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2018 | OriginalPaper | Buchkapitel

3. State-Led Changes: Failures and Successes

verfasst von : Jun Du

Erschienen in: Agricultural Transition in China

Verlag: Springer International Publishing

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Abstract

Chapter 3 provides an examination of the impact of agricultural policies on farm input and product markets under reforms. The way in which agricultural policies evolved lead us to observe that, in the short term, the market structure determined by agricultural reform policies played the decisive role in determining the process of technology selection. Based on an analysis of the interaction between two major determinants of agricultural policy—government’s fiscal budget and agricultural output—this chapter found that China’s post-1979 rural market institutions are not so much examples of market-oriented reforms as evidence of a state-oriented mode based on reform of the pricing system.

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Vorheriges Kapitel Economic Thinking on Chinese Agriculture

Nächstes Kapitel Trends in China’s Grain Production

This chapter is an early version of working paper Du and King (2016).

Of these, ‘wheat satellites’ and ‘rice satellites’ were the most famous.

According to China Statistical Yearbook of 1989, the 1957 national average level of wheat yield was 114 jin per mu, which is equivalent to 0.86 tonnes per hectare.

Qian, Xuesen. (1958, June 16). Liangshi muchan liang huiyou duoshao (How Much Grain Yield per Mu? 粮食的亩产会有多少?) Zhongguo qingnian bao (China Youth Daily, 中国青年报), p. 4.

The wheat yield of 1958 in the USA was 27.5 bushel per acre, which is equivalent to approximate 1.85 tonnes per hectare. (United States Department of Agriculture (USDA). National Agricultural Statistics Services. http://www.nass.usda.gov assessed on 15 May 2013.

From the economic view of GLF, the deprivation of exit right of farmers from a collective in the 1959 can be viewed as a cause of the sudden declines in agricultural productivity during the commune regime, and this prolonged decline in agricultural productivity throughout China was a main factor that precipitated disaster for famine (Lin 1990).

China’s Great Famine is frequently claimed to have taken about 30 million lives. However, Dikotter (2010) argues that having taken four years to collect information on the number of deaths throughout China, from late 1958 to 1962 the number of deaths was around 45 million. A similar number is cited by Yang Jisheng, Tombstone: The Untold Story of Mao’s Great Famine (墓碑: 一九五八——一九六二年中國大饑荒紀實) London: Allen Lane, 2012.

State Council Central Document No. 1. ‘Some Issues of Contemporary Rural Economic Policies’ (zhonggong zhongyang guanyu yinfa dangqian nongcun jingji zhengce de ruogan wenti de tongzhi, 中共中央关于印发当前农村经济政策的若干问题的通知). Beijing: Communist Party of China, Central Committee, 2 January 1983; State Council Central Document No. 1. ‘The Notice of CPC Central Committee about the Rural Area Work in 1984’ (guanyu 1984 nian nongcun gongzuo de tongzhi, 中共中央关于1984年农村工作的通知). Beijing: Communist Party of China Central Committee, 1 January 1984.

November 1982, the State Council Central Document 137, ‘Circular on the diligent execution of all operations affecting grain’ (guowuyuan guanyu renzhen zuohao liangshi gongzuo de tongzhi, 国务院关于认真做好粮食工作的通知). And January 1983, Central Document No. 1 [1983]. ‘Some Issues of Contemporary Rural Economic Policies’ (zhonggong zhongyang guanyu yinfa ‘dangqian nongcun jingji zhengce de ruogan wenti’ de tongzhi, 中共中央关于印发当前农村经济政策的若干问题的通知).

The grain system, essentially the grain bureau, was an administrative department of government in charge of grain work. It may be regarded as part of the service sector located in urban areas. As a government, the cost of urban grain circulation activity was determined by the market, while the other, rural, part was still under state control. In respect to non-profitable grain transactions with increased running costs during marketisation, the final cost of the grain bureau’s work was paid for from the government’s fiscal budget. So, the expense to the grain bureau of marketisation was carried by the government.

The CCP issued Central Committee ‘Document No. 1’ on 2 January 1983, entitled ‘some problems of the current rural economic policy’. Article 7 of Document No. 1 indicated that excess agricultural produce after ‘unified purchasing of agricultural products by the state’ could be disposed of through multi-channel marketing. Such produce included all grains but excluded cotton.

