginning to beneﬁt from the initiative, which was brought to a halt.9 Zeng’s remorse was more the exception than the rule. The overwhelming lesson of the Agricultural Cooperative Movement, the Great Leap Forward, the People’s Commune Movement, and the Movement to Learn from Dazhai over the ﬁrst two decades of Communist rule was that authorities would rarely acknowledge or correct their mistakes, however egregious or devastating. If peasant farmers did not help themselves, no one in party or government would come to their aid. This lesson drove the peasants of Xiaogang village in Fengyang County, in northern Anhui, to take their future into their own hands in 1979. Compelled by poverty borne of decades of collective farming, eighteen households in Xiaogang secretly vowed to lease collective land to individual households in the village. The peasants pledged secrecy to avoid political repercussions, agreeing that if their actions landed any of them in jail then the others would care for their families. Only desperation born of poverty can explain the audacity of this move: Anhui peasant farmers were driven to the edge of despair.10 Certainly the villagers of Xiaogang were not aware that their initiative would mark the beginning of a nation-wide reform program that would fundamentally change the livelihood of China’s peasant population from one end of the country to the other. Anhui’s party secretary, Wan Li, came around to endorsing the initiative in a political decision that substantially increased Wan’s political credentials. The Xiaogang initiative was now hailed as the ﬁrst successful example of a “family production responsibility system” that was to apply throughout the country. In the provincial discourse of poverty, this local initiative is likely to appear, in retrospect, every bit as profound and far-reaching as the uprising of their provincial ancestors in the Qin Dynasty. It has been noted that Anhui peasants are less enterprising and successful in small business and trade than their counterparts in the neighboring provinces of Jiangsu and Zhejiang. Until the 1970s, for example, beggars were widely considered a living symbol of Anhui poverty. This representation of local poverty is a little misleading, in the sense that begging during

160 Wanning Sun the winter season was a rational sideline industry for Anhui peasant families. Much as their counterparts in Jiangsu and Zhejiang provinces kept themselves occupied in the slack season by engaging in a variety of sideline industries, it was customary in parts of Anhui for the entire family to leave the village and set out on a “regular” begging journey. This is not to deny the reality of poverty; only in circumstances of extreme poverty is begging more cost-effective than other forms of sideline production. As it happens, the socalled “gypsies of China” in northern Anhui were one of few communities in the country that turned begging into an art form. In an ethnographic study of “wandering peasants” (liumin) north of the Huai River, Chi Zihua suggests that this historical pattern of annual migration, although driven by a drought-affected and ﬂood-prone ecology, evolved into a self-sustaining cultural phenomenon unique to the region. Leaving home in the winter and returning in the spring became a collective habit that many peasants maintained to maximize their opportunities and income, even in relatively good times.11 Chi Zihua’s recent work illustrates a theoretical shift among local researchers from a structural to a cultural approach to political economy and identity formation in Anhui. There is a new emphasis on local mentality and popular imagination, and some awareness of the contested nature of these concepts. Like their counterparts in other inland provinces such as Shanxi and Jiangxi, local intellectuals in Anhui are beginning to research, discuss and write about the content, development, and impact of their own particular provincial culture – in this case “Hui culture.” For example, Jianghuai luntan, the most respected journal of the Anhui Academy of Social Sciences, has for the past three years devoted a column in each issue to extended discussion of Hui culture. Hui culture derives its name from the county of Huizhou in south-eastern Anhui. The distinctive features of Hui culture are thought to include an indigenous understanding of medicine and maths, an intuitive grasp of commerce, a sophisticated grasp of literature, painting and theater, and a distinctive lifestyle covering everything from architecture, cuisine and handicrafts to fashion. It is widely associated with the history of Huizhou merchants, whose business ventures carried them throughout the empire. In their travels, Huizhou merchants helped to promote Hui cuisine – one of China’s “eight local culinary traditions” – which is characterized by delicacies from the mountains (including bamboo shoots, dried mushrooms and black fungi) and by its reputedly strong medicinal value.12 Since Hui merchants tended to be both wealthy and learned, they also helped to promote Hui opera beyond southern Anhui to parts of Jiangsu and Zhejiang.13 Today, Hui merchant culture is thought to be one of the three distinctive merchant cultures of late imperial times, along with Jin merchant culture of Shanxi14 and Gan merchant culture from Jiangxi.15 For Anhui, in particular, the local promotion of Hui culture offers a relatively positive and upbeat alternative to other provincial symbols, such as

Discourses of poverty in Anhui 161 the Huangshan Pine, that serve to convey a more stoic impression of hardship and endurance. In 1994, Anhui TV coproduced with the Anhui Film Studio a feature ﬁlm entitled Stories of Hui Merchants (Huishang qinyuan) centering on the rise and fall of a famous Hui merchant family. The ﬁlm’s ethnographic interest in local sartorial, architectural, cultural and linguistic particularities reinforced impressions of the moral integrity, commercial instincts, Confucian mannerisms and particular business style of the Huizhou merchants of old. The ﬁlm, styled in the form of the indigenous Huangmei opera, received considerable publicity and was singled out by the provincial government as the best ﬁlm of the year. These attempts to capture and classify the identity of Anhui in ofﬁcial and popular discourses highlight a continuing process of cultural homogenization within the province. Seldom mentioned in celebratory histories of Anhui are the large-scale historical encounters that signiﬁcantly changed the ethnic and cultural make-up of the Anhui population.16 The ﬁrst signiﬁcant encounter, which took place during the later years of the Eastern Han Dynasty, involved Sun Quan’s State of Wu and indigenous peoples living in the isolated mountains east of the Yangtze River. Sun’s ambitious and ultimately successful project of subduing the natives through war and assimilation does not sit easily alongside the widespread assumption that Anhui has “always” been inhabited by the Han people. It is nevertheless acknowledged that the territory now known as Anhui has since ancient times embraced a multiethnic population, including Man, Yue, Yi and Huaxia peoples. Anhui’s later history reveals many moments of cultural conﬂict, hybridization and appropriation. Apart from Sun Quan’s conquest of indigenous people during the Han Dynasty, there have been massive migrations from other regions into Anhui, some as recently as the nineteenth century. During the Tongzhi period of the Qing (1862–74), for example, the imperial government encouraged the migration of some 5 million people from Hubei, Henan, Guangxi and Hunan, into Anhui, which had lost around 15 million people over earlier decades through war and famine.17 Resettlement programs on this scale signiﬁcantly altered the composition of Anhui’s population, and inﬂuenced the development of local languages, lifestyles, customs and culinary traditions. Southern Anhui, in particular, evolved as a “multicultural” microcosm. While the consequences of these encounters were in some ways enriching, in other respects they proved quite painful. Migrant settlement, for example, remained a source of ongoing dispute between the “locals” (tu) and “guest residents” (ke) over land and resources well into the twentieth century. Concerted attempts have been made to reconcile these hybrid and contested memories of Anhui. According to scholars of Hui culture, for example, the early amalgamation of the Southern and Central Plain cultures resulted in something called “Chu culture” in Anhui. This Chu culture was an important component of early Chinese civilization – indeed central to the

162 Wanning Sun culture that came to be known as Chinese (or Central Plain zhongyuan) culture. Since Hui culture, the argument goes, derives from both Central Plain culture and southern mountain culture, and since its inﬂuence extended north and south of the Yangtze (conventionally considered the notional border between north and south China), Anhui’s particular cultural blend survives as living testimony of the heterogeneity, ﬂuidity and ambiguity of Chinese culture itself. Evidence for this argument is to be found in the region’s claims to classical learning and writing. It was the birthplace of Xuan paper (xuanzhi) and, until recently, the most famous source of ink, ink slabs and brushes in all China. It was home to both Laozi and Zhuangzi, founders of China’s major indigenous religion, Taoism (Daojia). It was also home to philosophers of the Neo-Confucian school of reasoning (Lixue), the most inﬂuential school of the high empire, of which Zhu Xi was the most prominent exemplar; and it produced some of modern China’s most brilliant and inﬂuential intellectuals, including Hu Shi and Chen Duxiu. Current attempts to ransack history in search of a quintessentially Anhui identity prompt a number of questions about the deﬁnition of the province and its place in history. Other provinces can claim longer histories as territorial units of government. Although Han settlement in the region dates back to pre-imperial times, Anhui did not emerge as a province until the twilight of the empire – speciﬁcally 1667, the sixth year of Emperor Kangxi of the Qing, when the province of Jiangnan was divided into Jiangsu and Anhui. Even the name of the province is a matter of dispute. Despite a common belief that the word was formed by combining the ﬁrst syllables of the cities of Anqing and Huizhou, historians still quarrel over how the word “Anhui” came to be selected and what it may have meant at the time. For all these differences, it is argued that the break-up of Jiangnan Province into Anhui and Jiangsu was beneﬁcial for the Anhui region as the move towards administrative decentralization expanded the scope for local government in the management of irrigation projects and farming technology. Certainly Anhui’s economy developed rapidly over subsequent decades. It ranked ninth among provinces between the Yongzheng and Tongzhi periods (1723–1874), and its success in the imperial examination placed it seventh in the national league table.18 The recent “discovery” of a distinctive merchant culture, in a province not noted for its entrepreneurship or marketing networks in the reform era, suggests that provincial identity construction is closely bound up with current trends in China’s political economy. Comparison with Jiangxi Province is instructive in this regard. Indeed the concurrent “Gan Culture” fever in Jiangxi Province reveals a similar dynamic of provincial identity construction. History has certainly afforded Jiangxi and Anhui different and sometimes conﬂicting modes whereby each province may imagine itself as a cultural and political community. Nevertheless, the two provinces have much in common: each lacks a common dialect, a recognizably common lifestyle, or a uniform natural environment. The privileging of the trope of “merchant

Discourses of poverty in Anhui 163 culture” in both provinces – with overt support from the two provincial governments – is designed to forge a sense of common purpose in developing an open market economy, and to strengthen each province’s self-conﬁdence in attempting this transition to the market. With few exceptions, however, these provincial self-representations have yet to translate into economic or administrative performance in either Anhui or Jiangxi.19

Economic reform: problems, strategies and issues Despite the province’s pioneering role in initiating agricultural and market reforms early in the reform era, Anhui’s economic growth lagged behind that of other provinces until relatively recently. Fengyang peasants precipitated nation-wide rural reforms in 1979 with their experiments in the household responsibility system, and over the following year residents of Hefei opened the ﬁrst small-goods free market in China, along Anqing Road. Nevertheless, provincial GDP over the period of the Seventh Five-Year Plan (1985–90) expanded by only 5.8 percent each year, signiﬁcantly below the national average of 7.9 percent. During the Eighth Five-Year Plan, however, provincial GDP grew by 14.1 percent per annum, substantially above the national average of 12 percent. This turnaround was achieved largely by extending market reforms from the agricultural sector into the rural and urban industrial sectors (see Tables 6.1 and 6.2). At the start of the reform era, Anhui was relatively slow and ineffective in reorganizing its industrial production, with state-run enterprises falling behind in the competitive transition from central planning to the market mechanism. The market economy absolved Anhui from further obligations to supply raw materials such as coal to Shanghai and other provinces. But inﬂexible management practices and ingrained patterns of dependency retarded provincial responses to new market opportunities. Much the same could be said of rural enterprises. In spite of the celebrated role of Anhui peasants in initiating the agricultural responsibility system, rural and township enterprises were slow to get off the ground. It was not until the early 1990s that rural communities were ﬁnally coaxed by the provincial leaderTable 6.1 Anhui provincial GDP: progressive growth rates by sector (%)

GDP Primary sector Secondary sector Tertiary sector GIOV GAOV Income per capita (rural)

7th 5YP

8th 5YP

1979–97

1991–97

5.8 1.6 9.5 8.0 12.7 2.8 7.9

14.1 4.1 21.2 14.2 26.2 6.5 19.3

11.0 5.4 15.5 13.6 16.6 6.8 15.7

14.0 5.3 20.7 13.7 23.8 7.6 18.8

Source: Anhui Statistical Yearbook 1998, pp. 8–10.

164 Wanning Sun Table 6.2 Comparative national and Anhui provincial growth rates (%) in GDP, GAOV and GIOV 1990

1991

1992

1993

1994

1995

1996

GDP National Anhui Ranking

3.8 2.9 27

ǁ 9.2 ǁ0.9 ǁ30

14.2 16.8 8

13.5 21.0 5

12.6 20.7 2

10.5 14.3 11

9.6 14.4 2

GAOV National Anhui Ranking

7.6 4.1 25

ǁ 3.7 ǁ15.0 ǁ30

6.4 21.7 1

7.8 12.1 4

8.6 3.2 27

10.9 14.2 3

9.4 11.6 11

GIOV National Anhui Ranking

7.8 7.0 12

ǁ14.8 ǁ11.2 ǁ18

24.7 26.4 8

27.3 42.2 3

24.2 37.0 4

20.3 17.1 14

16.6 22.0 4

Source: Anhui Statistical Yearbook 1998, pp. 14–15, 26–8.

ship, under Lu Rongjin, to experiment with town and village enterprises (TVEs). Between 1990 and 1995, the value of TVE production grew nine-fold. The number of peasants working in rural enterprises reached 7.7 million, or 30 percent of the rural workforce, and revenue from the sector grew to approximately 20 percent of provincial income.20 Urban light industry followed the TVE lead, moving away from materials processing to production of domestic electrical appliances. By 1995, Anhui ranked second in the production of household refrigerators, third in washing machines, seventh in electrical fans, and ninth in the production of television receivers.21 Provincial planners tend to favor large-scale enterprises, on the avowed principle of “developing big enterprises and letting go of smaller ones” (zhuada fangxiao). In consequence, the province is known for a number of large corporations producing brandname products, including the Anqing Petrol and Chemical Corporation, Tongling Nonferrous Metals, Maanshan Iron & Steel, Bengbu Tobacco, Meiling refrigerators, Rongshida washing machines and refrigerators, and Yangtze appliances. These ﬁrms claim annual growth rates in excess of 20 percent.22 In one sense the pace of Anhui’s development over the last few years has been made possible by the low baseline from which it started out in the reform era. Nevertheless, this catch-up growth has been retarded by structural and environmental factors that inhibited growth in the past. Certainly, the agricultural sector no longer dominates the provincial economy as it did in the pre-reform era. In 1979, the ratio of the primary to the secondary and tertiary sectors was 47.2:35.5:17.3. In 1990, the proportions had changed to 37.7:37.7:24.6, and, in 1995, to 26.5:50:23.5. While these changes indicate a

Discourses of poverty in Anhui 165 signiﬁcant shift from the primary to secondary and tertiary sectors, Anhui still falls 2 percent below the national average in the secondary sector and 7 percent lower in the tertiary sector, and stands 9 percent higher in the primary sector.23 The agricultural sector remains prone to natural disasters, suffers from inadequate infrastructure and facilities, and lags some way behind national measures of modernization and marketization. A single-product pattern continues to dominate the agricultural sector with rice making up 70 percent of grain production and pork 70 percent of animal husbandry.24 Productivity is relatively low. Rural worker productivity is ¥4,062 per capita, or ¥756 (15 percent) below the national average. The average yield is ¥8,926 per hectare. Further, rural production remains dominated by farming, which accounts for 60 percent of total agricultural income.25 Third, agricultural production uses relatively low-level technology. Estimates of the science and technology rate of contribution to agricultural growth, at 35 percent, fall 5 percent below the national average. Fourth, farm sizes are small, averaging around 5 mu (33 hectares) per household. Finally, the relative underdevelopment of processing industries incurs signiﬁcant opportunity costs. The ratio of agricultural processing to agricultural production in Anhui is 1.5:1, compared with a range of between 2:1 and 3:1 in Jiangsu, Guangdong and Shandong Provinces and of around 6:1 in developed economies. As the local pundits say, Anhui has far to travel before it can transform itself from a “big” agricultural economy to a “strong” or efﬁcient one.26 This appears to have been the aim of the provincial leadership when it convened late in 1995 to frame its Ninth Five-Year Plan. The meeting prescribed three goals for improved economic performance – in scale, vitality and income per capita – and three “transitions,” from a large agricultural sector to a strong agricultural sector, from a large resource province to a large resources-processing province, and from a large population province to a large economic province.27 In light of the province’s acknowledged shortages of capital and technology, and its comparative advantages in terms of laborforce, land, market size and resources, the leadership resolved to identify areas of potential inter-provincial collaboration and to rely on external forces to carry Anhui along (wan xiang dai dong).28 This strategy, in turn, depended on the development of “one line and two points”: developing the “line” of the Yangtze as it runs through Anhui, and promoting the two focal “points” of Hefei City and Huangshan Mountain. The Yangtze River is considered strategically important for Anhui’s overall economic development, as it connects the province with Jiangxi, Hubei and Sichuan upstream, and the coastal provinces of Zhejiang, Jiangsu and Shanghai downstream. Already areas along the Wan contribute 50 percent of the province’s industrial output, 40 percent of its agriculture and 45 percent of its power generation.29 The region encompasses eight cities, including the important port cities of Wuhu, Tongling (noted for its copper), Anqing (petro-chemicals) and Maanshan (iron and steel), and areas of

166 Wanning Sun surrounding countryside that rank among the wealthiest and most rapidly developing areas in the province. By 1995 signiﬁcant new transport and communication networks had been built, including domestic airports in Wuhu and Anqing, new rail links between Xuancheng and Hangzhou and between Hefei and Jiujiang, and various highways linking major cities.30 The region was also favored in general telecommunications infrastructure. In 1997, the provincial telecommunications industry recorded a business volume of RMB 4.27 billion for a year-on-year increase of 43.7 percent. A total of more than 600,000 lines of switching board capacity were added in the province and a similar number of telephone subscribers were added to the network. Nevertheless, Anhui’s 2.22 million telephone customers still account for only 4.45 percent of the province’s population. Most villages and farming households are yet to be connected by telephone.31 Hefei City, one of the two “points” highlighted in the provincial plan, is well endowed with scientiﬁc and technological resources. It is the site of the famous Chinese University of Science and Technology, and houses many other Beijing-funded research institutes specializing in electronics, information technologies, new materials production and biomedical research. In 1992 the central government granted Hefei the status of a “coastal city,” conferring development privileges associated with that status.32 The provincial government hopes to press this advantage in the direction of hi-tech resource development, aiming for 20 percent of GDP in high-end technologies by the year 2000.33 The politics of regional development has an impact on provincial economic planning. The reconﬁguration of sub-regions under provincial guidance entails a readjustment of customary interactions among regions within the province but, more importantly, a reworking of Beijing’s relations with the regions. The central government continues to set out policies and to grant privileges but regions are at liberty to interpret these to their particular advantage. This has played havoc with the provincial government’s second “focal point,” the development of the Mount Huangshan tourist resort. Although Anhui ranks ﬁrst in eastern China in terms of its tourism resources, tourist income ranks twenty-third in the country – seventy times less than Shanghai and 300 times less than Hong Kong.34 Huangshan provides an embarrassing reminder of the province’s failure to capitalize on its tourist potential in the popular saying: “Huangshan has ﬁrst-rate resources, second-rate development, third-rate management and fourth-rate income.”35 Mount Huangshan is widely if sometimes unfairly viewed as an outstanding national asset based in a mediocre province. It was the only site in Anhui honoured with a visit by Deng Xiaoping in the 1970s. Deng’s visit resulted in a series of directives from Beijing in 1979 to upgrade Huangshan from county to city status, and to establish a Huangshan Planning Committee directly under the control of the provincial government in Hefei. The lure of capital investment for infrastructure sent surrounding counties into a frenzy. They vied in particular to become the site of the municipal head-

Discourses of poverty in Anhui 167 quarters of the new Huangshan City. After bitter and protracted negotiations between a number of regional and provincial bodies, a town located some 30 kilometers from the tourist resort, the township of Tunxi, was declared the municipal headquarters of Huangshan City. This curious decision resulted in endless confusion and inconvenience among national and international tourists bound for Mount Huangshan. More importantly, promotion of the dusty township of Tunxi as the municipal headquarters of Huangshan City obscured another important national tourist asset, the ancient city of Huizhou. Huizhou, we have noted, was the birthplace of the Hui merchants whose cuisine, lifestyle and architecture are considered representative of traditional Chinese merchant culture. Beijing’s efforts to redress these imbalances have come to nothing. Throughout the 1980s, a number of national leaders, including Fang Yi and Wan Li, issued speciﬁc instructions regarding the regulation and development of Huangshan and Huizhou, and generally repeated Deng Xiaoping’s advice that Mount Huangshan was a national rather than provincial asset. Local governments have generally ignored their advice.36 The parochialism revealed in the Huangshan City case is a fairly common problem in reform-era China. Indeed many of the problems, issues and strategies identiﬁed in Anhui’s economic reform program are not unique to the province. Among its neighbors, the experience of development in Subei (northern Jiangsu) appears strikingly familiar. The great plains north of the Huai River – the most densely populated part of Anhui – share with Subei many structural problems, including an unfavorable ecology and serious issues of water control. In accounting for different rates and patterns of economic development in the north and south of Jiangsu province, Jacobs and Hong identify an array of factors in northern Jiangsu that apply equally to Anhui. These factors include a low economic base, poor standards of education and training, a limited transport infrastructure, ineffective government strategies, and a collective mentality characterized by a lack of initiative and independence.37 Perhaps the most serious problem facing Anhui in the reform era is the province’s lack of skills and capital. Anhui has plenty of land and labor but falls short in technology, skills, equipment and capital. Hence the province is heavily dependent on external capital for local investment, including central government investment, and on imported skills. But among the 300 centrally funded infrastructure and technical projects announced in 1997 Anhui was nominated for only three large-scale investment projects: the HuainanHuaibei coal project, the Huaihe Irrigation Project, and the Wuhu Yangtze River bridge project.38 At the same time, Anhui’s capacity to secure government loans has been weakened under Beijing’s Ninth Five-Year Plan. China’s banking system is now geared more closely to matching the size of capital loans with the relative sophistication of local facilities and infrastructure. The new regulations place provinces lacking basic facilities and infrastructure, such as Anhui, at a disadvantage. For much the same reason, provinces like

168 Wanning Sun Anhui are less competitive than coastal and border provinces in their attempts to attract international investment. Some local enterprises have managed to raise capital in the domestic capital markets, speciﬁcally Meiling Appliances, Wanneng Power and Maanshan Steel, three provincial state enterprises that were ﬂoated over the second half of 1993.39 The success of these three enterprises in raising capital for investment was widely touted as a milestone in Anhui’s economic growth, both in fostering a more positive image of Anhui enterprises outside the province and in inspiring other Anhui enterprises to face up to the challenges of reform. The effect was more exemplary than real. Most enterprises in Anhui remain small in scale, poorly served by their marketing strategies, and inexperienced in generating export income, and they show little capacity to improve quality controls or to upgrade their products to meet rising market expectations. Continuing poor sales and limited investment raises the prospect of enterprise failure, leading to increasing retrenchment in an environment with negligible social security, public welfare, or housing, educational and medical support. This raises the further prospect of social instability. According to provincial estimates, over the period of the Ninth Five-Year Plan some 100,000 urban employees are likely to be added each year to the list of those “waiting for employment” in Anhui’s cities, and another 2 million people from rural areas will move to the cities in search of work.40 Although township and rural enterprises have soaked up some rural unemployment, they have contributed to a wider sense of social crisis associated with environmental despoliation. In 1996, the Huai River was declared poisonous. Residents in Bengbu and neighboring areas were compelled to buy water for cooking and drinking. Consumption of bottled water is generally regarded as a luxury, and associated with the new rich of the wealthy coastal cities. In parts of Anhui, bottled water is a necessity, even for the poor.

Social and political consequences of economic reform In spite of the emergence of a new rich class (dakuan) in the private and collective sectors, and the appearance of managers and entrepreneurs associated with joint ventures, Anhui is better noted for producing a new underclass than a new middle class in the reform era. The emergence of this underclass is thought to pose a serious threat to social stability and to the political legitimacy of the regime. Anhui houses around 5 percent of the national population but accounts for only 3.5 percent of the national economy and less than 2.5 percent of revenues.41 Although its GDP ranks midway among provinces – fourteenth – income per capita has fallen well below the national average. In 1994, GDP per capita was ¥2,556.8, or 69 percent of the national average, placing it close to the bottom (twenty-third) among all provinces. In the same year urban income per capita was ¥3,793, ¥745 below the national average, placing Anhui even lower (twenty-ﬁfth) among all provinces.42 Although the

Discourses of poverty in Anhui 169 size of Anhui’s agricultural sector has fallen relative to other sectors, 85 percent of the population still live in the countryside. Rural income per capita at 1996 placed Anhui eighteenth among China’s provinces, with many households rating below the poverty line.43 Urban residents in Anhui have relatively fewer channels for nonstate employment or engagement in business enterprise. Only 17.4 percent of urban income derives from nonsalaried sources, compared with a national average of 23.9 percent. Not surprisingly, Anhui residents fall behind neighboring provinces in their rate of participation in tourism and cultural activities as well. Following the relaxation of visa requirements for overseas travel, for example, the number of Anhui residents who visited Singapore, Malaysia and Thailand in 1996 totaled 10,000, of whom 80 percent traveled on business. By report, the provincial total for Anhui could not match the number of tourists from any one county in Jiangsu and Zhejiang who visited these three international destinations over the same year. Those worst affected fall into four categories: people displaced by natural disasters, people formally dependent on communal or enterprise welfare (including children, recent mothers and the elderly), urban residents thrown out of work, and migrating rural residents driven to the cities in successive waves of urbanization. Anhui is prone to natural disasters. From 1949 to 1985, at least 1,500,000 people were cared for under disaster-relief programs every year. It is now estimated that over 5,600,000 people are in need of disaster relief on an annual basis. The second category of people, those dependent on social welfare, was largely accommodated under the former system. One survey dating from 1982 indicates that of 180,000 people who had difﬁculty keeping themselves, almost three-quarters (73 percent) were covered by the “ﬁve-guarantees” of food, clothing, medical care, accommodation and funeral expenses. Both the disaster-relief program and the “ﬁve guarantees” policy have come under severe strain with the collapse of state and collective enterprises. A comprehensive and effective social security system has yet to develop. Figures from 1993 indicate that as many as 3 million households live under the poverty line but that only 4.3 percent are now eligible for the “ﬁve-guarantees,” that only 8 percent of poor households receive any beneﬁts at all, and that no more than a tiny minority (2 percent) of dependants of army personnel receive any kind of concessional treatment.44 In the cities, meanwhile, enterprises are experiencing massive retrenchments. By 1998, twenty-three enterprises in Anhui were declared bankrupt and many others had shed workers in order to remain viable. From 1994 to 1995, retrenched workers made up a quarter of local unemployed.45 Being unable to provide welfare beneﬁts for unemployed workers, provincial and city governments have turned instead to subordinate organizations such as youth leagues, labor unions and women’s associations in an effort to dampen discontent. Nevertheless, many tales circulate in Anhui about sit-ins in front of companies or city government ofﬁces.

170 Wanning Sun Another source of displacement is large-scale migration from rural to urban areas. To be sure, Anhui is spared some of the worst consequences of migration by an emigrant preference for leaving the province and for remitting income back into it. In 1992, peasant migrants leaving Anhui generated a total income of ¥7.5 billion, much of it remitted home. Outmigrant income exceeded by ¥2 billion the total provincial revenues in the same year. Contrary to popular impressions, this is not all earned by elderly serving maids. Among peasant migrants, about 80 percent were male and 20 percent female, with 91.4 percent of them under 50 years of age.46 Migration is, of course, one way of transmitting the beneﬁts of coastal economic developments into China’s rural hinterland, and hence of relieving pressures that might otherwise lead to social discontent. In 1993 more than a quarter of migrant workers resident in Shanghai, or around 680,000 immigrants, hailed from Anhui.47 Nevertheless, the migrant phenomenon has produced a measure of moral displacement among rural communities in Anhui itself. The transition from a command economy to a market economy – an initiative widely attributed to Anhui peasants themselves – also involves a revolution from a relatively egalitarian society to an inherently unequal one, and a change in life-cycle expectations from ones valuing stability and rectitude to ones valuing change, mobility and wealth. This is often experienced with mixed feelings, not least among the peasant farmers who played such a part in getting the reforms underway. An indirect source of popular discontent is the emergence of a new and wealthy elite within Anhui itself. Although the province has yet to see the emergence of a signiﬁcant middle class, economic reform has nourished a reform-era elite born of the marriage of local power and privileged access to capital and opportunity. In Anhui, it is widely believed that this new elite has emerged by drawing on political power to obtain and deploy state and private capital, by taking advantage of loopholes in the system to expand its wealth and power, and by systematically engaging in bribery, embezzlement, tax evasion, smuggling, and the conversion of public assets into private wealth. The same cadre who levy growing tax burdens on the poor are thought to spend their local revenues wining and dining at sumptuous banquets. In consequence, resentment and distrust have come to characterize popular assessments of leaders in Anhui from the grass-roots level up to town, city and provincial levels. Resentment is ampliﬁed by the absence of formal channels for redress, resulting in protests, rallies, sit-ins, appeals, and the growth of messianic and millenarian sects. The ofﬁcial response has sometimes been brutal. In recent years, reports have circulated of widespread beatings of protesting peasants by tax ofﬁcers and local leaders. One tax ofﬁcer in Feixi county shot a peasant to death during a dispute. Nevertheless, protests continue. Since 1993, peasants from Wangyin village in Liquan County have made eight visits to Beijing in protest against increased taxes and corruption – including four group visits of no less than ﬁfty people each, kneel-ins before the

Discourses of poverty in Anhui 171 national ﬂag, and a sit-in outside the headquarters of the national Xinhua News Agency – in addition to staging numerous protests outside provincial, district and county government compounds.48 More ominously, reports frequently circulate about individuals donning the imperial yellow and declaring themselves “emperor,” and calling on local communities to rise up and overthrow the evil forces that have taken control of their ancestral lands. Another symptom of moral displacement is the rising crime rate attributed to Anhui’s mobile peasant population. Crimes by Anhui peasant immigrants have acquired almost legendary status in Shanghai. The evidence advanced for this claim is more often based on infamous anecdotes than on statistical data. Shanghai residents all know that the famous Shanghai writer, Dai Houying, was murdered by one of her relatives visiting from Anhui in 1996. One of the unintended consequences of economic reform is a limited liberalization of public life. Although sit-ins against unemployment and abuses of power are symptomatic of social discontent, they also indicate a growing willingness for people to take public action and a level of tolerance of public protest that were undreamed of two decades ago. Elements of the mass media have also begun to provide a barometer of public opinion. Anhui media can be divided into the party press, government publications, a restricted “internal” (neibu) press, and the popular media. The party press, including the Anhui Daily, conﬁne their attention to the latest orthodoxies, policies and strategies. Government publications, such as Anhui Work and Bengbu Work, publish limited criticisms, dissenting voices, and frank discussions of issues and problems, often written by middle-level or senior government cadres, including city mayors themselves. Internal publications with restricted circulation, such as the weekly compendium Anhui Internal Reference (Anhui neican) – which is put together by journalists of the Anhui Branch of the Xinhua News Agencies – offer wide-ranging surveys on current issues to approved and licensed subscribers. The sensitivity of its coverage can be measured by a regulation prohibiting general viewing for a full year from the date of issue. Taken together, these media outlets insure that people no longer pass their lives in an information vacuum.

Poverty and the leadership conundrum Anhui’s performance in the reform era has clearly been affected by a variety of historical, environmental and structural constraints. Leadership is also crucial. Chung has observed that provincial leaders are now in a position to capitalize on opportunities to renegotiate relationships within and between provinces and between the provincial and central governments.49 On the whole, however, the provincial leadership in Anhui has not risen to the occasion. At its highest levels, the Anhui leadership has a history of intense factionalism, frequent positional changes, and a tendency towards “Leftist” behavior. The ﬁrst party secretary appointed to head the provincial bureau was Zeng Xisheng, formerly party secretary of the New Fourth-Route Army in

172 Wanning Sun Northern Anhui. Zeng was appointed inaugural party secretary in 1952, when the Northern Anhui Party Bureau and the Southern Party Bureau amalgamated to form the CCP Anhui Provincial Committee. Throughout the 1950s into the early 1960s Zeng was a close follower of Mao and an ardent supporter of his Great Leap Forward. Under Zeng’s leadership, the province inﬂated its production targets and adopted high state-purchasing quotas, with the result that Anhui was among the provinces most severely affected by the famine of 1960. The annual grain ration for Anhui peasants in 1959 was 100 kilograms per head. The result was mass starvation from 1959 to 1960. Stunned by the famine, a repentant Zeng boldly experimented with an agricultural production “responsibility system” in Anhui. He soon fell out of favor with Mao Zedong, who replaced him with another nonnative, Li Baohua. The son of CCP founder Li Dazhao, Li Baohua was widely identiﬁed with the pragmatic policies of Liu Shaoqi, and was for a time welcomed by peasants for allowing them to keep their “private” vegetable gardens. Nevertheless, Li’s appointment was contested by residual elements of Zeng Xisheng’s former supporters, thereby launching a tradition of factionalism in the top leadership. Li was deposed early in the Cultural Revolution and was succeeded as Anhui party secretary by Song Peizhang and subsequently Li Desheng, both drawn from the “Support the Left” group. Into the mid-1970s, the provincial party apparatus ﬁrmly upheld the Maoist line of absolute collectivization, self-reliance, and emphasis on grain production, a line widely promoted through the national movement to “learn from Dazhai” and its local variant to “catch up with Guo Village,” a model village in Anhui. In 1977, Wan Li was transferred from Beijing – where he managed China’s national railway system – to Anhui with a view to challenging the province’s deeply rooted connections with the Gang of Four. In spite of his impressive record in the Railways Ministry, Wan recorded a mediocre performance in Anhui. His term in ofﬁce is remembered for his perspicacity in endorsing the Fengyang peasants’ audacious initiative with the agricultural production responsibility system, but for little else. Wan Li was succeeded by Li Guixian, a Soviet-trained former school friend of Li Peng. In 1989 Li Guixian moved on to head the People’s Bank of China, from which he was subsequently removed by Zhu Rongji. It was not until 1989 that a native of Anhui was appointed provincial party secretary. Born in 1933 and originally a worker in the Maanshan Iron & Steel Company, Lu Rongjin worked hard to become First Man of Anhui. His sensible and cool-headed performance during the June Fourth Incident – comparable to that of Zhu Rongji in Shanghai – earned him widespread respect. Over the term of Lu’s tenure Anhui also made signiﬁcant progress toward achieving the goals of the Eighth Five-Year Plan. Owing to his age, however, Lu stepped down in 1998 and was replaced by Hui Liangyu, who was concurrently provincial governor of Anhui. A native of Jilin Province, an economist by training, and a Hui by nationality, Hui Liangyu had earlier served as deputy governor of Jilin and party secretary of Hubei Province.

Discourses of poverty in Anhui 173 Hui has been quite assertive in commenting on the depth and scale of corruption within the Anhui leadership generally. Although widely considered an enlightened leader, Hui is, nevertheless, seen by many to lack what it takes to lead Anhui in difﬁcult times. In February 1999, the Second Plenary Session of the Ninth Provincial People’s Congress elected Wang Taihua to the governorship, relieving Hui Liangyu of his concurrent position as provincial governor. Hui remains party secretary of Anhui. His replacement, Wang Taihua, is a career cadre from Jiangxi Province who made his way up the party hierarchy from local to regional and city levels before his provincial government appointment. Wang transferred from Jiangxi to Anhui in 1992 as party secretary of Hefei City, the capital of Anhui.50 Hui Liangyu’s widely reported comments on leadership problems in Anhui echo a common refrain that has emanated from reformist elements for a number of years. Early in 1997, Hui cited statistics from 131 key enterprises in Anhui to show how they exaggerated or concealed their proﬁts and losses. Underreporting and overreporting is also rife among rural cadre. A good example is the loss of control over population growth: Anhui’s actual population is reliably estimated to exceed ofﬁcially reported ﬁgures by around 10 million people.51 Hui launched a particularly ﬁerce attack on middle-level leadership at a party work meeting in April 1997. Anhui Daily described Hui’s speech as “uncharacteristically harsh and straightforward.” He was certainly blunt: Some leaders think of nothing but their own interests – their houses, cars, money, positions and children. They ignore the people’s voices, and they speak deceitfully, boastfully, and obsequiously, just to please certain people. At one time they used to be shy or embarrassed in demanding promotion. Now they are thick-skinned and brutally frank. And they are extremely competitive – not in terms of their work but rather in terms of status, luxury, and power.52 Local observers read the speech as an attempt by Hui to position himself as a man of action, alongside a number of other senior ofﬁcials who were making similar observations. Bengbu Mayor Fang Yiben, for example, allegedly reported the dire situation of the city’s state-run enterprises to President Jiang Zemin, who in turn praised Fang for his forthrightness. Jiang chose the occasion of meeting with Anhui delegates to emphasize the importance of adopting a “down-to-earth” (jiaota shidi) workstyle and to “seek truth from facts” (shishi qiushi).53 It was widely rumored among residents of Bengbu, although unreported by the press, that local Mayor Fang was severely reprimanded on his return to the provincial capital for his outspokenness in Beijing. A common feature of criticism of local leadership in Anhui is a certain customary way of thinking found at all levels of the system. To be sure, the indifference to commerce that is said to characterize local cadre in Anhui has

174 Wanning Sun also been identiﬁed among Jiangxi cadre,54 and signs of local conservatism and an impractical work style are said to inhibit effective leadership in Hubei.55 But these are not the comparisons that spring immediately to mind in Anhui. More troubling to high- and middle-level policy-makers is how and why their neighbors in Jiangsu and Zhejiang have managed to succeed where Anhui has failed. According to a rare and frank soul-searching critique by the party secretary of Anqing City, unless Anhui’s senior and middle management break free of certain mental inhibitions the province is doomed to fall further behind the rest of the country. One of these mental constructs, according to Wang Shiman, is conservatism. Jiangsu and Zhejiang ﬁght for victory or death and leave themselves no way out. This compels them to engage in risk-taking behaviors. As Wang put it: [in Jiangsu and Zhejiang] they interpret Deng’s quote, “to grow is the only way to go” (fazhan cai shi yin daoli), as meaning “not to develop when we can is criminal, and not to grow fast, when we can, is simply another way of ignoring the rule of ‘seeking truth from facts.’ ” For us in Anhui, however, the interpretation of “seeking truth from facts” is to harp on our weak foundations and low starting point, and then adopt an overcautious approach.56 Another mental construct, according to Wang Shiman, is a mentality of dependence. The difﬁculties experienced by state-run enterprises undergoing restructuring are not unique to Anhui, but local reactions to these difﬁculties differ from reactions in Jiangsu and Zhejiang. Anhui enterprises react as if they would “run back to mummy,” expecting the leadership to step in and provide capital and marketing expertise. Not so in Jiangsu and Zhejiang, where restructured enterprises buy Anhui raw materials, use Anhui labor for processing, and then sell ﬁnished products back to Anhui. “We are not half as smart as Jiangsu and Zhejiang people,” concluded Mayor Wang, “when it comes to turning resources and labor to our industrial advantage.” Labor and management both share a dependency mentality.57 Echoing Wang’s criticism is a more speciﬁc comment on a particular strategy of dependence known as “going to sea in a borrowed boat.” This refers to the attempt by the provincial leadership of Anhui to tap into global markets indirectly, through neighboring coastal provinces, rather than seeking direct access to international markets and capital. One view holds that the strategy of following the lead of coastal provinces is a typically isolationist view of the world which may permanently render inland provinces such as Anhui dependent and passive agents of other provinces. According to Xie Daowen, policy-makers have failed to consider that coastal provinces are already integrated into international markets, and may have an interest in excluding further players.58 If this is the case, the development of inland provinces requires tapping directly into external markets to realize marketing and investment opportunities.

Discourses of poverty in Anhui 175

Conclusion The problems and challenges confronting Anhui highlight some of the uneven and unequal aspects of globalization as they bear on regional communities in China. Administrative and economic decentralization has removed some of the constraints on inland provinces that wish to tap directly into the global economy. But Anhui has not taken signiﬁcant steps in this direction. Its poor transport, tourism and telecommunications infrastructure – all legacies of the command economy – limit the province’s capacity to take full advantage of international opportunities. The leadership has done little to help. The story of Anhui reveals a series of gaps and cleavages in the processes of globalization more generally. Thus far, Anhui seems to have been a casualty of national reform agendas at the same time that it has failed to capitalize on the forces of globalization that increasingly galvanize China’s coastal provinces. Anhui is located to the east, but is not quite eastern enough to qualify for the privileges granted to coastal provinces or to attract immediate international attention. At the same time, it is not quite western enough to proﬁt from concessionary policies introduced by Beijing to compensate for underdevelopment in China’s western provinces. In principle, globalization allows regions or provinces to bypass national states to take full advantage of the division of labor, distribution networks, the world-wide diffusion of technology, and access to global capital. But national histories impose limits of their own. Anhui faces the prospect of lagging further behind in regional competition to get ahead in China.

Notes 1 Anthony Smith, “Towards a global culture?” in M. Featherstone (ed.) Global Culture: Nationalism, Globalisation and Modernity (London: Sage, 1990). 2 Antonia Finnane, “The origin of prejudice: the malintegration of Subei in late imperial China,” Comparative Studies in Society and History, vol. 35, no. 2 (1993), pp. 211–38. 3 Zheng Yulin et al., Zhongguo renkou: Anhui [China’s population: Anhui] (Beijing: China’s Finance and Economy Publishing House, 1987). 4 Zheng Yulin et al., Zhongguo renkou. 5 Anhui nianjian 1996 [Anhui yearbook 1996] (Hefei: Anhui Yearbook Publishing House, 1996). 6 Anhui dili [Anhui geography] (Hefei: Anhui Education Publishing House, 1996). 7 Li Linqi, “Huizhou nubian” [Slave rebellion in Huizhou], in Ding Jian (ed.) Yingxiang Anhui lishi de dashi [Important events in Anhui history] (Hefei: Huangshan Press, 1995), pp. 74–7. 8 Elizabeth Perry, Rebels and Revolutionaries in North China (Stanford: Stanford University Press, 1980). 9 Jiang Kunchi, “Taihua yixian de zeren tian” [A short-lived experiment with the land responsibility system], in Ding Jian (ed.) Yingxiang Anhui, pp. 288–91. 10 See Kate Zhou, How the Farmers Changed China (Westview, 1996) and Dali Yang, The Great Leap Famine (London: Cambridge, 1996).

