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The Politics of Foreign Economic Policy-making in China: The Case of Plant Cancellations with Japan*

Published online by Cambridge University Press:  17 February 2009

Extract

The following analysis of China's foreign economic policy-making will focus particularly on the decision of 1980–81 to suspend contracts with foreign countries, taking Baoshan and the petrochemical complexes as specific examples. I discuss this issue in terms of Sino-Japanese relations because Japan was the main target of the cancellations and because the relevant Japanese materials are plentiful. The decision-making process of Chinese foreign economic policy has barely been touched upon in previous research. However, recently there has been some study of the decision-making process in domestic economic policy. For example, Michel Oksenberg, relying on personal interviews, has published two perceptive articles that have been of great use to this study.

Type
Research Article
Copyright
Copyright © The China Quarterly 1986

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References

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9. Interviews with Japanese businessmen involved in the Baoshan project.

10. Ibid.

11. Ibid.

12. Ibid. with supplementary material from NSC.

13. Nihon Keizai Shimbun, 2 February 1978.

14. Asahi Shimbun, 16 February 1978 (evening edition).

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17. Ibid. 11 and 21 December 1978.

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19. Ashai Shimbun, 23 December 1978 and 9 January 1979; Nihon Keizai Shimbun, 23 December 1978.

20. Renmin ribao, 23 September 1978.

21. Ibid. 24 December 1978; Asahi Shimbun, 24 December 1978; Nihon Keizai Shimbun, 24 December 1978.

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27. Ibid. 6, 13, 27 June 1979.

28. Ibid. 1 June 1979. The Japanese loans to China were officially arranged when Prime Minister Ohira visited China in December 1979 (Asahi Shimbun, 7 December 1979).

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33. Ibid.

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35. Ibid. 16 August 1979.

36. See Ibid. 22 August (editorial), 16, 24 November 1979.

37. Guangming ribao (Guangming Daily), 8 September 1979. The establishment of an advisory committee in December 1979 was noted in August 1980: Xinhua News (Shanghai), 14 08 1980Google Scholar, in Chugoku Tsushin (China News), No. 3977–13. 14 (18 08 1980) (Tokyo: Chugoku Tsushinsha[China News Agency])Google Scholar.

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42. See, for example, “Capital construction must firmly uphold the ‘eight character’ policy,” Renmin ribao, 19 April 1980; “An interview granted by a responsible person of the State Statistical Bureau,” Renmin ribao, 2 May 1980; Jingyao, Lin, “Do not suppress disagreements over scientific and technological problems of construction projects,” Guangming ribao, 16 05 1980Google Scholar; and “Capital construction must be undertaken in accordance with actual capabilities,” Renmin ribao, 9 June 1980.

43. Asahi Shimbun, 4 July 1980 (evening edition).

44. Renmin ribao, 5 September 1980. See also Wenhuibao (Wenhui Daily) (Shanghai), 13 09 1980Google Scholar.

45. Renmin ribao, 11 September 1980.

46. Asahi Shimbun, 5, 12 September 1980.

47. Renmin ribao, 22, 23 July 1980.

48. “A view of the work style of the leadership at the Ministry of the Petroleum Industry in light of the Bohai No. 2 accident,” Renmin ribao, 26 August 1980.

49. “State Council decision on the Bohai No. 2 oil rig accident,” ibid.

50. “Continue to grasp the readjustment in order to stabilize the economy,” ibid. 6 November 1980.

51. ibid. 5 November 1980.

52. ibid. 19 November 1980; Asahi Shimbun, 20 November 1980.

53. ibid. 25 November 1980.

54. ibid. 18 February 1981 (evening edition).

55. See Selected Important documents, pp. 596–600, for a circular resulting from this Politburo meeting. See also Zhengming (Contention) (Hong Kong), No. 40 (02 1981), p. 8Google Scholar, and Asahi Shimbun, 15 (evening edition), 16 December 1980.