From 1979 to 1983, due to a favourable state monopoly purchasing price for major grain types, grain production in China had years’ harvest in the first four years of the 1979 reform. However, with years’ harvest, the state felt grain shortage was relieved, and considering the financial pressure brought by monopolising all grain output in rural China the state in 1983 first changed the state monopoly over grain purchasing to unified state purchasing with a contractual grain purchase policy. The harvest and central financial pressure promoted the policy allowing excess farms products to be directly traded on the market.

State Council Central Document No. 1. ‘Ten Policies of the Chinese Communist Central Committee and the State Council for Further Enlivening the Rural Economy’ (zhonggong zhongyang guowuyuan guanyu jinyibu huoyue nongcun jingji de shi xiang zhengce, 中共中央国务院关于进一步活跃农村经济的十项政策). Beijing: Communist Party of China Central Committee, 1 January 1985.

The ‘three links’ policy is easily understood: contractual grain purchase was directly linked to three issues, namely the provision of chemical fertilisers at fixed prices, the provision of diesel oil at fixed prices and the deposit paid for the state contractual grain purchase. The chemical fertiliser and diesel oil that was to be offered to farmers at fixed prices was specially supplied to the rural department at less than market price. To link grain production with important inputs at better prices was a major incentive that encouraged farmers to increase production.

Excludes the current year’s consumer price index (CPI) value.

Liu, Bin, Zhaogang Zhang, and Gong Huo. Zhongguo Sannong Wenti Baogao (China Farming Countryside and Peasantry Issues Report). Beijing: China Development Publishing Ltd, 2004, Chap. 8.

In form of financial subsidies distributed to urban citizens through their work units (gongzuo danwei, 工作单位).

Before 1998, rent-seeking by the grain bureau may be regarded as ‘individual behaviour’ as the rent-seeking was conducted by some individual branches of the grain bureau. Rent-seeking normally took place at the level of a local grain bureau (branch), by (for example) misrepresenting the grain stock level and purchasing cost. Compared with leakages that occurred after the 1998 grain reform, this kind of ‘leaking’ behaviour was on a small scale. Later, the position of the grain bureau gradually changed from a governmental organisation to a sole holder of commercial monopoly power over the grain market. Consequently, the small-scale rent-seeking by an individual ‘agent’ was transformed into more systemic profit-making behaviour.

The State Council Document No. 15 (1992) mainly sought to raise the state grain rationing price in the urban sector. In its appendix, the State Council however made it clear that the purchasing cost attributable to the grain bureau should be the same as the state order price for farmers. Central Committee Document No. 15. ‘Decisions on Increasing the State Monopoly Selling Price of Grain’ (guowuyuan guanyu tigao liangshi tongxiao jiage de jueding, 国务院关于提高粮食统销价格的决定). Beijing: State Council, 6 March 1992.

On 11 Sept. 1990, the State determined to set up the ‘state special grain reserve system’: i.e., to stabilise grain supplies, the state designated the creation of a special fund to purchase excess grain output over and above the fulfilment of government orders from local farmers, with a protection price built in.

The grain risk fund was mainly used to pay the price difference, interest and all relevant costs arising from government action in stabilising grain supply.

In article two of the State Council Document No. 15 (1992), following increases in the urban grain rationing price, the state distributed allowances to urban workers to reduce living costs. Allowances were distributed along with monthly salaries. The allowance standard for workers in state organs, enterprises (i.e., SOEs) and government institutions was five yuan per person per month.

The grain rationing price firstly increased during 1988–1989, however this increase was caused by high currency inflation happened at the end of 1980s and early 1990s. The second round of grain rationing price increase happened during 1993–1995, caused by the abolishing of grain coupons (liangpiao, 粮票), and was regarded the first time of real grain rationing price increase in the urban sector from Mao’s era.

Through this directive, the state lawfully abandoned control of all major grain types. Notably, the document No. 60 cancelled the grain bureau’s exclusive rights over rice purchasing, and instead, the state opened the rice purchasing market to all other economic units. For all agricultural products cited in this directive, other governmental departments and local government were forbidden to intervene, unless authorised by the state council.