176 Wanning Sun 11 Chi Zihua, “Jingdai huaibei liumin wenti de jige cemian” [Some aspects of peasant migration north of the Huai River in modern times], Ershiyi shiji [21st Century], vol. 38 (1996), pp. 37–45. 12 Din Dan’er, “Huicai: bie ju feng wei de yi da cai shi” [Huizhou cuisine: a distinctive culinary tradition], in Ding Jian (ed.) Yingxiang Anhui, pp. 116–67. 13 Tang Yue, “Si da hui ban jin jing” [Four well-known Huizhou theatre troupes in Beijing], in Ding Jian (ed.) Yingxiang Anhui, pp. 118–21. 14 David S. G. Goodman, “King coal and secretary Hu: Shanxi’s third modernization,” in Hans Hendrischke and Feng Chongyi (eds) The Political Economy of China’s Provinces (London: Routledge, 1999), pp. 211–48. 15 Feng Chongyi, “Jiangxi in reform: the fear of exclusion and the search for a new identity,” in Hendrischke and Feng (eds) Political Economy of China’s Provinces, pp. 249–76. 16 Bian Li, “Sun wu kai fa shan yue” [Sun Quan’s development of the southern mountainers], in Ding Jian (ed.) Yingxiang Anhui, pp. 24–7. 17 Gong Yi, “Qing ji jiangnan da yimin” [Massive migrations in the area of Jiangnan in the Qing Dynasty’], in Ding Jian (ed.) Yingxiang Anhui, pp. 150–3. 18 Ding Jian, “Kangxi liu nian, Anhui jian sheng” [The establishment of Anhui during the Kangxi era], in Ding Jian (ed.) Yingxiang Anhui, pp 78–82. 19 Feng Chongyi, “Jiangxi in Reform.” 20 Wang Shucheng and Li Renhu, “Anhui: shu li zhongbu diqu jueqi de xin xinxiang” [Anhui: building a new image of a rising province in middle China], Liaowang zhoukan [Liaowang weekly], no. 31, 1996. 21 Anhui nianjian 1996. 22 Anhui nianjian 1996. 23 “Anhui sheng guomin jingji he shenhui fanzha ‘jiuwu’ jihua” [Anhui’s economic and social development during the 9th ‘ﬁve-year’ plan], 4 Feb. 1996. Unpublished draft arising from the Fourth meeting of Anhui Eighth People’s Congress (widely known as “Document Five”). 24 Zhang Hao, “Zhuoli zhuanbian nongye zhenzhang fangshi” [Try to transform modes of development in the agricultural sector’], Anhui gongzuo [Anhui work], vol. 137 (February 1997), p. 28. 25 Ibid. 26 Ibid. 27 Chen Fuxiang, “Xingwan daji zhiyi: zhuzhong xibu fazhan” [Pay attention to the development of western Anhui], Anhui gongzhuo, vol. 123 (January 1996), pp. 8–9. 28 “Anhui sheng guomin jingji” (Document 5). 29 “Anhui sheng guomin jingji” (Document 5). 30 Liu Weifu and Xu Minhe, “Yige chengong de fanli” [A success story], Liaowang zhoukan, no. 37, 1995. 31 Xinhua News Agency, “Anhui province seeks brisk telecommunications growth,” 19 February 1998. 32 Wang Shucheng and Li Renhu, “Anhui: shu li.” 33 “Anhui sheng guomin jingji” (Document 5). 34 “Shiheng de yihan he huihuang de jueqi” [Regrets for lost opportunities and hopes of future development], Zhongguo qinnian bao [China youth daily], 15 Jan 1997. 35 Ibid.

Discourses of poverty in Anhui 177 36 Lu Dafa, “Anhui de ‘hui’ zi nali qule?” [Where is the ‘hui’ of Anhui], Dubao cankao [News references], vol. 138 (June 1996), pp. 11–13. 37 J. Bruce Jacobs, “Uneven development: prosperity and poverty in Jiangsu”, in Hendrischke and Feng (eds) Political Economy of China’s Provinces, pp. 113–54. 38 “Jiuwo jihua qijian guojia zhongdian gongchen xiangmu” [China’s state-funded projects during the 9th ﬁve-year plan], Jingji ribao [Economic daily], 9 April 1997. 39 “Zhuoli zhuanbian nongye zhenzhang fangshi,” p. 28. 40 “Anhui sheng guomin jingji” (Document 5). 41 “Hui Liangyu xiang quansheng ganbu qiao xiang jingzhong” [Governor Hui Liangyu alerting Anhui’s cadres to the dangers of corruption], Anhui ribao, 9 April 1997. 42 Deng Shouan, “Wo shen chengzhen jumin shouru xianzhuang yu zhanwang” [Anhui urban residents income: present and future], Anhui gongzuo, vol. 123 (January 1996). 43 Anhui Shenqing 1996 [Anhui statistics 1996] (Hefei: Anhui Statistics Bureau, 1996). 44 Yan Fangcai and Jiang Zongmin, “Jia kuai jianli nongcun shehui baozhang xin tixi – dui Anhui nongcun de kaocha baogao” [Speed up the establishment of a rural social security system: a report from rural Anhui], Jianghuai luntan [Jianghuai herald], vol. 153 (May 1995), pp. 19–23. 45 Yang Feng, “Guanghuai beizhi” [Taking care of the needy], Bengbu gongzuo [Bengbu work], vol. 15 (March 1997), pp. 28–9. 46 Xu Qi, “Woguo yidong rengou ruogan wenti taolun” [On several issues of China’s mobile population], Xueshujie [Academic world], vol. 55 (June 1995), pp. 88–91. 47 Ibid. 48 Yang Dali, Great Leap Famine. 49 Jae-Ho Chung, “The expanding space of provincial politics and development: thematic suggestions for future research agenda,” Provincial China: Research, News, Analysis, no. 4 (October 1997). 50 “Hui Liangyu xiang quansheng ganbu.” 51 This estimate is based on personal communication with specialists in Anhui. 52 “Hui Liangyu xiang quansheng ganbu.” 53 “Yao tichang jiang zhenhua: Jiang Zemin zhong shujin yu anhui danbiao yi xitan” [We must speak honestly: Jiang Zemin speaks to Anhui delegates], Renmin ribao [People’s daily], 10 March 1996. 54 Feng Chongyi, “Jiangxi in reform.” 55 Li Linqi, “Huizhou nubian.” 56 Wang Shiman, “Zai buduan fazhan de shijian zhong jing yibu jiefang sixiang” [Further liberate our thinking in the process of development], Anhui gongzuo, vol. 128 (June 1996), pp. 14–15. 57 Wang Shiman, “Zai buduan fazhan.” 58 Xie Daowen, “Shixian ganchao shouxian yao zhangwo shichang de zhudong quan” [We must take the initiative in our efforts to catch up under the market mechanism], Anhui gongzuo (March 1997), vol. 138, pp. 16–17.

178 authors name

Chapter Title

7

179

Looking south Local identities and transnational linkages in Yunnan Margaret Swain*

Introduction Yunnan is often characterized as a land “south of the clouds,” a culturally and geographically diverse frontier remote from the national center.1 But it is also portrayed as a province of great strategic and resource value to the nation-state of China.2 Contemporary tourism – a “pillar of development” in Yunnan – trades on both these images, promoting a region that is accessible but exotic, comfortably Chinese, and yet not very Chinese at all. Such images reﬂect a regional history of conﬂict and cooperation with the center, as well as periods of relative independence and ﬂuctuating interaction across borders. The movement of peoples and goods in and through Yunnan has engendered social, economic and political changes that have impacted on local identities over time. Yunnan at the beginning of the twenty-ﬁrst century is again orienting toward its southern borderlands. Transnational trade, migration, and infrastructure development (aided by international agencies) are all condoned by the central government even as they redeﬁne state power and patterns of cultural inﬂuence. Relations between Yunnan and Beijing, on the one hand, and the three neighboring countries of Vietnam, Laos, and Burma, on the other, offer a dramatic illustration of Yunnan’s changing political and economic environment. Relations between China and its southern neighbors moved from hostility to economic cooperation within the space of a decade. At the same time, neighboring provinces such as the people-exporting province of Sichuan, to the north, inﬂuence the pace of change and the kinds of reforms that governments and communities in Yunnan Province must endure. This chapter seeks to explain how these transnational and trans-provincial movements have impacted on ethnic, local, regional, provincial, and national identities of the people of Yunnan over time. Ideology and resource-control shape the nature of these identities, as seen in an historical overview of Yunnan’s political economy within and beyond China’s boundaries. We discuss events of the reform era, focusing on regional changes and variations in demography, agriculture and industry, and market socialism. This is

180 Margaret Swain

Yunnan Province

General GDP (billion yuan renminbi [RMB]) 185.57 GDP annual growth rate 7.20 as % national average 94.74 GDP per capita (yuan RMB) 4,452.00 as % national average 68.14 Population Population (million) Natural growth rate (per 1,000) Workforce Total workforce (million) Employment by activity (%) primary industry secondary industry tertiary industry Employment by sector (%) urban rural Employment by ownership (%) state collective private self-employed individuals Wages and Income Average annual wage (yuan RMB)

41.92 11.66 22.73 73.80 9.30 16.90 15.93 84.07 10.17 1.17 1.39 5.60 8,276.00

Growth rate in real wage 9.20 Urban disposable income per capita 6,178.68 as % national average 105.55 Rural per capita income 1,437.63 as % national average 65.04 Prices CPI [Consumer Price Index] annual rise (%) Retail Price Index annual rise Foreign trade and investment Total foreign trade (US$ billion) Exports (US$ billion) Imports (US$ billion) Realized foreign capital (US$ billion)

-0.30 -1.70 1.66 1.03 0.63 0.15

Education University enrollments 73,902 Secondary school enrollments (million) 1.67 Primary school enrollments (million) 4.81 Notes: All statistics are for 1999 and all growth rates are for 1999 over 1998 and are adapted from Zhongguo Tongji Nianjian 2000 [Statistical Yearbook of China 2000], Zhongguo Tongji Chubanshe, Beijing, 2000.

Transnational impact on Yunnan 181 followed by a study of tourism development in Stone Forest (shilin), in Lunan Yi Autonomous County, which involves a microcosm of processes that shape the province as a whole. Tourism is the latest of many reasons for outsiders to visit Lunan, adding to a list that has included migrations of Han and Sani Yi peoples in search of land, mission work by French Catholics, and the demands of international war. Stone Forest tourism involves transnational joint ventures, ethnic politics, globalization, modernity, nationalism, regionalism, and local identity issues. Relations among local tourism bureaus, communities, and individual entrepreneurs are examined, stressing ethnic, gender, and class interactions. As a key part of the modernizing process in Yunnan, tourism offers a window on life in China’s southern frontier zone today.

Re(form)-modernization David S. G. Goodman has drawn attention to the processes of accommodation that have taken place between state and society in China’s “remodernization” in the reform era. Goodman posits contradictions between state legitimacy and the ungovernability of reform, the retreat of the state economy, and the emergence of a civil society.3 In Yunnan, frontier conditions are also shaping economic growth and the transformation of social structures. Regionalism in the PRC since the 1978 reforms has been a major factor in national modernization, shaping the tenacious power of both the state (central and local government) and the CCP in their efforts to govern.4 Regional alliances involving trade and development projects may cross-cut provincial and national borders. Yunnan is responding both to policy changes of the PRC and to the economies of its neighbors, as it moves into the twenty-ﬁrst century. Tensions can arise between territorial and political afﬁliations. In China, multiple modernist imaginaries overlap: the ofﬁcial post-Mao state/nation project; inter-province projects; coastal projects of transnational ties; and frontier zone projects of negotiation between centers.5 These issues of political economy also involve issues of identity, negotiated by individuals who are tied to native place, province, region, and country. Identities may well be complementary rather than competing or hierarchical.6 Ethnic identity, however, is often factored into unequal relations, as seen in processes of internal colonization,7 or in national minority-group politics that play out with the central state and across provincial and national borders. In Yunnan, localized contestation of assimilation takes place alongside negotiated integration with state political economies and cultural systems. Ethnogenesis occurs locally, and may be legitimized nationally,8 while the use of cultural capital to market identities as a modern development strategy is pursued in the frontier by state and society. This commodiﬁcation of ethnic and native place identities is bound up with ideas of authenticity and issues of power.

182 Margaret Swain

Frontier studies Recent scholarship on frontier zones and ethnicity in China is particularly useful in building a framework for understanding Yunnan. The idea of a frontier zone was proposed by Michael Aris in his writing about Tibetan borderlands, where he notes that people on the periphery think of their territory as a “centre lying between . . . potentially threatening powers.”9 From this perspective we may conceive of the frontier as a zone “in which all possible boundaries of geography, race and culture cross and over-lap to form a broad . . . transitional area of great complexity.” Piper Gaubatz expresses a similar understanding in her study of frontier zones and urban transformations in China.10 Rather than a linear model of inevitable incorporation into the core area, she proposes a cyclical model to explain how a frontier persists between multiple inﬂuences from several core areas, and negotiates its own unique regional features. How these conditions were fostered by imperial China was explained by Owen Lattimore’s concept of Chinese “frontier feudalism” as a way to subjugate local peoples to a system of territorial rather than clan-based social organization.11 An intermediary group of local leaders (from tuzi to ganbu) is formed, whose interests are to maintain the patron–client relationship between the core and the frontier. Frontiers such as Yunnan serve functions of both settlement and control. They are sites of national identity and local character issues as well, with the settlement of permanent migrants and movement of temporary sojourners and tourists through the frontier zone. These frontiers “mark the limits of both the expansion of Han Chinese culture and the expansion of non-Chinese cultures: . . . both bastions of core cultures and places of multicultural exchange where new ways of life developed.” 12 Stevan Harrell and others writing about Confucian, Christian, and Communist “civilizing projects” on China’s ethnic frontiers have focused attention on the colonial nature of these unequal interactions, local reactions, and the ﬂuidity of identities.13 This approach informs the way identity issues in Yunnan are to be framed here, speciﬁcally by examining patterns of domination, migration, economic integration, cultural exchange, and resistance. Contrary to modernization theorists who have predicted the subsumption of ethnic to national identity, ethnic groups are emerging, persisting and re-inventing in China as they are world-wide. Therefore an ethno-historical approach provides needed information for an understanding of these complex processes. Frontier zones are rich areas in which to study the particular nature of identity issues in China, from imperial times to today, in which intense interethnic and native place competition is combined often simultaneously with “an equally passionate commitment to cooperation – that is, to China’s unity.”14 As China re-modernizes, issues of identity are closely linked to national and regional discourse and political economies.

Transnational impact on Yunnan 183

Overview of geography and history Yunnan Province is situated in the western part of the Yun-Gui Plateau, forming the south-west corner of China, bordering Burma (Myanmar) to the west, Laos and Vietnam to the south, Guangxi and Guizhou to the east, and Sichuan and Tibet to the north. It may be imagined as a landform pivoting from its tropical south-eastern border near sea level, tilting up toward the north-west, where mountains reach above 5,000 meters into the Tibetan borderlands. From this location, four of the largest rivers in Asia ﬂow within 100 kilometers of each other out of Tibet into Yunnan: the Upper Irrawaddy (Dulong jiang), Salween (Nu jiang), Mekong (Lancang jiang), and Upper Yangtze (Jinsha jiang). Vertical relief of almost 4,000 meters within a horizontal distance of three to four kilometers supports a great range of vegetation, from cultivated terraces of tropical fruits, to temperate forests, up into permanent snowﬁelds.15 Further south, the Red River (Hong He) ﬂows from central Yunnan into Vietnam. Yunnan Province’s total area of 394,000 square kilometers is 84 percent mountainous, 10 percent plateau, and 6 percent basin.16 Only 7 percent of the total area is currently under cultivation.17 This is a very rugged land that deﬁed timely transportation links between many regions until the advent of contemporary airline services and new railroad construction; hence Yunnan’s reputation of being “remote” from the rest of China, from Beijing, and from the “outside world” to the west and south. Despite the challenges of landscape, however, the peopling of this land has a long history, reﬂecting many kinds of groups moving in and out over time. The majority of Yunnan’s population of 39.4 million18 today inhabits a central plain dominated by the provincial capital of Kunming (altitude approximately 1,000 meters) at the north end of Lake Dian, and another fertile plain lying to the west along Lake Erhai. Kunming is called the “city of eternal spring” due to the very temperate climate conditions it enjoys although subject to the monsoon. In 1995, 14 percent of Yunnan’s population was identiﬁed as non-agricultural (fei nongye), and the population density was 100 people per square kilometer, compared to the national average of 117 people.19 Yunnan’s cultural diversity is reputed to be the greatest in China. The Han Chinese majority is also differentiated by native place origins and migration histories. Twenty-ﬁve minority minzu with populations of over 4,000 are currently recognized by the state,20 and comprise about one-third of the total population (see Table 7.1 a–c). The most populous minority minzu are Yi groups (10 percent of Yunnan’s people). In 1994, 54 percent of minority minzu lived in autonomous regions: eight minority minzu autonomous prefectures and twenty autonomous counties in other prefectures (zhou), districts (qu), or municipalities (shi). These regions, also inhabited by Han, comprise 70.2 percent of the total provincial area with 58 percent of

184 Margaret Swain the arable land, producing 55.8 percent of the provincial agricultural output and 27 percent of the industrial output in 1994.21 Poverty, however, is acute in primarily minority-inhabited mountainous areas, especially along the Tibet, Burma, and Vietnam borders. 22 Migration and settlement histories Evidence of early human activity in Yunnan is being uncovered by archeologists. At the Yuanmou site north-west of Lake Dian, discovery of remains of Homo erectus indicate that this area was inhabited about half a million Table 7.1a Ethnic composition (ǂ10,000; excluding groups smaller than 40) 1994 Han Yi Bai Hani Dai Zhuang Miao Lisu Hui Lahu Wa Naxi Yao Jingpo Zhang Bulong Buyi Pumi Achang Nu Jino Deang Mongol Man Delong Shui Other

2564.0 415.5 138.6 128.7 106.2 104.2 90.7 57.9 55.8 40.9 35.9 27.8 17.8 12.1 11.6 8.4 3.7 3.1 2.9 2.7 1.8 1.6 1.3 0.8 0.6 0.6 2.7

Total

3939.2

% 66.8 10.8 3.6 3.3 2.7 2.7 2.3 1.5 1.4 1.1 0.9 0.7 0.5 0.3 0.3 0.2 0.1 0.08 0.08 0.07 0.05 0.04 0.03 0.02 0.02 0.01 0.05 100.0

1990

1982

% growth

2462.9 405.4 133.9 124.8 101.4 100.4 89.7 55.7 52.2 40.8 34.8 26.6 17.3 11.8 11.1 8.2 3.4 2.9 2.8 2.7 1.8 1.5 1.3 0.8 0.7 0.6 1.1

2223.5 335.5 112.1 105.4 83.6 88.8 75.2 46.7 43.9 30.4 29.9 23.6 14.7 9.3 9.6 5.8 0.5 2.4 2.0 2.3 1.2 1.2 0.6 0.6 0.3 0.5 7.1

10.8 20.8 19.4 17.9 21.3 13.0 19.2 19.3 34.3 34.3 16.5 12.4 17.6 27.3 16.2 40.2 621.5 21.2 35.3 16.3 49.1 25.5 111.3 22.0 127.4 20.6 –

3697.3

3255.4

13.6

Sources: Yunnan Province (1990) Census Manual Tabulations, pp. 11, 108–9; China Statistical Yearbook 1995, p. 60; Yunnan Statistical Yearbook 1995, pp. 71–2 (includes yearly rates from 1952). From 1962 to 1973 Yunnan had a natural growth rate ranging from 28 to 31 percent. Yunnan Manual Tabulations (1990) pp.158–9, comparative data 1953, 1964, 1982, 1990; p. 4 summary of 1982 and 1990 population.

Transnational impact on Yunnan 185 Table 7.1b Minority minzu proportion of total provincial population 1964 1978 1985 1990 1993 1994

30.65 30.66 31.74 32.96 33.10 34.90

Source: Yunnan Statistical Yearbook 1995, p. 69.

Table 7.1c Yunnan sex ratio, 1994 1994 Men Women

106 (national average 104.5) 20,271,000 19,121,000

Sources: Yunnan Statistical Yearbook 1995, p. 71; China Statistical Yearbook 1995, p. 59. Further sources: China Statistical Yearbook 1995, p. 60; Yunnan Statistical Yearbook 1995, p. 72 (includes yearly rates from 1952). From 1962 to 1973 Yunnan had a natural growth rate ranging from 28 to 31 percent. Yunnan Manual Tabulations (1990) pp. 158–9; comparative data 1953, 1964, 1982, 1990; p. 4 summary of 1982 and 1990 population.

Table 7.1d Birth rates, death rates, rates of natural increase, 1994 National Birth rate Death rate Natural growth Yunnan Birth rate Death rate Natural growth

17.70 6.49 11.21 21.8 8.0 13.8

Source: China Statistical Yearbook 1995, p. 78.

years ago. Research on Neolithic peoples established that the Yunnan central region was settled by rice cultivators by the late third millennium BCE.23 By the end of the Bronze Age (between 1,200 and 500 BCE) metallurgical skills had been developed in Yunnan that surpassed work in the rest of Southeast Asia. The Dian culture controlled the region around Lake Dian until the beginning of the Common Era (midway during the Han Dynasty). Besides their sophisticated bronzework, their graves contained a wealth of trade goods, including large caches of cowry shells, stored in bronze vessels. The circulation of cowry shells up into regions far from ocean sources, indicates a far-ﬂung trade network.24 Cowry money in Yunnan was docu-

186 Margaret Swain mented as widespread through the Yuan and Ming dynasties, with its forced replacement by cash coins during the 1600s.25 Before then there was little monetary integration with the empire, and trade of cowry shells into Yunnan was overland from Burma and Thailand, supplied mainly from the Maldives. Ultimately, trade routes were cut off by European imperialism in the region. Vogel argues that “this close economic connection between Yunnan and the Southeast Asian maritime regions raises a partly ideological question . . . of the political and cultural afﬁliation of Yunnan to either the Southeast Asian region, or to various Chinese empires.”26 Besides these trade links, the region had shared systems of cowry money denominations and reckoning. The reach of Chinese forces from the north into Yunnan was ﬁrst recorded during the Warring States Period, when a kingdom of Chu general was dispatched to conquer Yunnan, sometime between 339 and 328 BCE. The general and his soldiers annexed the area around the central Dian plain, where they became permanently stranded.27 He declared himself the “King of Dian,” and his descendants ruled there for several generations, no doubt amassing cowry wealth. During the Han Dynasty (206 BCE to 220 CE) an ofﬁcial peaceful relationship was established early on with the King of Dian. A Han commandery was set up south of present-day Chengdu in 135 BCE, but little happened during the next 200 years until the Han empire enforced tribute relationships with local leaders, often installed as Han-approved “kings.” After the Han Dynasty ended, Han Chinese and indigenous migrants moved in and out of Yunnan, often in a domino effect, one group pushing on the next. The movement was generally southbound, as there was more land available and the political structure was less strict.28 Rule of the region also moved back and forth from local leaders to Chinese dynasty agents. Central governments preferred tributary relations, rather than setting up frontier garrisons. The indigenous Nanzhou kingdom (c. 732–902), based around Lake Erhai, developed an alliance for a while with the Tang court in Chengdu.29 The rise of the Dali (902–1252) over the Nanzhou in Yunnan was at about the same time as the rise of the Song in China. The Song’s nonintervention in Yunnan resulted in a period of independence from China for the peoples of Yunnan, until they were all conquered by Qubilai and incorporated into the Yuan Dynasty. Under the ﬁrst Yuan governor, Sayyid’ Ajall, Kunming became a cosmopolitan center that attracted people from all over the Chinese empire.30 Yuanera graveyards around Kunming, organized by native place, show that people settled on the frontier from as far away as Shandong and Hubei.31 Mongol rule (1253–1389) in Yunnan lasted 39 years longer than in the rest of China, as the Ming Dynasty came to power to the north.32 Warfare meant the slaughter of local populations every time a new regime triumphed. One counter move was state-sponsored migration. Gaubatz33 reports that in 1389 alone, an estimated 2.5 million migrants, mainly political exiles and their families from the Nanjing region, were sent down to Yunnan. Loyalists were also sent to

Transnational impact on Yunnan 187 administer the newly founded province of Yunnan, and for the ﬁrst time Kunming’s majority population was Han Chinese, rather than an ethnic mix. From the thirteenth to the eighteenth centuries, the Ming and Qing empires moved millions of settlers from China’s interior to farms (tuntian), mainly in eastern Yunnan and central Guizhou. Continuing a practice that began in the Han Dynasty, prisoners and soldiers from the north were conscripted into farming settlements in Yunnan, and under the Ming, into working the mines as well.34 Population movements trended southward, but there was also west–east movement, especially of indigenous groups pushed out of the plains and into the mountains.35 There has been a push–pull of migration in Yunnan over the millennium, coupled with trade: periods of domination and isolation, integration, assimilation, and segregation among Han immigrant and local peoples. This has implications for the ﬂuidity of ethnic and place identities. Such identities are invented and re-invented over time. Certainly imperial Chinese historiographers were correct in predicting the sinicization of some local groups as Han migrants moved in next to them. However, Han fears of ethnic mixing were also grounded in reality, with the inclusion of Chinese into local Yunnan communities. The incorporation of Chinese ancestors and cultural forms into persistent minority group cultures has a long history, just as Yunnanese Han have adopted local minority ancestors and cultural forms into their ways of life.36 Continuing cycles of conquest, revolt, and trade From the Yuan dynasty on, Yunnan was a staging area for Chinese incursions south, into present-day Burma and Vietnam, for the extraction of tribute, and for the maintenance of trade routes. The “Southern Silk Route” moved roughly along what was to become the Burma Road. Chinese expansion south was hindered by the fact that merchants and soldiers new to the frontier zone were often felled by malaria. During the mid-nineteenth century (1855–73), Yunnan was torn apart by a massive Muslim revolt against the Qing Empire that both united non-Han groups against the Han majority, and split groups apart. European imperialists from Southeast Asia, the British from Burma and India, and the French from Indochina, supplied arms to both sides of the rebellion. While the Chinese state was ultimately able to suppress the rebellion, they could not curb Anglo-French incursions into Yunnan from the south. China’s defeat in the Sino-French war of 1884–5, and the British annexation of upper Burma in 1886, set the stage for further European expansion. They competed to build a transportation network to link their colonial possessions with the upper Yangtze and the trade of China beyond. Mineral resources of Yunnan, especially coal, copper, and tin in the southeast were also a draw. By 1910, the French had completed a rail-line from the port of Haiphong to Kunming.37 Kunming became a European colonial outpost during the ﬁrst decades of the twentieth century, with its residential

188 Margaret Swain enclaves of colonial agents, engineers, bankers, and missionaries. British and American Protestant and French Catholic missionaries mapped out exclusive territories for conversion throughout Yunnan, building churches and schools and bringing a new kind of global identity, especially to non-Han groups. Christianity came into Yunnan after many centuries of effort by the imperial Chinese state to “civilize” the barbarians within their borders by inculcating Confucian identity. Outsiders were relegated to an “uncivilized” category. By the turn of the twentieth century, the long-held Chinese notion that race (zhongzu) and culture (wenhua) were inseparably linked had been reinforced by Han resistance to the Manchus. From this perspective, the coming of other barbarians such as the English and French imperialists was experienced as racial domination.38 Western Christians were involved in a “civilizing” project that was aimed at all Chinese, Han and non-Han, who were perceived as distinct kinds of uncivilized barbarians. China’s third civilizing project, of Communism, involves an amalgam of Western and Chinese ideology with socialist modernity as its goal. Throughout the twentieth century, these three projects competed for the control and identities of Yunnan’s people.39 As the CCP copes with reactions to its economic reforms, at the start of the twenty-ﬁrst century, there is a growing reassertion of Chineseness in association with a revival of Confucian ethics. Christianity, with its outside links, is perceived by the CCP as a competing civilizing project. From the end of the Qing Empire into the Republican era, Yunnan was a place of Western incursion, as well as a distinctive part of south-west China. Solinger has related the general character of this region at the time as a place of poverty, proﬁteering, and disorder.40 Warlords and secret societies controlled the extensive opium trade and local politics. What little legitimate regionalized trade there was in Yunnan followed the French rail-line into Vietnam, went along the Burma Road, or took several other roads radiating from Dali and Kunming to the north, west, and east. Along the southern frontier, Chinese Shan tuzi and an independent Dai-Lue kingdom controlled local populations and goods. Yunnan’s connections to the center were quite tenuous. Following the Japanese occupation of China in 1937, Kunming became an important center for industry, communication, ﬁnance, and defense.41 Yunnan again experienced an inﬂux of immigrants from the north, this time mainly intellectuals, professionals, and manufacturers. They found refuge in Kunming, where they set to work again. The South-west Associated University was formed to combine the efforts and libraries of northern academics into one institution, attracted students and engaged in international research on current conditions in Yunnan.42 Factories and banks moved from the coast and geared up to supply the war effort. Skilled workers were recruited primarily from Shanghai, while local peasants, organized by native place, held lower-status factory jobs. US troops moved into Yunnan from 1941 to 1945, working to link the Burma Road to India, and maintaining air-raid and transport bases, established in many areas

Transnational impact on Yunnan 189 populated by non-Han groups. Yunnan’s World War II history is marked by the presence on the frontier of these new people with links to the outside. In 1943, Owen Lattimore assessed this situation and predicted that with the Allied victory over Japan, Yunnan would become the “Pivot of Southeast Asia.”43 He saw Yunnan as a natural, post-colonial locus of trade and industry, with rich resources and trade routes linking China and Southeast Asia, becoming one of the most proﬁtable places in China. Instead, Yunnan would become contested territory for Nationalist and CCP forces from 1945 until March 1950. Most Chinese manufacturers and intellectuals, and many foreigners, evacuated the region. Yunnan was the last area secured by the CCP, precipitating the ﬂight of some 15,000 Nationalist troops into Burma where they formed a permanent guerrilla base in contact with the outside world through Taiwan.44 Non-Han minorities in Yunnan had aligned locally with Nationalist or CCP forces, and thus their post-Liberation experiences varied dramatically. Whatever their political connections, non-Han remained on the outside of majority cultural identity. After 1949, state racialist discourse was banned as discriminatory to minorities in this new polyethnic state, but the basic assumptions about racial exclusiveness and the continuum between nation, race, and culture remained.45 A case in point is the personal history of Governor Long Yun, a local Yi who controlled Yunnan from l928 to 1945. He was quite independent for years and allied himself with the Nationalists, until deposed by them in 1945. At that point Long moved to Hong Kong and put his considerable power behind the CCP. However, in 1957 he was targeted in China during the anti-rightist campaign and accused of being promoted by his followers in Hong Kong as the “Emperor of Yunnan” in a movement to claim “Yunnan for the Yunnanese.”46 Maoist era regional development Efforts to integrate Yunnan politically into the PRC included the incorporation of the province into the South-west Great Administrative Region (1949–54). Non-Han minzu were organized into a more coherent provincial unit with the creation of autonomous units for minority groups. These autonomous regions were clearly separated into “frontier” (bianjiang) and interior (neidi) zones. The ﬁrst concern was with securing the international frontier, marking this zone for defense rather than exchange. Five autonomous districts (qu) and ﬁve counties (xian) were established along the borders between 1953 and 1958. The CCP based local autonomous region administration in areas with Han population. Non-Han out-migration, especially by the Dai to the south into neighboring nations, occurred in response to the new regimes.47 In 1956, the CCP began establishing interior areas, forming three autonomous districts and seven autonomous counties by 1958. Distinctions between highland and lowland non-Han were also made in each zone, reﬂecting a construction of frontier issues and identities by the state.

190 Margaret Swain Those minority minzu living in interior lowland regions with the Han majority were expected to assimilate rapidly, while those isolated in highlands were consigned to the “least-developed” categories.48 Incorporation of Yunnan into the PRC’s national economy was a major issue during the Maoist era, as Zhao has demonstrated.49 From 1952 to 1986, Yunnan’s gross social product (GSP) contributed about 2 percent of the national total, and economically it ranked between twentieth and twentysecond of the twenty-nine provinces. The percentage of agricultural production in Yunnan’s GSP declined from 57.04 percent in 1952 to 38.27 percent in 1976, while the percentage of industry rose accordingly from 22.64 percent to 36.78 percent. However, this was still out of phase with the average national GSP, which was 23.15 percent for agriculture and 60.33 percent for industry in 1976. From 1964 to 1971, Yunnan experienced a second round of industrialization as part of Mao’s Third Front (san xian) defense industrial relocation policy, which moved industrial production away from the coast and into the interior. This policy resulted in the establishment of new industries and accelerated railway construction linking Kunming with Guiyang in Guizhou and Chengdu in Sichuan, which in turn provided a base for further economic development. However, like its neighbor Guizhou,50 these centrally planned economic programs had little linkage to the local agricultural base. A sustainable, diversiﬁed economy was impossible with little investment being made in the rural economy. Rural poverty was addressed by subsidies rather than investment. Zhao calculates that from 1952 to 1978, 56 percent of central government investment in Yunnan was in industry (and 92.3 percent of that was in heavy industry), while only 10.5 percent was in agriculture.51 These investments were mainly around Kunming, thus alienating the regional core from the peripheries all the more. The failure of the agricultural sector to develop was ofﬁcially blamed on various ideological factors, such as the local “low-cultural level” of the backward and even “uncivilized” rural population. The fault lay elsewhere. In the absence of signiﬁcant state investment, realistic prospects for growth in the agricultural sector were dampened by successive state-led disasters, including the Great Leap Forward (1958–60), the continual reorganization of rural communities to ﬁt the latest collective administration schemes, and the ferment of the Cultural Revolution. Of particular relevance to Yunnan was the closure of international frontiers for security purposes. Under these circumstances, expectations of a trade revival on the scale predicted in the 1940s were disappointed through to the 1970s.

Reform era modernization Reform discourse in China since the early 1980s promotes the household as an adaptable unit for production and consumption in a market economy. The household responsibility system can be understood as a reinvented

Transnational impact on Yunnan 191 Confucian civilizing project emphasizing family values and solidarity. Ong argues that these ofﬁcial narratives of Chinese modernity promise productivity (competition and greater income), security (rising standard of living) and seduction (expanding consumer choice). We see here the reworking of Confucian tradition – of loyalty, solidarity, and diligence – as a rational instrumentality for advancing Chinese modernity. Links between Confucian discourse and disciplinary rule (as in Singapore and Taiwan) on the one hand, and double digit economic growth on the other have provided the ground of common sense, often cutting across class, gender, and even ethnic lines in accepting such regimes of truth.52 In Yunnan, the rise of the household responsibility system has been tempered with the realities of provincial history, infrastructure, and geography. Demography The ethnic composition of Yunnan has seen a slight but steady increase in the proportion of ethnic minorities in the total population. This may reﬂect natural increases and birth rates. It also reﬂects continuing group identiﬁcation processes, and the readoption of minority identity by individuals who see advantages in claiming minority status for accessing economic and educational resources, due to afﬁrmative action policies. In 1994, Yunnan’s sex ratio at 106 was higher than the national average of 104.5, and the natural growth rate of 13.8 was greater than the national average of 11.2. The growth rate ﬁgures fell to 12.7 and 10.6, respectively, in 1995. In that year, Yunnan had the fourth highest birth rate in the country, following Tibet, Qinghai, and Guizhou, while its natural growth rate ranked seventh.53 The persistence of rural poverty over time in impoverished counties is a particular concern for the state and an impetus for international NGOs to target Yunnan with various aid projects. More than 75 percent of Yunnan’s poorest counties are in minority areas,54 with an adverse topography of poor soil, high elevation, and erosion.55 There has been a relative lack of state investment in these areas in the past. State aid to the poor has often been diverted by political decisions, including a preference to “bet on the strong,” and a policy that grants tax relief to villages, not to families.56 International NGOs have been active in Yunnan since 1986, including the Ford Foundation, Save the Children UK, OXFAM H. K., Care Australia (replaced by the Red Cross) and World Vision. Recently, Medicin sans Frontieres has become active in Yunnan. The Ford Foundation’s women’s reproductive health and development program in Yunnan, which began in 1992, is a model of vertical integration of agencies, from Beijing

192 Margaret Swain down to village cadres in participatory planning.57 It also takes a speciﬁc gendered perspective on rural life as well as bureaucracy. By targeting women’s health, the program had a vehicle for addressing a wide range of social, economic, and cultural conditions that affect the quality of life for women and men. Multilateral aid makes its way to Yunnan through various UN agency projects and the World Bank. The Bank is China’s largest source of foreign capital and China is the Bank’s largest borrower.58 In 1996, the Bank began a 5-year project of $247.1 million on south-west China poverty reduction. Targeting “China’s own third world,” it takes an integrated rural development approach with individual households, linking health, education, and diversiﬁed agriculture in some of the poorest counties in Guangxi, Guizhou, and Yunnan. School conditions and educational levels continue to present signiﬁcant problems in rural areas. Illiteracy rates are higher than 40 percent in some Yunnan counties, with upwards of 70 percent illiteracy among poor rural women.59 Yunnan is one of China’s main forest resource areas, and most of the rural population has access to forested land. However, use of these forest resources is problematic, due both to population pressure on the land, and an annual deﬁcit of 10 million cubic meters of ﬁrewood between the consumption and growth rates (49:39 million cubic meters). Peasant response to this pressure on forest resources is to look for ﬁrewood far from home and/or cut it illegally. As afforestation efforts have not kept up with demand, state institutes are developing energy sources such as marsh gas and electricity, and educational programs. Their main target is women, who are the procurers and consumers of ﬁrewood. A Ford Foundation social forestry project has been under way with the Yunnan Academy of Social Sciences, working over a wide range of issues and geographic locations in the province.60 Temporary migration of the rural poor to urban areas for work is a strategy especially for men in construction work.61 As indicated in Table 7.2, the disparity between rural and urban per capita income is increasing, and nonmonetary subsistence activities alone cannot possibly ﬁll the gap between them. Rural income was 28 percent of urban in 1993, and 26 percent in 1994. Urban income increased at a rate of 31 percent compared to a rural rate of 23 percent. The population distribution between urban and rural actual residence shows a continuing rate of increase in urban people compared to a ﬂuctuating but generally decreasing rural rate. Household registration (hukou) soon after reforms (1983) generally reﬂected actual residence, but by 1993, between migration and the annexation of rural areas by cities, there were many more registered agriculturists than rural residents. The urban unemployment rate in 1995 in Yunnan was the same as the national average (2.9 percent). Kunming is the locus of urban life, deﬁning urban identity for the rest of the province with booming construction and a very modern, consumption-driven self-image.62

Transnational impact on Yunnan 193 Table 7.2a Average family member income (yuan per capita)

1990 1993 1994

Urban

Rural

1,367 2,376 3,110

540 675 803

Note: 1994 Distribution of urban income (in yuan). Yunnan Statistical Yearbook 1995, p. 269: <1,000, 0.62%; 1,000– 1,500, 2.77%; 1,500–2,000, 9.38%; 2,000–2,500, 14.77%; 2,500–3,000, 18.92%; 3,000–3,500, 17.69%; 3,500–4,000, 14.62%; 4,000–4,500, 7.38%; 4,500–5,000, 4.00%; 5,000– 5,500, 3.08%; 5,500–6,000, 2.62%; 6,000, 4.15%.

Table 7.2b Population distribution (10,000 people)

1983 1993 1994 1995

Actual residence Urban Rural

Registration (hukou) Agri. Non-agri.

472.0 1664.0 1782.1 1821.3

2963.1 3380.5 3414.5 3445.5

2858.8 2221.2 2157.1 2168.3

367.7 504.7 524.7 544.1

Source: Yunnan Statistical Yearbook 1984, 1994–1996.

Table 7.2c Urban unemployment rate (percentages)

National Yunnan

1994

1995

2.8 2.7

2.9 2.9

Sources: China Statistical Yearbook 1995, p. 107; Provincial China, no. 3 (1997), p. 103; Yunnan Statistical Yearbook 1995, pp. 70, 261, 269, and 1996, p.70.

Industry and agriculture Nationwide, there has been a marked trend in the distribution of central and local shares of state expenditure, with the center providing 78 percent in 1955, steadily declining to 30 percent in 1994 as local governments expanded their share. The First Five-Year Plan (1953–7) expended 58 percent of its centrally-planned industrial investments in interior provinces, expanding new facilities as signiﬁers of socialist modernity.63 While decentralization has continued during the reform era in Yunnan, central and local state enterprise together have also moderated their position in the economy but maintained a dominant level of investment (see Table 7.3 a,b). Yunnan’s most important agricultural products in 1994 were grains, sugar cane, tobacco, and processed meat. The total agricultural output in 1994 was

194 Margaret Swain Table 7.3a Industrial output in Yunnan

Total value (mn ¥) State owned Collective Individual Other

1991

1994

1995

396.63

948.71

1207.0

76.3% 20.5% 2.6% 0.6%

73.4% 19.9% 4.3% 2.4%

69.4% 20.9% 5.6% 4.6%

Sources: Yunnan Statistical Yearbook 1992, p. 18; Yunnan Statistical Yearbook 1995, p.17; cf. Provincial China, no. 3 (1997), p. 110.

