China Economic Situation in the 1970’s and 1980’s

According to ALLUNITCONVERTERS, the years following the death of Mao Zedong saw the progressive affirmation of an economic policy with largely innovative connotations, aimed at giving the country, in the name of the four modernizations announced in 1977 – agriculture, industry, defense, science and technology – a decisive acceleration towards development, through openness and collaboration with the Western world. To achieve the ambitious goal of making China a true world power,leadership¬†which emerged after the definitive defeat of the ultra-radical wing (1978) had to deal with Maoism, decisively revising the primacy attributed to politics over the economy. In this key we must read the watchwords that have re-launched the need to base development on realistic assessments of the available forces, as opposed to ideological voluntarisms and dogmatisms, on the basis of the principle that “the criterion of truth is practice”.

On the institutional level, the way practiced is to limit state intervention with the introduction of a new market orientation system in agriculture, trade and industry, which guarantees greater freedom of action, combined with a proportional degree of responsibility of economic operators with regard to the choices made. A mixed economy model is therefore taking shape in which the control of centralized planning is reduced in favor of individual initiatives and market mechanisms. It is obvious that in this way it becomes more difficult to avoid that development is configured as a mechanism capable of strengthening some geographical areas over others, and that on a social level some categories impose themselves by acquiring greater well-being and prestige, with the worsening of the already substantial problems of socio-territorial dualisms. The current leadership, while aware of the dangers, believes that in any case, if the mechanisms of progress are activated, those who benefit first will be the driving force for the overall growth of the nation.

Agriculture. РThe first changes of address involved the productive organization of the countryside. Although the land remains under collective ownership, a liability system was introduced in 1979 whereby single or associated families can directly manage plots on the basis of the stipulation of an exploitation contract which provides for the option between different types of relationship. between state and economic operator. The latter is obliged to pay a certain amount of essential products (wheat, rice, cotton) to the state annually by way of rent. If in this way the needs of a planned economy are safeguarded, on the other hand the possibility of selling surpluses (to new markets or to the state, but at differentiated prices) opens a new way for establishing a true agricultural entrepreneurship. If the production is insufficient, or if the production unit has decided to grow other products, the quota in kind to be paid will have to be purchased on the market. The production groups can directly own the work tools, in the past this was the prerogative of the brigades, and they can pay for external work interventions offered freely on the market. The contracts have a maximum duration of 15 years (when they refer to degraded land to be rehabilitated, uncultivated, or to be reforested) and have been progressively made more favorable through the liberalization of the prices of a greater number of products and the reduction of the quotas to be paid.

In the constitution promulgated in 1982, a reform of the municipalities was carried out, in order to reduce their functions, especially through the separation between the economic and the political-administrative ones, and streamline the bureaucratic apparatus. The new liability system was applied not only to popular communes but also to state farms (about 2000), which work over 4,400,000 ha. After 1983, their breakdown into smaller particles brought their number to over 85,000.

The rationalization of agricultural production has also entailed the rapid disappearance of waste and parasitism, the elimination of which frees productive energies that are oriented either towards sectors integrated with rural activities or towards truly urban ones. The limited mechanization, which in China had among its causes also the overabundance of available laborers, could be strengthened with a clear improvement in the productivity of the sector.

As a result of the innovations introduced, there has been an increase in the production of both essential products and those considered luxury products. Between 1978 and 1983 the cereals marketed by the state had an increase of about 90%. For cotton, the increase exceeds 100%. Since the state paid higher sums for the purchase of cereals in the late 1970s and early 1980s, farmers’ incomes increased for the first time after 1949 by a greater percentage than those of citizens., coming to represent 46.5% of national income in 1982. However, this figure must be commensurate with the enormous disproportion existing between agricultural workers (69% of employed persons) and those in other sectors (31%).

There was also a reflection on the environmental damage produced by the Maoist policy of self-sufficiency of rural communities in the cereal sector, with the inevitable over-exploitation of land to achieve planning objectives. In areas traditionally dedicated to pastoralism, such as Inner Mongolia, there was a 50% reduction in the turf between 1969 and 1979. Considerations of this nature are also made with regard to water management, in order to increase the irrigated area. In many cases the indiscriminate use has caused the exhaustion of other traditional sources of livelihood of the population, hunting and fishing, linked to wet environments, without having a satisfactory cost-benefit ratio in order to increase agricultural yields. unitary.

China Economic Situation in the 1970's and 1980's

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