The State Council’s Document ‘No. 9’ (1993) signalled its intention to open grain pricing and marketing in the next two to three years.

Please refer to the Chap. 4 ‘Agriculture Product Circulation’ in the Agriculture Law of the People’s Republic of China (1993) (zhonghua renmin gongheguo nongye fa, 中华人民共和国农业法).

Central Committee Document No. 40. ‘China Dietary Pattern Reform and Development Program in the 1990s’ (guowuyuan guanyu yinfa jiushi niandai zhongguo shiwu jiegou gaige yu fazhan gangyao de tongzhi, 国务院关于印发九十年代中国食物结构改革与发展纲要的通知). Beijing: State Council, 27 May 1993.

State Council Document No. 12 (1993), ‘Circular of the state council on establishing grain purchase protection price system (guowuyuan guanyu jianli liangshi shougou baohu jiage zhidu de tongzhi, 国务院关于建立粮食收购保护价格制度的通知)’, was essentially intended to establish a state guiding protection price to prevent grain purchases from fluctuation, especially when the market purchase price was falling. The central government set the grain protection price by covering grain-producing cost with an extra small amount of profit. Local governments could set the local grain protection price at a level no lower than the central guiding protection price. Besides the principle of setting the grain protection price, Document No. 12 (1993) also published 1993 central protection prices for major grain crops.

Here ‘rice bag’ means grain supply.

As mentioned above in the total of 90 million tonnes, 70–80 per cent grain in circulation.

The 1993 grain reform, the state established the central and local grain reserves—two-layer reserve—to maintain stable grain supplies. Thus, to distinguish from the function of the grain bureau in grain circulation, state-owned grain enterprises includes both grain circulation and above two-layer reserves.

State Council Document No. 62 (1994) focused on interest-free loan policy. Central Committee Document No. 62. ‘Circular of the State Council on the Report of the Ministry of Finance and Other Departments on Withholding Accounts and Suspending Interests in Accordance with the Grain Policy’ (guowuyuan pizhuan caizhengbu deng bumen guanyu liangshi zhengce xing caiwu gua zhang tingxi baogao de tongzhi, 国务院批转财政部等部门关于粮食政策性财务挂帐停息报告的通知). Beijing: State Council, 29 November 1994.

State Council Document No. 12 (1995). Guowuyuan pizhuan zhongguo renmin yinhang deng liu bumen guanyu jiaqiang liang mian you zhengce xing shougou zijin guanli yijian de tongzhi (Circular of the State Council on the Proposal of the Chinese People’s Bank and Five Other Departments on Strengthening the Management of Funds for the Purchase of Grain, Cotton and Oil within the Framework of State Policies, 国务院批转中国人民银行等六部门关于加强粮棉油政策性收购资金等理意见的通知). Beijing: State Council, 30 May 1995.

Here refers to the administrative size of the grain system.

Decree No. 249 of the State council of the People’s Republic of China. Measures on Punishing Illegal Activities in Grain Purchasing and Marketing (liangshi gouxiao weifa xingwei chufa banfa, 粮食购销违法行为处罚办法). Beijing: State Council, 31 July 1998.

The largest financial drain arose from grain storage and purchases. The grain bureau claimed that grain storage loss was one of the biggest parts of the state fiscal budget. According to Liu et al. (2004), from 1992 April to 1998 May the total deficit in the grain bureau had reached 120 billion yuan. This figure indicates that from April 1992, the grain bureau system generated a monthly deficit of 2.97 billion yuan, or almost 100 million yuan per day. During this period the grain bureau had 40 thousand employees dealing with grain, so that the average per capita deficit was 23 million yuan per day.

Local state-owned grain enterprises were the major grain agencies to participate in local grain circulation.

Total grain output in 2003 was 430.7 million tonnes—the lowest level since 1987 (403 million tonnes).

Ash, Robert. ‘The Peasant and the State Source.’ The China Quarterly 127 (1991): 493–526.

———. ‘Economic Aspects of Land Reform in Kiangsu, 1949–52 (Part 1).’ The China Quarterly 66 (1976a): 261–292.

———. ‘Economic Aspects of Land Reform in Kiangsu, 1949–52 (Part 2).’ The China Quarterly 67 (1976b): 519–545.