Table 7.3b Investments in ﬁxed assets in Yunnan 1991

1994

Total value (mn ¥)

98.32

321.73

State owned (guoyou) Collectives (jiti) Individual (ge ren touzi) Other (qita gezhong jingji)

72.4% 14.5% 13.1%* * in above

68.7% 12.0% 11.0% 8.3%

Sources: Yunnan Statistical Yearbook 1992, p. 18; Yunnan Statistical Yearbook 1995, p.17; cf. Provincial China, no. 3 (1997), p. 110.

¥35.6 billion, which increased 33 percent in 1995. Grain production has increased annually since 1986, when 8.7 million tons were recorded; in 1994, 1.146 billion tons of grain were produced.65 The agricultural sector, although reduced in its share of the economy, is growing rapidly (Table 7.4 a–f). The provincial economy is much less reliant on agriculture than it was before reforms. Heavy industry has maintained a fairly constant percentage of the annual output since 1978, but light industry has increased signiﬁcantly. These industries include a wide range of goods and services such as tourism, cash cropping, and agro-forestry. Key light industries are being developed as “Pillars of Development” by the state, with particular emphasis on short-term proﬁts. The old colonial crops of tea, coffee, sugar, tobacco, spices, and rubber are encouraged, Table 7.4a Combined value of industrial and agricultural output (bn ¥) 1978 1985 1990 1994 1995

9.50 22.50 55.69 130.54 170.47

Sources: d’Hooghe, “Regional Economic Integration,” p. 289, for 1978, 1985; and Yunnan Statistical Yearbook 1995, pp. 16, 287 and 1996, pp. 16, 18, 289; Provincial China, no. 3 (1997), pp. 109, 110.

Transnational impact on Yunnan 195 Table 7.4b Economic output: composition (% of total)

Agricultural Industry Light industry Heavy industry

1978

1990

1993

1994

1995

41.9 58.1 25.0 33.1

38.0 52.0 32.5 29.5

29.0 71.0 34.3 36.7

27.3 72.7 39.4 33.3

27.8 72.3 38.5 33.7

Source: Yunnan Statistical Yearbook 1996.

Table 7.4c Percentage of natural resource reserves used, 1994 Coal Oil Natural gas Hydroelectricity

78.5 9.4 3.1 9.0 (5.5 in 1990)

Source: Yunnan Statistical Yearbook 1995, p. 419.

Table 7.4d Agricultural composition (% of total)

Cultivation Forestry Livestock Fish products

1993

1994

63.8 9.0 25.9 1.3

64.2 8.5 25.8 1.5

Source: Yunnan Statistical Yearbook 1995, p. 419.

Table 7.4e Share of farmland (in 10,000 sq. hectares)

Irrigated paddy Dry ﬁeld

1990

1993

1995

97.94 186.99

96.30 189.44

95.88 191.95

Source: Yunnan Statistical Yearbook 1996, p. 289.

Table 7.4f Rural households per capita area of cultivated land use (in mu)

National Yunnan

1994

1995

2.18 1.55

2.17 1.76

Sources: China Statistical Yearbook 1995, p. 343; China Statistical Yearbook 1996, p. 376.

especially if grown in “wastelands” that do not support grain cultivation or pasturage. Production of tobacco decreased signiﬁcantly from 874,400 tons in 1993 to 592,300 tons in 1994, due to problems in leaf quality and production control. This was a brutal lesson in market economics for many

196 Margaret Swain farmers who over produced in 1993 in response to favorable sales in 1992. Changes in grading standards and a market glut in 1993 forced many farmers to turn to other crops in 1994.65 Despite these issues, tobacco has become a critical factor in the ﬁscal calculations of Yunnan Province and the central state. By 1990, tobacco provided over half of Yunnan’s administrative funds. By 1995, tobacco taxes accounted for 85 percent of provincial tax revenue and 11 percent of central revenues. Of the ¥71 billion paid nationally in tobacco taxes, ¥1.8 billion was paid by Yunnan’s Yuxi state-owned cigarette factory alone.66 There were precedents in the eighteenth century, when a Qing era ofﬁcial reported that “over half of the farmland near Kunming is planted with tobacco. More families sell tobacco than rice.”67 Besides tobacco and other cash crops, two other pillars of development for Yunnan are minerals processing and tourism. Market socialism As nonstate investments and enterprise rise in Yunnan, open-door policies make it likely that transnational links will develop to the south, and beyond. This is happening, but not overnight. Rather, a number of economic plans, investments, and international development schemes are beginning to shape Yunnan’s growing economy. Beijing is not about to cut loose its provinces, and the CCP continues to have a strong local presence. Comparing Yunnan with its provincial neighbours (Table 7.5 a,b), we can see that it does have some speciﬁc strengths, but in many ways it continues to be similar to other south-western provinces. It is consistently behind Sichuan and Guangxi in levels of production and income, but signiﬁcantly ahead of Guizhou and Table 7.5a Gross and per capita domestic product, 1994

Yunnan Guangxi Guizhou Sichuan Tibet

GDP (bn ¥)

Per cap (¥)

% Natl per cap

% Natl rate

120.7 160.6 63.0 353.4 5.6

3025.1 3535.1 1795.9 3120.5 2333.3

62.9 73.5 37.3 64.9 48.5

120.0 104.4 135.2 93.6 152.6

Source: Provincial China, no. 3 (1997), pp. 94, 95, 109, 110, 114, 115, 117.

Table 7.5b Agricultural and industrial output, 1994

Yunnan Guangxi Guizhou Sichuan Tibet

GVAO (bn ¥)

% Natl

GVIO (bn ¥)

% Natl

47.4 74.4 34.5 152.0 3.6

2.3 3.7 1.7 7.5 0.2

120.7 166.6 55.7 442.6 0.9

1.3 1.8 0.6 4.8 0.0

Note: GVAO = gross value of agricultural output; GVIO = gross value of industrial output. Source: Provincial China, no. 3 (1997), pp. 95–116.

Transnational impact on Yunnan 197 Tibet. In terms of population growth, it is also in the middle. Yunnan’s relatively high rate of natural growth reﬂects its large minority minzu population, which had less stringent population regulations until 1991, when the two-child rule for all rural populations came into force. Regional per capita income is well above the poverty line of ¥300, but there are great differences between impoverished villages and new-rich neighbourhoods in the cities. Percentages for the gross value of agricultural outputs are consistently higher than those for the gross value of industrial outputs, measured on the national scale, although income from agriculture falls well below that from industry. From a regional perspective, Yunnan is situated in a unique position with neighboring provinces, both geographically and in terms of its political economy. It competes with Guizhou and Guangxi for tourist dollars and aid programs, while Sichuan sends a stream of sojourners south to Yunnan’s cities, villages, and frontier zones. The region provides markets and resources and cultural connections among cross-border communities and ethnic groups. For example, Moso families around Luguhu, in north-west Yunnan, send their sons for religious training in Tibet. Clearly, at this stage, Yunnan is not as wealthy or dependent on trade as many other provinces, and is still far from the level of the coastal provinces. What Yunnan does have, however, which the rest of the south-west does not, is a frontier zone spanning three countries, and formal incorporation into special development zones, most importantly the Greater Mekong Subregion (GMS). In this context, Yunnan functions more as a separate unit than a pod of the central state. Conversely, the central state uses Yunnan as the nation’s guanxi vector with Southeast Asia for trade and strategic purposes. Economic development zones Yunnan is part of a provincial regional economic development zone, the South-west Cooperation Zone, founded in 1984 with Sichuan, Guangxi, Guizhou, Chengdu, Chongqing, and Tibet, in an effort to present a united regional front to Beijing and develop regional linkages.68 Other economic zones at the provincial level include the international Greater Mekong Subregion (GMS), discussed below; four state-level border trading zones (Ruili and Wanding on the Burma border, Mengla with Laos, and Hekou with Vietnam);69 the Kunming Hi-tech Industrial Zone, as well as the Kunming Economic and Technological Development Zone, both ratiﬁed by the central government in 1992. Kunming is also the permanent site of the annual Export Commodities Fair, begun in 1993 with the South-west Cooperation Zone. In many ways, Kunming plays a unique role in Yunnan trade, having its own Foreign Trade Commission and strong ﬁnancial institution, the Kunming International Trust and Investment Corporation, owned by the city government. Some 670 foreign-funded and joint-venture enterprises had set up in Kunming by late

198 Margaret Swain 1994, with total investments of US$1.4 billion, including US$800 million in foreign funds. Province-wide there were over 1,315 foreign invested enterprises registered by the end of 1995, with a total investment of US$3.16 billion.70 The largest investments come from Hong Kong, Taiwan, Singapore, the United States, and Thailand. Yunnan encourages investment with its own tax breaks and other incentives parallel to national plans. Yunnan functions as a comparable unit among its neighboring countries in the GMS, a development group launched in 1992 under the auspices of the Asian Development Bank. Unlike ASEAN, the GMS “is an informal grouping of neighboring countries, which have categorically disavowed any intent to form a trade bloc.”71 As of January 1996, the Bank has provided loans totaling $280 million for priority projects in transport and energy. The Bank also works closely with multilateral and bilateral donor agencies including the UNEP, and has obtained ﬁnancial grants from Australia, Canada, France, Finland, Japan, Norway, and Sweden. Funding is also being used for human development projects in education, HIV-AIDS, and malaria control. The infrastructure development plans are on a very grand scale, with the ultimate goal of linking the sub-region by roads, rail, and communications, as well as working out resource-sharing infrastructure (including hydropower from Yunnan). Construction is under way. The very promise of new transport links has people moving in anticipation of expanded trade. Trade and international relations The informal GMS group has huge promise for inﬂuencing trade and encouraging transnational linkages. Some of these linkages reﬂect the presence of ethnic Chinese populations in bordering countries, their familial

Table 7.6a Share of exports and trade, 1991 Yunnan’s % of national exports % of trade in national GSP

1.17 4.84

Source: B. Womack and G. Zhao, “The many worlds of China’s provinces,” in Goodman and Segal (eds), China Deconstructs, p. 151.

Table 7.6b Export trade partners, 1991 (in US$million) US Hong Kong Japan USSR Burma

22.12 96.28 68.45 19.12 142.73

Source: B. Womack and G. Zhao, “The many worlds of China’s provinces,” in Goodman and Segal (eds), China Deconstructs, p. 151. These ﬁgures give a different view from those available in the Asian Development Bank 1996 report (p. 186) for 1994. Total value of exports $1,044 million, and exporting in order of value to Burma, Hong Kong, Japan, (as before), Vietnam, US, Singapore, Thailand, Malaysia.

Transnational impact on Yunnan 199 Table 7.6c Yunnan exports and imports (in US$10,000)

1992 1993 1994

Exports

Imports

Trade surplus

46,653 52,291 91,016

20,403 1,717 43,390

26,250 20,574 43,390

Source: Yunnan Statistical Yearbook 1995, pp. 503, 504, 507. (The largest importing foreign countries are the US, Germany, Italy, Japan, and Hong Kong.)

Table 7.6d Exports: most important products, 1994 (US$10,000) Tobacco Metal Oils

25,922 11,210 13,242

Source: Yunnan Statistical Yearbook 1995, pp. 503, 504, 507. (The largest importing foreign countries are the US, Germany, Italy, Japan, and Hong Kong.)

ties and trade connections to the north. These connections are valuable to all of the GMS. But for Southeast Asia they are also a source of fear of Chinese imperialism, enhanced on occasion by Chinese diplomatic moves to claim territory or to move troops. Memories of tributary-state ties to Beijing are evoked in Southeast Asian nationalism. Chinese cultural ties are strong as well in these multiethnic states, where Yunnanese traders settled and became citizens in the past. Renewed migration south out of Yunnan is strengthening these ties.72 Just as these states worry about China’s inﬂuence, Beijing worries that the pull of the south on Yunnan will enhance its independence from the center. The frontier zone also generates problems for China as a whole. Lack of state control along the Yunnan frontier zone has made this a place where the drug trade and smuggling can ﬂourish in a “black NET” (Natural Economic Territory).73 When the border was reopened, in the reform era, legal trade was once again encouraged. A transnational “economic quadrangle” then formed among businesses in Thailand, Laos, Burma, and Yunnan, quite distinct from the GMS, and driven by private enterprise (see Table 7.6 a–d).74 In terms of foreign trade, Yunnan falls around the middle of its provincial regional cohort, although the percentage of provincial GDP occupied by its foreign trade is much higher than in Sichuan, and realized foreign capital is signiﬁcantly less than in all provinces but Tibet. One indicator on which Yunnan ﬁrmly leads its region is consumption, measured by domestic purchases and sales. Its purchases are 144 percent and its sales 154 percent of the national average, while other regional provinces come in at around 74 percent on both indexes (excluding Tibet). If consumption offers any guide, there is an exceptional amount of economic activity in Yunnan (Table 7.7). Sex, drugs, and karaoke The combination of increasing afﬂuence, rising consumption, relaxation of social controls, and the embrace of “Asian modernity” has led to increased

200 Margaret Swain Table 7.7 Yunnan and neighboring provinces foreign trade, 1995 For. trade Yunnan Guangxi Guizhou Sichuan Tibet

2.2 3.1 0.7 3.5 0.2

USbn$ % Prov. GDP 14.9 16.1 8.8 8.2 32.4

Export % Prov. GDP

Import For. Capit. % Prov. GDP % Prov. GDP

8.7 8.8 5.8 5.4 1.3

6.2 7.2 2.9 2.9 31.3

0.8 3.7 1.2 1.5 n.a.

Source: Yannan Statistical Yearbook 1996.

trafﬁcking in women and drugs along the Yunnan frontier. These social ills are supplied from the south. Heroin produced in Burma feeds the highest incidence of use in China along the frontier zone and in Kunming. Drug trafﬁcking has exploded since 1989. The national Ministry of Health estimates that “China only interdicts approximately 6.5 percent of heroin passing through Yunnan and Guizhou to Guangdong and Hong Kong, and . . . an increased amount of this drug and opium is destined for consumers within China.”75 High drug purity leads to rapid addiction and intense withdrawal problems among users. A related problem is the spread of HIV. In Ruili County on the Burma border, a 1992 survey indicated an HIV rate of 82 percent among drug abusers. In Kunming, a drug rehabilitation center was established by the city government in 1989, and since then more than 8,000 addicts have been treated. The trafﬁc in women from poor villages for prostitution and menial labor occurs throughout the frontier zone, including Yunnan.76 In “karaoke culture,” an ubiquitous form of Asian modernity, individuals imagine themselves leading different lives. The harsh realities of the drug and sex trades are driven by similar dreams of escape. For some people living on in the borderlands it is possible to realize these dreams. The Akha, one of the ethnic groups that spreads across the frontier zone from Yunnan to Thailand, provide an example of the ﬂuidity of identities in the new political economy.77 Akha (or Hani, as they are classiﬁed by China) in Yunnan have used the system during reform to revive banished cultural forms and to integrate more fully into Yunnan’s economy and society in response to modernization and development. Akha in Thailand see relative advantages and greater citizenship status in China, and are in the process of exploiting the opening of China’s borders, the GMS infrastructure, and their heritage as tribal traders throughout the region. Individuals have accumulated wealth from ethnic tourism, petty-commodity trade, and illicit cross-border trade in drugs and smuggled gems, which they are now putting into fruit and coffee growing, tourist guest houses, restaurants, karaoke bars, and massage parlors. Tourism It is ironic that one of the hopes for rural development and poverty alleviation throughout the GMS is tied to the commercial potential of ethnic

Transnational impact on Yunnan 201 Table 7.8a Annual revenues (US$10,000) 1992 1993 1994

6,727 10,273 12,440

Source: Yunnan Statistical Yearbook 1995, pp. 511–12.

Table 7.8b Number of international visitors, including overseas Chinese 1992 1993 1994

313,462 405,209 522,059

Note: In 1993 and 1994, Thailand and Singapore were sources of the greatest number of visitors after Hong Kong and Taiwan. Source: Yannan Statistical Yearbook 1995, pp. 511–12.

minority groups long held to exemplify their “backwardness” among the national majority of society. Tourism is a major component in GMS group plans, and much of it draws on ethnic-group cultures. Just as tourism is one of the pillar industries in Yunnan, it is a focus of development throughout the region, and is transnational in resources and consumption. In Yunnan’s north-west, the city of Lijiang has been targeted for tourism development, with a new airport opened in 1995, and multiple development projects involving the state, joint-ventures, and aid agencies.78 A hotel ﬁnanced by a Thai company has had some difﬁculties, but plans march on for ski resorts up in the mountains. While Southeast Asian tourists ﬂock to cool and exotic Yunnan, Chinese tourists are heading for Thai beaches, or, in the case of Yunnanese businessmen, across the Thai border for trade and relaxation. Domestic tourism in Yunnan, measured at speciﬁc tourist sites and hotels, is very signiﬁcant for Yunnan’s economy. For the ﬁrst 11 months of 1996, 17.8 million domestic tourists and 600,000 foreign tourists (up 20 percent and 27 percent from 1995) had poured ¥7 billion into the provincial economy. The tourism bureau estimated that more than 21 million tourists visited the province in 1997, bringing in a record ¥8.5 billion.79 Nationally, as well, tourism is very big business, yielding US$10.2 billion in 1995 (an annual increase of 16.6 percent) from 22.8 million international tourists (ranking sixth highest in the world, according to the World Tourism Organization). Tourism accounted for 3.7 percent of the national economy in 1995, and the National Tourism Administration predicted that it would rise to 5 percent by the end of the decade (see Table 7.8 a,b).80 Tourists visit Yunnan to consume the natural and cultural landscapes. Judging from Chinese and Western travel writing, for many tourists this is an exercise in modernity, controlling nature by packaging it in cable-car rides, concrete pathways and coach tours, and objectifying culture by seeing Han

202 Margaret Swain heritage as something in the past, and diverse ethnic-group practices as frozen in time and primitive.81 Domestic and international tourists may be curious about “other” Chinese, but rarely question staged presentations of homogenized ethnic diversity.

Cultural production: marketing Stone Forest Tradition and modernity Both capitalism and socialism use a modernist discourse of conquering nature and overcoming tradition to rationalize change. In modern China the state discourse has been that tradition is backward (luohuo) and feudal (fengjian). In the early twentieth century the words “tradition” (chuantong) and “modern” (xiandai) were introduced into Chinese usage, inventing tradition for the deﬁnition and production of modernity.82 Marxist and Stalinist ideas, replacing cyclical history with linear social evolution, were embraced by the Chinese state in the 1950s. Minorities were then often portrayed as “living fossils” without theorizing the power of the state in producing identities and cultural forms. Likewise, Han cultural practices, such as lineage rituals, were cast as backward, to be replaced by the state. The Cultural Revolution took this logic to an extreme. In the post-Deng era, there is a paradoxical nostalgia and preservation of tradition, as the past, in fetishized minority and Han ritual display, while contemporary ritual practices continue to be banned. The Chinese nationstate is shaping the distinctive racial, cultural, and economic roots of modernity into a reformed Confucian civilizing project.83 As Ong notes, “there are other conversations, dialogues, and dissension from lower classes, women’s groups and indigenous communities that contest these perspectives, but their presence only serves to conﬁrm the force of this emerging hegemony of Asian modernity to contain them.”84 Counter-discourses of conservation, revitalization, and transformation are also emerging in China.85 From this perspective, “tradition,” as heritage, ties together community relationships, creating a sense of local identity and enhanced cultural, economic, and political autonomy from the state. The discourse of “cultural development” (wenhua fazhan) among minority elites, as Oakes has argued, illustrates two meanings of the phrase in the post-Mao era.86 The ﬁrst yokes together metropolitan, cosmopolitan, and national concepts of education, in science and technology, literacy, modern commerce, management, and entrepreneurship. The second blends local heritage with modern commercialism in the commodiﬁcation of ethnicity and “local color” (difang tese).87 In this second sense, “cultural development” can be seen as a process in which local folk produce their self-identity. The critical issue is control, although even when a cultural agenda is totally imposed people still react to it. Rather than seeing tourism development as something that is done to the local folk, it can be understood as negotiation.

Transnational impact on Yunnan 203 In response to tourism commodiﬁcation of their identity, local people may re-inscribe simulacra with their own meaning (as seen in the Sani uses of “Ashima” below). Certainly, promoting minzu tradition as a foil for modernization may result in new forms of internal colonization by the state: museumizing cultural forms, fossilizing rural modes of handicrafts, and using cultural producers as cheap and exploitable labor.88 But marketing minzu diversity also reinforces local ethnic identities while underscoring China’s national uniqueness, and countering globalized modernity. Globalization has been deﬁned by Kearney as the social, economic, cultural, and demographic processes that occur within nations while transcending them. Hence local processes, identities, and units of analysis yield incomplete understandings of the local unless they make reference to worldwide relationships.89 All aspects of globalization come together in the world’s largest industry, tourism. There is the implosion of peripheries into centers, shaking up previously held linear notions of development. Tourism is a force of globalization that plays out in local variations, but there are common factors: sex sells, gender and other inequalities in production and consumption prosper, and yet room for social, ideological, economic, and ecological transformations is opened up with tourism activity. Looking at the ethnic tourism of the Sani in Stone Forest, we can see contested meanings of gender and ethnic identities, the local uses of these identities in hierarchical relationships by individuals and communities, and their signiﬁcance in negotiating the good life in modern China’s frontier zone. The following sections will ﬁrst present the tourist site of Stone Forest in its local context, then discuss identity hierarchies in the production of “Ashima” Sani images, and cultural negotiations in the marketplace of Wukeshu. Stone Forest and Lunan County Stone Forest (Shilin), a national park of karst formations, is located in Lunan Yi Autonomous County, a rural area within the Kunming municipality. The park is one of Yunnan’s premier tourist attractions, extremely popular with domestic tourists. Following economic reforms since 1980, Lunan County people have become increasingly involved in tourism by providing services and souvenirs. The whole county is being heavily developed by the state for tourism and other transnational/global trade, with new roads, hotels, rail, and air facilities. A master plan for this development was begun in 1986. By the mid-1990s there were more than 1.5 million visitors annually to Lunan’s scenic attractions, including over 100,000 international tourists.90 Much of Lunan remains rural with an agricultural base invested in tobacco production. Lunan TVEs (town and village enterprises) include a tobaccoprocessing plant. Lunan County is primarily inhabited by Han and Sani Yi. In the 1990s Han comprised 70 percent of the county population (200,000 in all). Sani ancestors stopped migrating into the Lunan area and settled there about 500

204 Margaret Swain years ago. Han people, however, have continued to move from various places into Lunan over time, and the region has been controlled on and off since the Han Dynasty by a Chinese state system.91 Local history reﬂects conditions found throughout Yunnan. In Lunan there have been waves of immigration, mixing, and stratiﬁcation of populations by class and ethnic group, cycles of Chinese hegemony since the Han Dynasty, the incursion of European colonialism, and the promotion of Confucian, Christian, and Communist civilizing projects. 92 In the 1880s the French missionary Vial arrived, spreading Christianity and competing with the local Confucian project.93 Mission schools taught children in French, Latin, Chinese, and Sani writing systems, and brought powerful links to a global identity and the outside modern world to Sani converts. The Christian civilizing mission reinforced a distinct Sani identity, rather than attempting to consume it. The intersection of civilizing projects with local identities can be seen in Vial’s continuing impact on Sani culture. After decades of viliﬁcation during the Maoist era, his studies of Sani language and custom are now cycling back into local constructions of Sani modernity made by indigenous intellectuals and local tourism brokers. With the establishment of the Communist civilizing project in Lunan, Sani were classiﬁed as a branch of the Yi minzu by the state during the 1950s minzu shebie. This identiﬁcation is contested by local intellectuals who argue that Sani are Sani. But there are different kinds of Sani.94 The complexity of interrelated identities and ideologies is reﬂected in the fact that some of the most ardent Yunnan Communist revolutionary heroes in the 1940s were Sani, while in the same period, other Sani trained in French to become Catholic priests and nuns, or apprenticed themselves to indigenous ritualists to learn Sani sacred texts and dances.95 In 1956 the Lunan Yi Autonomous County was founded. The county was reorganized numerous times during the Mao era, suffering the vagaries of changing production systems, to re-emerge into the reform era with its place identity intact. In 1983 the county became part of Kunming municipality by national government ﬁat, and plans were drafted for local modernization and economic development. Tourism is central to these plans. While a relatively small proportion of Sani participate directly in tourism, many are inﬂuenced by its secondary economy in Lunan. Like the province as a whole, Lunan has remote areas of extreme poverty, developing areas, and a core area, around the county town and Stone Forest, that has the most investment and modern infrastructure. In the following sections, identity hierarchies marked by uses of the mythic Sani heroine “Ashima” and the marketplace of Stone Forest tourism are examined as aspects of globalized modernity and the local commodiﬁcation of difference. The primary image used to promote the Lunan region by the government, and also the logo of the Yunnan Provincial Tourism Bureau, is of the distinctive karst formation in Stone Forest Park named “Ashima,” for the heroic maiden who was turned into stone while resisting a

Transnational impact on Yunnan 205 rapacious overlord. This could be construed as a classic example of internal colonialism, appropriating indigenous symbols for the national project. However, as we will see, it is not entirely clear whose symbol Ashima has become. The logo may also be read as an emblem of globalizing modernity, objectifying the traditional indigenous woman as a controllable natural stone formation. Ashima and identity hierarchies The Ashima legend is identiﬁed in state versions, and in associated commodities, as closely tied to Sani culture. This identiﬁcation is effected through the portrayal of costume, especially Sani women’s distinctive headgear, and of place, notably the Stone Forest. State tourism development of Stone Forest started in the 1950s with construction of a hotel and identiﬁcation of scenic wonders, including Ashima, “the maid of stone.”96 Ashima has become a sign of something to be sold. In popularized accounts, the main elements of the story are as follows: Ashima plans to choose her own spouse but is stolen away by the evil landlord Rebubala to be his son’s bride. Ashima’s companion, Ahei, who in different versions of the tale is either her brother or her lover, rides to her rescue. After surmounting many trials, tricks, and tigers, Ashima and Ahei ﬂee Rebubala, only to be trapped in a raging ﬂood that sweeps Ashima way from Ahei. She returns as an echo heard in the Stone Forest. Ashima has become a commodiﬁed legend of resistance used in distinct transcripts97 of the state’s civilizing project and in Sani reactions to it. Ofﬁcial state versions of the Ashima legend were literally constructed from many Sani folklore elements in 1954 by a work team of the Yunnan People’s Cultural Troupe.98 Four decades later, both the Han state and local Sani and Han in Lunan County use Ashima transcripts as commodities. As a nation/state commodity, the packaging of Ashima does the double civilizing work of assimilating a minority people and minimizing the reality of ethnic social distinctions. As a Sani commodity, Ashima becomes a vehicle for ethnogenesis. Being and selling Ashima promotes Sani cultural uniqueness.99 Ashima commodiﬁcation is used for cultural incorporation by the state and cultural identity by the Sani. At the same time, Ashima signiﬁes Sani integration into the Chinese political economy. Private enterprises and state agencies capitalize on the image of Ashima on everything from cigarette brands to tourism advertisements. Individuals and the corporate state are both involved in commodifying practices. To some extent these practices reveal a dichotomy between local Sani and the Han state. But ethnic-identity hierarchies do not always favor the majority. Native-place identity is a factor even among state ofﬁcials, as local afﬁrmative action policies reserve top state jobs for minorities. Thus, Sani government ofﬁcials are implicated in the state project. On the other hand, Ashima images are produced by local Han tourist guides, by Han authors of guidebooks

206 Margaret Swain and of poetry and prose in the popular press, and by Han manufacturers of pseudo-ethnic goods. Several generations of young Lunan women and men have worked as state-trained “traditional” and modern (karaoke club) entertainers and ofﬁcial “Ashima” guides to lead tourists through the Stone Forest Park labyrinths. As one English language hotel brochure from the early 1990s puts it: When night falls, the Sani girls and boys dressed in their costumes will perform for you the exotic Sani minority dances which will usher you into a remote mysterious land of dream and fancy. That is something really unforgettable, detached and you have never experienced before. Welcome you, guests coming from afar! Schein develops an idea of “internal orientalism” in China, in which “the chain of signiﬁcation that linked ethnic to female to rural to backward served in effect to encourage a derogated, subordinated positioning of minorities, women, and peasants in Chinese society.”100 Yes, but we need a more nuanced understanding of local situations. In Stone Forest we can see both subjugation in prostitution among young guides who have already commodiﬁed their bodies in some ways, and resistance of those who maintain a sense of Sani (or native place, as many “Ashima” are Lunan Han) self that would not fool around with a Cantonese or northern (beifang) playboy. Furthermore, there is both ghettoized ethnic employment in patriarchially ordered “modern” national tourism services, and ethnic work of choice, such as informal marketing of handicrafts. Tourism is a signiﬁcant issue in contemporary Sani gender relations. The Sani are not patriarchal, but in order to participate in the global tourism economy, they often must engage in the consensual patriarchy of Chinese capitalism and the global economy. The touristic allure of “Ashima” signifying a nonpatriarchal, exotic (and perhaps erotic) Sani society where a woman’s gender status is her mark of authenticity, is paradoxically challenged by any direct participation in the global economy of tourism – she is compromised. Gendered authenticity as a characteristic of tourism subjects has signiﬁcance for their negotiations of ethnicity and modernity. As Vincanne Adams has observed of Lhasa, multicultural and transnational processes that commodify cultural differences “produce products that circulate not only in economies of money, but in economies of meaning where proﬁts are deﬁned politically and culturally.” The subjects of commodiﬁcation “negotiate within parameters of authenticity deﬁned by others.”101 Themes of Sani place and gender relations are employed in the commodiﬁcation of the Ashima legend through promises of exotic sights and nonHan people, expressed in scenery, performances and goods.102 Ashima also portrays tension, contradiction and resistance fueled by power inequalities

Transnational impact on Yunnan 207 between and within ethnic groups. For example, many of the sources of Ashima came from Sani literature, yet today the Sani language is not taught in local schools, and there are no interpretive exhibits introducing Sani literary heritage and culture at the Stone Forest park.103 The effects of this changing discourse produce new and perhaps conﬂicting economies of meaning as Ashima’s imagery feeds back into the lived experience of the Sani. With the opening of Stone Forest to international tourism in 1980, Sani Yi free-market artisans began to build an informal sector of handicraft souvenir manufacture. This is primarily a woman’s business, produced and marketed out of the home in and around Stone Forest, and in nearby Kunming, a two-hour bus ride from Lunan County.104 Handicraft marketing started from the village of Wukeshu, which was a nondescript Sani village until the mid-1980s, when the state started to actively administer tourism development. Packaging Wukeshu as marketplace Along the superhighway from Kunming heading into the Stone Forest, signs proclaim “Welcome to Ashima’s Hometown” in English and Chinese. Ashima’s name is known throughout China due to a 1960s movie, advertising logos, and tourism to the purported site of this mythical Sani maid’s transformation into limestone. Within the Stone Forest National Park, the karst formation identiﬁed as “Ashima” is a must-do photo opportunity for the thousands of tourists who stream by. This rock itself is not an indigenous site/sight, with special meaning in Sani culture. Indeed, as we have seen, the very construction of Ashima lore is highly problematized as a state folklore project. All of the park’s named limestone sites, from “Camel riding on an elephant” to “Glossy ganoderma,” are promoted with contemporary Han Chinese meanings that have developed over the course of the park’s history, since the 1930s, rather than with indigenous Sani inscriptions. Stone Forest Park used to be the ancestral lands of the adjacent Sani village of Wukeshu. Villagers have had special arrangements for work and park access with the government Stone Forest Tourism Bureau. Wukeshu (ﬁve trees) sits at 1,763 meters altitude in the karst topography typical of central Lunan. The village was founded over 500 years ago in a region controlled by indigenous tusi representing the Chinese imperial court. Until the recent explosion of tourism development at Shilin, this was an agricultural village removed from main transportation routes. Future changes were signaled in 1987, when the village’s administrative classiﬁcation was altered from an independent township to a town under the direct control of the Shilin Tourism Bureau. At that time the village lanes were unpaved, livestock roamed freely, and most houses were constructed from rammed-earth and thatch. The village population of 708 people in 144 households was all Sani except for two Han family members.105 Virtually all adults farmed their adjacent lands, which used to include plots in the park

208 Margaret Swain itself. While villagers had enough to eat, theirs were not considered a “rich village” by neighboring Sani. Before Liberation, French Catholics visited from the west, but the village has never been missionized. A post-Revolution era elementary school, catering to grade six, was located near the park gates. By 1993, as the surrounding tourism business grew, Wukeshu came to be known in the region as a “well off ” (you qiande) village. The village lanes were paved to beneﬁt the locals and wandering tourists. An edict from the Shilin Tourism Bureau attempted to enforce with ﬁnes the conﬁnement of all livestock, even pigs. Almost all roofs were tiled, and new-house building boomed at the village periphery as non-Sani workers rented out older buildings in the center. While the ofﬁcial village population of 760 people is still almost all Sani, their households have divided into 193 smaller units. Two hundred and twenty-nine people were reclassiﬁed from peasant (nongye) status to non-agricultural (fei nongye) household registration (hukou). The village land base shrank from 434 mu in 1988 to 191 mu in late 1993 after the Tourism Bureau bought up rights for further park development. The Tourism Bureau constructed a modern tourist shopping plaza just outside the park gates, renting out little stores to Wukeshu residents and outsiders (Sani and non-Sani alike) who run restaurants and souvenir shops. Economic competition and cooperation across ethnic boundaries has become a factor in the production and sale of Shilin tourism. Han tailors (mostly men) from as far away as Sichuan moved into Wukeshu to craft “Sani” goods for sale, or for wholesale trade with Sani merchants. Fourteen emigrant Han families lived in the village in 1993, producing vast quantities of piecework bags and children’s Ashima costumes for Sani and Han retailers. How many Han were living in the village became a case for denial in Wukeshu where, even in 1993, residents during would often assert “we are all Sani here!” Later in the same year, Wukeshu ofﬁcially ceased to exist. The status of the community was changed from a peasant village to the Stone Forest Peasant Industry and Commerce General Corporation (Shilin Nonggongshang maoyi zonggongsi). All 760 villagers, including indigenous women, men, children, and several Han women who married into Sani families, with their offspring, became corporation members. Their corporation was placed in charge of around 4 million yuan that the government paid over to the corporate community for land-use rights. A small group of elected male community leaders administer these funds in tight agreement with the Shilin Tourism Bureau. The Bureau is also male dominated, and the leadership hierarchy is topped by outside Han, followed by local Han, followed by local Sani. This is the opposite of the county’s ethnic-political organization. Wukeshu folk in late 1993 tended to dismiss the name change of their community as yet another government scheme, and were skeptical about rumours that they would have to move out into other communities as their homes were transformed into an idealized tourist attraction. According to these rumors, a plan had been concocted by the Shilin Tourism Bureau and

Transnational impact on Yunnan 209 local ofﬁcials to “museumize” the village by moving out all the residents and setting up a “sanitized” Sani tourism village with beautiful young people in quaint costumes acting as guides to the past. Another proposed function of the corporation is to regulate handicraft production by its members. As Sani women are the main producers, and almost all ofﬁcials are male, this arrangement would have signiﬁcance for local gender hierarchy. The General Corporation administers jobs in Stone Forest Park allocated by the Tourism Bureau: taking staged tourist photos, renting costumes, park cleaning, handicraft selling, and tourist foods. The Corporation also makes investment agreements, including a contract with a Singapore company to construct vacation villas on a nearby reservoir. This involves a 20-year investment plan, anticipating 10 percent annual growth on an initial investment of ¥100,000 in 1993 that was made over to the Corporation in return for use of 29.5 mu of land. Construction is under way, and land rentals to other companies, including one from Beijing, have subsequently been negotiated. County-level transnational and national investments in Lunan are also having a direct effect on Wukeshu. In 1993, the Lunan County party secretary (a Sani man who has traveled throughout Asia and the United States) negotiated ¥1.8 billion (1.44 billion from foreign sources) for twentyeight new TVEs.106 In an interview, he emphasized the importance of tourism, and the importance for investors to come and see for themselves the mountains, the water, and the folk customs. Those who do have been “moved by the zest of Lunan people.”107 Funds from Hong Kong have been invested in a new airport, a train station, and tourist housing close to the park entrance, while Japanese funds and technical assistance have been invested in a nearby cement factory. After talking to the two elected Sani village leaders (cunzhang) about the effects of economic growth, one comes away with two very different impressions about the future facing the village. One of the leaders, an old farmer with deep family roots in the community, acknowledges the ﬂow of money and the need to change, but prefers a gradual approach. The other, a young bureaucrat who has been sent all over Southeast Asia by the Tourism Bureau and is married to a Han woman from Hekou, boasts that in a few years “you won’t recognize the place.” Certainly, the Shilin Tourism Bureau insists that the future of the village is now strictly the business of the General Corporation. This may make the village unrecognizable not only to visitors but to its own inhabitants – a goal to which the younger leader clearly aspires. In 1995, at least, the community formerly known as Wukeshu was still recognizable, with some new houses built on the periphery, and more stores opening up on the village side of the park. Economic class distinctions were growing, and young people found that their futures, although different from those of their farming parents, were no easier to negotiate.108 New things, including global goods such as boomboxes, VCRs, cars and motorcycles, are

210 Margaret Swain both symbols of modernity and vectors of inequalities, differences, and resentments. Karaoke music blares into the night, and video screenings at the largest Sani-owned guest house (zhaodaisuo) feature Hong Kong kungfu movies. Televisions in many homes are tuned to national TV and foreign shows. The restaurant trade booms, and busts, and local young people try to make it good. Annual household income at the end of 1993 ranged from ¥400, in the case of a widower with two young children, to ¥40,000 reportedly earned by the family that owns the guest house. Local cultural and global political economy issues surface together in the commodiﬁcation of indigenous events, such as the annual Torch Festival (huobajie) for the consumption of thousands of domestic tourists. Tourism competes for priority with a global commodity, tobacco, in strategies for local economic development. Even the timing of the new tobacco harvest coincides with an old festival previously held at less busy times. Performing local culture for international ﬁlm productions is another regular occurrence. When a Hong Kong crew ﬁlmed a mock “traditional” wedding for a commercial in Wukeshu, in 1992, residents saw their touristic image reﬂected back in the advertisement on local television. As a corollary to popular representations of Ashima, the Sani people have become generic ethnic stereotypes. A local cultural village, the Ashima Culture and Art Company Ltd (Ashima wenhua yishu youxiangongsi), was planned for construction along the road linking Kunming and Stone Forest Park, outside Wukeshu. Construction was started in 1993 but stalled for lack of funds when several Hong Kong ﬁrms pulled out of the venture. This was a very ambitious joint-venture project, with a hotel (the ﬁrst thing to be built), a performance hall, an observatory, a museum, and an exhibition and sales hall for artisan handicraft production. Lunan County ofﬁcials saw the project as providing a boost to economic development and as a way of promoting ethnic arts and culture. The project was to have representatives of some twenty distinct Yi peoples drawn from three provinces. Local Sani commented that the company should either drop the name “Ashima,” if the project was to represent pan-Yi groups, or opt for local Sani culture as its focus of authenticity if it were to retain the Ashima title. A “living cultures village” may yet eventuate in Stone Forest. But in terms of an economy of meaning it is not clear who will sell, who will buy, and who will proﬁt from this marketing of Sani identity.

Conclusion This account of Stone Forest, in Lunan County, illustrates patterns of accommodation between state and society in the reform era.109 The local Communist Party has been central in economic reforms, leading the way in negotiating outside investments but continuing to control the process in the face of rising expectations and disparities. The state has removed itself from direct investment in some areas of economic growth by promoting joint ventures and local collectives, such as the Stone Forest General Corporation

Transnational impact on Yunnan 211 that was once Wukeshu village. This collective also raises questions about the possible development of civil society, as it works side-by-side with private family-based enterprise, such as the guest house, and state agencies including county government ofﬁces and the Tourism Bureau. New class identities based on connections, political power, and wealth accumulation, compound other local identities. Transnational opportunities, globalization, modernity, ethnic politics, regionalism and nationalism all blend into new local identity conﬁgurations. The commodiﬁcation of the identities of peoples and places erodes territorial integrity and cultural differentiation. At the same time, territorial myths or signiﬁers may be reinvented to support ethnic assertions of diversity. For example, to reach modern consumers the image of Ashima may be used to promote Lunan County, or be divorced from its local ethnic origin all together while signifying exotic, sexualized difference. Witness this message from Yunnan’s past and future. In 1993, the Kunming Chemical Factory billboard at Kunming South railway station carried an advertisement for their proprietary “Ashima” skin cream, featuring an image not of the “maid of stone,” but of an exotic 1940s Western blond pin-up. This image links contested identities in Yunnan, drawing from local group identities, regional meanings, national projects, transnational trade, and globalization in the frontier zone. The reconﬁguration of identities as commodities in the local marketplace reﬂects national and global trends to homogenize difference while diversity persists. China in the post-Deng era occupies a unique position in the global economy. The scale of the country has made a huge impact abroad, as a source of cheap labor and as a site of potentially massive consumption.110 Current lines of debate about the ways in which Chinese national identity conforms with the globalization of the country fall into several camps. Some scholars focus on culture, contending that Confucian ideology marks greater Chinese capitalism in speciﬁc ways, most notably as a national fraternity.111 Others contend that national culture is much less signiﬁcant in promoting China’s successful economic development within global capitalism, despite the maintenance of strict state controls over cultural production.112 Perhaps both trends are in effect. A culturally diverse provincial identity has been an important resource for Yunnan’s political economy in the reform era. Yet the state often conﬂates difference with widening socio-economic inequalities. Persistent deep poverty in the back country, especially among ethnic minorities, is attributed in state discourse to backwardness or lack of culture (wenhua luohou) – presumably referring to Confucian, Han, or modern culture. There is a homogenizing state factor, or as Ong has put it, a “reﬂexive modernity,” in which capitalism and Confucianism go hand in hand as systems that consume cultural difference. 113 As we have seen, transnational migration and trade though Yunnan have impacted on identities – ethnic, local, regional, provincial, and national identities – of the province and its peoples over time. The movement of

212 Margaret Swain peoples and goods has brought changing messages of civilizing projects, and changing access to resources, which have fed back in turn on to the ways in which people identify and organize themselves. Cyclical patterns of change are in the nature of frontier zones. They have shaped Yunnan as a center unto itself, located between the competing and cooperating centers of Beijing and neighboring Southeast Asian nations. China as a nation looks south to Yunnan. Yunnan itself looks further south, yet remains tied to the local and to the nation-state.