56. See, for example, “The first thing is to study conscientiously,” Renmin ribao, 25 January 1981; Jin, Zhou, “Further economic readjustment: A break with ‘leftist’ thinking,” Beijing Review, No. 12 (23 03 1981)Google Scholar; Dongxiang, No. 28 (01 1981), p. 7Google Scholar; and Fusao Takada, “Central Work Conference.”

57. Dangdai (Contemporary Monthly) (Hong Kong), No. 5 (01 1981), p. 31Google Scholar.

58. Ibid. See also Dongxiang, No. 28 (01 1981), p. 4Google Scholar.

59. Zhengming, No. 40 (02 1981), pp. 1015Google Scholar.

60. Ibid.

61. Asahi Shimbun, 25 December 1980.

62. Ibid. 6 January 1981.

63. Ibid. 28 January 1981.

64. Ibid. 6, 31 (evening edition) January 1981.

65. Ibid. 5 February 1981.

66. Ibid. 13, 14 February 1981.

67. Yilin, Yao, “Report on the readjustment of the 1981 national economic plan and state revenue and expenditure,” Renmin ribao, 8 03 1981Google Scholar.

68. Asahi Shimbun, 25 February and 14 March 1981.

69. Ibid. 20 March 1981.

70. Ibid. 8 September 1981.

71. Nihon Keizai Shimbun, 16 December 1981 (evening edition).

72. Renmin ribao, 16 April 1982.

73. South China Morning Post, 24 March 1982.

74. Renmin ribao, 6 January 1983.

75. “The present and future of Baogang,” Liaowang (Prospects), July 1982; and Mainichi Shimbun, 27 July 1982.

76. Ibid, (both Liaowang and Mainichi).

77. Renmin ribao, 27 March 1983.

78. Asahi Shimbun, 14 September 1985; Renmin ribao, 27 March 1983; and Beijing Review (Japanese edition), No. 16 (1983), p. 8Google Scholar.

79. Interviews with Japanese businessmen associated with the Baoshan project.

80. Jin, Zhou, “Further economic adjustment,” p. 24Google Scholar; Yao Yilin, “Report on the readjustment.”

81. Ibid. Yao Yilin in FBIS, 9 March 1981, L9.

82. Beijing Review, No. 9 (22 03 1981), p. 5Google Scholar.

83. See, for example, Chen's speeches on 8, 21 March, 18 September 1979 and 16 12 1980 in Selected Important Documents. See alsoChen Yun wenxuan (Selected Works of Chen Yun): 1949–1956 (Beijing: Renmin chubanshe, 1984)Google Scholar.

84. Renmin ribao, 10, 12, 14, 19 December 1980.

85. For example, Asahi Shimbun, 9 November 1980.

86. See ibid. 30 October, 7, 13, 15 November 1980 and 17 January, 3 February 1981.

87. For example, Weibin, Feng, “On the question of socialist democracy,” Renmin ribao, 24, 25 11 1980Google Scholar.

88. Yomiuri Shimbun (Yomiuri Newspaper) (Tokyo), 19 12 1982Google Scholar. This speech was not included inSelected Important Documents.

89. See, for example, Hua, Xiao, “Eleminate ‘leftist’ thinking and consciously carry out the Party's line,” Renmin ribao, 27 03 1980Google Scholar; “Straighten out the guidelines in economic work,” Renmin ribao, 9 April 1981.

90. Ibid. (“Straighten out”); “Fear not slowness but detours on the pace of economic development,” Renmin ribao, 21 January 1981.

91. Dongxiang, No. 28 (01 1981), p. 10Google Scholar; Zhengming, No. 40 (02 1981), p. 8Google Scholar; Asahi Shimbun, 21 January 1981.

92. “Economic and trade relations with foreign countries must serve the readjustment of the national economy,” Renmin ribao, 25 February 1981, in FBIS, 26 February 1981, L17.

93. See “Import with courage, accelerate the speed,” Renmin ribao, 17 September 1978.

94. In January 1981 Mu, Gu said: “China's open-door policy remains unchanged. China remains the largest and most stable market” (Xinhua News, 5 01 1981Google Scholar, in FBIS, 6 January 1981, A2–3).

