China's Economy—Retrospect and Prospect

Abstract

The Chinese Communist Party was forty-eight years old in July, 1969: the Chinese Communist economy celebrated its twentieth anniversary in October 1969. This would therefore seem an appropriate point at which to attempt a review of China's economic development in the period 1949-69, and to examine the progress achieved in the light of the early promises made by the Peking regime. China, as a country, can fairly be described as one of the most enigmatic, unpredictable and (considering its size) volatile areas in the world. The importance of China to the world as a whole hardly needs stressing. Here is a country with one-fourth of the world's population, and the world's third largest nation in territorial extent (although its cultivable area is only one-third as extensive as that of the United States). Its per capita income, to take an average of various independent estimates made in 1968,1 is only 85 United States dollars a year. Yet China is a country with already a considerably developed nuclear programme. The economic paradox offered by this contrast between the highly sophisticated nuclear sector and the rest of China is remarkable. It demonstrates what can be done, even in a retarded economy, by the sufficiently authoritarian use of limited resources. One thing seems perfectly clear. The revolutionary impetus which the founder of the Chinese People's Republic, Mao Tse-tung, originally communicated to it is by no means exhausted. The 'Great Proletarian Cultural Revolution' is witness to that. Mao's revolutionary drive is as powerful and pervasive as ever, and this, while he continues as Chairman, could well be the most important single factor governing China's future. This drive is, of course, basically political. But economic factors obtrude, and will continue to do so. They act as a brake on Mao's revolutionary momentum, and were doubtless one source of the conflict with the now deposed Liu Shao-chi which initiated the Cultural Revolution: and they are now fanning the embers of that still smouldering conflagration, on the continuance of which there are many reports from within China.