Notes * Research assistance by Eileen Otis is gratefully acknowledged. Support for ﬁeldwork presented in this paper was generously provided by the University of California Research Expeditions (1992), the Committee on Scholarly Communication with China (1993), and the Ford Foundation Project on Yunnan Mountain Poverty (1993, 1995). Note: part of this chapter is based on research published in M. B. Swain, “Native place and ethnic relations in Lunnan Yi Autonomous County, Yunnan,” in S. Harrell (ed.) Perspectives on the Yi Southwest China (Berkeley, CA: University of California Press, 2001), pp. 170–94, esp. pp. 186–8, © the Regents of the University of California; reprinted with kind permission of the University of California Press. 1 I. d’Hooghe, “Regional economic integration in Yunnan,” in D. S. G. Goodman and G. Segal (eds) China Deconstructs: Politics, Trade, and Regionalism (New York: Routledge, 1994), pp. 286–321. d’Hooghe’s introduction stresses Yunnan’s image of being “inaccessible,” backward and forbidding as fact for most of the time, except for several moments in history when Yunnan was part of the Southern Silk Road (early centuries CE, p. 296) and during the penetration of European colonialism in the early twentieth century. Information on contemporary trade, infrastructure, relations with neighboring provinces and countries presented in d’Hooghe is often similar (but updated) to that used in this paper. However, these data are approached distinctly. Rather than an economic analysis seeking answers to Yunnan’s potential for regional integration, this paper combines political economy with cultural analysis. It argues for a nuanced understanding of Yunnan’s identity as an enduring strength, a duality of remote/central images shaping negotiation with the center and local cohesion. 2 Typical of government publications, such as the Yunnan jingji nianjian 1994 [Yunnan economic yearbook 1994]. Academic writing, government sources and the popular press on Yunnan usually stress one image or the other of Yunnan. 3 D. S. G. Goodman, “The political economy of change,” in D. S. G. Goodman and B. Hooper (eds) China’s Quiet Revolution (New York: St. Martin’s Press, 1994), pp. ix–xxi. 4 D. S. G. Goodman, “The politics of regionalism: economic development, conﬂict, and negotiation,” in Goodman and Segal (eds) China Deconstructs, pp. 1–20. 5 A. Ong, “Anthropology, China and modernities,” in H. Moore (ed.) The Future of Anthropological Knowledge (London: Routledge, 1996), pp. 60–91. Ong draws attention to the central and coastal projects, but not frontier zones. 6 Goodman, “Politics of regionalism,” p. 11; S. Harrell, “Introduction,” in M. Brown (ed.) Negotiating Ethnicities in China and Taiwan (Berkeley: Institute of East Asian Studies, University of California, 1995), pp. 1–11.

Transnational impact on Yunnan 213 7 See T. Oakes, “Selling Guizhou: cultural development in an era of marketization,” in Hans Hendrischke and Feng Chongyi (eds) The Political Economy of China’s Provinces (London: Routledge, 1999), pp. 31–72; Harrell, “Introduction,” p. 2, provides a deﬁnition of ethnic group that is understood in this paper: “a group of people that shares a putative common origin through descent and a putative commonality of cultural features such as language, food, clothing, and customs that distinguish it from other ethnic groups.” 8 See S. Harrell (ed.) Cultural Encounters on China’s Ethnic Frontiers (Seattle: University of Washington Press, 1995). Contemporary separatist movements for independence as in Tibet and Xinjiang are not evident in Yunnan. 9 M. Aris, Lamas, Princes, and Brigands: Joseph Rock’s Photographs of the Tibetan Borderlands of China (New York: China Institute in America, 1992), p. 13. 10 P. Gaubatz, Beyond the Great Wall: Urban Form and Transformation on the Chinese Frontiers (Stanford: Stanford University Press, 1996), p. 13. 11 Cited in ibid., pp. 17–19. 12 Ibid., p. 44. 13 See Harrell (ed.) Cultural Encounters; J. Millward, “New perspectives on the Qing frontier,” in G. Hershatter et al. (eds) Remapping China: Fissures in Historical Terrain (Stanford: Stanford University Press, 1996), pp. 122–3. He suggests that the work of Chinese historians about peoples on the frontiers (and other social scientists) tends to be skewed by a national ethos and political restrictions, while Western scholars are of course also subject to the inﬂuence of present political and cultural concerns, such as ongoing struggles to deﬁne the position of minority groups. 14 J. Cole, “Competition and cooperation in late imperial China as reﬂected in native place and ethnicity,” in Hershatter et al. (eds) Remapping China, p. 63. 15 B. Swope et al., “Uncommon property rights in south-west China: trees and tourists,” in B. Johnston (ed.) Life and Death Matters (Walnut Creek: AltaMira Press, 1997), p. 44. 16 Yunnan sheng tongjiju (ed.) Yunnan tongji nianjian [Yunnan statistical yearbook], (Kunming: Yunnan Publishing House, 1995). [Hereafter YSY, followed by relevant year], p. 6. 17 This is below the national average of 10 percent. See d’Hooghe, “Regional economic integration,” p. 287. 18 YSY 1995. 19 YSY 1995, p. 71. Nationally, the urban population was 28.6 percent of the total population in 1994. Zhongguo tongji nianjian [China statistical yearbook; hereafter CSY] (Beijing: People’s Press, 1995], p. 59. In 1995, Kunming’s population was 3.8 million, close to 10 percent of the provincial total. See Provincial China (PC), no. 3 (1997), p. 108. 20 The term minzu translated as nationality or ethnic group will be used, following current Western scholarship. Many groups (some among the 28 branches or zhi of the Yi minzu for example), contest their classiﬁcation as members of a state constructed category or as nondifferentiated “Han.” The continued minzu shibie project, classifying minzu, moves slowly through the state hierarchy and is linked to various afﬁrmative action regulations. In 1991, 2.3 percent of the provincial population was categorized as “other” (qitazu). YSY 1992, p. 97. 21 YSY 1992, p. 50; YSY 1995, p. 7, 37, 46. What “autonomous” means in terms of cultural, political, and economic self-determination varies by time and location.

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24

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26 27 28

29

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The bottom line is that these regions are part of Yunnan and that Yunnan is part of the PRC, which regulates all citizens’ lives. d’Hooghe, “Regional economic integration,” p. 228, notes that more than 75 percent of Yunnan’s poorest counties are located in minority areas. J. Armijo-Hussein, “Sayyid ’Ajall Shams al-Din: a muslim from Central Asia, serving the Mongols in China, and bringing ‘civilization’ to Yunnan,” unpublished PhD dissertation, Inner Asian and Altaic Studies, Harvard University, 1996, pp. 103–4. Vogel, “Cowry trade and its role in the economy of Yunnan: from the ninth to the mid-seventeenth century,” Journal of the Economic and Social History of the Orient, XXXVI (1993), pp. 211–52, 309–53. There is a lack of agreement among scholars as to whether this cowry trade was indicative of a monetary system or not during the Dian culture era. Textual reference to cowry money use in Yunnan is not made until the ninth century in the Nanzhao kingdom. Vogel, “Cowry trade,” pp. 335–6, quotes a fascinating account from 1626, documenting how the “barbarians of Tien” were inﬂuenced into accepting cash over cowry, and the political signiﬁcance of Chinese rule over the frontier symbolized by the imposition of a Chinese money system. Using propaganda methods that sound much like those of the early PRC, ofﬁcials posted printed notices for urban literati, composed folk songs for the peasants, and lectured to intellectuals and political leaders. Cowry money became associated with backward minority peoples’ trade. The ultimate blow, literally, was a 1650 law decreeing that people using cowries faced the penalty of having their nose and feet cut off. Yunnan money distinct from national currency again circulated during the reign of Long Yun until the mid-1940s. Ibid., pp. 213, 237. Armijo-Hussein, “Sayyid ’Ajall Shams al-Din,” pp. 105–6. J. Lee, “Migration and expansion in Chinese history,” in H. McNeill and R. Adams (eds) Human Migration: Patterns and Policies (Bloomington: Indiana University Press, 1978), pp. 20–47. Gaubatz, Beyond the Great Wall, p. 7. In 799, the Nanzhou attacked and sacked Chengdu, but still continued to send tribute to the Tang court in Chang’an. Their complex relationship ended when the Tang cut off all relations with Nanzhou. Armijo-Hussein (op. cit.) has turned on its head the “more Confucian than the Han” argument applied to non-Han Chinese empire agents by a sinicizing historiography. She demonstrates that the civilizing project of Sayyid’Ajall had deep Central Asian Islamic roots complementing the Confucian project of the empire. Gaubatz, Beyond the Great Wall, p. 78. Armijo-Hussein, “Sayyid ’Ajall Shams al-Din,” p. 151. Gaubatz, Beyond the Great Wall, p. 79. Thus making this region something of a Chinese Australia. J. Lee, “Food supply and population growth in south-west China, 1250–1850,” Journal of Asian Studies XLI, no. 4 (1982), pp. 711–46. Lee reports (ibid., p. 714) that the courts provided tools, seed and draft animals, and invested in land to be cleared and irrigated. Ming law required that all government immigrants had to be married before going to the south-east in an apparent effort to head-off intermarriage with native groups. If no wife could be found, one was assigned from the female prisoner population. The fear of Chinese people “going native” was probably

Transnational impact on Yunnan 215

35

36

37

38 39

40 41

based on the reality of intermarriage resulting in ethnogenesis of “minority” groups, or at least re-conﬁguration. Certainly people re-constituted identities then, as now. For example, some Sani Yi refer to ancestors from Nanjing, and Chinese scholars recorded intermixing of Miao and Yi villages with Han soldiers in the seventeenth and eighteenth centuries. Lee, “Migration and Expansion,” pp. 38–9. Oral histories of groups such as the Hmong (Miao) peoples record long sagas from the far north down through Yunnan and into Southeast Asia. The Sani Yi record movement along three routes (two from Dali and one from the north) to Eastern Yunnan over 500 years ago. Use of the term “indigenous” is always problematic, and in the case of Yunnan usually means (1) was there ﬁrst, and (2) was not identiﬁed as Han Chinese. Chinese states drew the boundary lines. At the end of the twentieth century a number of minority minzu occupy the frontier zones of Yunnan and adjacent provinces and countries (for example, Guizhou: Miao; Sichuan: Yi; Vietnam: Yao; Laos: Akaha; Burma: Dai). Laurel Bossen, “Household, gender, and economic choice in Chinese villages: an anthropological perspective,” unpublished paper presented at the Association for Asian Studies Annual Meeting, 1994. This work comparing Yunnan and Hunan Han peasant communities is very instructive on this point. Bossen works in a Yunnan village ﬁrst studied in X. Fei, Earthbound China: A Study of Rural Economy in Yunnan (Chicago: University of Chicago Press, 1945). Lee, “Food supply,” has noted that non-Han populations were often not recorded or differentiated in census counts. C. Osgood, Village Life in Old China: A Community Study of Gao Yao, Yunnan (New York: The Ronald Press Company, 1964). Osgood believed that in 1938, the non-Han population far outnumbered the Han population in Yunnan, but gives no census data to conﬁrm. F. Hsu, Under the Ancestor’s Shadow: Kinship, Personality, and Social Mobility in Village China (New York: Columbia University Press, 1948). Hsu’s famous study presents its subjects as “Chinese peasants” living in the Lake Erhai region, Yunnan, as the ethnographer saw them, with virtually no mention of their Bai (minzu) ethnic heritage (and subsequent identity). The concession to build this line was given to France by China in 1898. For a detailed discussion of this railroad, its environment and related issues in Yunnan before construction was completed, see P. Vial, “De Lao-kai a Yun-nan-sen en chemin de fer,” Annales de la Société des Missions-Étrangères, no. 54 (1906), pp. 294–304, 321–42. Ong, “Anthropology, China and modernities,” p. 67. S. Harrell, “Civilizing projects and the reaction to them,” in Harrell (ed.) Cultural Encounters, pp. 3–36. There is a growing literature on many Yunnan minority minzu. It is not possible to inventory all of this scholarship here, so sufﬁce it to say that a good deal of interesting material is now available on Yunnan minority peoples. D. Solinger, Regional Government and Political Integration in South-west China 1949–1954 (Berkeley: University of California Press, 1977). G.Z. Zhao, “A model of decentralized development: border trade and economic development in Yunnan,” Issues and Studies (1996), pp. 85–108. Zhao notes that some of Yunnan’s major factories producing machinery, electrical equipment, and munitions were established at this time, but most factories shut down as the civil war escalated. See Osgood for a detailed description of the French railroad,

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42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60

61 62

63 64

aviation connections between Vietnam, Yunnan, and Chongking, and expatriate life in Kunming during 1938, as well as his village study. See Zhao, “A model of decentralized development,” pp. 87–8. K.H. Shih, China Enters the Machine Age (Cambridge, MA: Harvard University Press, 1944); Gaubatz, Beyond the Great Wall, p. 83. P. Hinton, “Growth triangles, quadrangles and circles,” Thai-Yunnan Project Newsletter no. 28, 3/95 (1995), internet, Australia National University. G. Moseley, The Consolidation of the South China Frontier (Berkeley: University of California Press, 1973), p. 34. Ong, “Anthropology, China and modernities,” p. 67. Solinger, Regional Government, pp. 57, 61–3; Moseley, The Consolidation, pp. 114, 119. Moseley, The Consolidation, p. 120. The Sani of Lunan Yi Autonomous County certainly ﬁt into this category of state expectations. Zhao, “A model of decentralized development.” Oakes, “Selling Guizhou.” Zhao, “A model of decentralized development,” pp. 89–90. Ong, “Anthropology, China and modernities,” pp. 68–70, 80. Cf. Provincial China, no. 3 (1997), p. 95. d’Hooghe, “Regional economic integration,” p. 288. J. Unger and J. Xiong, “Life in the Chinese hinterlands under the rural economic reforms,” Bulletin of Concerned Asian Scholars, 292 (1990), pp. 4–17. Ibid. S. Wang and V. Li (eds) Women’s Voice from Rural Yunnan: Needs Assessment of Reproductive Health (Beijing: Beijing Medical University, 1995). China Development Brieﬁng (Hong Kong: Asia Paciﬁc Social Development Research Centre), vol. 1 (1996), pp. 5–6. Yunnan Population Census, Manual Tabulations (1990), pp. 128–33; Wang and Li, Women’s Voice From Rural Yunnan, p. 236. He Pikun, Project Proposal of Investigation Task on Women’s Function in the Countryside Energy Construction of Yunnan (Kunming: Yunnan Provincial Forestry Institute, 1993). This proposal was submitted to The Ford Foundation in Beijing in 1993. H. Guo and C. Padoch, “Patterns and management of agroforestry systems in Yunnan: an approach to upland rural development,” Global Environmental Change, vol. 5, no. 4 (1995), pp. 273–9. This article outlines the Traditional Lands Management Systems Research Programme, funded largely by the Ford Foundation. Peter Huntoon, “Hydrogeologic characteristics and deforestation of the stone forest karst aquifers of South China,” Ground Water, vol. 30, no. 2 (1992), pp. 167–76. Contrary to belief that deforestation in China’s karst regions was a post-1958 phenomenon, many areas of Yunnan were completely devoid of trees by 1954 when government afforestation (the replanting of land which has not had trees for at least 50 years) efforts began. Unger and Xiong, “Life in the Chinese hinterlands,” p. 10. While construction in the core area has resulted in the destruction and replacement of many of Kunming’s old neighborhoods, there is some effort being made to preserve and refurbish heritage sites as well, such as the Cuihu Park. Oakes, “Selling Guizhou;” Table from CSY (1996), p. 21. YSY (1995), p. 307. The statistics used in this paper are presented by way of illustration, not as hard science.

Transnational impact on Yunnan 217 65 M. Swain, J. Momsen and F. Q. Yang, “Tobacco road,” unpublished manuscript, 1997. 66 Unger and Xiong, “Life in the Chinese hinterlands”; K. Huus, “Hazardous to health,” Far Eastern Economic Review (FEER), 25 July 1996, pp. 70–2. 67 Lee, “Food supply,” p. 741. This is a quote from a Qing ofﬁcial and observer of life in Yunnan. 68 d’Hooghe, “Regional economic integration,” p. 295. 69 For details, see d’Hooghe, “Regional economic integration,” and Zhao, “A model of decentralized development.” Zhao gives some interesting comparisons of interior and border economic growth indicators, and charts built infrastructure, savings deposits, and retail sales on the border. He does not however give any indications of the nature of this trade that is providing this income in a curiously antiseptic reading of one of Yunnan’s greatest issues, the drug trade and smuggling “black net.” See Zhao, “A model of decentralized development.” 70 L. Zheng, “Opportunities abound in Yunnan,” Beijing Review (BR), 10 February 1997, p. 21; A. Webb, “Preparing for Kunming,” China Trade Report (February. 1997), pp. 6–11. Webb gives higher ﬁgures of 1,460 projects and $4 billion. 71 Asian Development Bank, Economic Cooperation in the Greater Mekong Subregion: Facing the Challenges (Manila: Asian Development Bank, 1996). 72 B. Litner, “Enter the dragon,” FEER, 22 December 1994, pp. 22–24, 26. 73 G. Segal, “Deconstructing foreign relations,” in Goodman and Segal (eds) China Deconstructs, p. 333. 74 Hinton, “Growth triangles.” In terms of cultural identities, a concept of “growth circles” has been put forward by Southeast Asian intellectuals to counter the Euro-centric constructs of trade triangles or quadrangles, with an Asian point of view. Seeing history in cycles and working through connections (guanxi) does make sense, but there is little evidence that nation-states are going away. 75 C. McCoy et al., “No pain, no gain: establishing the Kunming China Drug Rehabilitation Center,” Journal of Drug Issues, vol. 27, no. 1 (1997), pp. 73–85. 76 M. Jaschok. and S. Miers, “Traditionalism, continuity, and change,” in M. Jaschock and S. Miers (eds) Women and Chinese Patriarchy (Hong Kong: Zed Books, 1994), pp. 264–7. 77 B. Henin, “Ethnic minority integration in China: transformation of Akha society,” Journal of Contemporary Asia, vol. 26, no. 2 (1996), pp. 80–200; M. Vatikiotis, “Tribal traders,” FEER 8 May 1997, pp. 36–8. 78 Swope et al., “Uncommon property rights”; H. Niu, “Tourism and environmental protection: A strategy for Lijiang Naxi Autonomous County, China,” unpublished MA thesis, Bangkok: Asian Institute of Technology, 1993; P. Howard, “Discussion with leaders of Lijiang Prefecture and County” (CIDA project, with Yunnan Academy of Sciences, building cooperatives) (Vancouver: Simon Fraiser University, 1993). 79 Webb, “Preparing for Kunming,” p. 8. 80 H. Chu, “In a push for tourism,” LA Times / Sacramento Bee, 13 July 1997, travel section, p. 6. 81 For an example of this objectifying kind of writing, see P. Hessler, “Into the past at China’s edge,” The New York Times, Sunday 11 May 1997, p. 8, travel section. 82 M. Yang, “Tradition, travelling anthropology and the discourse of modernity in China,” in H. Moore (ed.) The Future of Anthropological Knowledge (London: Routledge, 1996), pp. 93–5 (citing Anthony Giddons). The word “yichan”

218 Margaret Swain

83 84 85 86 87

88

89 90

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meaning ties to the past, heritage and legacy, is not an introduced word from the West, and may be applied to reinvented forms of Chinese identity. Ong, “Anthropology, China and modernities,” p. 62. Op. cit., p. 85. T. Solﬁeld and S. Li, “China: tourism development and cultural policies,” Annals of Tourism Research (in press). Oakes, “Selling Guizhou.” M. Swain, “Zhongguo xinan minzu chuantongde shangpinhua” [Commercialisation of minority traditions in south-west China], Minzuxue [Ethnology], vol. 3, no. 4 (1990), pp. 66, 67–9; Yunnan Provincial Academy of Social Sciences, Ethnology Research Division, Kunming, “Commoditizing ethnicity in southwest China,” Cultural Survival Quarterly, vol. 14, no. 1 (1990), pp. 26–9. Authenticity in handicrafts is not a consumer issue in Stone Forest, except for international, non-Han tourists. Otherwise, it is the name, the sign, the simulacra, not the thing that attracts and is sold/consumed. M. Kearney, “The local and the global: the anthropology of globalization and transnationalism,” Annual Review of Anthropology, no. 24 (1995), pp. 547–65. In 1992, there were 1.48 million visitors to Lunan scenic districts, while the park alone had 1.15 million of these visitors (including 104,800 international tourists), and earned ¥5.25 million (RMB). F. Wang, “Guanyu fazhan luyoushiye de qingkuang baogao” [Status report about the development of tourism enterprise] (Shilin: Lunan Yizu Autonomous County Tourism Bureau, 1993). Local tourism employment in administration is approximately 100 government agency employees. Yunnan International Non-Government Organization Society (YINGOS): A Brief Introduction (Kunming: np, 1993); Yunnan luyou tongji ziliao 1992 [Yunnan tourism statistical data for 1992] (Kunming: Yunnan sheng luyouju, 1993). Several Lunan sites indicate early human habitation. See Lunan Yizu zhizhixian gaikuang [Lunan Yi Autonomous County survey] (LYZG) (Kunming: np, 1986), pp. 27–9. Cave paintings have also been discovered near the Stone Forest. See He Yaohua, “Lunan minzu guanxi de lishi he xianzhuang” [History and status quo of national relations in Lunan], Yunnan Shihuikexue [Yunnan Social Sciences], no. 6 (1994), pp. 40–56. According to He, these paintings are the cultural heritage of primitive Lunan indigenous people who then mixed with in-migrating non-Han peoples from the north-west, and Chinese from central China, creating ancestors of the Sani people. He, “Lunan minzu guanxi,” p. 41. Some Sani lineages claim ancestors coming from Nanjing during the Ming Dynasty. Under the Ming in 1383, Lunan was incorporated into an hereditary land administrator (tusi) system which controlled non-Han people, in some cases until Liberation in 1949. Meanwhile in 1382, some 2,627 Han soldiers were sent into Lunan with their families to guard the city and cultivate agricultural land. Prisoners from central China were also sent down for agricultural work. Landlords were both Han and non-Han peoples now identiﬁed as Yi. According to government research, before Liberation some 7 percent of the population were landlords, who rented out 59 percent of the land. In some areas landlords experimented with improvements in agricultural and working conditions, and elsewhere coal mining developed. Han and Yi groups in Lunan have moved for water, conquered, rented or purchased lands in areas controlled by another ethnic group, and migrated for cash employment out of their home communities.

Transnational impact on Yunnan 219

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94 95 96

97 98

99

100 101 102

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LYZG op. cit.; P. Vial, “Miao-Tse et Autres,” Annales de la Société des MissionsÉtrangères (1908), pp. 15–32. He, “Lunan minzu guanxi,” p. 41. Of course it could also be argued, as Vial did (p. 22), that even if these groups were once one society, they have become separate ethnic groups over time. LYZG 1986, p. 31. Vial interpreted ethnic relations between the Sani and other local groups as being shaped by their socio-cultural “character” differences, as well as by the dynamics of political inequalities, and their physical proximity to each other. The relationship between Sani and Chinese was his primary emphasis. He rarely noted Sani relations with neighboring indigenous groups such as the Noeso (Nuosu) Lolo, Ashi (Axi) Lolo or Miao. Muslims allied with various indigenous groups including the Sani during their grueling twenty-year revolt, but they often became enemies according to Vial, “Miao-Tse,” p. 4. He cites Muslim treachery as the reason why there was so much post-revolt enmity between them, despite their common Chinese oppressor. P. Vial, Les Lolos: Histoire, Religion, Moeure, Langue, Ecriture (Chang-hai: Imprimerie de la Mission Catholique, 1898). Linguisitically, there are four sub-dialects of Sani language. Lieshi (martyrs) from the revolution are featured in Lunan wenshi ziliao [Historical materials of Lunan], issues 1 and 2 (1986). Possible correlation between tourism development of Stone Forest and the activities of the folklore production team during the 1950s is another issue to be investigated. Was the construction of the Ashima legend part of a planned process of making Shilin a major tourist attraction? J. Scott, Domination and the Arts of Resistance: Hidden Transcripts (New Haven: Yale University Press, 1990). G. Li (ed.) Ashima (Kunming: Yunnan People’s Press, 1960). The production team’s compilation process can be seen as state cultural imperialism, an example of “Han chauvinism” that Mao himself warned against, where the state group assumes from their privileged position and presumed cultural superiority that they should decide what is the authentic tale. When the people doing these things, by acting as guides or making Sani style artifacts for example, are Han, then a re-evaluation of minority value in the majority society can be posited. L. Schein, “Gender and internal orientalism in China,” Modern China vol. 23, no. 1 (1997), pp. 69–98, esp. p. 92. V. Adams, “Karaoke as modern Lhasa, Tibet: Western encounters with cultural politics,” Cultural Anthropology vol. 11, no. 4 (1996), pp. 510–46, esp. p. 537. The signiﬁcance of non-Han gender relations as a sign of an exotic, alluring and potentially dangerous “other” in Chinese ethnic relations and ethnic tourism in particular should be noted. See N. Diamond, “The Miao and poison: interactions on China’s south-western frontier,” Ethnology vol. 27, no. 1 (1987), pp. 1–25. There has been a Sani-Hanyu dictionary (1984) produced by the state in Yunnan, and Sani is planned to be taught someday as a model Yi regional language. However, there is little push to promote Sani as a distinct culture, other than at the commodiﬁed, folkloric level, and that has been mainly for foreign tourist consumption. Tourist signs in English and Chinese at Stone Forest have brieﬂy noted Sani culture in English, but leave it out in the Chinese versions. M. Swain, “Women producers of ethnic arts,” Annals of Tourism Research, vol. 20, no. 1 (1993), pp. 32–51; M. Swain, “A comparison of state and private artisan

220 Margaret Swain

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109 110 111 112 113

production for tourism in Yunnan,” in Alan Lew and Laurence Yu (eds) Tourism in China (Boulder: Westview Press, 1995), pp. 223–33. See Swain, “Women producers,” and Swain, “Comparison of state and private” for details, especially on Kunming trade not discussed here. Yunnan Sheng, Lunan Yizu zizhixian dimingzhi [Dictionary of Lunan Yi nationality place names] (Lunan: Lunan Yi Autonomous County People’s Press, 1989), p. 18. L. Li et al., “Maitou kugan zhong shixiao, shenggu kanhao ‘Ashima’” [Engaged in a great effort, merchants are relying on Ashima], Yunnan ribao [Yunnan daily], 6 March 1993. Ibid. One new possible opportunity is to migrate for work using their identity as a cultural commodity. With the advent of local ethnic tourism and mass tourism minority cultural villages in Kunming, Beijing, Shenzhen, and even Orlando, Florida, there is a new kind of “Sani sojourner.” For a few young men and women their authentic native place in the Stone Forest of Lunan is an important part of their work qualiﬁcations. Goodman, “Politics of regionalism.” W. Greider, “The real Chinese threat,” New York Times, 5 March 1997. A. Ong, “A momentary glow of fraternity: narratives of Chinese nationalism and capitalism,” Identities, vol. 3, no. 3 (1997), pp. 331–66. A. Dirlik, “Critical reﬂections on ‘Chinese capitalism’ as paradigm,” Identities, vol. 3, no. 3 (1997), pp. 303–30. Ong, “A momentary glow of fraternity,” p. 345. An example Ong gives is the consumption of feminized minority subjects in domestic ethnic tourism.

Chapter Title

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The political implications of Heilongjiang’s industrial structure Gaye Christoffersen

Introduction The economic reforms and opening in Heilongjiang Province have integrated the province’s economy into the north-east Asian regional economy, creating structures of interdependence, and subjecting the province to the boom-andbust cycles of trade with neighboring Primorskii Krai in Russia. Heilongjiang enthusiastically pursued the economic-opening policies, positioning itself as the entrepot to the lucrative Russian market and attracting Hong Kong investment with its policy of “link with the south, open to the north” (nan lian bei kai). This has made Heilongjiang a marketing center for a Natural Economic Territory (NET) that spans the north-east Asian region. Although the provincial government attempts to manage this regional economy, the NET’s economic space extends far beyond the political space of the provincial government. There was little provincial enthusiasm, however, for another program of economic reforms, industrial restructuring, and reform of the state-owned enterprise (SOE). Reform of SOEs would produce widespread worker layoffs and reduce the economic power of provincial party-state cadres, creating a lose–lose situation for both cadre and worker. From the provincial point of view, there have been few incentives to implement SOE reform. The focus of this chapter is on the politics of Heilongjiang’s economic reforms, opening, and industrial restructuring. The argument is that the north-east Asian regional political economy was a determining factor in how the province carried out industrial restructuring. The regional economy provided opportunities for windfall proﬁts to Heilongjiang after the collapse of the Soviet Union in 1991, which was followed by a sudden drop in SinoRussian border trade in 1993–4, putting the provincial economy in crisis. The local Russian government had imposed restrictions on Chinese shuttle traders crossing over the border into neighboring Primorskii Krai. This boom–bust cycle in Heilongjiang’s foreign economic relations required a provincial governmental response and led to restructuring of the province domestically, addressing the question of the optimum mix of state-owned enterprises (SOEs) and township and village enterprises (TVEs). State-owned enterprises were to be marketized and better integrated into the province’s border trade

222 Gaye Christoffersen

Heilongjiang Province

General GDP (billion yuan renminbi [RMB]) 289.74 GDP annual growth rate 7.50 as % national average 98.68 GDP per capita (yuan RMB) 7,660.00 as % national average 117.23 Population Population (million) Natural growth rate (per 1,000) Workforce Total workforce (million) Employment by activity (%) primary industry secondary industry tertiary industry Employment by sector (%) urban rural Employment by ownership (%) state collective private self-employed individuals Wages and Income Average annual wage (yuan RMB)

37.92 5.06 16.80 48.40 22.40 29.30 46.72 53.27 25.92 5.21 3.05 17.88 7,094.00

Growth rate in real wage 17.20 Urban disposable income per capita 4,595.14 as % national average 78.50 Rural per capita income 2,165.93 as % national average 97.99 Prices CPI [Consumer Price Index] annual rise (%) Retail Price Index annual rise Foreign trade and investment Total foreign trade (US$ billion) Exports (US$ billion) Imports (US$ billion) Realized foreign capital (US$ billion)

-03.20 -3.90 2.20 0.96 1.24 0.32

Education University enrollments 157,063 Secondary school enrollments (million) 2.36 Primary school enrollments (million) 3.10 Notes: All statistics are for 1999 and all growth rates are for 1999 over 1998 and are adapted from Zhongguo Tongji Nianjian 2000 [Statistical Yearbook of China 2000], Zhongguo Tongji Chubanshe, Beijing, 2000.

Politics and industry in Heilongjiang 223 with the Russian Far East by combining them with the TVEs into enterprise groups (qiye jituan). The outcome was determined by politics at three intersecting levels – intra-provincial, inter-provincial, and international. The crisis produced by the regional political economy occurred in conjunction with directives issued by Beijing in 1993 for a new push to more seriously reform SOEs with “pilot projects” in 111 cities that included Harbin, the capital of Heilongjiang. Reform measures meant privatizing SOEs by selling shares in them or selling them off entirely. The purpose was to eliminate their subsidies, which put a heavy burden on the central government’s budget and produced a large number of nonperforming loans. The state’s role was to shift from micro-managing SOEs to macro-economic management of the economy. It would require extensive worker layoffs. Because Heilongjiang’s provincial leadership had resisted marketizing the SOEs, an outsider, Yue Qifeng, was appointed provincial party secretary in May 1994, following a reshufﬂing of the previous provincial leadership. Yue had gained fame, if not success, as a reformer while governor of Liaoning from 1990 to 1994, when conservative provincial cadres had subjected him to severe criticism and blocked his reform policies.1 Undaunted by failure in Liaoning, Yue moved on to Heilongjiang, where he planned to restore the province’s market share in Sino-Russian border trade, reform the SOEs operating in the red, and promote the non-state sector of the economy – TVEs, rural enterprises, foreign-funded enterprises and private enterprises. The surplus workforce could be absorbed into the shuttle trade if it were revived. Yue promoted “growth points” in the provincial economy, a distributive policy that would beneﬁt numerous counties throughout the province but not necessarily advantage the larger cities where most SOEs were based. Yue’s reforms faced strong opposition and ruthless ideological attacks from provincial party hardliners in Heilongjiang, which he survived partially due to the backing of Zhu Rongji, Yang Shangkun and Li Tieying. There are several schools of thought on how Chinese industrial restructuring, involving reform of the SOEs, will eventually be accomplished. One school emphasizes the role of markets, expecting SOES to be gradually displaced by TVEs as TVEs come to constitute a larger share of GDP. No state intervention is needed, as SOEs will gradually evolve towards greater marketization in response to their environment, whether they are privatized or not. Another school expects the party-state to continually obstruct reform of SOEs.2 The party cadre/businessman manages SOEs to his advantage, using state assets to create economic power.3 TVEs also provide opportunities for the local cadre. Local-level cadres subcontract the use rights of public assets to private individual entrepreneurs, receiving in return a share of the proﬁts. Because entrepreneurs are so dependent on local government, they are susceptible to being squeezed through excessive taxation and demands for bribes. A counter argument to the thesis that the party-state obstructs reforms adopts an institutional approach, arguing that state intervention managed by

224 Gaye Christoffersen the Chinese Communist Party, rather than independent entrepreneurs, produced economic reforms. There is continuity and resilience in Communist bureaucratic authoritarian institutions that supported a planned economy prior to 1978, and economic reform after 1978.4 Thus, this line of argumentation expects that the party-state has the will to promote economic reform and the capacity to transform the industrial structure. A variation on the institutional thesis provides an analytical framework that takes provincial party cadre leadership as the independent variable and the strategies and implementation of economic reform as the dependent variable, arguing that variations in economic reform are accounted for by provincial party cadres.5 In this chapter we shall add an international factor to these arguments on domestic politics, and present an argument situated within the framework of international political economy. Chinese domestic industrial reform is not isolated from the north-east Asian regional economy. In previous studies of SOEs, the author found that China’s industrial structure was changing as a result of state-guided reforms inﬂuenced by China’s incorporation into a north-east Asian regional political economy.6 The formation of Chinese enterprise groups (qiye jituan) was modeled on the Japanese keiretsu and Korean jaebol. The trade and investment patterns of north-east Asia, including the Russian Far East, encouraged export-led strategies of development. Informed by that earlier analysis, this chapter considers an analytical framework focused on long-term structural transformations and social and economic changes in the regional political economy, that have both shaped the process of Heilongjiang’s industrial restructuring, and have had political consequences for provincial governance.

Heilongjiang: the background Heilongjiang has eleven prefectural-level cities and sixty-eight counties in an area of 450,000 square kilometers. The total provincial population is 37 million, with approximately 53 percent living in cities and townships and 46 percent in villages. Heilongjiang is very mountainous, leading to the provincial claim that it is “ﬁve parts mountain, one part water, one part grassland, and three parts farmland” (wu shan, yi shui, yi cao, san fen tian). The border it shares with the Russian Federation is 3,000 kilometers. The province has 5,000 kilometers of railways and 47,000 kilometers of highways. Ten rivers mark the province’s boundaries and traverse it, providing 4,700 kilometers of river transport. The most signiﬁcant cities are Harbin, Mudanjiang, Jiamusi, Sanjiang, and Qiqihar. Most of these cities were “railway towns” built along the trunk lines. Harbin was a railroad town that emerged at the juncture of the East Manchurian Railroad, the line built by Czarist Russia across northern Manchuria as a shortcut for the Trans-Siberian to its terminus in Vladivostok, and the Japanese-built South Manchurian Railroad. Thus the orientation of these cities is towards rail transport. They are not on the SinoRussian border and have attempted to compensate for this by placing the

Politics and industry in Heilongjiang 225 administration of border-trading counties under their jurisdiction. Most of the counties with border trade ports are on rivers. This area of northern Manchuria has traditionally been thought of as a region of swamps, steppes and forests, populated by “barbarian” tribes and by Juchen and Mongol nomads beyond the Great Wall. These Manchu lands became part of the Chinese empire with the founding of the Qing Dynasty. Russian imperial expansion towards the Paciﬁc Ocean forced the Qing to deﬁne the boundaries of the region in the Treaties of Aigun and Peking (1858–60), using the Amur River (Heilongjiang River) as the northern boundary and the Ussuri River as the eastern boundary. Russian hegemony continued over this region, leading the Qing court to permit Han Chinese settlement to help secure the area from further Russian encroachment. Prior to this, Han Chinese had been prohibited from migrating there, to protect Manchu cultural identity. Russian inﬂuence continued into the twentieth century as thousands of White Russians settled in Harbin after the 1917 Bolshevik Revolution. In 1932, Japanese hegemony displaced Russian with the creation of the Manchukuo puppet state, resulting in an inﬂux of Japanese military and economic administrators and Korean forced labor. This cultural heritage is apparent in Heilongjiang today, but the ethnic heritage less so, due to processes of Siniﬁcation and Han migration. The Manzu (Manchus) are considered the largest minority with 1.18 million, Koreans 450,000, the Hui (Muslim Han) 140,000, and the Mongolians 140,000. The indigenous tribes are very few: Daur 40,000, Sibo 9,000, Oroqen 3,500, Owenk 2,500, Hezhen 3,700, and 1,500 Kirgiz.7 Persons of mixed Chinese–Russian or Chinese–Japanese heritage the author has met tend to identify themselves as Han. Within a total provincial population of 37 million the minorities are not numerically signiﬁcant, although administratively there are one minority autonomous county, eleven minority townships, and ﬁfty-eight minority villages. Heilongjiang Province has since 1949 been deﬁned by its industrialization and economic development strategies. In the early years of the PRC, Heilongjiang was an industrial leader, known as the ﬁrst province to enter the planned economy in the 1940s (a claim contested by Liaoning). Heilongjiang beneﬁted from the First Five-Year Plan and Soviet assistance in developing heavy industry and SOEs, building on the industrial base left by the Japanese. It was part of the country’s industrial heartland. There was strong Russian inﬂuence during the 1950s in the province and ﬂourishing border trade. After the Sino-Soviet split, the province became an inner border region cut off from the outside world. The Cultural Revolution contributed to the province’s own unique subculture of a pioneering spirit, captured in the phrases “the Daqing spirit” of self-reliance, “the spirit of Iron Man Wang,” and “the spirit of the Great Northern Wilderness.” The latter term refers to the massive land reclamation project in the swamps to which many intellectuals were sent during the Cultural Revolution. They would later produce a literature of the Great Northern Wilderness. Daqing is an oil ﬁeld discovered with Soviet

226 Gaye Christoffersen assistance in the 1950s, which was extolled as a model of self-reliance after the Sino-Soviet split in the 1960s, and became the main source of oil exports that earned hard currency for China’s opening up in the 1980s. In the 1990s, Heilongjiang was known as the “last province to retreat from the planned economy” (a claim also made of Liaoning). While the national economy was the fastest growing in Asia, Heilongjiang SOEs grew only 0.75 percent from 1989 to 1994, earning them the label of an unreformed “industrial rust belt.” During the economic reforms, Heilongjiang has prospered from the Sino-Russian border trade carried out primarily by TVEs. In 1997, Hong Kong was the main source of foreign investment (51 percent) in Heilongjiang, much of that investment going into border-trading companies. Hong Kong investors use Heilongjiang as a base to access the Russian market. South Korea accounted for 9 percent, the United States 12 percent, and Taiwan 7 percent, while Japan accounted for only 4 percent of foreign investment. Yue Qifeng claimed the province based its business strategy on teamwork with Hong Kong. This has been captured in the phrase “link with the south and open to the north,” a strategy that has, as we have noted, embedded Heilongjiang into the regional economy.

Heilongjiang’s border ports Mudanjiang Mudanjiang is the largest city located in the south-eastern part of Heilongjiang Province, and thus is in charge of the border port cities of Ningan, Suifenhe, Muling, Hailin, and the counties of Dongning and Linkou. The consolidation of the governance structure, with the city in charge of surrounding counties, occurred early in the economic reforms in September 1983. The total population of Mudanjiang and surrounding suburbs is 2.57 million. The population within the city proper is 0.073 million. The city’s goal is to become an international trade city by virtue of its location as the axis of the fan-shaped opening made from Mishan, Hulin, Suifenhe, and Dongning in Heilongjiang Province, and Hunchun in Jilin Province. Mudanjiang proclaims itself a center of regional trade on the road between Harbin and Niigata, Japan and the rest of the Asia-Paciﬁc by way of Vladivostok.8 During the height of Sino-Russian cooperation in the 1950s and early 1960s, the rail infrastructure passing through Mudanjiang was a well-trafﬁcked route for civilian trade. During the Sino-Soviet dispute, its uses were primarily military. With the resumption of Sino-Soviet trade in the 1980s, most goods traveled by rail, crossing into Russia at Suifenhe. The Mudanjiang branch of the railway bureau is in charge of the HarbinSuifenhe line, the Tumen-Jiamusi line, and several others. The US-Russia Commission, formerly called the Gore-Chernomyrdin Commission, developed an interest in this transport corridor as a project for US–Russian–Chinese trilateral cooperation.