95. Schurmann, Franz, Ideology and Organization in Communist China, Ch. 1 (Berkeley: University of California Press, 1966)Google Scholar; Okabe, Tatsumi, Chugoku no TaiNichi Seisaku (China's Foreign Policy Toward Japan), Pt I (Tokyo: University of Tokyo Press, 1976)Google Scholar.

96. U.S. Department of Commerce, China's Economy and Foreign Trade, 1979–81 (Washington D.C., 05 1982), p. 26Google Scholar.

97. Asahi Shimbun, 13 February 1981.

98. Beijing Review, No. 8 (23 02 1981), p. 6Google Scholar; Asahi Shimbun, 14 February 1981.

99. On China's economic relations with foreign countries,” Hongqi, No. 8 (1982)Google Scholar, in Beijing Review, No. 22 (31 05 1982), p. 15Google Scholar.

100. See supra, fn. 47. See also Renmin ribao, 21 February 1981.

101. Wenhuibao, 7, 13 September 1980.

102. See Weil, , “The Baoshan steel mill,” pp. 370–71Google Scholar; Keiichi Koshiro, “Another look”; and Lewis and Bonavia, Far Eastern Economic Review.

103. Using Chinese and Japanese newspapers, I looked at the activities of each Chinese organization, for example of their meeting in China or Japan with Japanese representatives. The Japan–China Assocation on Economy and Trade's two annuals, Nitchu Jinji Koryu Jokyo (The State of Japan–China Exchange) and Sen-kyu-hyakunana-ju-hachi nen no Nitchu Kankei (Japan-China Relations in 1978), are also useful.

104. “What are the ideological obstacles in reducing the capital construction front?”, Renmin ribao, 27 March 1979.

105. Ibid. 28 September 1980, in FBIS, 30 September 1980, L30.

106. Ibid. L29.

107. “Set capital construction on the right course, follow strict capital construction discipline,” Renmin ribao, 10 June 1980.

108. Yilin, Yao, “Report on the readjustment.” The same idea was put forward by Zhao Ziyang at the Central Work Conference in 12 1980 (Selected Important Documents, Vol. I, p. 616)Google Scholar.

109. Nihon Keizai Shimbun, 5 December 1980.

110. Bingqian, Wang, “Report on the final state accounts for 1979, the draft state budget for 1980 and the financial estimates for 1981,” Renmin ribao, 13 09 1980Google Scholar. The former minister was Zhang Jingfu.

111. Yi, Xu, Baosen, Chen and Zhengji, Tao, “The key is readjusting the size and structure of capital construction,” Renmin ribao, 28 11 1980Google Scholar. Xu, and Chen, jointly published another article in this period, “The necessity and the possibility of stabilizing prices,” Zhongguo shehui kexue (China's Social Sciences), No. 2 (10 03 1981)Google Scholar. According to a note in the article, they were working for the Ministry of Finance.

112. Guangming ribao, 14 December 1980. The entire proceedings of this meeting were published in three volumes by chubanshe, Zhongguo caizheng jingji (Beijing) in 1981Google Scholar: Dangqian caizheng wenti (Current Financial Problems), Lun caizheng fenpei yu jingji de guanxi (On the Relations between Financial Distribution and Economics) and Lun caizheng zhidu gaige (On Reform of the Financial System).

113. Current Financial Problems, p. 190.

114. Ibid. pp. 190–207.

115. Ibid. p. 196.

116. Liqun, Deng, Learn from Comrade Chen, p. 70Google Scholar.

117. Yao Yilin, “Report on the readjustment.”

118. Renmin ribao, 4 February 1981.

119. Liu Lixin, “The utilization of foreign funds must be beneficial to readjusting the national economy,” ibid. 28 July 1980.