Central Committee Document No. 9 [1993]. Guowuyuan Guanyu Jiakuai Liangshi Liutong Tizhi Gaige De Tongzhi (Circular of the State Council on Speeding up Reform of the Grain Circulation System, 国发[1993]9号《国务院关于加快粮食流通体制改革的通知》). Beijing: State Council, 15 February 1993.

Central Committee Document No. 11 [1999]. Guowuyuan Guanyu Jinyibu Wanshan Liangshi Liutong Tizhi Gaige Zhengce Cuoshi De Tongzhi (Circular of the State Council on Policies and Measures for Further Improving Grain Circulation System Reform, 国发[1999]11号《国务院关于进一步完善粮食流通体制改革政策措施的通知》). Beijing: State Council, 30 May 1999.

Central Committee Document No. 12 [1993]. Guowuyuan Guanyu Jianli Liangshi Shougou Baohu Jiage Zhidu De Tongzhi (Circular of the State Council on Establishing Grain Purchase Protection Price System, 国发[1993]12号《国务院关于建立粮食收购保护价格制度的通知》). Beijing: State Council, 20 February 1993.

Central Committee Document No. 12 [1995]. Guowuyuan Pizhuan Zhongguo Renmin Yinhang Deng Liu Bumen Guanyu Jiaqiang Liang Mian You Zhengce Xing Shougou Zijin Guanli Yijian De Tongzhi (Circular of the State Council on the Proposal of the Chinese People’s Bank and Five Other Departments on Strengthening the Management of Funds for the Purchase of Grain, Cotton and Oil Within the Framework of State Policies, 国发[1995]12号《国务院批转中国人民银行等六部门关于加强粮棉油政策性收购资金管理意见的通知》). Beijing: State Council, 30 May 1995.

Central Committee Document No. 15 [1992]. Guowuyuan Guanyu Tigao Liangshi Tongxiao Jiage De Jueding (Decisions on Increasing the State Monopoly Selling Price of Grain, 国发[1992]15号《国务院关于提高粮食统销价格的决定》). Beijing: State Council, 6 March 1992.

Central Committee Document No. 15 [1998]. Guowuyuan Guanyu Jinyibu Shenhua Liangshi Liutong Tizhi Gaige De Jueding (Decision of the State Council on Further Reform over the Grain Circulation System, 国发[1998]15号《国务院关于进一步深化粮食流通体制改革的决定》). Beijing: State Council, 10 May 1998.

Central Committee Document No. 17 [2004]. Guowuyuan Guanyu Jinyibu Shenhua Liangshi Liutong Tizhi Gaige De Yijian (Opinions of the State Council on Further Deepening the Reform to the Grain Distribution System, 国发[2004]17号《国务院关于进一步深化粮食流通体制改革的意见》). Beijing: State Council, 23 May 2004.

Central Committee Document No. 20 [1998]. Guowuyuan Guanyu Jinyibu Wanshan Liangshi Liutong TIzhi Gaige Zhengce Cuoshi De Buchong Tongzhi (Supplementary Circular of the State Council on Policies and Measures for Further Improving Grain Circulation System Reform, 国发[1999]20号《国务院关于进一步完善粮食流通体制改革政策措施的补充通知》). Beijing: State Council, 11 October 1999.

Central Committee Document No. 32 [1994], Guowuyuan Guanyu Shenhua Liangshi Gouxiao Tizhi Gaige De Tongzhi (Circular of the State Council on the Further Reform of Grain Purchase and Selling System, 国发[1994]32号《国务院关于深化粮食购销体制改革的通知》). Beijing: State Council, 9 May 1994.

Central Committee Document No. 35 [1998]. Guowuyuan Guanyu Yinfa Dangqian Tuijin Liangshi Liutong Tizhi Gaige Yijian De Tongzhi (Circular of the State Council on Issuing the Proposals on Promoting the Reform of the Grain Circulation System under Current Circumstances, 国发[1998]35号《国务院关于印发当前推进粮食流通体制改革意见的通知》). Beijing: State Council, 7 November 1998.

Central Committee Document No. 40 [1993]. Guowuyuan Guanyu Yinfa ‘Jiushi Niandai Zhongguo Shiwu Jiegou Gaige Yu Fazhan Gangyao’ De Tongzhi (China Dietary Pattern Reform and Development Program in the 1990s, 国发[1993]40号《国务院关于印发<九十年代中国食物结构改革与发展纲要>的通知》). Beijing: State Council, 27 May 1993.