Politics and industry in Heilongjiang 227 The Mudanjiang Customs Ofﬁce, set up in 1990, manages foreign trade for Mudanjiang City, Jixi City, Mishan City, Hailing City, Ningan City, Linkou County, Muling County, Hulin County, and Jidong County. The Customs Ofﬁce is responsible for control of imports and exports, assessing the proﬁt tax, searching for smugglers and Customs statistics. In 1996, Mudanjiang claimed exports valued at US$22.3 million. The largest export destinations were Japan (US$8.7 million) and Russia (US$4.6 million). Exports to South Korea, Singapore, Hong Kong, the US and Saudi Arabia were valued at less than US$1 million. The city is developing its relationship to the Tumen River development project as a distribution and communications hub between Tumen and Jiamusi, between Harbin and Suifenhe, and between Hegang and Dalian. Mudanjiang’s international orientation is towards the “north-east Asian Economic Circle,” both the Tumen River Development project supported by UNDP and UNIDO, and the Japan Sea Rim project based in Niigata. In 1994, the municipal government of Mudanjiang created “The Greater Mudanjiang Development Plan” to map out Mudanjiang’s role in the northeast Asian circle with an economic zone that encompassed Mudanjiang, Vladivostok, and Chongjin in North Korea. The plan’s goals were for the city to invest in infrastructure – including railways, highways and telecommunications – and to ﬁnd a specialized niche for the city in regional trade. In the same year, the central and Heilongjiang provincial governments were investing in regional telecommunications, but most of their investment centered on Harbin – providing, for example, optical-ﬁber cable links from Beijing, through Shenyang, to Harbin and Qiqihar, and a digital microwave channel from Shenyang through Changchun to Harbin.9 These projects promoted integration of the north-east, and linked the north-east to Beijing, but largely bypassed Mudanjiang. Suifenhe There are parts of Suifenhe architecturally similar to Harbin and Vladivostok, visible reminders that it was created as a railroad town on the Eastern Manchurian Railroad. At that time, international trade with nineteen countries passed through the town, earning it the name of the “national border commercial capital” (guojing shangye dushi).10 It has been a trading port for almost 100 years and is Heilongjiang’s main trade port for trade with the Commonwealth of Independent States. The Suifenhe Border Trade Bureau is a municipal department which had a staff of thirty-ﬁve people and twenty-ﬁve sections in 1992. This foreign trade department is the only organization in the city said to have the right to conduct border trade. The Border Trade Bureau also functions as a company, setting up joint ventures with more than 200 enterprises from other provinces and cities in China and granting them trading rights, for which it collects tariffs based on trade volume. The Heilongjiang Provincial Border

228 Gaye Christoffersen Bureau collected ¥410 million in tariffs and taxes during 1989–92, and ¥300 million in proﬁts from its border trade enterprises. Suifenhe’s annual revenue in 1992 was approximately ¥26 million.11 The provincial and central governments are represented by several units: the Suifenhe Customs Ofﬁce, the Suifenhe Branch Ofﬁce of Foreign Transportation, the Suifenhe Commodity Inspection Bureau, the Suifenhe Sanitation and Quarantine Station, the Suifenhe Quarantine Institute for Animals and Plants, and the Suifenhe Frontier Inspection Station. Despite the numerous departments represented, which creates opportunities for too many inspections and assessments of fees by each level of government, Suifenhe is considered the model of efﬁcient, coordinated processing of goods. The city has invested ¥900 million in transport and telecommunications infrastructure and built a large inspection building at the train station, where inspectors, Customs ofﬁcers, and commodities inspection personnel jointly process the goods and traders passing through. The inspection room is now computerized and the thirty-two procedures required of border inspection ofﬁcers have been simpliﬁed. The China Council for the Promotion of International Trade (CCPIT) had established a Suifenhe branch that maintained contacts with its counterpart in Vladivostok. A law ofﬁce in town specializes in foreign trade and maintains contact with a Russian law ofﬁce in Vladivostok. Suifenhe could by 1996 efﬁciently process 1 million tons of cargo and 500,000 persons annually.12 According to Suifenhe’s mayor, due to the modern infrastructure and numerous government agencies represented, the city had cracked down on fake and poor quality goods and closed more than 1,000 companies in 1996. Dongning County Although border trade began much earlier in Dongning County, it was formally opened as a trade port in 1990. Dongning now claims to manageone third of Heilongjiang’s border trade, to have contact with 900 companies in many countries, including 878 registered companies from Russia. Its prosperity derives from its close proximity to Hunchun, Suifenhe, and Vladivostok.13 Dongning has especially beneﬁted from the Russian Far East’s trade in used Japanese automobiles. Although the auto trade is run by local Russian maﬁa groups and is not completely legal, Dongning is held up as a model border port county. Heihe Heihe is one of the primary border ports to Russia. The city is on the Heilongjiang River, situated across from Blagoveschensk on the Russian side. In the early 1990s, the railway from Beian to Heihe was reopened to facilitate trade. Border traders use the frozen Heilongjiang River as an ice bridge during the winter and depend on ferries during the summer. A bridge

Politics and industry in Heilongjiang 229 between Heihe and Blagoveschensk to facilitate trade has been delayed by local Russians fearful of Chinese illegal migration. Heihe’s trade with Russia in 1994 decreased 81 percent over 1993, but then increased somewhat in 1995. Heihe had linked 3,000 Chinese enterprises with 700 CIS enterprises. Responding to the slump in border trade, the city of Heihe has established a trade promotion council, an international chamber of commerce, and an arbitration commission to mediate in border trade disputes. Heilongjiang Province claims its border trade accounts for two-thirds of total border trade in China and one-third of China’s trade with the CIS. Heilongjiang has continued to compare itself with Guangdong since it ﬁrst opened its borders, using slogans such as “Shenzhen in the south, Heihe in the north” as early as 1985. By 1996, Heilongjiang had twenty-four border ports, giving the Sino-Russian border a porosity that seemed excessive to the Russians but allowed Heilongjiang to claim it ranked second in the country only behind Guangdong. Of those twenty-four border ports, only about sixteen were actually open in 1998.14 The number of counties engaged in border trade is surprisingly large, most of them situated on the Sino-Russian border and only accessible by truck, along a road that parallels the Sino-Russian border. Rail lines only cross the border at Suifenhe and Manzhouli (which is actually in Inner Mongolia). Older trade routes, branches of the Silk Road, had passed through northern Heilongjiang, as evidenced by the Muslim mosques in Qiqihar. Although the trafﬁc across the border is difﬁcult to estimate, some provincial data suggest that every year there are 1.54 million crossings by people, 100,000 by motor vehicles (trucks, buses, cars), 16,000 ships, and 1,490 planes passing through Heilongjiang’s borders and ports. The ﬁgure of 1.54 million crossings does not mean that more than 1 million people enter the Russian Far East each year. There are an estimated 100,000 Chinese in Heilongjiang engaged in border trade who make multiple crossings annually. Central, provincial, and local city/county governments administer this border trafﬁc unevenly and sporadically.

The regional context of development North-east Asian multilateral regime formation in the 1990s produced several different models. This presented a number of options. Would the regional regime follow a more closed pattern or a more open pattern? Would the international division of labor be structured on the vertical, ﬂying-geese pattern with Japan on the ﬁrst level, South Korea on the second level, and with China and Russia on the third level? This was the old division of labor, which Heilongjiang wanted to replace with a horizontal division of labor. The concepts of “growth points” (zengchang dian) and “growth regions” (zengchang qu) were the most important issues bearing on the development model. The regional division of labor would be more horizontal, or equitable,

230 Gaye Christoffersen if there were many “growth points” rather just one “growth region” based in Jilin and dominating north-east Asian regional cooperation. One Harbin author argued that Harbin, Hunchun, Dalian, and Haixianwei (Vladivostok) were “growth points,” and that the Tumen River Delta was the “growth region.”15 This placed both Harbin and Vladivostok as important participants in north-east Asian regionalism rather than peripheral to a Tumenfocused project. In January 1993 Governor Shao Qihui presented a government work report to the provincial people’s congress, characterizing the 5 years from 1988 to 1993 as ones of “linking with the south, opening to the north.” This term in fact dates back to the mid-1980s, when it generally referred to TVEs with heavy Hong Kong and Taiwanese investment. The domestic target of this strategy was to reform the agricultural structure, expand the service sector, and reduce the heavy industrial sector in the province. The plan was to shift the ratio between primary, secondary, and tertiary industries from 21:54:25 in 1992 to 18:45:37 in 1997, with a target of 15:40:45 by 2000. The value of imports and exports was expected to account for 30 percent of the province’s GNP by 1997 and 40 percent of GNP by 2000. Governor Shao suggested that proﬁts from the TVEs should be distributed according to a ratio of 7:2:1 rather than provincial and central government tax bureaus “killing the hen to get the eggs.” Successful TVEs had proﬁts from border trade subjected to spontaneous and excessive taxes and fees levied on them by ofﬁcials. Between 1989 and 1993, the Heilongjiang provincial government had signed general framework agreements of cooperation with all the local Russian governments in contiguous territories. Private businesses, individuals and county-run TVEs, however, carried out actual economic cooperation and trade. The Ministry of Foreign Trade and Economic Cooperation (MOFTEC) was responsible for jointly monitoring border trade with the Heilongjiang Provincial Committee for External Economic Relations, but it appeared that in many cases nobody managed the chaos that was border trade in the early 1990s. On the Russian side, the local governments lacked the means to supervise the thousands of Chinese shuttle traders as they came across the border. The author, living in Vladivostok at that time, remembers local Russian hostility so intense to potential Chinese migration that on average two Chinese shuttle traders were killed (or at least disappeared) each month. When Primorskii Krai introduced more stringent visa restrictions for Chinese in mid-1993, the territory stemmed the ﬂow of Chinese immigrants and shuttle traders into the Russian Far East, with Moscow adopting the more restrictive policy at the end of 1993. Russians claimed that the participating countries in north-east Asian economic cooperation projects, the US, Japan, and South Korea, were colluding with China to undermine Russian sovereignty in the Russian Far East through massive Chinese migration, primarily shuttle traders.16 In April 1993, Heilongjiang’s vice-governor in charge of foreign economic relations, Wang Zongzhang, attempted to explain to Hong Kong investors

Politics and industry in Heilongjiang 231 via a Hong Kong reporter the strains that were emerging in Sino-Russian trade. Barter trade had beneﬁted the province, as Heilongjiang could barter its agricultural products and consumer goods for Russian raw materials, equipment and machinery, especially suited to the aging industrial plant in the province’s SOEs that were built by the Russians in the 1950s. Companies from outside Heilongjiang, approximately 8,000 from Hong Kong, Taiwan, and the coastal provinces, were blamed for exploiting Primorye’s dependence on Chinese commodities, reaping enormous proﬁts and producing a local Russian backlash. The outsiders had cut into Heilongjiang’s share of the Russian market. In response, Heilongjiang needed to expand into other markets, especially through north-east Asian transnational economic cooperation. Speciﬁc measures included assigning responsibility for Sino-Russian border trade to the large and medium SOEs, improving the organization and planning of economic and trade cooperation with Russian counterpart cities (rather than leaving it to independent trading companies), and designing 110 large projects for cooperation that would use the “project responsibility system” at the provincial, prefecture and city level.17 With these measures, the provincial government hoped to better manage tripartite cooperation between the province, Russia, and foreign investors from Hong Kong, South Korea, and Japan. At a symposium co-sponsored by the State Council’s Development Research Center in January 1994, Harbin introduced “The north-east Asian Great Strategy,” a development plan to make Harbin a key trade center in north-east Asia by 2030. Harbin viewed itself as entering a competition with other cities within the “North-east Asian circle.” Internationally, Harbin competed with Tokyo. Domestically, Harbin competed with Shenyang, Dalian, and Changchun.18 Within Heilongjiang, Harbin competed with other cities, especially Mudanjiang, to be the “dragon’s head” (longtou) of border trade. The Tumen River Development Program (TRADP) is Beijing’s preferred program for north-east Asian economic cooperation and integration. Beijing had designated Jilin Province’s Hunchun as the centre of north-east China’s participation. An alternative centre was created in the Yellow Bohai Sea Rim (YBSR) concept that included all the same countries but by focusing on the Bohai, privileged Liaoning and included Shandong. Liaoning claimed the YBSR to be the gateway to north-east China and that Liaoning should play an even greater role in north-east Asian economic regionalization because of the province’s industrial base, technological strengths, and ports. Liaoning had reorganized its SOEs into export-oriented enterprise groups that would make the province more competitive internationally.19 Japanese investment had favored the YBSR, which took 71 percent of total Japanese investment in China in 1987 and 44 percent in 1991.20 It was Liaoning’s intensive and developed economic cooperation with Japan, Liaoning scholars argued, that should bestow a special status on the province in north-east Asian economic cooperation and the Japan Sea Rim

232 Gaye Christoffersen grouping.21 Liaoning’s larger and more developed industrial base gave China a better position within the international division of labor in the Bohai Rim than Jilin would in the Tumen project.22 Jilin scholars argued that China’s resumption of GATT (WTO) membership would inﬂuence north-east Asian economic cooperation for the better by removing the preferential policies enjoyed by border trade in Heilongjiang. The Tumen project centered on Hunchun in Jilin would be a “dragon’s head” or growth triangle for northeast Asia.23 Such signs of a “struggle between three provinces” provoked a response from Beijing designed to integrate the north-east more closely. It helped devise a north-east regional plan for domestic infrastructure development that appears to mark a compromise between the three provinces. It promised beneﬁts dispersed throughout north-east China. Driven by the Tumen project, the plan called for “three strips and one zone.” The ﬁrst is a coastal strip that stretches from Dandong to Shanhaiguan (where the Great Wall meets the sea). The second strip is a region along north-east China’s border, stretching from Mongolia to Liaoning, beneﬁting all the cities and counties with border ports. Altogether there are thirty-six cities and counties along north-east China’s borders in all three provinces and eastern Inner Mongolia that are encouraged to open to neighboring countries. The third strip starts at Dalian, extending along the railroad to Harbin in the north (the old South Manchurian Railroad), and beneﬁts all the inland cities on the railway. The Western Resources Zone, a raw materials base for north-east China, incorporates eastern Inner Mongolia, Chaoyang City in Liaoning Province, Baicheng Prefecture in Jilin Province, and Daxinganling area of Heilongjiang Province.24 One aim of this development plan was to break up provincial administrative separation in north-east China to better distribute trade beneﬁts, integrate the regional economy and form a uniﬁed regional market. TRADP’s former program manager noted that China’s commitment to TRADP, after reassessment, had shifted. Domestic development throughout north-east China took priority, and took into account the impact on border regions along the entire periphery rather than focusing solely on the Tumen area.25 Beijing’s strategy was also intended to develop a regional economy rather than three provincial economies, and to better coordinate the opening of China’s north-east towards the north-east Asian regional economy. It appeared more rational to coordinate development of infrastructure projects on a regional basis and to establish a regional banking system than to allow each province to independently open to the regional economy, competing with each other. The objective was to make north-east China’s economic policies consistent.26 Ofﬁcials from the three provinces met in September 1996 to hear the guidelines issued by the State Council for integrating the regional economy during the Ninth Five-Year Plan, and readjusting its industrial structure as the center of the north-east Asian economic zone. The three provinces would

Politics and industry in Heilongjiang 233 be required to cooperate with one another to form a supra-provincial coordination organization.27 The inspiration and underlying logic for economic integration of the three provinces come from various projects for north-east Asian economic cooperation, especially the Tumen project. According to the logic of Tumen, within the north-east Asian zone “growth points” accumulate into “growth lines” that transcend provincial boundaries and national boundaries. Growth lines could be development projects along railways, roads, or gas pipelines. The projected “growth axis” of the north-east Asian zone is the “Harbin– Dalian axis” which would begin as a growth line intersecting with other growth lines. Eventually, growth lines and axes would merge into a growth network spanning north-east Asia with China’s north-east as its center.28 Whatever Heilongjiang’s provincial strategies might be, it was clear that Beijing would impose a north-east supra-provincial strategy that would subordinate the province’s priorities. The reorganization of the banking system in late 1998, replacing provincial branches of the People’s Bank of China in each province with regional banks, meant that provincial cadres could no longer pressure the provincial branch of the bank to make loans to their SOEs, contributing to the bad debt of local banks. The regional bank for China’s north-east was based in Shenyang, beyond Harbin’s control. This was designed to remove a major impediment to reform of the province’s industrial structure.

The provincial consolidation of border trade Border trade through Heilongjiang had initially been concentrated in the four SEZs, especially Heihe, Suifenhe, and Dongning, creating unbalanced development in the province. The four-zone strategy was Heilongjiang’s response to the State Council’s “Notice on further opening of Heihe and the four border cities” (Jinyibu duiwai kaifang heihe deng si ge bianjing chengshi de tongzhi).29 Voices within the province advocated extending beyond the four SEZ border openings in a distributive policy to promote greater equity in disbursement of trade beneﬁts to counties along the 3,000 kilometer border and to cities not on the border.30 They placed no restrictions on who could participate in border trade. The current politics of remembering in Heilongjiang portrays the Soviet Far East as a source of scientiﬁc and technological knowledge that helped develop the technologically backward regions along the Heilongjiang, the Songhuajiang and Ussuri Rivers. Exports and imports in Soviet border trade in Heilongjiang reached their peak in 1959, with a total value of ¥35 million. Border trade stopped in 1968, several years into the Sino-Soviet split. In October 1982, Heilongjiang sent a delegation to the Soviet Far East to discuss a trade agreement, which was followed by a Soviet delegation visiting in April 1983 to sign a trade agreement. The total value of trade in 1983 was ¥21 million.31 The ﬁrst border towns to open, Heihe, Suifenhe, Hunchun, and

234 Gaye Christoffersen Manzhouli, are the largest and most developed. Eventually Heilongjiang opened twenty-four border ports. During the 1980s Harbin’s economy beneﬁted from the expansion of township and village enterprises (TVEs) although they produced poorquality goods, had limited investment, and lacked advanced technology. Forming the TVEs into enterprise groups was suggested as early as the 1980s as a means to rationalize their production.32 Sino-Soviet border trade was primarily expanded through the activities of individual shuttle traders and TVEs. After the Soviet economy disintegrated, the Russian Far East was thrown into crisis when it lost its supply line from European Russia, which it had depended on for half its food and consumer goods. This unmet demand made Russian Far East markets enormously proﬁtable for Chinese enterprises. Every province in China had a trading company in Suifenhe to proﬁt from this booming market following the strategy of “connecting with the south and opening to the north,” which Heilongjiang had hoped to use for industrial restructuring and rationalization.33 Heilongjiang’s view of how China participates in north-east Asian cooperation divides China and its foreign links into three economic regions: (1) the southern region encircling the Sea of Japan and including the Tumen River area; (2) the northern region stretching from Ulan Bator to North China; and (3) the north-east region of Heilongjiang, Jilin, and the Russian Far East, including Japanese and South Korean ports on the Sea of Japan. The southern region represents Sino-Japanese and Sino-Korean cooperation, the northern region represents Sino-Mongolian cooperation, and the northeast region represents Sino-Russian cooperation.34 This segmentation into several regions makes Harbin the center of China’s participation in north-east Asian cooperation as Harbin sought the role of “dragon’s head” (long tou) growth center. Border port cities, such as Heihe and Suifenhe, played the role of “linking spaces” (kongjian jiehe bu) for Heilongjiang’s participation in the north-east Asian economy. These transnational economic zones reﬂect local-global linkages as they draw in investment and technology from other countries to become the “centers and hot spots” of regional cooperation.35 The inland cities – Qiqihar, Mudanjiang, Daqing, Shangyashan – were each assigned a specialization in exports. Daqing would become a petroleum reﬁning and chemical center in north-east Asia. Mudanjiang specialized in used cars and trucks imported from Russia. The dragon metaphor attempts to give every city and border county a role in border trade. If Harbin was the “dragon’s head,” the twenty-four border checkpoints (or “frontier belt of openness”) were the “dragon’s wings,” and the larger provincial cities were the “dragon’s body.” The “dragon” was connected by air, rail, and road transportation. The Heilongjiang provincial government promoted Sino-Russian border trade as the core of north-east Asian cooperation but border trade was conducted by 8,000 private enterprises, small traders with shoddy and fake goods. Food exports were sometimes poisonous. There was insufﬁcient

Politics and industry in Heilongjiang 235 control by the provincial government. Local Russian resistance to Heilongjiang’s border and barter trade caused exports to drop in 1994, about 45 percent in the ﬁrst half of the year after which exports rose leaving the annual export volume 21 percent lower than 1993. The provincial government considered shifting border trade from small traders to large SOEs, and creating structures of regional cooperation with the Russian Far East rather than let market forces control this trade. A conference held at this time to discuss Sino-Russian border issues and trade friction witnessed representatives from both Moscow and Beijing request of the other government that it strengthen state control in the border regime in a mercantilist direction. Beijing asked the Russians to adopt a more rational trade policy for the border with better policy coordination between Moscow and Primorye. Moscow requested border trade be shifted to SOEs from individual traders who had provoked local Russian hostility. Both sides wanted more state initiatives, state funding, and SOEs forming joint ventures.36 It was apparent that the provincial economy was overly dependent on the Russian market, which could be closed off suddenly and arbitrarily. The provincial government responded by shifting from barter trade to standard monetarized trade in hard currency according to international practices; exercising greater macro-economic control over export businesses; consolidating thousands of small export businesses with large SOEs into enterprise groups (qiye jituan); the licensing of a few large trading companies as “dragon’s heads” to manage exports from the enterprise groups; and developing a belt of free-trade zones along the Sino-Russian border to attract investment from Japan, ROK, Hong Kong, and Taiwan. What remained constant was the goal to economically integrate better with south China by “linking with the south and opening to the north.”37 Heilongjiang’s provincial government proposed that border trade be shifted to state enterprises and enterprise groups because it would increase provincial revenue collection. Enterprise groups would better link provincial production with overseas trade. The slump in border trade gave the province an opportunity to reorganize and rationalize its overseas enterprises, which had expanded chaotically from the ﬁrst overseas enterprise in Hong Kong in 1984 to 450 in the following decade. Enterprise groups had begun forming in the 1980s and by 1994, 270 enterprise groups existed of which 159 were owned by the state, 36 by shareholders, 9 by townships or villages, and 3 owned by private businessmen. Of these, 102 enterprise groups were authorized to import and export.38 In 1994, Vice Governor Wang Zongzhang announced plans to reorganize these overseas operations into ten large enterprise groups (conglomerates) between 1994 and 1997. These enterprise groups would be better able to conduct transnational business, and have better market information, along with the ability to maintain a stable market share for Heilongjiang’s exports.39 Heilongjiang’s organization of enterprise groups was part of a national

236 Gaye Christoffersen program to restructure Chinese industry, modeled on the Japanese keiretsu and Korean jaebol. An enterprise group is expected to better integrate industrial enterprise with trading and ﬁnancial companies, making SOEs more export-oriented.40 Heilongjiang was reorganizing domestically for expansion overseas. This restructuring was carried out in every industry that produced for foreign markets – petroleum, electronics, textiles – and in every province that had shifted to export-led growth during the economic reforms. The difference with Heilongjiang was that the province was not originally designated to participate in export-led growth as the coastal region had been. This shift to state-controlled enterprise groups was opposed by some local interests who touted the beneﬁts of smaller transnational companies that were more ﬂexible and better able to respond to changing markets in border trade. The provincial party committee and the provincial government had helped these smaller companies.41 The previous policy on border trade, State Council Document no. 33, was nulliﬁed because of lax controls. In March 1995, the Ministry of Foreign Trade and Economic Cooperation (MOFTEC) issued a report deﬁning China’s trade strategy towards the Commonwealth of Independent States. MOFTEC’s goal was to regain market share in Russia that had been lost, and create a more positive image through greater governmental control in China over Chinese traders and investors, more thorough inspection of Chinese exports and regulation of Chinese entering the CIS. Within Russia, MOFTEC would expand consulate staff to coordinate Chinese trade and investment, ﬁnd joint-venture partners for Chinese businessmen, and protect Chinese investors. An ofﬁcial advisory commission would use information from the consulates to advise SOEs on CIS markets. The central government would limit the number of SOEs and direct their operations in the CIS. The report indicated the extent to which Beijing would be intervening in Heilongjiang’s business activities in Russia.42 The individual entrepreneur could no longer transact business deals in the CIS indifferent to the consequences to Sino-Russian relations. MOFTEC, also in early 1996, formulated a new border trade policy to better supervise and bring local practices up to international standards, known as State Council Document no. 2. Border trade would continue to have preferential treatment, a 50 percent reduction in customs duties, within the framework of the WTO. The new policy standardized taxes on border trade that previously had differed by province. With no uniﬁed standard, local governments declared their own policies regulating their border trade. Many companies pretended to be border trade companies to take advantage of whichever local government offered the most favorable terms. Although there were twenty-four border ports that satisﬁed the goal of disbursed growth and equitable development, only one-third of border ports were actually operational. Another third were only half-developed, and the other third had not yet opened by the end of 1998. Whether a border port

Politics and industry in Heilongjiang 237 was opened or not depended on the local county government. Not all border counties were taking advantage of the preferential policies. To standardize procedures at border ports, Harbin created a “leading group” in charge of border outlets headed by Vice-Governor Wang Zongzhang. The Heilongjiang Commodity Examination Bureau trained approximately 1,000 personnel in quality control and assigned them to border trade companies.43 The provincial government was said to have invested ¥2 billion in border port infrastructure and in seven Chinese commodities markets located in the Russian Far East. The province’s development strategy was to support the “frontier export-oriented economic belt,” the “foreign-oriented processing and industrial belt,” and the “frontier people’s trade belt.” The new policy clariﬁed the concept of border trade and clariﬁed center–local areas of regulation. Border trade was deﬁned as limited to small-scale trade carried out by registered border-trade enterprises situated within 20 miles of the border. It is therefore not trade that is carried out by border provinces as a whole. Border trade was not “barter trade,” which had led to the boom and bust cycle in the early 1990s. Cities and counties within the border trade area have authority to determine which enterprises can conduct border trade but the central government can override them if it so determines.44 Altogether, eighteen problems restricting border trade were identiﬁed. The provincial government held three conferences to coordinate implementation of border trade policies, and convened four “on-the-spot” border trade conferences in Suifenhe, Dongning, Mishan, and Heihe, to discuss strategies for resolving these eighteen problems. The new policy advantaged Heilongjiang’s border port counties, which would continue to enjoy preferential policies. Apparently disadvantaged were all the major cities situated along the rail lines further inland that would pay full duty unless they could claim jurisdiction over the border ports. These privileges were important for determining a county’s or city’s economic wellbeing. Border trade had eradicated poverty in at least half of the border counties and had given the poorest, previously peripheral, counties a standard of living higher than that of Harbin.45 Russian criticism of border trade was that it was asymmetrical and exploitative. Russians perceived trade as dominated (80 percent of it) by three large-scale enterprises: the Heilongjiang Foreign Trade Company, and the border trade companies of Heihe and Suifenhe. This facilitated unequal bargaining arrangements with Chinese able to play 1,300 Russian enterprises off against one another. This resulted in Russian enterprises exporting valuable raw materials, plant and equipment, below world market prices in exchange for Chinese over-priced and substandard foodstuffs and consumer goods. Chinese shuttle traders carried two sets of documents to bypass Russian customs control, which in 1992 resulted in US$100 million of undeclared cargo leaving Russia for China.46 The fundamental problem in border trade was the unequal state capacity between the Chinese and Russian sides, which was most apparent at the

238 Gaye Christoffersen border crossings. The twenty-four border openings that Heilongjiang had created to compete with Guangdong presented an enormous drain on Primorskii Krai’s resources. Consequently, the Russian side had poor infrastructure and was understaffed at those ports where there was staff. A Russian report in 1999 indicated that Sino-Russian border ports were no longer under the control of federal customs and border guards because they were run by local governments and private companies, some of which had maﬁa connections. Commercialization of border ports on the Russian side allowed illegal immigration, narcotics, weapons, and contraband to ﬂow across the border. These commercially-run ports levied numerous and spontaneous fees on shuttle traders that were lost to Primorskii Krai’s revenue stream, and allowed large amounts of strategic materials to be exported to China.47 On the Chinese side, the local state was more ﬁrmly in control, although commercialization of the Russian side increased opportunities for extra-budgetary income for local cadres. PLA-owned companies were especially active in smuggling. Local Russian military ofﬁcers have been known to make “spontaneous” sales of military equipment. Some analysts have argued that the Heilongjiang–Primorskii Krai region has the potential of becoming a zone of transnational interdependence under Sino-Russian governmental joint management.48 However, interdependence under conditions of unequal state capacities, which led to the commercialization of border trade by Russian municipalities and companies in cooperation with the counties and TVEs on the Chinese side, produced a transnational criminalization of the border. While border trade was booming, shuttle traders could manage the bribes. But the Russian ﬁnancial crisis and the collapse of the rouble in August 1998 caused border trade to plummet. In overall bilateral trade, Chinese exports to Russia dropped 53 percent in the ﬁrst 4 months of 1999 compared to the previous year. Although Chinese imports increased 42 percent, this was largely due to imports of commodities – timber, rolled steel, chemical materials, aluminum, machinery, and electronic – that individual shuttle traders did not lug across the border.49

Reform of industrial structure Into this particular provincial and regional political economy, Yue Qifeng arrived in spring 1994 as party secretary to implement reforms, with the strong backing of Zhu Rongji. Yue’s reforms, clearly articulated in an article forecasting Heilongjiang’s future in 2010, emphasized industrial restructuring towards a product mix that was resource-oriented, developing Heilongjiang as an agricultural base for which there was strong market demand, domestically and internationally. Because of the earlier emphasis on heavy industry in the province, there was too much primary manufacturing that left much of the province’s land idle and one-third of the surplus industrial and mining workforce unemployed. A shift towards

Politics and industry in Heilongjiang 239 agriculture was rational since Heilongjiang was the primary grain production base in China, with over 60 percent of its territory a black-earth zone containing around 10 percent of China’s arable land.50 Yue promoted the non-state economy, whether its ownership form was collective or individual, with disbursed development “scattered all over the province,” i.e. not concentrated in the province’s major cities. Yue warned that Heilongjiang could not rely on the central government for budgetary allocations to subsidize the failing SOEs. He stressed the role of TVEs but with greater value-added production and less micro-managing by county-level bureaux. Heilongjiang also could not rely on border trade with Russia as the engine of economic growth, which even at its height had not contributed to industrial development, as it involved mainly retailing. Yue advocated diversifying Heilongjiang’s opening in all directions in order to attract investment and technology transfer from Japan and the East Asian NICs.51 Yue’s critique of the province’s industrial structure was validated by serious labor unrest at the end of 1996 because half of the SOEs could not pay their workers’ wages or pensions. This was the worst labor unrest since the economic reforms began, but would be quickly followed in 1997 by even more serious worker riots. The mining industry around Shangyashen had collapsed, causing hundreds of unpaid miners to stage a sit-in in front of the Communist Party headquarters. In Shangyashan, Jiamusi, Jixi, and Mudanjiang as many as 80 percent of the workers had been laid off.52 Yue Qifeng encouraged foreign investment in reclamation farms. Heilongjiang has 104 state farms covering 2 million hectares of arable land, producing grains and soybeans. Yue’s greater emphasis on the agriculture sector found support in Japan’s Ministry of International Trade and Industry (MITI) and Japanese corporations that had previously not invested signiﬁcantly in the province. MITI had encouraged Japanese corporations to diversify investments towards the inland provinces of Heilongjiang and Jilin, and away from an over-concentration in Liaoning Province. Part of Japan’s fourth package of yen loans to China was designated for building a state-run farm and a chemical fertilizer plant on the Sanjiang Plains, a fertile region in Heilongjiang, and for railway and road projects to facilitate exports. MITI discussed with the Chinese State Planning Commission the prospect of maintaining an ongoing dialogue with Heilongjiang, as it had done with Liaoning. In 1995, Japanese investment in Heilongjiang totaled US$68 million. Although the US and South Korea also have invested in joint ventures in the agricultural sector, Russia represented the largest potential market for agricultural products. If modern, large-scale production of foodstuffs were of a higher quality, this might help regain market share in Russia that had been lost by TVE’s export of contaminated food. By mid-1996, Governor Tian Fengshan could ﬁnd positive indicators in the economy. Economic growth in SOEs increased 7 percent over the same period in 1995, while TVE growth was 28 percent over 1995. Industrial

240 Gaye Christoffersen output value of TVEs in the ﬁrst 5 months of 1996 was ¥18.68 billion, a 61 percent increase over 1995. Financial revenues for the province increased 29 percent over 1995. However, the SOEs continued to operate in the red, and export volume dropped due to the new border trade policy’s delimitation on barter trade. Many counties and cities had failed to implement industrial restructuring, while others had formulated their own restructuring plans.53 Despite indicators of success, emphasizing agriculture and downsizing heavy industry seemed to the provincial conservatives to mark a step backward from a progressive socialist civilization. From his initial appointment, Yue Qifeng came under attack by hardline conservatives. Yue himself was known to use politically provocative language directed at local bureaucrats who were resisting and obstructing his attempts at marketizing the state sector. In 1995, a “10,000-character document” that was critical of Yue (written under the auspices of Deng Liqun) was circulated privately. Although the Central Propaganda Department prohibited any reprinting of the critique, a paraphrasing of the document and a rebuttal in defense of Yue were published together in a Guizhou journal (Jingji gongzuo yuekan). Politburo members also came to his defense.54 As long as Yue Qifeng enjoyed high-level backing on the Politburo, he seemed impervious to provincial-level opposition from conservative bureaucrats. However, in July 1997 he was purged in a string of provincial reshufﬂes that followed a corruption scandal, purportedly involving US$1.87 billion in graft. Yue was held personally responsible by the Politburo for his failure to reform the province’s state sector. He was replaced in 1997 by Xu Youfang, a party functionary who promoted similar policies of reforming SOEs and laying off workers but who placed greater emphasis on strengthening party leadership. Under Xu’s leadership, the city of Harbin planned to auction the property rights of 123 small and medium SOEs to foreign and domestic investors. These SOEs were all operating in the red, some not paying employees, two-thirds of them with debt ratios of 60 percent or more. Heilongjiang Province intended to sell off 1,000 SOEs. The auctioning of SOEs was a strategy of Zhu Rongji’s but by 1999 Jiang Zemin’s emphasis on social stability and party control of the economy took precedence. In January 1999, Heilongjiang’s nine auction houses were closed. There had been an estimated 1 million laid-off workers in the province in 1998. Generally speaking, cadre corruption in the province generally involves extra-budgetary income derived from the administrative fees levied by each government bureau. The province’s mineral wealth and border trade provided increasing opportunities for bribes and fee collection over the period under review. Heilongjiang’s extra-budgetary income has reached an extraordinarily high level of 0.9:1 relative to budgetary income, and is used by cadres for perks for themselves rather than for legitimate expenses. A former deputy mayor of Harbin, Zhu Shengwen, who was accused in association with the 1997 corruption scandal, was arrested, imprisoned, and tortured.

Politics and industry in Heilongjiang 241 Nevertheless, Zhu is said to have been innocent, and to have been set up by another deputy mayor who was actually the guilty party.55 The party secretary of Qiqihar, Wang Shubin, has been charged in a different corruption and bribery scandal. The mayor of Daqing, Qian Dihua, was arrested in July 1999 for economic crimes in relation to a Daqing petrochemical ﬁrm that was publicly listed in 1997. At that time the ﬁrm’s executives had provided 2 million shares to government ofﬁcials, including Qian.56 The contrast of worker lay-offs and their increasing immiseration amidst widespread cadre corruption, privileges, and decadent lifestyles erupted in workers’ riots in late November 1997. A Hong Kong newspaper reported that approximately 100,000 workers participated in riots in Qiqihar, Jiamusi, Mudanjiang, and Yichun, setting ﬁre to cadre’s vehicles, attacking public security and armed police with stones, hunting riﬂes, and Molotov cocktails. Workers’ complaints included demands for back pay, the right to work, an end to cadre corruption, and the political use of lay-offs under the guise of SOE reform. Workers were angry at state–business collaboration against workers’ interests.57 Members of the China Democracy Party have campaigned for worker’s rights in Heilongjiang for which they have been arrested and interrogated by the police. As the economic reforms have progressed, the opportunities for cadre corruption have multiplied, necessitating a changing pattern of governance. Following a trend in the National People’s Congress, the Heilongjiang Provincial People’s Congress has expanded its role during the economic reforms to exercise legislative oversight of the provincial bureaucracy. This supervisory role of monitoring provincial government bureaus and uncovering cadre corruption is the primary function of the Provincial People’s Congress, changing its image of a “rubber stamp” legislature, which it had prior to the economic reforms.58

Conclusion The economic reforms have made Heilongjiang a marketing center of a north-east Asian Natural Economic Territory that extends far beyond the jurisdiction of the provincial government. Heilongjiang has become increasingly vulnerable to investment and trade decisions determined outside the province, whether in Hong Kong, Guangzhou, Moscow, or Vladivostok. Provincial leaders demonstrated a capacity for policy implementation in response to this international environment similar to the pattern of opening in the coastal region. However, when implementing directives from Beijing on industrial restructuring, provincial leaders demonstrated a reluctance to comply, a policy response that varies remarkably little from other provinces resistant to SOE reform. Newspaper articles on Heilongjiang’s industrial reforms suggest an analysis focused on the provincial leadership and factional struggles within it. The focus of these journalistic accounts, however, does not identify the long-term structural transformations that began long before a cadre such as

242 Gaye Christoffersen Yue Qifeng arrived in Heilongjiang, and that continued beyond his departure. Their focus also places undue emphasis on the domestic politics of industrial restructuring, virtually omitting the international context. Export opportunities were a motive force for combining SOEs and TVEs into enterprise groups that would function as transnational corporations and redirect SOEs toward export-led growth. Although the case of Yue Qifeng’s failure to reform the SOEs in both Liaoning and Heilongjiang should bring into question any view of provincial political leadership as decisive, this view is, nevertheless, encouraged by the language that provincial cadres use to describe their own work. In 1999, the author had the opportunity to interview a cadre who had just been assigned responsibility to work with the vice-governor to design SOE reform in Liaoning, and devise a provincial model that would be emulated by other provinces. Zhu Rongji had assigned him this task, stating that because Liaoning was the hardest case, it should become a model for the rest of the country.59 He was a colleague of Yue Qifeng, and had observed Yue’s defeats in the early 1990s in Liaoning and then in Heilongjiang. Nevertheless, he was fully conﬁdent that in the new push to reform SOEs beginning in 1999, he would exercise sufﬁciently strong provincial leadership to succeed where Yue had failed. He was an amazingly capable leader, leaving the author all but persuaded that he could single-handedly reform SOEs. The structures that he has inherited, however, leave room for skepticism about his prospects of success. Within Heilongjiang, provincial cadres have not distinguished themselves for their economic reform strategies as much as they have for their personal strategies to increase their own perks and extra-budgetary income. The politics of economic reform and opening in Heilongjiang is a high-stakes game. As a government cadre one could become very wealthy, or end up jailed and tortured. Workers in the SOEs could ﬁnd themselves in an enterprise transformed into a multinational enterprise group enjoying extraordinary proﬁts from the Russian market, and retaining their membership status in the elite of the workforce. Other SOE workers may end up unemployed, and rioting in the streets in armed conﬂict with public security and the police, or sent down to work on a state farm. A displaced worker could join the shuttle trade where he might become wealthy, or he might be killed by a xenophobic local Russian in Primorskii Krai. There is a lot at stake here in the politics of industrial restructuring. Judging from workers’ complaints, the decision as to who remains and who is laid off is a highly politicized one. It is also a highly politicized decision as to which cadres are indicted for corruption and which are not. Much of the structural transformation in Heilongjiang seems to be directed from Beijing. Beijing’s policies to restructure the banking system, abolishing provincial branches of the People’s Bank of China in favor of regional banks, effectively removed a major resource from provincial cadre control. Local cadres could no longer pressure the local provincial bank to

Politics and industry in Heilongjiang 243 extend further loans to the failing SOEs, a practice that kept them aﬂoat and contributed to the problem of nonperforming loans. It was the National People’s Congress in Beijing that initiated the use of the Provincial People’s Congress for legislative oversight that forced provincial cadres to be more accountable for their actions. Implementation of reform policies or retrenchment seems to follow the zigs and zags of reform policies in Beijing, whether Jiang Zemin is emphasizing social stability or Zhu Rongji is pushing for enterprise reform. Restructuring China’s north-east so that it could better integrate with the north-east Asian regional economy was also Beijing’s program to reduce administrative divisions in the north-east among the three provinces. Administering and beneﬁting from border trade is contested political terrain within Heilongjiang Province between border counties and inland cities. This intra-provincial competition is compounded by Heilongjiang’s inter-provincial competition with Jilin and Liaoning to be the center of China’s participation in north-east Asian economic cooperation. Beijing’s program to construct a supra-provincial administrative region that would govern the political space of China’s north-east, and manage its integration into north-east Asia’s regional economy, may have only limited success. This program could be undermined by the economic spaces each of the three provinces has established for itself as a marketing center with transnational linkages to surrounding countries: Heilongjiang with Russia, Liaoning with Japan, and Jilin with South Korea. A viable north-east Asian multilateral regime in the future may be able to better integrate these separate relationships, although the incongruence of political space and economic space is yet to be resolved.