120. A personal interview with a member of this government delegation.

121. Nihon Keizai Shimbun, 27 February 1981 (evening edition).

122. Asahi Shimbun, 10 March 1981; Nihon Keizai Shimbun, 14 February 1981.

123. Asahi Shimbun, 20, 25 February 1981.

124. Yun, Chen, “The economic situation and our experiences and lessons,” in the Selected Important Documents, Vol 1, p. 602Google Scholar, and Zhengming, No. 40 (02 1981), p. 11Google Scholar.

125. See supra, fn. 19.

126. Renmin ribao, 2 July 1979.

127. Deng himself admitted this: “Due to the lack of unanimous and profound understanding in the Party this decision (readjustment) was not efficiently carried out.” Xiaoping, Deng, “Implement the policy of readjustment,” p. 313Google Scholar.

128. For example, Jin, Zhou, “Further economic adjustment,” pp. 27–8Google Scholar; Asahi Shimbun, 27 December 1980; Mainichi Shimbun, 9 January 1981.

129. Xiaoping, Deng, “Implement the policy of readjustment,” p. 313Google Scholar.

130. Yun, Chen, “Several major issues in current capital construction work,” Hongqi, No. 5 (1959)Google Scholar, in Lardy, Nicholas and Lieberthal, Kenneth (eds.), Chen Yun's Strategy for China's Development (White Plains, N.Y.: M.E. Sharpe, 1983), pp. 95Google Scholar and 106.

131. Asahi Shimbun, 25 December 1980.

132. China Directory 1982 (Tokyo: Radiopress), p. 51; Directorate of Intelligence, Appearances of Leading Chinese Officials During 1981, April 1982, p. 123.

133. Yilin, Yao, “Report on economic plans for 1980 and 1981,” Renmin ribao, 12 09 1980, in FBIS (supplement), 23 September 1980, p. 7Google Scholar and “Report on readjustment.”

134. Klein, Donald and Clark, Anne, Biographic Dictionary of Chinese Communism: 1921–1965, Vol. 2 (Cambridge: Harvard University Press, 1971), p. 1,000Google Scholar.

135. Ziyang, Zhao, “Study new problems and carry out economic reform successfully,” Renmin ribao, 21 04 1980Google Scholar, in FBIS, 22 April 1980, L3.

136. “Capital construction must be resolutely readjusted,” ibid. 22 August 1979.

137. See Selected Important Documents, pp. 610 and 622.

138. Asahi Shimbun, 15 February 1981.

139. Renmin ribao, 13 February 1981, in FBIS, 13 February 1980, L7.

140. Yibo, Bo, ‘The socialist industrialization of China,” Hongqi, No. 20 (1963)Google Scholar, in Selections from China Mainland Magazines, No. 388 (28 10 1963)Google Scholar.

141. Yibo, Bo, “Accelerate the pace of technical transformation in our electronics and engineering industries,” Jingji ribao (Economic Daily), 25 07 1983Google Scholar, in Joint Publication Research Service (JPRS), No. 84188, 25 August 1983.

142. Nitchu Keizai Kyokai Kaiho (Bulletin of the Japan–China Association on Economy and Trade), No. 94 (Tokyo) (05 1981), p. 10Google Scholar.

143. Nihon Keizai Shimbun, 5 December 1980.

144. Asahi Shimbun, 27 October 1978.

145. Ibid. 25 October 1978.

146. Ibid. 13 January 1981.

147. Yaobang, Hu, “Speech at the Politburo meeting,” 11 1980Google Scholar, Chugoku Naigai Doko (China's Internal and External Trends), No. 151 (Vol. 5, No. 23), Radiopress, B10. This speech is not included in Selected Important Documents.

148. Ibid. B9. It appears that Hu is not active in the formation of economic policy, although he has made speeches on the subject occasionally. For example, see Yaobang, Hu, “On the question of economic relations with foreign countries,” 14 01 1982Google Scholar in Selected Important Documents, Vol. II.

149. See supra, fn. 119.

150. Li, Wan, “Conscientiously implement the Party's economic policy in the rural area,” Hongqi, No. 3 (1978)Google Scholar, in JPRS, No. 71063, 5 May 1978. p. 158.