Central Committee Document No. 60 [1991]. Guowuyuan ‘Guanyu Jinyibu Gaohuo Nongchanpin Liutong’ De Tongzhi (Circular of the State Council of How to Further Improve the Circulation of Agricultural Products, 国发[1991]60号《国务院关于进一步搞活农产品流通的通知》). Beijing: State Council, 28 October 1991.

Central Committee Document No. 62 [1994]. Guowuyuan Pizhuan Caizhengbu Deng Bumen Guanyu Liangshi Zhengce Xing Caiwu Gua Zhang Tingxi Baogao De Tongzhi (Circular of the State Council on the Report of the Ministry of Finance and Other Departments on Withholding Accounts and Suspending Interests in Accordance with the Grain Policy, 国发[1994]62 号《国务院批转财政部等部门关于粮食政策性财务挂帐停息报告的通知》). Beijing: State Council, 29 November 1994.

Central Committee Document No. 137 [1982]. Guowuyuan Guanyu Renzhen Zuohao Liangshi Gongzuo De Tongzhi (Circular on the Diligent Execution of All Operations Affecting Grain, 国发[1982]137号《国务院关于认真做好粮食工作的通知》). Beijing: State Council, 28 November 1982.

Central Document No. 1 [1983]. Zhonggong Zhongyang Guanyu Yinfa ‘Dangqian Nongcun Jingji Zhengce De Ruogan Wenti’ De Tongzhi (Some Issues of Contemporary Rural Economic Policies, 中发[1983]1号《中共中央关于印发<当前农村经济政策的若干问题>的通知》). Beijing: Communist Party of China, Central Committee, 2 January 1983.

Central Document No. 1 [1984]. Guanyu 1984 Nian Nongcun Gongzuo De Tongzhi (The Notice of CPC Central Committee About the Rural Area Work in 1984, 中发[1984]1号《中共中央关于1984年农村工作的通知》). Beijing: Communist Party of China Central Committee, 1 January 1984.

Central Document No. 1 [1985]. Zhonggong Zhongyang Guowuyuan ‘Guanyu Jinyibu Huoyue Nongcun Jingji De Shi Xiang Zhengce (Ten Policies of the Chinese Communist Central Committee and the State Council for Further Enlivening the Rural Economy, 中发[1985]1号《中共中央、国务院<关于进一步活跃农村经济的十项政策>》). Beijing: Communist Party of China Central Committee, 1 January 1985.

Central Document No. 1 [1988]. Guanyu Wanshan Liangshi Hetong Dinggou ‘San Guagou’ Zhengce De Tongzhi (Notice on Improving Grain Contractual Purchase via the “Three Links”’, 中发[1988]1号《国务院关于完善粮食合同定购“三挂钩”政策的通知》). Beijing: Communist Party of China Central Committee, 3 January 1988.

Central Document No. 1 [2004]. Zhonggong Zhongyang Guowuyuan Guanyu Cujin Nongmin Zengjia Shouru Ruogan Zhengce De Yijian (Opinions of the Central Committee of the CPC and the State Council on Several Policies for Promoting the Increase of Farmers’ Income, 中发[2004]1号《中共中央国务院关于促进农民增加收入若干政策的意见》). Beijing: Communist Party of China Central Committee, 31 December 2003.

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———. ‘Macheng Jianguo Yi She Chuxian Tianxia Diyi Tian: Zaodao Muchan Sanwan Liuqian Jiubai Duo Jin’ (‘Macheng Jianguo No. 1 Corporative Shows the Ever Best Farm After Foundation: Early Rice Yield per Mu Reached More Than 36,900 Jin’). Renmin Ribao (The People’s Daily), 13 August 1958.

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Titel: State-Led Changes: Failures and Successes
verfasst von: Jun Du
Verlag: Springer International Publishing
Buch: Agricultural Transition in China
Print ISBN: 978-3-319-76904-2

Electronic ISBN: 978-3-319-76905-9

Copyright-Jahr: 2018
DOI: https://doi.org/10.1007/978-3-319-76905-9_3

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