Notes 1 Margot Schueller, “Liaoning: struggling with the burdens of the past,” in David S. G. Goodman (ed.) China’s Provinces in Reform: Class, Community and Political Culture (London: Routledge, 1997), pp. 93–121. 2 Dwight H. Perkins, “Summary: why is reforming state owned enterprises so difﬁcult?” China Economic Review, vol. 4, no. 2 (1993), pp. 149–51. 3 Dorothy J. Solinger, “Urban entrepreneurs and the state: the merger of state and society,” in Arthur Lewis Rosenbaum (ed.) State and Society in China: The Consequences of Reform (Boulder: Westview Press, 1992), pp. 121–41. 4 Susan Shirk, The Political Logic of Economic Reform in China (Berkeley: University of California Press, 1993). 5 An excellent example of the leadership approach is Peter T.Y. Cheung, Jae Ho Chung, and Zhimin Lin (eds) Provincial Strategies of Economic Reform in PostMao China: Leadership, Politics, and Implementation (Armonk, NY: M. E. Sharpe, 1998). For an analysis focused on local leadership in Heilongjiang, see Yanzhong Huang and Dali L. Yang, “The northeast phenomenon in China: Heilongjiang and the dilemmas of industrial adjustment,” paper prepared for China’s Provinces in Reform, 2nd Workshop, Zhejiang University, Hangzhou, 20–24 October 1996.

244 Gaye Christoffersen 6 Gaye Christoffersen, “Socialist marketization in East Asia: locating the Chinese experience,” in Juan Lindau and Tim Cheek (eds) Market Economics and Political Change: Comparing China and Mexico (Boulder, CO: Rowman and Littleﬁeld, 1998). 7 Heilongjiang sheng ditu ce [Volume of maps of Heilongjiang province] (Harbin: Harbin ditu chubanshe, 1998), p. 6. 8 Mudanjiang’s homepage on the web, created with the assistance of UNIDO, is <www.mwcc.co.cn/mdjvy/index1.htm>. 9 RA Report [Center for Russia in Asia, University of Hawaii], no. 16 (January 1994), p. 21. 10 Li Jinbo, Liu Jiaqi, and Shi Xiuwen (eds), Si shi touze shouce [Four cities investment handbook] (Mudanjiang: Heilongjiang chaoxian minzu chubanshe, 1992), p. 14. 11 Zou Dedong, “Rapid development in China’s border trade,” Liaowang Overseas Edition (Hong Kong), no. 40 (5 October 1992), pp. 21–2. 12 Xinhua, 1 February 1996, in FBIS-CHI-96–022, 1 February 1996, pp. 47–8. 13 <www.mwcc.co.cn/mdjvy/index1.htm>. 14 Interview with Heilongjiang economist, Harbin, November 1998. 15 Huang Lucheng, “Lun dongbeiya quyu jin fazhan moshi” [Discussion on northeast Asian regional economic development model] Dongbeiya luntan [North-east Asia discussion] no. 2 (1995), pp. 17–19. 16 Alexander Yakovlev, “The international political situation in north-east Asia and the position of Russia in the region,” Far Eastern Affairs, no. 2 (1995), p. 15. 17 Hua Tachen, “Opening up along the borders should be upgraded strategically: interview with Heilongjiang Vice Governor Wang Zongzhang,” Ta Kung Pao, 6 April 1993, p. 4, in FBIS-CHI-93–074, 20 April 1993, pp. 4–5. 18 Wang Yetian “Great strategy struck,” China Daily, Harbin Supplement, 24 January 1994. 19 Yu Zhixian, “Dongbeiya quyu jingji hezuo de moshi xuanze ji women zhanlue” [The selection of a model for north-east Asian regional economic cooperation and China’s strategy], Shehui kexue jikan [(Liaoning) Social sciences quarterly] no. 4 (1990), pp. 56–7. 20 Cao Yong, “Economic cooperation between China and pan-Paciﬁc countries: implications for economic and regional development of China,” Journal of Chinese Geography, vol. 4, no. 3/4 (1994), p. 85. 21 Yan Li and Yang Meiping, “Dongbeiya diqu jingji hezuo yu Liaoning tong ri de jingji jiaoliu” [Economic cooperation in north-east Asia and economic exchange between Liaoning and Japan], Shehui kexue jikan [(Liaoning) Social sciences quarterly] no. 1 (1995), pp. 87–91. 22 Chen Yue, “On the coastal economic zone around the Yellow Sea and Bohai Sea,” Nankai Economic Studies, vol. 1, no. 2 (1994), pp. 12–20. 23 Bai Chengqi, “Zhongguo ‘fu quan’ yu donbeiya diqu jingji hezuo” [China’s resumption of GATT membership and north-east Asian economic cooperation], Dongbeiya luntan, no. 4 (1993), pp. 83–7. 24 Zhou Yuan (National Research Centre for Science and Technology for Development), “Chinese development strategy for north-east China,” in Conference Proceedings, Fifth Meeting Northeast Asian Economic Forum, Niigata (Honolulu: Northeast Asian Economic Forum, 1995), pp. 66–9. 25 John Whalen, “The TRADP institutional structure: progression, stages of national commitment, and conclusions – a personal commentary,” ibid., pp. 98–104.

Politics and industry in Heilongjiang 245 26 Xu Shaoda, “Northeast region, Inner Mongolia to jointly develop economy,” Liaoning ribao [Liaoning daily], 5 July 1996, p. 1, in FBIS-CHI-96–143, 5 July 1996. 27 XINHUA, 6 September 1996, in FBIS-CHI-96–177, 6 September 1996. 28 Won Bae Kim and Young Bong Kim, “Planning regional development in northeast Asia,” Northeast Asia Economic Forum Newsletter, no. 19 (Winter–Spring 1997), pp. 3–5. 29 State Council Document No. 33, On State-level Zones. 30 Li Liangzeng and Wang Xiaoju, “Qianghua bianmao xindai quanli, cujin ‘si ge yanshen’ ” [Strengthen border trade credit management, advance the four extended], Dongbeiya luntan, no. 1 (1995), pp. 68–71. 31 Heilongjiang sheng renmin zhengfu bangongting tiaoyan shi (ed.) Heilongjiang Sheng Qing [The situation in Heilongjiang Province] (Harbin: Heilongjiang renmin chubanshe, 1986), p. 651. 32 “Fazhan Harbin xiangzhen qiye de zhanlue sikao” [Thinking about the strategy for developing Harbin’s township and village enterprises], Beifang luncong [Northern review] no. 4 (July 1988), pp. 86–90. 33 Sun Jingzhong, “Heilongjiang sheng chanye jiegou yanjin de kaocha yu si” [Observations and considerations on the evolution of the Heilongjiang provincial industrial structure], Nankai Economic Study, no. 5 (1991), p. 62. 34 Qu Yifeng and Li Minghuan [Heilongjiang Provincial Government, Economic Research Centre], “Heilongjiang sheng zai dongbeiya jingji hezuo zhong de diwei ji duice yanjiu” [Heilongjiang’s position in north-east Asian economic cooperation and research on countermeasures], Dongbeiya luntan, no. 1 (1994), p. 47. 35 Zhang Guangheng and Li Minghuan, “The necessity and possibility of establishing Sino-Russian transnational economic cooperation zones,” Heilongjiang ribao [Heilongjiang daily], 18 April 1994, p. 6, in FBIS-CHI-94–083, 29 April 1994, p. 82. 36 Conference Report on “The dynamics of economic development in the Russian Far East and north-east China,” conference organized by the International Research and Exchanges Board (IREX) and the China Institute of Contemporary International Relations (CICIR), Harbin, May 1994. 37 Wang Zongzhang, “Quicken pace of internationalizing border trade,” Heilongjiang Ribao [Heilongjiang daily], 15 January 1995, p. 6, in FBIS-CHI-95–063, 3 April 1995, pp. 62–5. 38 Wang Tongliang, Zhou Kaicheng, and Li Chunming, “Improve enterprise groups, strengthen economy of scale,” Heilongjiang ribao [Heilongjiang daily], 11 December 1994, p. 6, in FBIS-CHI-95–042, 11 December 1994. 39 Heilongjiang People’s Radio [Harbin], 23 February 1994, in FBIS-CHI-94–037, 24 February 1994, pp. 56–7. 40 For greater detail on the national program, see Christoffersen, “Socialist marketization in East Asia: locating the Chinese experience,” in Lindau and Cheek (eds), Market Economics. 41 Wang Zijun, “Correctly treat the new situation in the development of border trade,” Heilongjiang ribao [Heilongjiang daily], 19 June 1994, p. 6 in FBIS-CHI94–126, 30 June 1994, pp. 59–60. 42 Wang Chien-chun, “China formulates new trade measures toward CIS,” Hsin Pao [Hong Kong economic journal], 30 March 1995, p. 24, in FBIS-CHI-95–101, 25 May 1995, pp. 19–21.

246 Gaye Christoffersen 43 Heilongjiang ribao [Heilongjiang daily], 5 August 1996, p. 2, in FBIS-CHI96–166, 5 August 1996. 44 Sun Hong, “Border commerce uniﬁed,” China Daily (Business weekly), 25 February–2 March 1996, p. 1, in FBIS-CHI-96–038, pp. 30–1. 45 Elizabeth Wishnick, “Chinese perspectives on cross-border trade: economic problems and political consequences,” unpublished paper, 1997. 46 Igor Kazakov, “Enterprises in China and Russia prefer to trade directly,” Moscow News, no. 51, 17 December 1993, p. 9. 47 “Border crossings privatized,” Vladivostok News, 16 July 1999. 48 Gilbert Rozman, “Spontaneity and direction along the Russo-Chinese border,” in Sephen Kotkin and David Wolff (eds), Rediscovering Russia in Asia: Siberia and the Russian Far East (Armonk, NY: M. E. Sharpe, 1995), p. 280. 49 Xinhua, 27 May 1999, in FBIS-CHI-1999–0527, 27 May 1999. 50 Yue Qifeng, “On building Heilongjiang into a strong farming province for the 21st century,” Renmin luntan, 8 May 1996, pp. 12–13, in FBIS-CHI-96–144, 8 May 1996. 51 “Heilongjiang secretary on township enterprises,” Heilongjiang ribao [Heilongjiang daily], 6 July 1994, p. 2, in FBIS-CHI-94–144, 6 July 1994. 52 Jasper Becker, “Protests triggered by industrial unrest said to rise,” South China Morning Post, 28 November 1996, p. 9, in FBIS-CHI-96–232, 28 November 1996. 53 Tian Fengshan, “Heilongjiang Governor discusses economic work,” Heilongjiang ribao [Heilongjiang daily], 24 June 1996, pp. 1, 4, in FBIS-CHI-96–146, 24 June 1996. 54 “Party reformers continue support for controversial private sector reform in China’s north-east,” FBIS Trends, 4 October 1996. 55 Roderick MacFarquhar, “Provincial people’s congresses,” The China Quarterly, no. 155 (September 1998), p. 663. 56 Ivan Tang, “Mayor in custody over listings scandal,” South China Morning Post, July 5, 1999 [internet edition]. 57 Yue Shan, “Labour turmoil involving 100,000 workers in four cities: a true account of workers’ unrest and riots in Heilongjiang,” Cheng Ming [Hong Kong], 1 January 1998, pp. 18–19, in FBIS-CH-98–135, 15 May 1998. 58 MacFarquhar, “Provincial people’s congresses,” p. 666. 59 Interview with Liu Ming, President of Liaoning Energy Corp. , April 24, 1999.

Chapter Title

9

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Why provinces? Barbara Krug

Introduction There is no such thing as even economic development. Some people get richer, some regions prosper more than others. Why this should be so is a question that has puzzled people who work in the ﬁeld of economics since the days of Adam Smith. On a world scale, uneven development is often attributed to nation-states and their governments, which are assumed to cause “uneven” development by interfering too much (the “Chicago” claim)1 or by intervening too little (the Leftist claim). These arguments both fail when it comes to explaining regional-income differences within one country. After all, economies such as the United States, Australia, or Germany show remarkable regional income disparities regardless of the economic policies pursued. In the case of China, there is no reason for economists to assume that the beneﬁts of economic reform would ﬂow equally throughout the national territory. In every case, further explanations are required to explain regional income disparity within a particular national state. And further analytical concepts are called for to “catch” the geographical diversity of domestic economic outcomes. To a classical economist or economic geographer, the province does not immediately leap to mind as a useful explanatory concept for explaining regional economic variations. Why bother with an administrative unit such as a province? This is not to say that administrative provinces don’t have their uses for economists. Indeed the most obvious answer to the question “Why provinces?” is a very practical one. Provinces are bureaucratic sites for aggregating and publishing data sets (provincial yearbooks and the like) that help to break down the larger picture described in the national State Statistical Yearbooks. Provincial yearbooks facilitate research into the distributional effects of reform, and they enable comparison of the economic performance of different regions organized as provinces. To stop here, however, is to imply that provinces are merely technical devices for disaggregating national data. Their explanatory utility remains limited to the degree that regional differences cut across administrative boundaries, including those of provinces. A political scientist might proffer another plausible answer to our question, “Why provinces?” Provinces matter because they are major players in the

248 Barbara Krug Chinese political context.2 As convincing as it may appear at ﬁrst sight, this approach rests on an assumption that the province can be modeled as a black box. In other words, it assumes that intra-provincial relations and interactions have little impact on provincial behavior, that all people living within provincial boundaries have homogenous preferences or interests that center around a provincial identity, and, last but not least, that the political leadership of a province embodies all imputed provincial characteristics. As the theory of bureaucratic behavior and the economic theory of politics claim, and empirical studies on China demonstrate, there is no exogenous provincial identity, nor do economic and political actors at the grass-roots level necessarily share the interests of the party-state machinery at the apex of the province.3 The black box begs to be opened if we are to pursue our question, Why Provinces? The need to open the black box highlights the strengths of a third approach to the province which we shall adapt from the New Political Economics (NPE), or New Institutional Economics as it is sometimes called.4 NPE employs the tools of economic analysis to analyze political processes. In so doing, it offers a third answer to our question: provinces are important as an arena or political market where the demand for decentralization meets the supply of decentralization. Key differences between the aforementioned approaches and the NPE approach may be summarized as follows: 1

2

According to NPE, differences in provincial endowment, including natural resources, infrastructure, size, capital, and location are, at best, a necessary and not a sufﬁcient condition to explain differences in economic and political outcomes. Development depends rather on incentives, organizations, and norms, in short on institutions that allow the mobilization of resources, exploitation of income opportunities, and effective allocation of resources.5 All else being equal, differences in economic outcomes of provinces reﬂect different institutions. In the context of China’s economic reform, this suggests that different patterns of economic development are accompanied by different degrees of institutional change. The study of provinces, as key institutional nodes, enables us to ask which institutional settings offer the best prospects for economic development in the political and social environment of the People’s Republic of China. According to NPE, institutional change and economic development are both agent-driven, mitigated and brokered by a political market. Institutional change is neither resource-driven as is assumed in the theory of comparative advantage, nor political actor-driven as assumed in the political science models.6 Even in an authoritarian state, institutional change cannot be designed or enforced from the top alone. This has to do with asymmetric information and ineffective control mechanisms. Hence the Communist Party (or the party-state machinery) cannot be treated as a black box, nor can we neglect the leeway that economic

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3

4

249

actors have in inﬂuencing political actors to behave according to their particular interests.7 One of the interests of economic actors is to demand institutions that allow them to pursue their own interests more effectively. They demand this from those who can establish institutions, namely political leaders. In general, it is in the political process that this demand for change meets the supply for change (or lack thereof). And when we observe provinces with different institutional settings, NPE suggests that we should focus on the political process as a locus for institutional change. Institutional change at the provincial level in China can be called, as a matter of convenience, decentralization,8 on the assumptions that (i) different degrees of decentralization lead to different outcomes, and (ii) different forms of decentralization depend on the number, kind, and interests of actors who demand decentralization or supply a decentralized institutional setting. As difﬁcult as it is to single out the signiﬁcant groups of actors, or to operationalize decentralization, NPE provides general criteria to help explain differences among provinces. Thus, for example, it matters who initiates institutional change: economic actors such as private entrepreneurs, TVEs and foreign investors, on the one hand, or political actors such as the provincial leadership or the central government, on the other. As will be shown presently, if decentralization (or demand for decentralization) is initiated by economic actors then NPE speaks about demand-side driven forms of decentralization depending on (economic) entrepreneurship. If decentralization is initiated by political actors, or more accurately those who have the power to establish laws and organizations, then decentralization is supply sidedriven and the result of political entrepreneurship. The reason it matters who actually initiates decentralization is that different actors have different ideas and interests. To insist that each group in every province has its unique reason for advocating speciﬁc forms of a decentralized structure is to preclude comparative analysis (“Anhui cannot be compared with Hunan”). In order to avoid this kind of outcome, NPE provides a conceptual frame that starts with only two broad categories. One group of actors might call for decentralization because it expects higher gains from such a structure when compared with a more hierarchical structure based on ﬁat. Another group calls for decentralization because it claims a uniqueness on cultural grounds that should be acknowledged by the right to self-government irrespective of costs. In the former case, the call for decentralization is based on efﬁciency arguments; in the latter, on cultural arguments.

The following analysis makes use of the political-economic models provided through NPE, as well as published research on China’s provinces in the reform era, with a view to examining the economic dynamics of provincial change and suggesting areas for future research. The ﬁrst section outlines a

250 Barbara Krug model of the market for decentralization. It shows that four different forms of decentralization can be identiﬁed, and ends with a preliminary classiﬁcation of the provinces according to the different forms they assumed in the mid-1990s. The second section concentrates on the process behind the emergence of decentralization in China. Here it is maintained that political markets at the national and provincial levels largely determine which form of decentralization is chosen in any particular province. The third section summarizes the discussion, showing how the analytical approach in combination with empirical studies can be used to compare provinces and to explain the diversity of provincial behaviors. The ﬁnal section elaborates on the inadequacy of research into nonpolitical actors and groups, and suggests a need for further empirical and analytical research.

The market for decentralization: a model From a constitutional economics point of view, a state is a jurisdiction that (among other things) deﬁnes a government’s power to regulate, tax or otherwise intervene in the individual or collective action of its populace.9 Such state functions might also be called “legislative power.” If this power is concentrated in one political center then we talk of a centralized state. Where power is shared between a center and other organizations we talk of a decentralized state. Centralization can take many forms. One of the most frequent is the sharing of legislative power between the center and subordinate units delineated by territory (subordinate territorial echelons).10 These units may be called states, Kantons, Laender or, in the case of China, provinces. Typically, decentralization occurs when there is a shift of “legislative power” from the political center to the subordinate territorial echelon (the province).11 In the case of China, the common assumption is that decentralization of this kind has indeed occurred. Nevertheless, some issues remain in dispute, including the questions of when this decentralization started, what forms it has taken, where it is heading, and, on a more general level, how these developments are best conceptualized.12 In the ﬁeld of economics, the obvious starting point for an analysis of decentralization is to assume there must be a market for it. There must be demand for and supply of decentralization, both of them depending on expected returns. Assuming there is a market for decentralization (Dc), we might graphically represent the relationship as in Figure 9.1. There is a positive supply (S) for Dc that meets a positive demand (D), thus determining the amount of Dc, i.e. the amount of provincial legislation (x) and the corresponding price (p) a populace has to pay for such a governance structure. The supply curve is constructed on the assumption that suppliers compare expected net returns from Dc as opposed to a more centralized government structure.13 Dc is offered when and as long as net returns are higher as (or at least equal to) a centralized form of government. The demand side, using the same reasoning, will demand more Dc when and as long as net

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returns exceed those that can be expected from a more centralized governance structure. This starting point deﬁnes the focus of the analysis. Having clariﬁed the focus of analysis, we need to (1) identify actors on both the supply and demand side, (2) single out factors that deﬁne the amount of demand and supply at alternative price levels, and (3) take a closer look at the institutional arrangement whereby demand and supply are coordinated; that is, explore the political process. In a political system that allows no open competition for executive let alone legislative positions, such as the Chinese party-state, the only actors who can promote institutional change are political actors within the party-state machinery. In this case, the range of actors is limited to the CCP, the NPC, and respective subordinate agencies. Other groups of actors may hold promise of institutional change, but without the imprimatur of the party-state they have little prospect of enforcement. For this reason, the supply side of the political market can be constructed as the aggregate of offers by approved political actors. The demand side, however, is made up of economic and social groups that can articulate a demand for reduced central control. To identify these groups is a major challenge for further research. An economic analysis would suggest that they comprise two groups, organized around shared (material) interests or around shared cultural values: that is, economic interest groups and social interest groups. Thus, the demand side of the political market can be constructed as the aggregate demand of economic actors such as entrepreneurs, workers (employed or unemployed) or foreign investors, and social groups such as ethnic minorities, the new middle classes, or youth, to cite a few examples. In contrast to the equilibrium model (Figure 9.1), the starting point for empirical study shows marked differences (Figure 9.2). We observe two different points (A and B) to which we ascribe two different amounts of Dc and two different prices. More precisely, the assumption for China is a move from A to B, the latter describing more decentralization at a lower price. That today’s B indicates more decentralization at a lower price is based on the conclusion that the highly centralized governance structure of the past

Figure 9.1 Market for decentralization: equilibrium model.

252 Barbara Krug left almost no positive returns for the supply or demand sides.14 The analytical problem with such an “observed” shift from A to B is that we do not know the underlying changes in the demand and supply curves. For example, such a movement can be caused by a change in demand, as in Figure 9.3. The movement from A to B may signal two cases: ﬁrst, a move from D1 to D2 in which the demand side asks for more Dc according to higher net returns, with the effect that the slope of the curve changes. This is called the efﬁciency argument. In contrast, the movement D1 to D3 is caused by a parallel shift of the curve and stands for the willingness of the demand side to ask for more decentralization irrespective of net returns (or costs). As can be seen in the ﬁgure there is a higher demand at each cost level. This is called the cultural argument, as it stands for a propensity to place a positive value on a provincial uniqueness put forward by the province or by the center. Whether this uniqueness is based on speciﬁc traditions, habits, or ethnic composition is of minor importance at this stage of analysis as long as such positive value leads to more decentralization at each price level – that is, as long as individuals in the province are prepared to pay for a governance structure that institutionalizes their uniqueness. The same kind of change can occur on the supply side. The supply curve can change its slope, thus reﬂecting changes in net returns: more Dc will be offered when by doing so agents making the offer can expect higher returns (the efﬁciency argument). A parallel shift, in turn, would reﬂect more provincial legislative power irrespective of net returns on cultural grounds, or for example, on the grounds that a federalist state has a value in itself. Four cases behind the movement from A to B are illustrated in Figure 9.4. It follows that (i) decentralization can be supply driven; that is, initiated by political actors – either on efﬁciency (case a) or cultural (case b) grounds, and (ii) decentralization can be demand driven, that is to say initiated by economic and social actors, either on efﬁciency (case c) or cultural (case d) grounds.15

Figure 9.2 Market for decentralization: uniform variants.

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Figure 9.3 Market for decentralization: non-uniform variants.

The model thus predicts that: 1

2

Decentralization is not a uniform development. It will take at least one of the four described forms or a combination thereof. Uniform development would require the extreme (and unrealistic) assumption that the costs of governance are identical for each part of China, that there is no geographical dimension to economic problems, that preferences remain the same for all Chinese, and that expected net gains from a governance structure are identical irrespective of location. The actual amount of decentralization “clusters” around point B. In the hypothetical drawing (Figure 9.2) the shift from A to B looks impressive. But this is a contrived effect designed to aid the reader to grasp the signiﬁcance of the graph. There could be no shift at all if A equalled B, a case ruled out by our assumption that decentralization has occurred in China; or there could be merely a marginal shift. Moreover B stands for the aggregate, or for the “sum” of all “amounts” of decentralization observable in all provinces. It may hide signiﬁcant differences between highly-decentralized provinces and those with little or no shift of “legislative powers.”

Given these predictions, the task for empirical research is to characterize patterns of decentralization for China as a whole and, as far as possible, for each province. In each case one needs to distinguish between decentralization Supply

Demand

Efﬁciency

case a

case c

Culture

case b

case c

Figure 9.4 Four ideal forms of decentralization.

254 Barbara Krug at the national level (central–provincial relations) and decentralization at the provincial level (provincial–subprovincial relations). The accompanying table classiﬁes provinces according to the form of decentralization chosen, national and provincial, and on the basis of case studies published in the three volumes of China’s Provinces in Reform (Goodman 1997, Hendrischke and Feng 1999, and the chapters in this volume). The overall picture is one of remarkable political entrepreneurship. In most of the cases listed, decentralization was initiated by provincial political actors who expected higher returns from a decentralized governance structure than from one in which they retained greater control of resources and decision-making. Further, some provinces responded to pressures for decentralization from economic and social groups at the margins of the formal state system. To understand how this came about we need to move beyond a static approach to provincial–central (or provincial–subprovincial) relations and analyze the politics of the market for decentralization, taking note of all of the actors or agents involved.

The market for decentralization, or one use of provinces The amount of decentralization and its respective price depends not only on changes on the supply side or the demand side. Further factors determining Table 9.1 Forms of decentralization Initiated by political actors Efﬁciency argument

Cultural argument

Chongqing Hebei Inner Mongolia Shanxi Shaanxi Sichuan Yunnan Henan Hubei Hunan Qinghai Tibet Hainan Tianjin Beijing Heilongjiang Liaoning Jilin Guangxi

Initiated by economic actors Anhui Guangdong Zhejiang

Xinjiang Guizhou Fujian

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decentralization are the number and characteristics (self-interest) of individuals or groups that generate supply and demand, and the techniques for coordinating supply and demand. The NPE, or more precisely Constitutional Economics, claims that in the end it is not market determinants (let alone the laws of history) that determine decentralization.16 Instead, decentralization depends on choice, decisions, self-interest, and bargaining by individual and collective actors.17 Case studies are invaluable at this point because they help to show who actually sits at the table when decentralization is discussed, because they identify who can and will avail themselves of opportunities to offer decentralized institutions, and because they classify the interests that motivate such behavior. The following section considers various case studies in the form of a proposition and elaboration. The proposition is a simple one: that provinces are a necessary vehicle that turns (private) latent demand for decentralization into effective demand. This is so because the provinces move in two different arenas. First, the provincial level is the arena where intra-provincial decentralization is coordinated. The agreed-upon amount and form of decentralization is transferred to the higher level (the political center) with the effect that, secondly, provinces generate and express demand for decentralization at the national level depending on their respective self-interest. It should be noted, however, that the demand for greater provincial decentralization is expressed not only by the provincial political leadership. “Big business” such as the managers of state ﬁrms, or managers of joint-venture companies or TVEs, indeed even artists, can do so by claiming that they represent a provincial interest or that they manifest provincial identity or culture. It is tempting to argue that provinces are a constitutional device allowing private actors to transform demand for decentralization into corresponding supply for decentralization at lower costs than an alternative governing structure that would allow competition among groups, but this would be to imply free competition among consciously designed structures. The province, nevertheless, functions as a relatively successful institution when it comes to regional/local interests being acknowledged by corresponding institutions. It is also tempting to argue that provinces are an effective device as they are seen as the “natural” institution to represent provincial interests. Yet, as many of the case studies remind us, no private actors, whether peasants, workers, families or investors, regard the province as the political entity with which they identify most closely. Instead, as will be shown below, private actors, whether economic or social groups, who seek an institutional design that permits them to move within an economic and cultural nexus of their own choice, rely on provincial autonomy as a ﬁrst step toward the autonomy they seek for themselves. The province at the national level To date, policy formulation is dominated by the “supply side.” Although the political leadership is anything but a monolithic bloc, and although more

256 Barbara Krug voices on the “demand side” now make themselves heard in the National People’s Congress, there still can be no doubt that central party and state agencies are the main suppliers. The shift toward more decentralization over the past two decades must then have been caused by a shift of supply due either to efﬁciency or to cultural considerations (or a mix of both), or more remarkably with one section of the party, at provincial level, showing up on the demand side. As Fitzgerald has convincingly argued, the notion of the unity of China is a powerful national myth in which unity is symbolized by one and only one center: the imperial court or today’s Beihai Park.18 This myth has several implications. It ﬁrst equates the unitary state with a centralized state, much to the liking of the Communist Party. Second, it creates a taboo with the result that alternative governance structures are not considered, let alone their different costs compared.19 Third, a considerable amount of resources and effort is spent continuously reinforcing this myth, in particular linking the idea of national unity to a proclaimed homogeneity of Chinese culture. The center can maintain this myth almost effortlessly when the reference point is the outside world, as it is easy to see that the Chinese have something in common that distinguishes them from the rest of the world.20 They can also neglect the diversity that characterizes China’s economic, social, and cultural life by claiming that they represent the center and not different parts. Thus, it is hardly surprising that no major proponent can be found at the national level who would argue in favor of a decentralized structure on cultural grounds.21 Provincial leadership, we shall see, typically ﬁnds itself in less clear-cut situations. If cultural reasons for supply-driven decentralization can be ruled out, our economic analysis suggests that efﬁciency considerations must have steered the decentralization process. Let us start with the efﬁciency gains that theoretical analysis might predict, and then brieﬂy assess how well the case ﬁts the theory. First, while it would be presumptuous to claim that the optimum size of a state can be calculated, we can nevertheless make some assumptions about the size beyond which a state is either too small or too big – and concentrate on the latter.22 In economic terms, a state can be too big because the beneﬁts (the cooperation rent from unitary legislation) do not increase inﬁnitely with increasing territory. Instead, we observe moral hazards, increasing interest conﬂicts, and conﬂicts with neighboring states that demand higher defense budgets, all of them progressively increasing governance costs. The political leadership in China has ample evidence for these cost factors ranging from complaints about the lack of “spontaneous enthusiasm” by the “masses,” to large scale intra-elite conﬂicts and military action along its borders. If a country such as China does not want to split, then it has to search for an effective low-cost governance structure. Constitutional economics suggests two ways forward: one is to reduce the scope of government action by shifting functions executed by the state (and paid by the general taxpayer) to

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the private sector and allowing individual and collective actors to organize production and distribution amongst themselves. To the point that private action leads to higher efﬁciency and subsequently higher income, on which state revenue depends, not only society at large but also the national coffers beneﬁt from such a course of action. Second, efﬁciency gains can be expected from decentralization, as such a governance structure deals better with the spatial dimension of economic problems, and with the spatial dimension of people’s preferences. This second course of action is the more advantageous if there is “fair” taxation, i.e. one in which tax payments are linked to speciﬁc and identiﬁable public services.23 Efﬁciency gains can also be expected if functional jurisdictions supplement territorial jurisdictions. The term functional jurisdictions refers to clubs and networks established by individual actors who share a common interest in the provision of public goods and who for that reason pool resources in order to produce them. Territorial jurisdictions refer in this case to sub-national territorial entities. These points will be elaborated further in the fourth section, in which we deal with the demand side. All in all, decentralization offers productivity gains relative to centralization (central legislation) in so far as it allows: 1 2

3

4

Production of public goods at lower costs, in particular when the large overhead costs of state bureaucracy can be reduced or eliminated. Innovation, as local producers usually know more about the economic problems involved than central state ofﬁcials (the problem of asymmetric information and “localized learning”).24 Exploitation of specialization gains to the extent that different producers of public goods have an incentive to specialize in one component of the end-product. Reduction of the dead-weight losses of taxation that occur when taxpayers feel that they get nothing back for the money they were forced to transfer to the state and change their behavior accordingly, either by leaving the ofﬁcial economy or by reducing personal work effort.25

It seems that Chinese debates about economic reform closely mirror these economic arguments. Once it had been agreed (1978) that the country was too big to be controlled by one hierarchical organization and ﬁat,26 the center had two general alternatives. It could pursue mechanical decentralization by trying to divide the country into subdivisions of comparatively equal size – in terms of population, territory, industrial base and so on – and empowering the new divisions with the right to legislate (to levy taxes, formulate regulations or hand out subsidies for which the new divisions get a share of the national budgets within neatly deﬁned areas). This is the model that Napoleon adopted when he transformed the political landscape of France by establishing an administrative network relying on the prefectures, sub-prefectures, and departments. This can be achieved only at considerable

258 Barbara Krug cost, not least compensating the entrenched interests that stand to lose power and sources of income. The guillotine and the terreur conveniently resolved that problem for Napoleon.27 In the case of China, the Cultural Revolution demonstrated how big the costs could be for a political center seeking to change the national political structure. In China, it seems, the leadership assessed the costs of such transformation as prohibitively high.28 The alternative is to start with inherited institutions, in this case the provinces,29 and establish an open architecture for the governance structure that allows experiments in the scope, nature, and size of government. As noted, decentralization can lead to efﬁciency gains to the extent that it matches the geographical dimensions of economic problems and the geographical dimension of individual preferences. In China, where the idea of differing individual preferences is ruled out by an insistence on cultural homogeneity, economic considerations narrow down to the calculus of comparing expected gains from scale economies with expected gains from private exchange, private trade, competition, and open access to markets. A review of the case studies shows how closely the debate about provincial versus national economic policy during the 1980s reﬂected the economic arguments at the expense of cultural ones. First came the debate about scale economies versus specialization gains. Proponents of the former believed and still believe in the usefulness of extensive growth and insisted that with more input, such as capital and technology, large state ﬁrms could become competitive. As the case studies reveal, this argument was employed when strong self-interests were involved, namely by managers of state ﬁrms or in localities where state ﬁrms dominated the industrial structure.30 In other cases, as in Zhejiang, Henan, and Guangxi, the provincial leadership insisted on subordinating provincial interests to the larger economic unit of the national planned economy.31 Proponents of productivity-led intensive growth, on the other hand, correctly argued that state ﬁrms had exhausted economies of scale and that further efﬁciency gains could only be expected from changes in the incentive structure for old and new ﬁrms. The conﬂict was resolved, as Mao would say, in practice. When a number of small-scale ﬁrms that initially lacked “size,” capital, workforce, and equipment proved to be highly competitive, and began to undermine the monopoly rent of state ﬁrms, the proponents of the ﬁrst course lost the debate and often surrendered their positions within provincial governments as well. The turn-around occurred during or at the end of the 1980s in Sichuan, Zhejiang, Shandong, and Hainan, while Liaoning, Shanghai, Guangxi, Shaanxi, and Guizhou appear to have waited until after Deng Xiaoping’s southern tour of 1992.32 Second, there was some debate on establishing special regions that would receive preferential treatment in the national budget. Starting with the very ﬁrst plan in 1978, under which the whole of China was to be divided into different regions, several provinces including Sichuan, Liaoning, Shanghai, Guizhou, and Shaanxi tried to imitate central procedures for creating special

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regions.33 But functioning economic districts cannot be created in a planning commission, and attempts to select particular cities or regions as special economic zones or open cities carry attendant risks. A striking example of the latter is the attempt to turn one city in Guangxi (Beihai) into a foreign investment center. Only US$2.9 million of the US$30 million investment fund offered by Beijing for upgrading the infrastructure of Beihai City was invested after ﬁve years.34 The choice of economic regions must follow the geography of economic problems as well as the geographical distribution of people’s preferences in order to become a source of efﬁciency gains.35 When it emerged that neither the national plan for establishing special regions nor different provincial plans to carve out special economic districts would deliver on their promises, such plans were scrapped or neglected, or replaced by alternative economic policies that relied on incentives, competition, and prices. Again, efﬁciency considerations prevailed. In sum, although the Chinese leadership may have been operating on crude economic assumptions, it was not far wrong. Behind the twists and turns of policy lay some sound economic policy as prescribed in NPE textbooks: the leadership reduced the scope of government, it decentralized the economic system by making inherited provinces the focus of decentralized jurisdictions (thus introducing jurisdictional competition), and it introduced tax farming while simultaneously hardening budget constraints. For provinces such as Guangxi, Liaoning, Sichuan, Anhui, Hainan, and Guizhou, the turning point came when provincial leaders realized that foreign direct investment could not compensate for the loss in transfers (subsidies or capital allocation) from the central budget.36 The same case studies also reveal that a relatively “free” ﬂow of goods, capital, and labor introduced inter-provincial competition for scarce resources, not least by offering favorable legislation for investors, in particular for foreign ﬁrms. At the same time, provincial policies aiming to concentrate investment and infrastructure and to provide relief from central control introduced intra-provincial competition among township and local leaders who could increase their power (and budgets) by turning themselves into entrepreneurs.37 Not surprisingly, the effect was an increase in overall efﬁciency. It is tempting to argue that increasing efﬁciency resulted primarily from the re-emergence of the private sector and the TVEs, and hence that the introduction of private property rights and price liberalization was all that mattered.38 This argument overlooks the process by which property rights are introduced, as well as the high premium a state must offer to all potential entrepreneurs, regardless of whether they are Schumpeterian entrepreneurs or collective entrepreneurs on the TVE model. An institutional analysis, by contrast, suggests that the open architecture of China’s governance structure at the start of the reform era placed that country in a better position than any alternative recommended by self-proclaimed Western advisors who favored a US or European model of governance structure. Different provinces experimented with different incentives, and the jurisdictional competition

260 Barbara Krug provided by provinces gave rise to a level of adaptive efﬁciency required by an economy in transition.39 The province at the provincial level The equation of “Chineseness,” “one China,” and “a centralized (Communist) party-state” makes clear and unequivocal sense at the political center. At the provincial level things look rather different. Here, the equation is certainly not the salient feature in decision-making. At this level, lofty ideas of a socialist utopia or of a singular Chineseness need to be translated into enforceable policies. Constraints imposed by natural and cultural endowment need to be taken into account, lest social and economic change escape the control of the party-state with the unwarranted effect that the center can no longer steer their development. Provincial leaders need to weigh carefully the trade-offs between compliance with the center and the need to respond ﬂexibly to actual requirements in the province, the more so as the demand side makes itself heard. The province, we noted, resembles an open arena in which a few powerful players on the supply side (such as the political leadership or their allies in the business community) face variable and various players on the demand side. To date, no clear rules deﬁne how coordination between the two sides should be effected. This explains the frustration of attempts to analyze processes ranging from conventional bargaining, to exchange of bribes and favors, to log-rolling and even, in the case of the village, to include voting. Fortunately, two related constants allow us to embark on a more systematic analysis. First, to achieve more decentralization the province needs a minimum level of independence from central control. Second, there must be someone on the demand side who wants or proﬁts from a decentralized governance structure. As the case studies indicate, decentralization at the provincial level refers to two separate features of a governance structure: less control from the center, and less provincial control over the economy and society within provincial boundaries. Thus, while the province features on the demand side for decentralization at the national level, it is the major supplier of decentralization at the provincial level. In terms of our earlier discussion, the question also arises as to whether the offer of a more decentralized structure is based on cultural or efﬁciency grounds. Today’s provincial leaders work under a number of new constraints. First, they have to respect a harder budget constraint. Their budget deﬁcits are no longer automatically covered by the national budget, with the notable exception of deﬁcits in state industries located within provincial boundaries that are not under provincial jurisdictions. Regions that rely heavily on one ﬁrm or one industry face negative externalities should this industry collapse. The collapse of an industry (or ﬁrms) leads simultaneously to a decline in the value of property and human capital connected to these industries, and

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subsequently to the decline of provincial tax revenues. Provincial leaders have, therefore, an incentive to see state industry subsidised, the more so the larger the state sector in the province.40 It is therefore misleading to take a province’s lobbying for state transfers to state industry as an indicator of political conservatism. It is rather an attempt to safeguard the tax base. Yet, as case studies of Tianjin, Heilongjiang, and Shanxi41 show, money transfers for state industry are not without cost, since they invite greater central control and leave a provincial leadership less empowered to deﬁne policy. The most dramatic case of a “province” strangled in this way was Shanghai before 1992. In order to ﬁght off central (resource) control the province needs to build up other revenue sources. Hence the provincial leaders’ willingness to offer incentives to other forms of ﬁrms, such as private companies or TVEs, or foreign investors.42 These attempts may be interpreted as an investment in future returns, for new ﬁrms and workplaces provide an alternative tax base outside the planned economy, and provide a more reliable source of income than transfers from the center. Decentralization is driven by the interest of the provincial leaders to build up such a tax base, under the pressure of hard budget constraints, with a view to increasing their disposable budget, or their freedom to spend according to their own plans and policy designs. It is worth mentioning that one part of the much-deplored corruption at the provincial level serves the same purpose.43 Provincial party or state cadres have an incentive to give a hand when it comes to escape central regulation and centrally controlled taxes, as this leaves ﬁrms and income earners within their jurisdiction with higher net income. A second constraint is competition from other provinces. Here, the same line of argument can be applied, at least in principle. To the extent that other provinces offer a better deal to foreign investors a given province may lose out in the race for foreign capital, as Shanghai did in the 1980s.44 To the extent that a given province employs a tax and regulation mix that leads to higher investment and production costs, even “native” ﬁrms will move to other places, perhaps by establishing subsidiaries as in Hainan.45 And to the extent that other provinces offer more (or more lucrative) labor opportunities, out-migration will set in, as for example in Sichuan or Anhui.46 Yet interprovincial competition is imperfect in China today, as provinces can close markets and establish all kinds of monetary and nonmonetary trade barriers. Greater inter-provincial competition requires a strong central government, or more precisely a binding constitution, to insist upon and enforce a domestic free-trade principle. Free trade appears to be more effective as an administrative design in the case of border provinces or greater economic regions, as for example in the case of Guangxi and “Greater Southwest China.”47 Provinces that settle for domestic and international export-led growth will do better in terms of net returns and proﬁt from the spill-over effect that liberalization in the export sector creates, in terms of the increase of the provincial value-added. This phenomenon offers additional insights

262 Barbara Krug into the process by which economic development sets new incentives for institutional change within one country. The third constraint is deﬁned by the populace, or more precisely the populace’s response to government regulation and taxation. A reforming provincial leadership needs to heed its populace, even in the absence of elections, due to what constitutional economists call Thiebout-voting, or Hirschman’s exit.48 It must open up avenues for private as opposed to state-organized collective action. The operating mechanism is the freedom of individual actors to stay or leave once governments surrender control over movement and settlement, capital ﬂows and workplace creation. So an estimated 5.5 million people left Sichuan in 1993, for example, and many people moved to Hainan to take advantage of better conditions and higher returns.49 A provincial government might not worry about people leaving the province when unemployment and underemployment levels are high. However, the moment tax-paying actors such as investors and entrepreneurs leave the province, the effect is directly felt in the local and provincial budgets. In other words, lowered exit costs give the individual actor leverage. Here again the difference between the national and the provincial level matters. It would take migration waves of a considerably higher scale than is evident today to make themselves felt at the national level, the more so since labor outﬂows from China are easily compensated for by capital inﬂows from foreign investors. Individual provinces, on the other hand, need to take the exit option seriously. They have to nourish a stable and reliable tax base by offering an economic and political environment that entices its population to stay, at a minimum, or better still attracts capital but not workers from outside. In short, to give in to demands for more decentralization at the provincial level is proﬁtable on efﬁciency grounds. This, however, makes it difﬁcult to assess whether a province is changing due to its speciﬁc culture or due to efﬁciency considerations. In particular, to conclude that those provinces that attempt to establish a more decentralized structure do so because they have a stronger provincial identity and face more demands from intra-provincial cultural groups can be short-sighted, as the case of Guizhou suggests.50 Such a conclusion overlooks the mutual dependency of the provincial leadership and the business community. While public budgets depend increasingly on revenue from the business community and earners of taxable income, the business community depends on favorable legislation to become (and remain) competitive. Lobbying at the national level for more power to legislate is thus a necessary ﬁrst step to increasing the province’s ranking among other provinces and to ﬁll the provincial coffers, as Shanxi and Guizhou soon discovered.51 In economic parlance, the supply-side curve changes its slope, indicating more responsiveness (a higher elasticity in supply) to changes in the price one has to pay for maintaining a centralized, controlled economy.52

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Summary 1: comparing provinces One way of summarizing achievements thus far is to claim that decentralization as a speciﬁc form of institutional change may be explained by employing approaches developed in the NPE. The case studies support the claims that: 1 2

3

Decentralization in China was agent-driven and shaped by the interaction between politics and the economic sector. Decentralization was the outcome of political rather than economic entrepreneurship at the national and provincial level, steered predominantly by efﬁciency considerations, with the result that there is less ﬁat and more cooperation in China. Decentralization at the provincial level occurred as a systematic response by provinces to changes in constraints imposed by either the political center in Beijing or by provincial agents.