151. Ming Bao (Hong Kong), No. 40 (02 1981), p. 15Google Scholar, in FBIS, 2 February 1981, U15.

152. Zhengming, No. 40 (02 1981), p. 15Google Scholar, in FBIS, 2 February 1981, U15. This speech is not included in Selected Important Documents.

153. Qishi niandai (The Seventies) (Hong Kong), No. 109 (02 1979), p. 20Google Scholar, in FBIS, 27 February 1979, N5.

154. Asahi Shimbun, 14 September 1978.

155. Ibid.

156. Asahi Shimbun, 7 September 1980.

157. See, for example, Zhengming, No. 33 (07 1980), pp. 78Google Scholar and No. 36 (October 1980), pp. 10–14; Dongxiang, No. 23 (08 1980), pp. 46Google Scholar and No. 24 (September 1980), pp. 9–11.

158. Yomiuri Shimbun, 1 August 1980; Asahi Shimbun, 26 August 1980; and Zhengming, No. 33 (07 1980), p. 8Google Scholar.

159. Qiuli, Yu, “Strive to promote rapid development of the national economy,” Renmin ribao, 3 07 1978Google Scholar, in FBIS, 6 July 1978, E7.

160. Asahi Shimbun, 17 December 1980.

161. Zhanwang (Outlook) (Hong Kong), No. 454 (1 01 1981), p. 7Google Scholar.

162. See supra, fn. 44.

163. Xian, Kang, “Speech at the national conference of the textile industry on learning from Daqing,” Renmin ribao, 15 06 1978Google Scholar, in FBIS, 22 January 1978, E7.

164. He was replaced by Jiaxi, Lu (Renmin ribao, 20 05 1981)Google Scholar. See also Zhanwang, No. 458 (1 03 1981), p. 15Google Scholar.

165. Yi, Fang, “On some problems of scientific and technological work,” 12 01 1979Google Scholar, Lilun dongtai (Theoretical Developments), No. 110 (Beijing: Zhonggong zhongyang dangxiao chubanshe, 20 01 1979), p. 25Google Scholar.

166. Renmin ribao, 26 August 1980, in FBIS, 26 August 1980, L3.

167. Renmin ribao, 9 January 1978, in FBIS, 10 January 1978, E3.

168. Ibid. 5 September 1980.

169. Asahi Shimbun, 19 December 1980.

170. Ibid. 11, 29 March, 8, 23 April 1978.

171. See Funabashi, Yoichi, Naibu (Internal) (Tokyo: Asahi Shimbunsha. 1983), p. 96Google Scholar.

172. See Zhanwang, No. 458, 1 03 1981, p. 15Google Scholar. See also Renmin ribao, 9 March 1982.

173. Nihon Keizai Shimbun, 11 January and 3 February 1978.

174. Renmin ribao, 19 November 1980.

175. Guofeng, Hua, “The government work report,” Renmin ribao, 7 03 1978Google Scholar, in FBIS, 7 March 1978, Dll and D18.

176. Guofeng, Hua, “Raise the scientific and cultural level of the entire Chinese nation,” Peking Review, No. 13 (31 03 1978), p. 12Google Scholar.

177. See supra, fn. 50.

178. Dongxiang, No. 28 (01 1981), p. 16Google Scholar; Mainichi Shimbun, 10 January 1981.

179. “Central Party document No. 23, 1981,” Chugoku Naigai Doko, No. 155 (Vol. 6, No. 4), B3. This document was also obtained by the Radiopress. See also Mainichi Shimbun, 5 January 1982.

180. For another classification, see Solinger, Dorothy, “The Fifth National People's Congress and the process of policy-making: reform, readjustment and the opposition,” Asian Survey, 12 1982Google Scholar.

181. As far as I know, however, China has never officially used the word “interdependence” when describing the international economic system.

182. Ziyang, Zhao, “Report on the restructuring of the State Council's organizations,” Renmin ribao, 9 03 1982Google Scholar; ibid. 5 May 1982.