Three changes in constraints stand out: the hardening of the budget constraint, the introduction of (jurisdictional) competition between provinces, and exit/voice. As the ﬁrst two constraints depend crucially on decisions taken by the central political leadership, the analysis reminds us of the role the party-state played in the development toward a more decentralized political system. It is the third constraint – lowered costs for exit/voice and subsequent dependency between local political leadership and economic entrepreneurs – that pushes decentralization toward institutional solutions that allow economic and social actors to combine their individual selfinterest with the interests of the political leadership. Put differently, decentralization determines how the gains arising from the new governance structure are shared among political and economic/social actors. An economic analysis then expects provinces to differ with respect to the forms of a decentralized governance structure and with respect to the sharing parameters that determine how the cooperation gains produced by decentralization are shared among political entrepreneurs and economic (and social) actors. The ﬁnal result points to a fruitful area of empirical analysis; that is, one that concentrates on the demand side of the political market, with a view to assessing whether and how much economic and social actors actually proﬁt from decentralization. This problem will be taken up presently. Generalizations based on case studies, if valid, should allow formulation of “testable” hypotheses. Although not testable in any econometric sense, the above hypotheses can be exposed to a simple reality test. In short, if all provinces respond to changes systematically we should be able to “predict” the changes or responses. Three identiﬁed constraints may be treated separately for analytical purposes: the hard budget constraint, competition nationally and within provinces, and exit/voice.

264 Barbara Krug The hard budget constraint While all provinces were forced to bring their budgets closer to balance, a number of case studies show that transfers continued to ﬂow to state industries located in provinces, and that centrally planned investment did not stop. Moreover, capital inﬂow accompanying foreign direct investment is a strong substitute for investment ﬁnanced by taxes. Thus, the larger the continuing national transfers (subsidies and central investment) or the smaller the reductions in transfers, during reform, the smaller the change in provincial economic policy. Neither the political leadership nor economic actors have sufﬁcient incentive to change behavior. This version of the hypothesis sounds almost banal, but not the complementary version: the smaller the amount of national transfers or the larger their reduction uncompensated by foreign direct investment, the more radical the shift towards a liberal economic policy, starting with a demand for more provincial autonomy which enables the provincial leadership to draft legislation to better accommodate the needs of economic and social actors in the province. In other words, the analysis expects the “poorer” provinces of the planning era to demonstrate more radical behavior in their policy environment. Likewise, the smaller the amount of national transfers or the larger their reduction compensated by foreign direct investment, the higher the demand for “autonomy,” yet the lesser the need to accommodate the interests of provincial (as opposed to foreign) economic actors. Competition between provinces and sub-provincial jurisdictions It is doubtful that the reforms intended to make use of jurisdictional competition. Nevertheless, the result is that provinces began to compete for central state-controlled resources, for a stable tax base, and for foreign direct investment (and hence access to international capital markets). Case studies show that provinces have been affected differently. The extent to which each province is exposed to competition depends on its location and on local consequences of the central leadership’s decision to “open up” the provinces, a decision accompanied by transfer of legislative power. Thus, provinces that face more intense domestic or international competition embark on an economic policy that allows entrepreneurs to search for market niches and comparative advantages resulting in specialization gains. Regardless of whether the entrepreneurs are individual (Schumpeterian) or collective, and whether or not their activity is in the agricultural, industrial or service sector, we expect to ﬁnd economic policies and institutions that will accommodate the self-interest of producers. The effect will be a more diversiﬁed supply of goods and services produced by private, collective, and state ﬁrms. The analysis also predicts a drop in the provision of such public goods as would beneﬁt only consumers or private households. In contrast, provinces still protected from domestic or international competition have

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less incentive to look for specialization gains. Instead they will proceed with an economic policy that attempts to expand their industrial capacity, either by further lobbying for state-allocated capital or by offering higher premiums for foreign direct investment. The effect, here, would be an economic policy that concentrates on infrastructure and large investment projects. There is a difference between the two cases which should not be underestimated. In the latter case, there will be a close alliance (or oligopoly) between the provincial leadership, central state bureaucrats, and foreign investors, who share an interest in “closing” the political arena from other economic actors and social groups. In the former, however, the province will focus more on the broad base of small and medium entrepreneurs who gain access to the political arena in return for their contribution to overall development (and tax payments). The combination of budget constraint and competition points to a further result, namely that decentralization in China today is seen as a means to increase overall efﬁciency. How far such economic decentralization develops into legislative decentralization depends crucially on the willingness of local (sub-provincial) agents, such as villages or districts, to turn themselves into entrepreneurs and be “successful” in running their villages. Exit and voice People in China today face lower costs for exit and voice when compared to the Maoist era. Yet, once more, the case studies show that people are affected differently depending on the province they live in, since mobility costs, unemployment levels, or number of workplace-generating institutions differ. So too the willingness to protest or strike differs among provinces, or more precisely among social groups that live in different parts of China. Taking into account the generally high unemployment level, emigration from one province can hardly place an effective constraint on provincial behavior. Exit and voice therefore appear in the form of capital movements, i.e. the threat to invest in another province, and in forms of protest whose suppression needs to be ﬁnanced out of the provincial coffer. Thus, provinces in which there are numerous domestic or foreign capital owners will embark on an economic policy that sets high premiums for further investment by offering legislation and complementary state-ﬁnanced infrastructure investment. In other words, the “richer” the province the more accommodating it will be to the needs of private and collective entrepreneurs. Once more, the mutual dependency of political and economic entrepreneurs will shape economic policy and decentralization. This result does not mean that the poorer the province the more it will care for the need of private households; hard budget constraint does not allow this. The result rather supports the theory of Collective Action,53 which tells us that in order to push economic policy into the direction of catering for the need of private households, organizations are needed on the demand side of the political market.

266 Barbara Krug The costs of protest also have provincial and national elements. Thus provinces facing unrest and protest whose suppression needs to be ﬁnanced out of the provincial budget will accommodate the protesting groups, depending on costs, while provinces where unrest leads to central intervention (as in the case of Tibet or Xinxiang) have no incentive to change their policy with regards to protesting groups. It is beyond the scope of this chapter to test the foregoing hypotheses on the basis of existing case studies alone, not least since rigorous testing would require further data collection. The hypotheses are worth presenting here, nevertheless, to suggest an agenda for further research and to demonstrate how distinct case studies can be integrated into a greater or more general scheme. This allows us to question each province’s uniqueness, to move one step closer towards generalizations, to compare provinces by other than socio-demographic or geographical data, to analyze processes behind different forms of decentralization, and, cautiously as ever, to predict future developments.

Summary 2: the demand side for decentralization as a research agenda Much more problematic is the demand side of the political market; that is, cases where institutional change is initiated by private economic or social actors. Here there are severe conceptual problems, suggesting that more theoretical research is required in order to analyze institution-building from below. Nevertheless, empirical studies on China (and other countries) can help to shape the research agenda, and point in directions likely to lead to fruitful research outcomes. Our case studies show that private, individual, and collective actors play a greater role in China today than in the pre-reform era. That these actors make full use of the greater leeway granted by the central political leadership is a result that might be predicted not only by economic analysis. What is of interest here, however, is the question of which groups have an incentive to push for further institutional change, and particularly which have an interest in calling for more decentralization within a province. When, as above, groups are singled out according to their interest (on efﬁciency or cultural considerations), economic analysis offers a range of arguments. These include the signiﬁcance of clubs. The emergence of clubs Who or what would an economic analysis expect to ﬁnd asking for more decentralization on efﬁciency grounds, on the demand side? Generally those who claim cooperation rent from being allowed to solve economic problems, independently of the state plan, within a speciﬁc territory. The territory is usually smaller than one province and need not fall completely within one

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province. Such an association of private joint owners of resources is called a club. NPE shows that efﬁciency gains do indeed occur in the case of the “commons”; that is, in the case of public goods that the market fails to produce (or produce in sufﬁcient quantity) but that are produced more expensively by the state.54 The efﬁciency of club production depends crucially on, ﬁrst, the exclusion of outsiders from consuming the public goods whose production they have not contributed toward, and, secondly, on internal communication and participation.55 Hence these clubs will ask for a functional jurisdiction that allows them to establish their own governance structure.56 Functional jurisdictions can be found universally and seem to have preceded later forms of democracy based on territorially deﬁned constituencies.57 In China, the long existence of irrigation societies is an obvious example of a functional jurisdiction that predated the modern era. Indeed these societies were scrapped on the grounds that only a central state in close control of resources could “modernize” the economy.58 Yet “traditional” jurisdictions may enhance modernization. Recently, international organizations such as the World Bank have begun to acknowledge that dismantling clubs based on inherited structures can mean foregoing chances for economic development.59 In today’s China there is an increasing number of clubs, or groups of people who want to pool resources, and who claim that efﬁciency gains depend crucially on the right to build appropriate jurisdictions around these jointly owned resources. The most numerous are the TVEs, which served as the driving force behind the high growth rates of the reform era.60 The success of the TVEs cannot be explained without reference to the institutional environment built around local industry, which generated transactioncost advantages high enough to compensate for the poor capital equipment with which they usually started.61 In this context, village compacts (or village constitutions) that include procedures for voting, debate, and the provision of common-law agencies (such as ethics committees), appear as institutional devices for coordinating different interests within a village. At the same time, they predetermine how the returns from the village’s economic activities are shared among different actors. Once more, it is the mutual dependency between a revenue-starved political leadership and revenue-generating economic actors which becomes the salient feature in institution-building, simultaneously setting incentives for political leaders to become entrepreneurs while ruling out political alternatives that would weaken the tax base. Decentralization thus appears in the form of clubs that claim an institutional environment matching the geographical dimension of an economic problem. Yet, analysis of the commons suggests further that a governance structure works better the more it can rely on a (local) culture. This brings us to the last question – namely, is there a culturally-driven movement for greater decentralization?

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Summary 3: the demand for decentralization and cultural diversity Culture is a useful but imprecise term that requires clariﬁcation in every particular application. “China” is an umbrella under which numerous groups or sub-cultures hide themselves. Our ﬁrst question is what constitutes a culture within the umbrella of “China.”62 Economics aside, the social sciences generally start with a deﬁnition of culture before proceeding with their analysis. Two cultures stand out in a review of the social science literature on China: the extended family and ethnic groups. There are of course other candidates, including “local cultures” (as in “Shanxi local culture”) and religious groups. Identifying a common denominator linking these arbitrarily deﬁned cultural units presents a challenge for further studies. In evolutionary economics, however, “culture” stands for a conceptual term at the end of an analysis of group behavior or collective action. Experimental economics,63 game theory,64 and evolutionary economics65 all end up with the same conclusion: that a group is one in which members interact more with each other than each does with the outside world. The interaction refers to production, exchange and the pooling of resources, including manpower, capital, and ideas. If the interaction refers further to the establishment of a common language, common gods, common manners or customs, and common norms such as reciprocity, then a group is not a club but a cultural community. The economic value of groups in general, and of cultural communities in particular, is that resources needed for enforcing promises (contracts), monitoring behavior, and sanctioning are lower within the group than among strangers whose activities are coordinated and sanctioned by imperfect or even perfect markets. As long as members comply with the written or unwritten governance structure, the level of honesty, loyalty, and voluntary contribution to common effort is higher within the group than between the group member and the outside world. This signiﬁcantly reduces transaction costs.66 Culture also deﬁnes the properties of a group within which honesty and loyalty are valued, and whose norms are passed on to the next generation via education and socialization. A culture dies when it becomes detrimental to the well-being (material or otherwise) of the group members. This generally follows a process of involution67 involving exit, when group members leave and search for other group memberships, or involving free-riding, when increasing numbers of people exploit the honesty and loyalty of the rest until nobody is left on whose effort and voluntary contribution the riders can proﬁtably travel “free.”68 Cultural groups survive via protest, namely, when group members press for modiﬁcations so that the cultural group generates sufﬁcient cooperation gains to survive in a changing environment.69 The implications of such an analysis for contemporary China are numerous. First, there may be many more cultural groups within one province than hitherto identiﬁed. If the foundation of a cultural group is not

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settlement, but interaction, then networks should be included in any analysis of intra-provincial diversity.70 This would include cultural groups such as party networks, and professional groups such as the army or the new middle classes.71 Second, groups should be evaluated not only by their economic or functional value. Groups also carve out a hospitable niche for their members.72 We know that people do not want states merely to maximize monetary income or growth rates. Nor do they want to see the market ruling everything. There is little support for an open bidding process for the allocation of women to men (or men to women) in place of today’s customs of ﬁnding a spouse. Nor do they want the “state” telling them how and whom to marry, even if this should be done with the best of intentions. Instead, people want to decide for themselves in which arena activities (demand and supply) are to be coordinated. What is needed is an analysis of which groups choose to make use of which arena for coordinating which activity. There may be a group of people who do not mind their dead parents being disposed of according to bureaucratic rules that claim medical reasons for burying the corpse quickly. There might be groups of people who are willing to take health risks consequent on following rules that insure a more digniﬁed funeral as prescribed by custom. There might be a group of people who ask a local government to provide the necessary infrastructure that allows them to combine health considerations with old customs. Or there might be a group that wants to invest in the necessary (cooling) equipment but wants in return a tax legislation that allows them to invest at low cost. This is one example that might be drawn from thousands. It highlights the need to single out the kind and volume of activities that culture groups want the state to coordinate, those they want the market to allocate, and those they insist on doing themselves according to rules of reciprocity, rites, or whatever. To the point that cultural groups think a state can best take care of one activity, such as infrastructure investment, or (as in the case of continental Europe) primary education, a centralized structure will be accepted. When groups think the market can best take care of some activity, let’s say the production of bicycles, they will demand privatization from the political process. When, however, they think that some activities should be provided according to rules of reciprocity and shared norms of a speciﬁc cultural group, they will ask for a more decentralized structure. Without taking account of group preferences, within their own hospitable niche, our analysis is at a loss to deﬁne the location and shape of the demand curve. Third, the survival of a speciﬁc cultural group depends not only on the leeway granted by the political institutions, but also on competition from other groups. As the case study on Guizhou, for example, makes quite clear, the culture of minorities in the province is threatened not only by a traditional party-state that denies them greater autonomy, but also by a new class of entrepreneurs who turn the speciﬁc features of one cultural group into a marketable good for the tourist industry. What is needed are empirical

270 Barbara Krug studies and conceptual ideas showing how groups interact with each other outside state institutions. Fourth, all groups share an interest in demanding a governance structure that allows them to organize themselves without inhibition. The question remains under which circumstances groups opt to join forces. If all groups made common cause then institutional change would occur immediately, because, by deﬁnition, the political leadership belonging to one or several groups would be part of the alliance. Each group has an incentive to vote for an institutional setting that allows all other groups to organize their activities according to their own governance structures. Yet, at the same time, each group has an incentive to close off different arenas so that it becomes itself the sole provider of certain activities. In plain language, each seeks a monopoly. This problem is known as the problem of rent-seeking. Rent-seeking is an old problem, historically associated with the issue of state centralization. In 806 CE, the Reichssynode (Imperial Synod) made compulsory the Rules of the Order of the Benedictines for all monasteries, putting an end to religious diversity for the next ﬁve centuries by wiping out monasteries that offered any other form of Christian belief. A strong state in form of the Holy Roman Empire was needed to uphold this monopoly. At the same time, however, a centralized state (able to harmonize rules and provide strict hierarchical supervision) may be the only form of state that can eliminate rent-seeking groups. Rent-seeking behaviors can then undermine decentralized government. For this reason the Age of Absolutism was greeted (demanded, an economist might say) by many in Europe. This is also why some European countries today see strong European central institutions as the proper remedy for current rent-seeking behaviors in Brussels. It also helps explain why so many Chinese asked for a strong and united government over the ﬁrst half of the twentieth century – and why, more to the point, economists as well as political scientists invariably blame groups for rent-seeking behavior that limits access to the value-added of an economy. A strong state is not the only solution to the problem. One alternative is a strong constitution that keeps access to the different arenas open, that allows individuals to change cultural groups, and that allows participation and communication. The difﬁculty lies in identifying the process whereby group diversity, having shown its merits on a preconstitutional level, is lifted to a constitutional level. Two plausible models have been mooted. One is Rawls’ notion of a veil of ignorance, an elegant logical exercise whose requirements seldom prevail in real life. The other is the notion of constitution building by good practice.73 The Chinese case may assist us in developing these theoretical models. It certainly would be a challenging and rewarding project to consider, ﬁrst, which practices exercised by cultural groups within a province become common law and how they do so; second, which practices taken up at the provincial level become part of a provincial constitution; and third, which practices a province ﬁnds useful enough to justify lobbying for at the national level.74 In this case, one would have to trace certain institutions

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back to their roots by asking who was the initial institutional entrepreneur, who imitated whom, and how the level of constitutional practice (if not written legislation) was ultimately achieved. All in all, more questions have been raised than answered. Still, we can cautiously claim increasing demand for decentralization on cultural grounds. To be sure, our analysis recognizes and stresses the narrow scope within which cultural groups can realistically expect their demand for more decentralization (and autonomy) to be transformed into corresponding supply. Such a demand will meet a positive response only to the extent that culturallybased jurisdictions promise efﬁciency gains. The conclusion, then, is that (sub)cultures in China which do well, economically, are rewarded with more autonomy than those that can merely claim a large population, an old tradition, or a different language, but cannot promise major contributions to overall outcomes. This is indeed what we observe from the case studies.

Notes 1 To be precise, the neoclassical claim is “a divergence of the economic structure (as different regions specialize according to their comparative advantage) and a covergence of income levels.” See Antony J. Venables, “Economic integration and center-periphery inequalities: the view from trade theory,” in Hans-Juergen Vosgerau (ed.) Zentrum und Peripherie – Zur Entwicklung der Arbeitsteilung in Europa (Berlin: Duncker and Humblot, Schriften des Vereins fuer Socialpolitik Bd. 50, 1997), pp. 33–4. 2 David S. G. Goodman, “The People’s Republic of China: the party-state, capitalist revolution and new entrepreneurs,” in Richard Robinson and David S. G. Goodman (eds) The New Rich in Asia: Mobile Phones, McDonalds and Middle Class Revolution (London: Routledge, 1994), pp. 225–42. 3 Barbara Krug, Chinas Weg zur Marktwirtschaft (Marburg: Metropolis Verlag, 1993), pp. 79–182. For the empirical side, see for example David S. G. Goodman and Gerald Segal (eds) China Deconstructs: Politics, Trade and Regionalism (London: Routledge, 1994); Jia Hao and Lin Zhimin (eds) Changing CentralLocal Relations in China (Boulder: Westview, 1994); David S. G. Goodman, China’s Provinces in Reform: Class, Community and Political Culture (London: Routledge, 1997); Peter T. Y. Cheung, Jao Ho Chung and Zhimin Lin (eds) Provincial Strategies of Economic Reform in Post-Mao China: Leadership, Politics, and Implementation (New York: M. E. Sharpe, 1998); Hans Hendrischke, and Chongyi Feng (eds) The Political Economy of China’s Provinces: Comparative and Competitive Advantage (London: Routledge, 1999). 4 There is no common name for those approaches which rely on economic reasoning while addressing problems of politics in its widest sense. Terms such as Public Choice, Rational Choice, and New Institutional Economics are used indiscriminatorily, although the differences among them can be considerable. What these approaches have in common is (1) methodological individualism, (2) a Popperian (positivist) foundation, and (3) a rejection of the notion that the price mechanism (the market) is the superior, if not natural, device for coordinating individual action. New Political Economics basically stands for the economic theory of

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politics. It is no longer normative (like its predecessor) but, unlike Public Choice, is less concerned with quantitative models that allow predictions. Instead, models are searched for which allow insights into collective behavior and into interaction between politics and the economy. The best book for an overview is Dennis Mueller, Public Choice II (Cambridge: Cambridge University Press, 1992, 2nd edition). The classic work is Douglas C. North, Structure and Change in Economic History (New York: Norton, 1981). See also Jon Elster, The Cement of Society (Cambridge: Cambridge University Press, 1989). For a discussion of ‘induced change’ see Nigel K. Nicholson, “Applications of public choice theory to rural development,” in Clifford S. Russell and Nigel K. Nicholson (eds) Public Choice and Rural Development (Washington, DC: Resources For the Future Inc., 1981), pp. 17–41. See Barbara Krug, Chinas Weg zur Marktwirtschaft (Marburg: Metropolis Verlag, 1993), chs 6 and 7, pp. 183–270. The debate in economics uses the terms “economic” or “ﬁscal” (as opposed to) “political” federalism. See the classic works by Mancur Olson, “The principle of fiscal equivalence: the division of responsibilities among different levels of government,” American Economic Review 59 (1972), pp. 479–87; Wallace E. Oates, Fiscal Federalism (New York: Harcourt, Brace, Jovanovich, 1972); Bruno S. Frey and Reiner Eichenberger, “Competition among jurisdictions: the idea of FOCJ,” in Leo Gerken (ed.) Competition among Institutions (Oxford: Macmillan, 1994), pp. 209–29; and the summaries in Bruno S. Frey and Gebhard Kirchgaessner, Demokratische Wirtschaftspolitik (Muenchen: Vahlen, 2nd edition, 1994) and Mueller, Public Choice. James M. Buchanan, “National politics and competitive federalism,” lecture at the University of Saarland, 15 June 1993; James M. Buchanan and Gordon G. Tullock, The Calculus of Consent (Ann Arbor, MA: University of Michigan Press, 1962); also Douglas C. North, Structure and Change in Economic History (New York: Norton, 1981), and Douglas C. North, “Transaction costs, institutions, and economic history,” JITE 140 (1984), pp. 7–17. Another example is provided by functional groups, such as in collective bargaining in the Federal Republic of Germany. In this case, trade unions and employers’ organizations negotiate labor conditions and wages. The result of the bargaining is binding in the sense that the state (in form of the courts) enforces the outcome of collective bargaining. Readers might object to the term legislative power in a non-parliamentarian context. The term is used in the following as a label for different forms of state interventions, such as law-making, regulation, the right to levy taxes, or to establish and guarantee monopolies, as well as direct resource control. The usage does not mean to insinuate that China is moving toward a democratic, parliamentarian system. Paul Bowles and Gordon White, The Political Economy of China’s Financial Reforms (Boulder, CO: Westview Press, 1993), ch. 7, 160–82; Ting Gong and Feng Chen, “Institutional reorganization and its impact on decentralization,” in Hao and Lin (eds) Changing Central–Local Relations in China, pp. 67–88; John B. Knight and Ligang Song, “The spatial contribution to income inequality in rural China,” Cambridge Journal of Economics 17 (1993), pp. 195–213; Andrew G. Walder, “Local governments as industrial corporations: an organizational analysis

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of China’s transitional economy,” Papers in Political Economy (Chicago: University of Chicago, 1994); Christine P. Wong, “Fiscal reform and local industrialization,” Modern China 18 (1992), pp. 197–227. The best overview can be found in Dali Yang, “Reform and the restructuring of central-local relations,” in Goodman and Segal (eds) China Deconstructs, pp. 59–98. In economic parlance, p stands for the shadow price. Krug, Chinas Weg zur Marktwirtschaft, ch. 3, pp. 39–57. It should be noted that both movements indicate a drastic change that must have occurred before; namely, an opening up of the totalitarian state. In the case of the efﬁciency argument, the preceding turnaround was the willingness of the state to assess its regime in terms of efﬁciency rather than in terms of the socialist utopia. In the case of the cultural argument the change led to greater willingness of the state to allow the provinces, the populace, as well as dissenting cadres, to express their preference for greater autonomy. Old theories of induced institutional change considered only technical and change in the natural environment, see Hans P. Binswanger and Vernon W. Ruttan, Induced Innovation: Technology, Institutions, and Development (Baltimore, MD: Johns Hopkins University Press, 1978). Ideally, decentralization according to the models should be coordinated by a democratic political process that offers individuals the opportunity to see their preferences for decentralization transformed into a corresponding supply at lowest cost. In the case of China we do not have to worry about this form of collective decision-making. It is bargaining that coordinates demand and supply. See Krug, Chinas Weg zur Marktwirtschaft, Chs 3 and 4, pp. 39–57. John Fitzgerald “The nationless state: the search for a nation in modern Chinese nationalism,” The Australian Journal of Chinese Affairs 33 (1995), pp. 75–106. Albert O. Hirschman, “Ideology: mask or nessus shirt,” in Alexander Eckstein (ed.) Comparison of Economic Systems (Berkeley, CA: University of California Press, 1971), pp. 285–96. In Schelling’s analysis it would be called the “focal point” that leads to salient outcomes. Thomas C. Schelling, The Strategy of Conﬂict (Cambridge, MA: Harvard University Press, 1963). Gilbert Rozman (ed.) Confucian Heritage and its Modern Adaptation (Princeton, NJ: Princeton University Press, 1993); Barbara Krug, “Moving the mountains: transformation as institution building from below,” in Juergen Backhaus and Guenter Krause (eds) The Political Economy of Transformation: Country Studies (Marburg: Metropolis, 1997), pp. 127–52. ‘Federalist’ is a dirty term in China, indicating secessionists trends. See Prasenjit Duara, Rescuing History from the Nation: Questioning Narratives of Modern China (Chicago and London: Chicago University Press, 1995). That countries can be too small is often forgotten in the present European debate on the European Union. Euopean history offers ample illustrations. Europe in the fourteenth century embraced 1,000 different political entities; by the beginning of the sixteenth century the number had declined to around 500, and at the turn of the twentieth century only twenty-ﬁve survived. Today’s Germany was 314 states between 1648 and the end of the eighteenth century. The United States did start with the conscious decision to unite, i.e. to extend the territory under one legislation in order to better ﬁght off the colonial powers and to dismantle tax systems that, by restricting long-distance trade, kept returns from individual assets low. Rein Taagepera, “Size and duration of empires: systematics of size,”

274 Barbara Krug

23

24 25

26

27 28 29

30

31 32

33

34 35

Social Science Research 7 (1978), pp. 108–27; E. L. Jones, The European Miracle (Cambridge, MA: Harvard University Press, 1988, 2nd edition) ; Dieter Wittman, “Nations and states: mergers and acquisitions; dissolutions and divorce,” American Economic Review 81 (1991), pp. 126–9. On the so-called ﬁscal equivalence principle see Mancur Olson, “The principle of fiscal equivalence: the division of responsibilities among different levels of government,” American Economic Review 59 (1969), pp. 479–87; Wallace E. Oates, Fiscal Federalism (New York: Harcourt, Brace, Jovanovich, 1972). George J. Stigler, “Markets, market failures, and development,” American Economic Review 79 (papers and proceedings) (1989), pp. 197–203. Bruno S. Frey, “Tertium datur: pricing, regulating and intrinsic motivation,” Kyklos 45 (1992), pp. 161–85; Bruno S. Frey, “Institutions affect fairness,” JITE 151 (1995), pp. 286–303. In this sense the party-state resembles big multinational companies which, at some point, also need to address the problem of decentralization and downsizing. Oliver Williamson, The Economic Institutions of Capitalism (London: Macmillan Williamson, 1985). In order to further weaken entrenched interests the adminstrative network lost its power to legislate. Douglas C. North, “Transaction costs, institutions, and economic history,” JITE 140 (1984), pp. 7–17. This comes close to Granovetter’s concept of embeddedness. See Mark Granovetter, “Economic action and social structure: the problem of embeddedness,” American Journal of Sociology 91 (November 1985), pp. 481–510. As in Western democracies, it is not that Chinese agents do not know that scale economies do not go on inﬁnitely with increasing ﬁrms’ size. A quick glance at the history of state industry tells them otherwise. As the debate on the bankruptcy law clearly revealed, the scale economy argument is a smokescreen behind which interest groups, in particular the managers and cadres of the state industry controlling agencies, hide their rent-seeking. For a short introduction on the advantages of a decentralized or centralized structure see Bruno S. Frey and Gebhard Kirchgaessner, Demokratische Wirtschaftspolitik, ch. 3, 56–67; Dennis Mueller, Public Choice II. Keith Forster, “Zhejiang: paradoxes of restoration, reinvigoration and renewal,” in Goodman (ed.) China’s Provinces in Reform, pp. 246–7, 249. See case studies by Hendrischke (Guangxi), Feng and Goodman (Hainan), Schueller (Liaoning), Chung (Shandong), Jacobs (Shanghai) and Hong (Sichuan) in Goodman (ed.) China’s Provinces in Reform, and case studies by Watson (Shaanxi) and Oakes (Guizhou) in Hendrischke and Feng (eds) Political Economy of China’s Provinces. See contributions by Schueller (Liaoning), Hong (Sichuan) and Jacobs (Shanghai) in Goodman (ed.) China’s Provinces in Reform, and those by Oakes (Guizhou) and Watson (Shaanxi) in Hendrischke and Feng (eds) Political Economy of China’s Provinces. Another way to rearrange administrative boundaries so that rural settlements became part of city districts can be found in Belas Tálas, Economic Reforms and Political Attempts in China 1979–1989 (Berlin: Springer, 1991). Hendrischke, “Guangxi,” pp. 34–5. The third requirement, not mentioned so far, is that the different regions or

Why provinces?

36

37 38

39

40

41 42 43

44 45 46 47 48

49 50 51 52 53 54

55 56 57

275

provinces must compete with each other in order to maintain the efﬁciency gains. See the chapter by Christoffersen on Heilongjiang in this volume. See contributions by Feng and Goodman (Hainan), Schueller (Liaoning), Hong (Sichuan) and Jacobs (Shanghai); Oakes (Guizhou) and Watson (Shaanxi) in Hendrischke and Feng (eds) Political Economy of China’s Provinces. Chung, “Shandong,” p. 128. Jean Oi, Rural China Takes Off (Berkeley, CA: University of California Press, 1999). As evolutionary economics argues. See Richard R. Nelson, The Sources of Economic Growth (Cambridge, MA: Harvard University Press, 1996); Barabara Krug, “Blood, sweat, or cheating: politics and the transformation of socialist economics in China, the USSR, and Eastern Europe,” Studies in Comparative Communism 24, 2 (1991) pp. 137–70. Barbara Krug, “Marktwirtschaft als Problem des “Institution Building” von unten., pp. 163–78; Krug, “Moving the mountains,” pp. 127–52, and Christoffersen’s chapter on Heilongjiang in this volume. See Schueller, “Liaoning,” pp. 103–7, and Dorothy J. Solinger, “Despite decentralization: disadvantages, dependence and ongoing central power in the inland – the case of Wuhan,” The China Quarterly 145 (1996), pp. 1–34. The same argument can be found in Watson, “Shaanxi,” pp. 16–17. See Goodman, “Shanxi” and contribution by Goodman in Hendrischke and Feng (eds) Political Economy of China’s Provinces. See Jacobs, “Shanghai,” pp. 168–9. Hendrischke, “Guangxi,” p. 38; Schueller, “Liaoning,” p. 113; Chun, “Shandong,” p. 148; Jacobs “Shanghai,” p. 170; Hong, “Sichuan,” p. 220; Forster, “Zhejiang,” p. 261. A highly suggestive example of ways to attract foreign investors is given in Oakes, “Guizhou,” pp. 45–8. Jacobs, “Shanghai,” p. 169. See Feng and Goodman, “Hainan,” p. 73. See Hong, “Sichuan,” p. 217, and Sun’s chapter on Anhui in this volume. See Hendrischke, “Guangxi,” pp. 35–8 and Christoffersen’s chapter on Heilongjiang in this volume. On Thiebout see Dennis Mueller, Public Choice II; Bruno S. Frey and Gebhard Kirchgaessner, Demokratische Wirtschaftspolitik; Albert Hirschman, Exit, Voice, and Loyalty (Cambridge, MA: MIT Press, 1970). See Hong, “Sichuan,” p. 217, and Sun’s chapter on Anhui in this volume. See Oakes, “Guizhou.” Ibid. See Figure 9.4, fn. 15. Mancur Olson, The Logic of Collective Action (Cambridge, MA: Harvard University Press, 1965). The most comprehensive study can be found in Elinor Ostrom, Governing the Commons (Cambridge: Cambridge University Press, 1990). Lower state efﬁciency is due to the dead weight loss of lowered intrinsic motivation (apathy) of those on whose cooperation efﬁciency gains depend. For the relationship between overregulation and loss of intrinsic motivation see Frey, “Tertium datur,” pp. 161–85, and Frey, “Institutions affect Fairness,” pp. 286–303. See Iris Bohnet, Kooperation und Kommunikation (Tübingen: Mohr Siebeck, 1997). Frey and Eichenberger, “Competition among jurisdictions,” pp. 209–29. See, for example, Avner Greif, “Contract enforceability and economic institutions

276 Barbara Krug

58 59

60 61

62

63 64

65 66 67 68 69

70 71 72

73

74

in early trade: the Maghribi traders coalition,” American Economic Review 83 (1993), pp. 525–48. Prasenjit Duara, Culture, Power, and the State: Rural North China, 1900–1942 (Stanford, CA: Stanford University Press, 1989). R. Crook and J Manor, “Enhancing participation and institutional performance: democratic decentralization in South Asia and West Africa,” Report to the Overseas Development Administration (1995); Manor, “Democratic decentralization in Africa and Asia,” ids-Bulletin 26 (2 April 1995), pp. 81–8. Krug, “Moving the mountains,” pp. 127–52. See the report on the new village constitutions, for example in Lianjiang Li, “The two-ballot system in Shanxi Province: subjecting village party secretaries to a popular vote,” The China Journal 42 (1999), pp. 103–18. The following will use the term culture while the term sub-culture might be more appropriate. We assume that the reader understands that we talk about “cultures” within a Chinese frame. See, for example, Iris Bohnet, Kooperation und Kommunikation (Tübingen: Mohr Siebeck, 1997). See the comprehensive overview in Shaun Hargreaves Heap, Martin Hollis, Bruce Lyons, Robert Sugden and Albert Weale, The Theory of Choice (Oxford: Blackwell, 1992), chs. 7–9, pp. 93–154. See Nelson, Sources of Economic Growth. Barbara Krug and Judith Mehta, Entrepreneurship by Alliance, unpublished ms, Faculteit Bedrijfskunde, Rotterdam, 2000. A term coined by Richard R. Nelson in Sources of Economic Growth. It is intriguing to ask whether socialist culture does not wither away precisely on account of this last reason. On inter-relations between exit and voice see Albert O. Hirschman, “Exit, voice, and the fate of the German Democratic Republic,” World Politics 45, 2 (1993), pp. 173–202. Settlement is a weak predictor for actual behavior as is gender, age or party membership. See Duara, Culture, Power, and the State. See Goodman, “The People’s Republic of China,” pp. 225–30. Reinhard Zintl, “Clubs, clans und cliquen,” in Bernd T. Ramb and Manfred Tietzel (eds) Ökonomische Verhaltenstheorie (München: Vahlen, 1993), pp. 89–118; Krug, “Blood, sweat, or cheating,” pp. 137–70. Robert Benewick, “Toward a developmental theory of constitutionalism: the Chinese case,” Government and Opposition, vol. 33, no. 4 (1998), pp. 442–61; Viktor Vanberg and James M. Buchanan, “Interests and theories in constitutional choice,” Journal of Theoretical Politics, 1 (1989), pp. 49–62. One known example is the reintroduction of crop-sharing contracts as a means of allocating initial rights over land. The practice started in some counties, was quickly imitated by others, and eventually became a national “norm” in China. Barbara Krug, “Moving the mountains,” pp. 127–52.

Index

Absolutism 270 Adams, Vincanne 206 Administration Inspection Districts 23 administration, territorial 17, 20, 21, 23–4, 31, 32 agricultural responsibility system 163 agriculture 47, 48, 76, 98–100, 110, 230; in Anhui 157, 165, 169; in Guangdong 145; in Heilongjiang 239; in Yunnan 190, 192–6; see also rural development; countryside AIDS see HIV-AIDS Akaha 215n35 Akha people 200 Alekseev, V. M. 94 America see United States Amur River see Heilongjiang River Anhui Academy of Social Sciences 160 Anhui Daily 171, 173 Anhui Film Studio 161 Anhui Internal Reference 171 Anhui Province 1, 13, 23, 68, 91, 261; and decentralization 254; development 6; economy 163–5; environment 160; government 38n52; and Great Leap Forward 172; growth 163–8; history 155–6, 161; industry 163–4; intellectuals 160; labor migration 5; language 162; and natural disasters 169; and New Political Economics 259; origin of name 162; politics 155–6 ; population 157; poverty in 5, 6, 153–77; statistics 154; topography 156 Anhui Work 171 Anqing 165–6 Anqing Petrol and Chemical Corporation 164 anti-communism 96; see also communists; Chinese Communist Party

Anti-Corruption and Bribery Bureau (Guangdong) 141; see also corruption Anti-Hu Feng Movement 98 anti-Japanese war 48, 49, 51, 92–3, 96, 158, 188; see also Japan; World War II Anti-Rightist Campaign 99 Anyang 93, 97 Aris, Michael 182 armaments industry 47 armies 15, 49 ASEAN 198 Ashima Culture and Art Company 210 Ashima legend 203–11 passim, 219n96 Ashi people 219n93 Asian Development Bank 7, 198 Australia 214n30, 247 Austria 41 automobile industry see industry, motor vehicle Ba kingdom 48 Bandit-Encirclement Zones 23–4; see also banditry banditry 96, 137; see also BanditEncirclement Zones banking 167, 172 bankruptcy of SOEs 72–3 barbarians 225 barium 47 beggars 153; see also poverty Beian 228 Beihai 259 Beihai Park 256 Beijing 2–5, 201, 212, 220n108, 227 231, 235, 241; becomes capital 94; and Chongqing 43–4, 61, 65–8, 70, 72; and decentralization 254; and Guangdong 128; and Heilongjiang 7, 223, 236, 242; in Ming Dynasty 119; and Nanjie

278 Index 118; and provinces 166–7, 196, 197; radicalism in 159; and Three Gorges Project 56–7, 75, 82n34; and urban hierarchy 26–8, 30; and Yunnan 6, 179; and Zangzhou 107; see also center, centralism Beijing University 102 Beiping 27 Belgium 120n21 Benedictine monks 270; see also religion; Roman Catholic Church Bengbu 173 Bengbu Tobacco 164 Bengbu Work 171 Big Sword Society 95; see also religion; sects Blagoveschensk 228–9 Bohai Gulf 92 Bo Juyi 92 Boluo 132 border ports 226–39; see also ports; trade bribery see corruption Britain 48, 187, 188; see also colonialism Bronze Age 185 Brussels 270 Buddhism 94–5; see also religion bureaucracy 15–16, 44, 224; corruption in 76; provincial 247; state 5 bureaucratization 24 Burma 6, 179, 183, 184, 186 215n35; drug abuse 200; HIV-AIDS in 200; and trade 187; and Yunnan 197–200 Burma Road 187, 188; see also Southern Silk Route cadres 111, 116, 122n63, 170; afﬂuence of 221, 223; in Anhui 173–4; corruption among 141–2, 240–2; despotism of 105; in Heilongjiang 224; involved in smuggling 138; in Yunnan 192 cannibalism 101 Canton see Guangdong Cantonese people 135, 206 capitalism 111; see also market economy Care Australia 191 cave paintings 218n91 CCP see Chinese Communist Party center, political 7, 16, 26, 32, 56, 76; and Chongqing 62, 66, 70–1, 74; and economic planning 66–7; and Heilongjiang 224; and Henan 105; relationship to provinces 20, 21, 23; and Three Gorges Project 77; see also Beijing; centralism; decentralization

Center for Research on Provincial China 1, 8n1 Central Executive Yuan 22, 23 centralism 33–5 centralization 250 Central Plain culture 161 Chahar 19 Chang’an 214n29 Changchun 227, 231 Chaoyang City 232 Chayashan People’s Commune 101; see also collectivization; communes chen see towns Chen Bangguo 64 Chen Duxiu 162 Chengdu 43, 48, 51, 55, 59, 61–3, 80n5, 83n61, 186, 190, 197, 214n29; development 46; industry 46 Cheng Sheng 92 Cheng Yi 92 Cheng Yiju 64 Chen Jiongming 26, 32 Chen Shen 158 Chen Yizi 101 Chen Zhihui 64 Cheung, Peter 4 Chiang Kiashek 23, 25, 33, 92; constitution 35; see also Nationalist government; Nationalist party; Nationalists Chicago 247 Chihli 95 China: ancient 156; history of 11, 14, 48–52, 92, 162; Imperial 14, 16, 18; Neolithic 93; state 21; territorial administration 11; as totalitarian state 273n15; transformation of state 11; weakness 11 China, Nationalist see Nationalist China China, People’s Republic of see People’s Republic of China China, Republican see Republican China China Council for the Promotion of International Trade 228 China Daily 105 China Democracy Party 241 China’s Provinces in Reform (Goodman) 1 Chinese Civil War 93, 158, 189, 215n41 Chinese Communist Party 20, 27, 112, 115; Anhui Provincial Committee 172; Central Committee 81n23, 84n63, 108, 114; and Chongqing City 62, 65; in Civil War 189; and Heilongjiang 224, 239; and Henan 107, 109; and land

Index 279 reform 158; and Nanjie 111; National Congress 63; Politburo 50, 81n23, 84n63; and provinces 248, 251, 256; and regionalism 181; and Stone Forest 210; and Yunnan 188; see also communism; communists; Communist Government Chinese empire see Imperial China Chinese language 204; see also language Chinese University of Science and Technology 166 Chi Zihua 160 Chongjin 227 Chong Hong 68 Chongqing City 2, 3, 27, 41–87, 118n1, 197; area 41; becomes national capital 23; and centre 70; and Chengdu 61–2; climate 46–7; corruption in 72; and Cultural Revolution 52; and decentralization 254; development 46, 49, 67–8; economy 45–6, 54, 60–1; history 44, 48–52; industry 48, 52; and market economy 69; Nationalist Government 49–50; “New” 64–5, 69–70; population 41–2; poverty in 72–3; in reform era 52–4; and Sichuan 45, 57, 59; and State-Owned Enterprises 53, 70–3; status 41, 46; and Three Gorges Project 73–4, 77; topography 46; see also Wanxian City Chongqing Clock and Watch Factory 53 Chongqing Daily 64 Chongqing Municipal Party Committee 44 Chongqing Knitting Mill 72 Chongqing Province 1; see also Chongqing City Chongqing Steel Corporation 64 Christian House Church 95; see also Christianity; religion; sects Christianity 94–5, 182, 188, 204, 270; see also missionaries; religion; Roman Catholic Church; sects Christoffersen, Gaye 7 Chuanbian 19; see also Sikang Province Chuandong 2 “Chu culture” 161 Chu kingdom 156, 186 Chu state see Chu kingdom circuits 11, 21, 22; see also administration; territorial units CIS see Commonwealth of Independent States cities: challenge provinces 12; coastal 44;

in empire 15; hierarchy of 27; in provinces 2, 3; rise of 25–6, 28–30; status of 43; see also urban expansion; urban hierarchy Cities, Direct Jurisdiction see Direct Jurisdiction Cities Cities, Provincial Jurisdiction see Provincial Jurisdiction Cities Cities, Special see Special Cities Cities, Yuan Jurisdiction see Yuan Jurisdiction Cities civic awareness: Guangdong 142–4 Civil War see Chinese Civil War class 97, 168, 191, 209, 211; see also identity Collective Action 265 collectivism: Henan 123n94; Nanjie 109–11 collectivization 97–8, 108, 110, 190; see also collectivism; communes colonialism 182, 187, 204, 212n1 Comintern 108; see also Soviet Union committee system 22–3 Commonwealth of Independent States (CIS) 236 communes 3, 30, 99–101, 159, 190; in Henan 107; see also collectivization communism 182, 204; and Nanjie 111–12; and Yunnan 188 Communist China see People’s Republic of China Communist Government 20, 35, 49; constitution 22; and Henan 97–8; see also Chinese Communist Party; communism; communists; People’s Republic of China Communist Party see Chinese Communist Party communists 46, 158; occupy Sichuan 49; see also anti-communism; Chinese Communist Party; Communist Government; People’s Republic of China “Communist Wind” see Great Leap Forward communitarianism 89 Confucianism 6, 94–5, 161–2, 182, 188, 191, 204, 214n30; see also religion conservatism 174 Constitutional Economics 254 constitutions 22, 114; Can Gun 35; Nationalist 35, 37n30 Construction Planning Committee (Nationalist Government) 66

280 Index corruption 5, 138, 170; among cadres 138, 141–2, 240–2; in Guangdong 140–2; penalties 75–6; see also crime counties 11, 18, 33; and center 16–17; and cities 31; population 18; and provinces 22; and urban expansion 28–9 countries 273n22 countryside 26, 27, 44, 109; Anhui 169; Guangdong 132–3; Henan 97, 104; Yunnan 192; see also agriculture; rural development; peasants; cowry shells (as money) 185–6, 214n25 crime 5, 75–6, in Anhui 171; in Henan 105, 114; in Sichuan 137–9; in Yunnan 199–200; see also corruption; drug abuse; riots; sex industry; smuggling “Cry from the Poor Mountains” (Li) 74 Cuihu Park 216n62 cuisine 160 culture: Chinese 268; and decentralization 267–71; and economics 268–9; Huizhou 267; Shanxi 268 Cultural Revolution 3, 50, 83n61, 84n62, 95, 118; in Anhui 172; in Chongqing City 52; in Heilongjiang 225; in Henan 102–4; and provinces 258; and Stone Forest 202; in Yunnan 190

Department of Organization 62 departments 11; see also territorial units Dian: culture 185; King of 186 Ding Changhe 63 Direct Jurisdiction Cities 27 discos 114, 116 districts 11; see also territorial units Dongdu see Kaifeng Dongguan 132–3 Dongning County 228 dragon metaphor 234 drought 91; see also natural disasters drug abuse 137–8, 199–200; see also crime; smuggling Duara, Prasenjit 31 Du Fu 92 Eastern Zhon Dynasty 93 East Manchurian Railroad 224, 227 ecology see environment economic development 247 see also economy economics 247; and politics 271n4 economic zones 30; see also special economic zones economists 247 economy 69–70; of Anhui 154, 162; of Chongqing 45; of Heilongjiang 221, 226; of Henan 90; planned 25, 29, 30, 70; of Yunnan 193–6; see also market economy education 58, 77, 102, 113, 192, 202, 204, 207; in Anhui 154; in Guangdong 145; in Heilongjiang 222; in Henan 90; in Yunnan 180 egalitarianism 91, 118n2 employment: Heilongjiang 222; Yunnan 180 Enterprise Bankruptcy Law 72; see also state-owned enterprises enterprise groups 235–6 enterprises, rural 163, 223 environment 157, 160, 168 Er-Yu-Wan Border Region 158 ethnic groups see minorities ethnicity see identity ethnography 160 Eyuwan 108 Export Commodities Fair 197 exports: Yunnan 198–9

Dabie Mountain 158 Dachuan 57 Dai 215n35 Dai Houying 171 Dai-Lue kingdom 188 Dai people 189 Dali 186, 188 Dalian City 27, 54, 227, 230–1, 233 Dandong 232 Daoism 94–5, 162; see also religion Daqing 234, 241; oil ﬁeld 225 Daqin River 92 Daur tribe 225 Dazexiang village 158 Dazhai 159, 172 decentralization 35, 249–71 and culture 267–71; and provinces 254, 258; see also centralism; centralization defense industry 50 demonstrations 63, 72, 169–71; see also rebellion; riots Deng Liqun 240 Deng Xiaoping, 95, 174; criticized 103; as military leader 49, 158; southern tour families 110 147, 258; visits Huangshan 166–7; and famine 91–2, 101, 161; in Anhui 172; see also natural disasters Xiao Yang 63, 84n63

Index 281 Fang Yi 167 Fang Yiben 173 Feixi 170 Fengjie County 76 Feng Kexi 64 Fengtian 19 Fengyang County 153, 157, 159, 172 Fengyang Flower Drum 153, 155 feudalism 182 First Field Army 49–50; see also People’s Liberation Army Five Dynasties 17 93 Five-Year Plan: First 59, 97–9, 192, 225; Second 99; Third 67; Fifth 53; Eighth 53, 163, 172; Ninth 165, 167–8, 232 ﬂoods 91–2, 98, 100, 104, 157, 160; see also natural disasters Ford Foundation 191–2, 216n60 Foreign Trade Commission 197 forests 183, 192 Foshan 132–3 France 48, 120n21, 181, 187–8, 204, 208, 215n37, 257–8; see also colonialism; missionaries free market see market economy French language 204 frontiers 179–82, 189, 199–200, 213n13 Fujian Province 24, 43, 130, 147, 254 Fuling City 2, 41, 47, 57, 64–5, 73; see also Chongqing City “Fundamentals of National Reconstruction” (Sun) 22, 32 Gang of Four 103–4, 172 gangs 137 “Gan Culture” 162 Gan Xeuju 64 Gan Yuping 65 Gaoyao 132 garrisons 15 Gaubatz, Piper 182 gender 191, 206, 219n102; see also women General Command Headquarters for Bandit-Encirclement 23; see also Bandit-Encirclement Zones; banditry Germany 199, 247, 272n10, 273n22 globalization 175, 203, 155 Gong, Prince of 48 Goodman, David S. G. 8n1, 181 government: local 33; provincial 32–5, 62, 64 Greater Mekong Subregion 197 Greater Mudanjiang Development Plan 227

“Greater Southwest China” 261 Great Leap Forward 3, 50–1, 98, 100–1, 107–8, 159, 172; and Yunnan 190 Great Northern Wilderness 225 Great Wall 225, 232 Green and Red Gangs 95; see also religion; sects Guangdong International Trust and Investment Corporation 142 Guangdong Province 1, 5, 13, 20, 23, 26, 28, 43, 60, 125–52, 165; corruption in 140–2; countryside 132–3; crime in 137; and decentralization 254; drug abuse 200; economy 126–31; education 126; employment 126 government 34; growth 127–31; and Hainan 45; and Heilongjiang 229; and Hong Kong 127–31; independence of 24–5; living standards 128; as model 4; politics 131; population 125–6; in reform era 125–52; smuggling 200; wages 133; see also special economic zones Guangdong Provincial Protectorate 137 Guangxi Province 1, 13, 134, 136, 161, 183, 196–7; and decentralization 254, 258–9; government 34; independence of 24–5; and minorities 215n35; and New Political Economies 259; and poverty 192 Guangzhong, Emperor 48 Guangzhou 22, 26–7, 29, 32, 54, 132–3, 144; and Heilongjiang 241 Guiyang 55, 190 Guo village 172 “gypsies” 160 Hailing City 227 Hainan Province 1–2, 41, 261; and decentralization 254, 258;and migration 262; and New Political Economies 259; and prefectures 28; separated from Guangdong 45 Haiphong 187 Haixianwei 230 Han Dynasty 16,18–19, 48, 93, 156, 161, 185–7, 204 Han Fei 92 Hangzhon 166 Hani see Akha people Han people 181–3, 190, 201, 219n98; culture 202; migration of 186–7, 225 Han Yu 92 Hangkou 27

282 Index Harbin 27, 64, 223, 224–5, 227, 230–1, 237; and state-owned enterprises 240 Harrell, Stevan 182 health; Yunnan 192, 198 Heavenly Bamboo 95; see also religion; sects Heavenly Order 95; see also religion; sects Hebei Province 27, 31, 91 Heberer, Thomas 3 Hefei City 163, 166, 173; and decentralization 254 He Guanying 85n86 Hegang 227 He Haoju 57 Heihe City 228–9, 233, 237 Heilongjiang Commodity Examination Bureau 237 Heilongjiang Foreign Trade Company 237 Heilongjiang Province 1, 221–46; agriculture 231; and decentralization 254; development 229–30, 233; economic reforms 221, 223, 226; education 222; employment 222; geography 224–5; history 19, 224–6; industry 225, 233, 261; and other provinces 7; population 222; ports 226–9; resists center 7; and stateowned enterprises 231; topography 224–5; trade 221; unemployment 242 Heilongjiang Provincial Border Bureau 227–8 Heilongjiang Provincial Committee for External Economic Relations 230 Heilongjiang River 225, 228–9 Hekou 197 He Long 49 Henan Daily 99 Henan Province 1, 23, 58, 89–124, 155–6; and communitarianism 89; culture 91–2; and decentralization 254, 258; defers reforms 118; economy 90, 105–9; education 90; egalitarianism 91; history 89, 93; instability 105; known as Zhongzhou 92; and migration 161; as model province 3–4, 89–91; natural resources 91; population 90; religion 94–6; as revolutionary model 97–105; and secret societies 94–6; topography 93; trade 90; wages 90 Henan Ribao 104 Henan University 97 Hendrischke, Hans 8n1

Heyhen tribe 225 Hirschman’s exit 262 HIV-AIDS 198, 200 Hmong (Miao) peoples 215n35, 219n93 homocide 170–1, 230 Honan 95 Honda 84n77 Hong Kong 41, 125, 142, 189, 209–10, 235; crime in 137–8; and Guangdong 127–31, 146–8; and Heilongjiang 221, 226–7, 230–1, 241; as market economy 30; and tourism 166; and trade 71, 231; and Yunnan 198–9 hospitals 72 household responsibility system 6, 163, 190–1 Hou Zongbin 104 Huaihe Irrigation Project 167 Huai-Longhair Battle 158 Huainan-Huaibei coal project 167 Huai River 153, 156–7, 167; declared poisonous 168 Huangshan City 157; upgraded to city 166 Huangshan Mountain 156 Huangshan Pine 156, 161 Huangshan Planning Committee 166–7 Huang Yasheng 69 Huayuankou 92 Hubei Province 1, 23, 46, 56–7, 68, 155, 172, 174; and decentralization 254; and migration 161, 186 Hu Gu 11 Hui culture 160 Huidong County 138 Hui Liangyu 38n52, 172–3 Hui people 225 Huizhou 160–1, 167, 132 Huizhou Peasant Uprising 158 Huizhou Province 1, 13, 50, 133, 183, 196–7, 240, 262; and Chongqing 46; culture 269; and decentralization 254, 258; drug abuse 200; minorities 269; and New Political Economies 259; poverty in 192; smuggling 200; and Yunnan 190–1 Hulin County 227 Hunan 133–6; and Chongqing 46; and decentralization 254; and migration 161 Hunchun 228, 230, 232–3 Hu Shi 162 hydroelectricity 47

Index 283 identity: Chinese 260; class 211; ethnic 179–82, 191, 202–11, 220n108; ﬂuidity of 182; national 182; territorial 211 ideology 62, 111, 179 Imperial China see China India 187–8 individualism 116 Indochina 187 industrialization 112; Chongqing 48–9; Heilongjiang 225; see also industry industry: in Chongqing 47, 51; and decentralization 261; defense 47, 70; in Heilongjiang 223, 231, 233, 236, 238–43; in Henan 99, 105; in Kunming 188, 192; local 76–7; motor vehicle 47, 68, 84n77; “rural” 26; and work safety 136; in Yunnan 193–6, 215n41; see also industrialization Inner Mongolia 232, 254 Inspectorate Personnel Ofﬁces 23 intellectuals 98–9; in Anhui 160 interior, development of 44 Irrawaddy River 183 Islam 94, 214n30, 225 see also Muslims Italy 199 Jakobi, Sabine 3 Japan 16 158, 199, 209; acquires Taiwan 19; invades China 19, 24, 27, 49; and Heilongjiang 224–8, 231, 235–6, 242; MITI 239; occupies Shanghai 49; and trade 71, 84n77, 239; see also antiJapanese war Japan Sea Rim Project 227, 231–2 Jehol 19 Jesus Family 95, 119n15; see also Christianity; religion; sects Jews 93–4 Jiamusi 224, 239, 241 Jiangmen 132–3 Jiang Minkuan 50–1 Jiangnan Province 162 Jiang Qing 103 Jiangsu Province 1, 13; and Anhui 155–6, 159–60, 165, 167, 169; economic growth 128–30; industry 68; Nationalist Government in 23–4; origins 162; and urban expansion 28 Jiangxi Province 24, 104, 136, 155–6, 173–4; language 162; merchants 162–3 Jiang Zemin 173, 240–1 Ji Dengkui 103 Jidong County 227

Jilin Province 104, 172, 230–2, 234, 239, 242; and decentralization 254 Jin Dynasty 16, 93, 119n6 Jing Dianying 95 Jin-Ji-Lu-Yu 158 Jin Lie 64 Jiujiang 166 Jixi City 227, 239 Juchen 225 June Fourth Incident 172 Jurched invasion 93 Kaifeng 92–4, 97, 102, 105, 108, 119n6 Chewings, Emperor 157, 162 karaoke 114, 199–200, 206, 210 Kirgiz 225 Korea 51, 224–5, 236; see also North Korea; South Korea Korean people 225 Kunming 55, 183, 186–8, 190, 192, 200, 210, 216n62, 220n108; industrial zone 197 Kunming Chemical Factory 211 Kunming International Trust and Investment Corporation 197 labor: Anhui 164; disputes 140, 239; in Lunan 211; see also employment; strikes; unemployment Lake Dian 183 Lake Erhai 183, 186 language: in Anhui 162; in Jiangxi 162; Latin 204; Mandarin 43 Lanzhou 55 Laos 6, 179, 183, 197, 199, 215n35 Laozi 92, 162 Lasha 55 Latin language 204 Lattimore, Owen 182, 189 law: customary 114; “Organic” 22; rule of 5 leadership 171, 224 Leftism 171 Lei Feng 114 Lhasa 206 Liang Dynasty 93 Liaoning Province 1, 28, 135, 223, 225–6, 231–2, 239, 242; and decentralization 254, 258; and New Political Economies 259 Liao Zhigao 81n23 Li Baohua 172 Liberation Tower 41 Li Boning 56, 74

284 Index Li Dazhou 172 Li Desheng 112, 172 Li Deshui 64 Li Guixian 172 Li He 92 Lijiang 201 Lijian Hong 3 Li Jingquan 50, 52, 59–60, 81n23 Li Lanqing 112 Lingnan 13 Linkou County 227 Lin Qing 120n22 Lin Ruo 133 Li Peng 65–6, 77, 172; visits Chongqing 41 Liquan County 170 Li Si 92, 115 literacy 77, 51, 192, 202; see also education Li Tiezing 223 “Little Gang of Four” 103 Liu Bang 156 Liu Bocheng 49, 158 Liu Shaoqi 84n74, 102, 158, 172 Liu Zhizhong 64–5 Li Wencheng 120n22 Li Zicheng 92 locusts 91; see also natural disasters Lolo 219n93 London 94 Longshan 93 Long Yun 189 Lu Buwei 92 Lu Dadong 50 Luguhu 197 Lunan Yi Autonomous County 181, 203–11, 218n90, 218n92 Luo Gan 112 Luohe City 107 Luoyang 93, 97, 103, 103 Lu Rongjin 172 Maanshan 165 Maanshan Iron and Steel 164, 168 Macau 125 macro-regions 14 maﬁa, Russian 228 malaria 198 Malaysia 169 Maldives 186 Manchu people (Manyu) 225 Manchu rule see Qing Dynasty Manchukuo see Manchuria Manchuria 19, 34, 225

Mandarin language 43, 63 Manzhouli 234 Mao era 49, 190 Maoism 30, 107, 118, 172, 190; in Nanjie 109–15; see also Mao Zedong Mao Zedong 3, 33, 49, 67, 84n74, 99–100, 111–13, 159, 219n98; criticized 108; cult of 14–15; and Cultural Revolution 102; and Great Leap Forward 172; praises Henan 122n48; seen as god 115; visits Xianxiang 109 Mao Zedong Thought see Maoism market economy 26, 31, 69, 223, 261; in Anhui 163; in Chongqing 73; Hong Kong 30; in Nanjie 113; in Yunnan 190, 195–6; see also economy market socialism 196 market-towns 14 Marxism 202 mass media 171 Medicin sans Frontiers 191 Meiling Appliances 164, 168 Mekong River 183 Mengla 197 merchants 160–3, 208; and culture 167 Mianyang 68 Miao see Hmong peoples middle class 168; see also class migration: into Anhui 160–1, 168, 170; of Han 181–3, 186–7, 225; into Heilongjiang 229–30; and identity 220n108; of labor 5, 135–6; of minorities 214n34, 215n35, 218n91; into Yunnan 212 Mi Jiansu 83n61 military 21; as administration model 23 mineral resources 47–8, 187, 238–9 Ming Dynasty 13, 16–17, 19, 92, 96, 158, 186–7, 214n30 Ministry of Foreign Trade and Economic Cooperation (MOFTEC) 230, 236 Ministry of Machinery 64 minorities: and Civil War 190; elite 202; ethnic 145, 183, 187–91, 214n30, 225; Guizhou 269; migration of 214n34, 215n35; poverty of 191, 200; and tourism 202–11; see also identity minzu see identity; minorities Mishan City 227 missionaries 48, 94–5, 181, 188, 204, 208; see also Christianity; religion MITI see Japan “modelism” 91

Index 285 Ningbo 54 Ningxia Province 2, 41 nomads 225 non-government organizations 191 Nongmin Ribao 105 North-east Asian Economic Circle 227 Northern Huai plain 157 Northern Song period 93 North Korea 69, 227; see also Korea; South Korea Noeso people 219n93 NPOs see New Political Economics

modernization 181–2, 267; cultural 24, 202–11; Nanjie 116; Yunnan 190–1, 209 money 185–6, 214n25 Mongol empire 17, 186, 225 Mongolia 232 Mongolian people 225 Moscow 230, 235, 241; see also Soviet Union; Russia Moso people 197 Mount Huangshan 166–7 Movement to learn from Dazhai 159 Mudanjiang 224, 226–7, 231, 234, 239, 241 Mudanjiang Customs Ofﬁce 227 Muling County 227 Municipal People’s Congress, Chongqing 52 Muslims 187, 225; see also Islam Myanmar see Burma

ofﬁcials, local 62–6 oil 226 opium 188, 200; see also drug abuse Orogen tribe 225 “Outline for the Ninth Five-Year Plan” 30 Ouyang De 142 Owenk tribe 225

Nanchong 57 Nanjie model village 4, 89–90; Mao cult 109–18; wealth 124n102 Nanjing 19, 24, 27, 80n6, 186; becomes national capital 23; Nationalists leave 49 Nanzhou 186, 214n29 Napoleon Bonaparte 257–8 Nationalist China 41 Nationalist Government 20, 23–4, 34–5, 49, 66, 158; in Chongqing 50, 70 Nationalist Party 19, 93, 108; see also Chiang Kaishek; Nationalist Government nationalists, Chinese 34 National Tourism Administration 201 natural disasters: Henan 91–2, 104; Anhui 157, 160, 165 Natural Economic Territories 199, 241 Naughton, Barry 26 Neo-Confucianism see Confucianism Neville, Christopher 62 New Birth Church 95, 120n16; see also religion; sects New Fourth Army 158, 171 New Institutional Economics see New Political Economics New Life Movement 24 New Political Economics (NPE) 248–9, 251, 254, 259, 267, 271n4 newspapers 171, 241 NGOs see non-government organizations Ningan City 227

Pan Fusheng 98, 108, 118 party-state 31 Pearl River 131; see also Guangdong Pearl River Delta 131, 133–7, 140, 144, 147; see also Guangdong Peasant Movement Training Institute 107 peasants: rebellions 96, 120n22, 158; in Anhui 153, 158, 170, 172; in Guanxi 192; in Henan 98, 101, 103, 108; and Nanjie 116–17, 120n63; in Yunnan 215n36 Peking see Beijing Pengshui County 74 people, the (renmin) 34 People’s Bank of China 172, 233, 242 People’s Communes see communes People’s Congress: Anhui 173; Chongqing 65; Guangdong 138, 144–6; Heilongjiang 241–2; National 57, 241–2, 256 People’s Daily 106 People’s Liberation Army (PLA) 59, 101, 146; and Anhui 159; involved in smuggling 238; in Sichuan 49; in Yunnan 190 People’s Republic of China 11, 25, 33, 41, 67; and Heilongjiang 225 Persistent Way 95; see also religion; sects Pingyuan Province 19, 103, 108 Politburo see Chinese Communist Party Political Economy of China’s Provinces (Hendrischke and Feng) 1 pollution see environment

286 Index population control 173 Popper, Karl 271n4 pornography 116 see also sex industry ports 225–9, 232, 234 poverty: in Anhui 5, 160, 169; Chongqing 72–4, 76; and crime 200; in Henan 106; rural 74; in Guangdong 133–6; in Guangxi 192; in Sichuan 44; and tourism 200–1; in Yunnan 184, 190, 197, 204 prefectures 11, 25, 33 prefectural district 28 Prefectural Revolutionary Committee 38n40 Primorskii Krai 221, 230, 242 Primorye 231, 235 private enterprise 106–9, 114, 211, 230, 257; see also economy privatization 223 Propaganda Department of the Central Committee 114 prostitution see sex industry provinces: and Beijing 2–3; as administrative units 1, 247; as “black box” 248; and the centre 20; competition between 8; deﬁned 1; economic growth 13; government 29, 32–5; history 2, 11–39; instability 18; and the nation 256; need for 247–76; and planned economy 25; as political actors 247–8; and state-building 19; and urban expansion 28–9; weakness of 12; and wealth 265 provincialism 33 Provincial Jurisdiction Cities 27 Provincial Planning Committee 22, 24; Sichuan 56 Provincial Protectorate, Guangdong 141 public order see crime Public Security Bureau, Guangdong 137 Pudong 38n52 Pu Haiqing 63–5, 69, 84n62, 84n64 Qian Dihua 241 Qianjiang Prefecture 2, 41, 47, 57, 65; poverty 73; see also Chongqing City Qian Min 63 Qiao Shi 112 Qiliying 99 Qin Changdian 64 Qindao 54, 60 Qin Dynasty 11, 18, 48, 158–9 Qinling Mountains 46 Qingdao 27

Qing Dynasty 18–20, 187, 158, 161–2 Qinghai 191, 254 Qin Sihuang (emperor) 48 Qiqihar 224, 227 Qubilai 186 Radio Henan 104 railways 96, 172, 188, 190, 211, 215n37, 224, 226–8, 233 Railways Ministry 172 Rawls, John 270 rebellions 11, 120n22, 121n28, 158–9; labor 241; peasant 96; Muslim 187 Red Basin see Sichuan Basin Red Cross 191 Red Guards 108 Red Spears 96, 108; see also banditry; secret societies Red Turbans 95; see also religion; sects reform era 71, 114, 125 267; Anhui 155, 163–8; Heilongjiang 223; Yunnan 190 reforms 6; economic 53, 62, 69, 73, 257; in Anhui 163; Guangdong 125–52; Heilongjiang 223, 230; industrial 224, 238–43; market 46; Yunnan 181 regionalism 181 regions, economic 13 Reichssynode 270 religion 94–6, 115, 182, 204, 208, 214n30; see also Christianity; missionaries; Roman Catholic Church; sects Ren Baige 81n23 Renmin Ribao 103–4 rent-seeking 270 Republican China 11, 19, 26, 34–5 Republican Government 19, 35 Republican revolution (1911) 20, 48 resettlement 74, 161, 187; see also migration; Three Gorges Project revolutionaries 11, 20 riots 140, 239, 241–2 roads 30 ROK 235 Roman Catholic Church 181, 188, 204, 208 Rongshida brand 164 Rozman,Gilbert 14–15, 18 Ruili County 197, 200 rural development 44 Russia 223, 225, 228, 230–1, 235–8, 242 Salween River 183 Sani culture 202–211, 219n98, 219n103 Sani language 204, 207, 219n103

Index 287 Sani Yi people 181, 202–211, 218n91, 219n93, 219n94 Sanjiang 224 Sanjiang Plains 239 Sanxia (proposed Three Gorges province) 56, 74; see also Three Gorges Project Saudi Arabia 227 Save the Children UK 191 Sayyid’ Ajall 186 script, Chinese 92; see also language Sea of Japan 234 secession movements 20 Second Field Army 49–50, 84n62; see also People’s Liberation Army “Second Revolution” (1913) 20 secret societies 94–6, 188; see also religion; sects sects 94–6; see also Christianity; missionaries; religion self-government 32 sex industry 199–200, 206; see also crime; women Shaanxi Province 1, 13, 48; and Chongqing 46; and decentralization 254, 258; and natural disasters 91 Shacity City 31 Shandong Province 1, 58, 60, 95, 120n15, 128; and Anhui 155–6, 165; and decentralization 258; and Heilongjiang 231; leadership 159; and migration 186; and natural disasters 91 Shangcheng see Chongqing Shang Dynasty 93 Shanghai City 1–2, 5, 44, 98, 128, 130–1; and Anhui 163, 170–1; and the centre 261; and decentralization 258; and Guangdong 147; occupied by Japan 49; status 27; tourism 166 Shangtung 95 Shan people 188 Shang Yang 92 Shangyashan 234, 239 Shanhaiguan 232 Shansi 95 Shantou 133 Shanxi Province 1–2, 13, 64, 82n34, 160; culture 268; and decentralization 254; government 34; independence of 24–5; industry 261; and natural disasters 91 Shao Qihui 230 Shen Buhai 92 Shensi 95 Shenyang 27, 227, 233

Shenzhen 54, 60, 109, 112, 132, 133, 220n108; riots 136; and strikes 140 Shexian County 158 Shilin Tourism Bureau 207–8 Shouters sect 95; see also religion; sects Shue, Vivienne 31 Shui Zhengkuan 64 Shu kingdom 48 Shunde 132 Sibo tribe 225 Sichuan Basin 43 Sichuan dialect 43; see also language Sichuanese people 43 Sichuan Province 1–3, 13, 23, 43, 48–9, 51–2, 74, 77; autonomy of 60; and decentralization 254, 258; development of 46; division 42–3, 50, 56, 61–2, 82n39; government 34; and Guangdong 136, 147; and Henan 118n1; industry 68; leadership 63–5, 81n23, 83n61; and migration 262; and minorities 215n35; and New Political Economies 259, 261; and riots 136; and Three Gorges Project 56–9; and Yunnan 179, 183, 190, 196–7, 199 Sihui 132 Si Mayi 92 Singapore 169, 191, 198, 227 Sino-French war 187 Sino-Soviet split 225 Six-Year Plan (Henan) 101 Skinner, G. William 13–15, 18 slavery 158 Smith, Adam 247 smuggling 138, 199, 227; by PLA 238 social conﬂict 139–40 social security 116 Socialist Education Movement 102 Society of Elderly Brothers 95; see also religion; sects Song Dynasty 17, 21, 48, 108, 186 Song Jian 112 Song Peizheng 172 Song Ping 112 Song Qi 158 Southeast Asia 125–7; and Yunnan 197, 199, 201; tourism 209, 212 South-west Associated University 188 South-west Cooperation Zone 197 South-west Great Administrative Region 189 South-west Military Administrative Committee 50 South-west Military Region 50

288 Index South-west Regional Bureau of the Central Party Committee 50 Southern Silk Route 187, 212n1 South Korea 226–7, 229, 231, 239, 242; see also Korea; North Korea South Manchurian Railroad 224, 232; see also railways South Service Regiment 84n62 Soviet Union 59, 172, 221, 225, 234; see also Russia Special Administrative Regions 19 Special Cities 26–7 special economic zones 54, 57, 112, 115, 233; crime 137 Spring and Autumn period 93 Stalinism 202 state, the: authority of 31; expansion of 29, 31; involution of 31; and market economy 25–6; see also state-building state-building 19–21, 24, 35; and provinces 26 State Council Development Research Center 231 state institutions 31 state-owned enterprises (SOEs) 43, 53, 79n3, 86n98; in Anhui 168; bankruptcies 63, 72–3; in Chongqing 68, 70–71; in Guangdong 145, 147; in Heilongjiang 225–6, 231, 235–6, 239–42; in Henan 106–7; reform of 221, 223–4 State Planning Commission 68, 239 State Statistical Yearbooks 247 Stone Forest 181, 202–211, 219n96, 220n108 Stone Forest Peasant Industry and Commerce General Corporation 208–9; see also Wukeshe village Stories of Hui Merchants 161 strikes 139–40, 239 Subei 19, 156, 167 Sufan Movement 98–9 Sui Dynasty 93 Suifenhue 227–8, 234, 237 Suifenhue Border Trade Bureau 227 Suifenhue Branch Ofﬁce of Foreign Transportation 228 Suifenhue Commodity Inspection Bureau 228 Suifenhue Customs Ofﬁce 228 Suifenhue Frontier Inspection Station 228 Suifenhue Quarantine Institute for Animals and Plants 228

Suifenhue Sanitation and Quarantine Station 228 Suiping County 101 Suiyuan 19 Sun Quan 161 Sun Yatsen 22, 25, 32–3 “Support the Left” group 172 Suxian County 158 Suzuki 68, 84n77 Taiping uprising 92 Taiwan 19, 23, 140, 198, 226, 230–1, 235 Taiyuan 64 Tang Dynasty 93 Taoism see Daoism Tao Zhu 101 Tawney, R. H. 109 taxes 5, 256–7, 260–62, 265, 267 technology 167 telecommunications 30, 166, 227–8 television 68, 210 Ten Jiuming 64 territorial units 17, 26; see also administration, territorial; cities; counties; prefectures; provinces Thailand 169, 186, 199 Thiebout-voting see Hirschman’s exit Third Front Project 67, 71–2, 190 Three Gorges 46, 56, 70; see also Three Gorges Project Three Gorges Project 3, 46, 47, 56–7, 82n43; cost 75; impact on Chongqing 73–4; new province proposed 56; time estimate 77; see also Yangtze River Three Kingdoms 93, 156 Tian Fengshan 239 Tianjin Province 1–2, 19, 26–7, 44, 62, 82n24, 130; and decentralization 254; industry 261 Tibet 19, 50, 182, 184, 191, 196–7, 199; and decentralization 254 Tien 214n25 Tokyo 231; see also Japan Tongling 165 Tongzhi period 161–2 Torch Festival 210 tourism 166, 169, 218n88, 218n90, 219n103; Yunnan 200–11 town and village enterprises (TVEs) 164; and decentralization 259, 261, 267; in Heilongjiang 221, 223, 230, 234, 238, 240, 242 towns (zhen) 27 townships (xiang) 27

Index 289 trade 13; Anhui 174; border 226–38; and Cultural Revolution 190; and Heilongjiang 221, 223, 225–39; in Yunnan 187–90, 198–200 trade unions 272n10 tradition 202 Traditional Lands Management System Research Programme 216n60 transport 47, 187, 209, 228 Trans-Siberian railway 224 Treaty of Aigun 225 Treaty of Peking 225 treaty ports Tumen 227, 230, 232–3 Tumen River 227, 230, 234 Tumen River Development Program 231 Tunxi 167 Ulan Bator 234 underclass 168 unemployment 63, 72–3, 86n8, 192, 221, 240–2, 262; in Anhui 169; see also employment; labor; strikes UNEP 198 United Nations 192 United States 95, 198–9, 209, 226, 227, 239, 247, 273n22 universities 97 urban development 14–15, 32, 44 urban expansion 28–31 urban hierarchy 27–8 urban networks 14–15, 25 Urban Networks in Ch’ing China and Tokugawa Japan (Rozman) 14 Urumqi 55 USSR see Soviet Union Ussuri River 225

Wang Qian 63 Wang Shiman 174 Wang Taihua 173 Wangyin village 170 Wang Yunlong 64 Wang Xianzhi 92 Wang Zhongzhang 230, 235, 237 Wan Hanzhang 56 Wan Jiang 38n52 Wan Li 159, 167, 172 Wannan Incident 158 Wanneng Power 168 Wanxian City 2, 41, 47 57, 65, 73, 887n120; see also Chongqing City warlords 37n30, 93, 188 Warring States Period 93, 186 Wei Dynasty 16, 93 weiyuanzhi (committee system) 22 welfare 169 Wenzhou 115 West, the 71, 188, 201, 213n13, 259 Western Resources Zone 232 White Lotus 95, 120n19; see also religion; sects women, 192; employment 5; trafﬁcking in 199–200 World Bank 192, 267 World Trade Organization (WTO) 236 World Vision 191 World War II 188–9 Wu Bangguo 66 Wu Daozi 92 Wu De 103 Wu dialects 156; see also language Wudu see Chongqing Wu Guang 92 158 Wuhan 54 80n6 Wuhu 165–6 Wuhu Yangtze River Bridge Project 167 Wu Jianong 64 Wukeshu village 207, 209–11; see also Stone Forest Peasant Industry and Commerce General Corporation Wushan County 76–7 Wu state 161 Wu Zhipu 97, 107–8

“veil of ignorance” 270 Vial, P. 204, 219n93 Vietnam 6, 179, 183–4, 187–8, 197, 215n35 villages 27, 33, 104, 109–18, 192, 207–8, 265; and decentralization 267; and identity 220n108; and social conﬂict 139 Vladivostok 224, 227–8, 230, 241; see also Xi’an 27, 55 Russia Xi’ning 55 Xiamen 54 Wancounty City 31 Xiang Ying 158 Wanding 197 Xiang Yu 156 Wang Enmao 112 Xiaogang village 159 Wang Hongbin 115 Xiao Ke 112 Wang Hongju 64–5

290 Index Xiao Yang 51, 57, 63, 82n44, 84n62, 84n63 Xiao Zuxiu 64 Xie Daowen 174 Xie Fei 139 Xikang Province 50, 81n23 Xing Yuanmin 64 Xinhua News Agency 171 Xinji City 31 Xinjiang 19, 254 Xin Wen 56 Xinxiang prefecture 99, 101, 109 Xuancheng 166 Xuan paper 162 Xuchang 103, 122n67 Xu Yongze 95 Xu Youfang 240 Yamaha 84n77 Yan’an 20, 112 Yang Rudai 112 Yang Shangkun 223 Yangshao 93 Yangtze brand 164 Yangtze River 3, 13, 41, 49, 73–7; and Anhui 156–7; and Chongqing 68; in Civil War 189; climate 46–7; delta 54; history of 48, 161–2; and Three Gorges Project 43, 58, 63; Wuhu bridge 167; and Yunnan 183, 187; see also Three Gorges Project Yan Hongyan 50 Yao 215n35 Yellow Bohai Sea Rim 231 Yellow Emperor (Huangdi) 92 Yellow River 91–2, 100, 119n4; see also ﬂoods; natural disasters Yellow Turbans 95; see also religion; sects Ye Ting 158 Ye Xuanping 138, 145 Yichang 57 Yichun 241 Yinchuan 55 Yi people 183, 189, 204–11 passim, 213n20, 215n35, 218n92, 219n103 Yongzheng period 162 Yuan Dynasty 11, 16–18, 20–1, 25, 186–7 Yuan Jurisdiction Cities 27; see also Direct Jurisdiction Cities Yuan Shikai 21–2, 25, 33 Yue Fei 92 Yue Qifeng 223, 226, 238–40, 242

Yun Gui Plateau 183 Yunnan Academy of Social Sciences 192 “Yunnan for the Yunnanese” 189 Yunnan Province 1, 50, 81n23, 179–220; and Beijing 179; and decentralization 254; demography 191–2; economy 190; education 181; employment 181; ethnicity 184–5; ﬁnances 198; as frontier 182; geography 183; government of 34; growth 181; health 198; history 183–6; independence from China 186; industrialization 190; and migration 6, 184; modernization 190–1; population 181; poverty in 192; in reform era 190–1; settlement 184; status 7; topography 183, 191; tourism 179, 181 Yunnan Provincial Tourism Bureau 204 Zang Biguo 64 Zengcheng 140 Zeng Xisheng 159, 171–2 Zhang Aiping 112 Zhang Deling 44, 54, 63–5 Zhang Heng 92 Zhang Zhongjing 92 Zhao Haiyu 64 Zhaoqing 132 Zhao Ziyang 52–3, 56, 59, 101 Zhejiang Province 1, 13, 24, 43, 68, 84n62, 104, 128, 135, 155–6, 159–60, 169, 174; and decentralization 254, 258 zhen see towns Zhengzhou 95, 97, 100, 103; relations with Beijing 107 Zhengzhou University 102 Zhongguo (Middle Kingdom) 92–3; see also Henan Province Zhongshen 132–3 Zhongzhou see Henan Province Zhonxian County 77 Zhou Enlai 67, 84n74 Zhuangzi 92, 162 Zhuhai 132–3, 140 Zhujiang see Pearl River Zhulin 109 Zhu Rongji 77, 112, 172, 223, 238, 240, 242 Zhu Shengwen 240–1 Zhu Xi 162