Beiji A CHINESE WEEKLY OF NEWS AND VIEWS VoTIT, No.18 May 2-8, 1988 US-Soviet Relations & the World Situation PROVINCE- CHINA'S LARGEST SEZ AT NIGHT

Chinese cities are usually quiet at 10 o'clock at night. But in the Shenzhen Special Economic Zone, night life is just starting. The three photos show Shenzhen at around 1 0 pm. by Chen Xiaopo

Yan Li (right) is a magazine editor. She usually attends a late evening lecture at the Art Training Institute.

The open-air theatre called "Everybody is Happy" attracts many amateurs who have performing talents.

The students of the management department at the Shenzhen University attend a lecture. Beijing HIGHLIGHTS OF THE WEEK

vol.. 31, NO. IX MAY 1W8 New State Council Set to Tackle Tasks

CONTENTS • Honesty in government, tightening discipline and eliminating bureaucracy should be the main principles of the NOTES FROM THE EDITORS 4 new State Council's work style, Chinese Premier Li Peng said Hainan to .Adopt More recently at the council's first plenary meeting. He also outlined Spet-ial Policies the new division of labour among government members (p. 5).

EVENTSARENDS 5-0 State (oiincii Duties I)i\idcd Hainan Becomes a Province and the Fifth SEZ China Vahic lies With Circece Japanese F.nvo> VJMtb Beijing • The recent NPC session granted Hainan Island the status of Price Hikes Hit China s Markets province and made it China's fifth and largest special economic China Launches Housing Reform zone (p. 4). A report on Hainan's resources, preferential \Vcekl> Chronicle (April 18-24) policies and development strategy (p. 14).

INTERNATIONAL 10-13 Palestinian Struggle; Assassination Enterprise Law—A IVIilestone of Reform Will Not Stop Uprising Japan: Paving ihe Way to • The Enterprise Law, drafted after nine years of preparation Send Troops Abroad and passed by a majority at the recent NPC session, provides a Soviet Union: Letter Sets legal guarantee for the independent management of enterprises. Off New Debate on Reform It is expected to increase their vitality and produce a WorJd Bank-IMF; Uncertainty tremendous impact on China's economy as a whole (p. 20). Lingers After Meetings Laos: Cautiously Taking The Road of Reform Changes in the World Favour Detente

Hainan Province—China's • The world economy is entering a new period of Largest SEZ 14 development. The trend towards a multipolar world has been Enterprise Law: A Milestone strengthened. All countries, even the United States and the For Reform 20 Soviet Union, have found it necessary to concentrate on Fang Lizhi's Academic internal affairs, especially economic and technological Acliievements 23 development. These changes will help stabilize the international Otianges in International situation and prolong the current US-Soviet relaxation (p. 24). Relations 24

TOURISM 29 Assassination Will Not Stop Uprising BUSINESS/TRADE 30 CULTURE/SCIENCE 32-34 • Abu Jihad, the deputy commander of the Palestine COVER: A bird"s-eve view of the Haikou Revolutionary Forces, was assassinated in Tunis on April 16. Citv. The atrocity aroused a chorus of condemnation around the Xue Chao globe and new waves of protest by the Palestinians (p. 10).

Subscription rates (1 year): USA US$24.00 Published every Monday by General Editorial Office Tel: 8314318 Australia A.$24.00 Canada Can.$23.00 BEIJING REVIEW English Dept Tel; 831.5599 Ext. 546 New Zealand NZ.$33.00 24 Baiwanzhuang Road, Distributed by China International Book UK £13.00 Beijing 100037 Trading Corporation (GUOJI SHUDIAN) The People's Republic of China P.O. Box 399, Beijing, China Hainan to Adopt More Special Policies by Yang Xiaobing The first session of the Seventh materials are sold to the mainland through transfer and lease to National People's Congress, with more than a 20-percent develop and manage the land or which just closed, granted Hainan increase in value after processing, conduct real estate business. The Island the status of province and full customs duties will be levied longest term for the transfer of made it China's largest special on imported raw materials. land-use right is set at 70 years. economic zone. • Foreign-funded enterprises To supplement the policies CPC Central Committee Gen• (Sino-foreign joint ventures, co• adopted by the central govern• eral Secretary once operative and wholly foreign- ment, efforts are now being made suggested that Hainan could owned enterprises) usually begin to draft relevant local regulations. implement more open economic paying over a 15-percent income Xu Shijie, who has been policies than the existing special tax in their third profit-making entrusted by the central govern• economic zones (such as Shen• year. Hight-tech and development ment to take charge of the zhen) and take the lead in projects, or construction projects preparations for establishing experimenting with political struc• for basic facilities other than Hainan Province, expressed the tural reform at the provincial power, will pay inconae tax in their need to boldly use the policies level. Since then, Hainan Island fifth profit-making year. The adopted by the central govern• has become the focus of attention Hainan government has the power ment, but not abuse them. The of many overseas investors. to approve tax exemptions or "motorcar incident" of three years According to a reliable source, reductions for enterprises facing ago, in which the right to import the special preferential policies for difficulties. It will be possible for motor vehicles on the island was Hainan Island approved by the foreign investors to remit profits made use of to sell them on the central government will soon be abroad directly from the enter• mainland for profits, is sdll fresh made public. The major contents prises' foreign exchange accounts in people's memories. of the policies will include: tax free. A 10-percent tax will be The central government has • Hainan will have the right to collected on outward remittances followed two principles in grant• raise funds abroad, and accept of profits from loan interests, ing more open policies to unlimited foreign loans under the equipment rental and royalties. Hainan — the island must not sell principle that the island bears all imported goods on the mainland responsibility for their repayment. • Foreign exchange can be for high profits, and the other • Foreigners will be allowed to freely bought and sold by Hainan places must not take advantage of contract management of state- enterprises and enterprises in Hainan's preferential policies to owned and collectively owned other special economic zones. indulge in tax avasion and the enterprises in Hainan. • Foreign banks can set up illegal procurement of foreign • No quotas will be set for branch organizations in Hainan to exchange. export products from Hainan. handle foreign exchange deposits Products rnanufactured using raw and loans, bonds and stocks. To cater to the establishment of materials or semi-finished pro• • Foreigners holding passports a large special economic zone, ducts from the mainland with can enter Hainan with visas issued Hainan has now started reforms more than 20 percent added value by fronfier stations. Compatriots to its political structure, with the will be treated as products from from Hong Kong and Macao can aim of introducing a system of Hainan. do the same using their ID cards. "small government and greater • Hainan will be able to import For Taiwan compatriots, only society." "Small government" means of production as well as 24 travel certificates and visas issued involves streamlining government controlled import goods, such as by frontier stations are needed. organizations and more import• household electrical appliances, Foreigners travelling to Hainan antly limiting government func• with customs duties exempted or on business can apply for tions to planning, co-ordination, reduced. Customs duties will be temporary residential certificates supervision and examination. levied on imported cigarettes and and stay for longer periods of "Big society" implies using socio• liquor. The use of imports will be time. economic units to replace govern• limited to the island. If products • Foreign enterprises and indiv• ment organizations in charge of made using imported raw iduals can acquire land-use rights | real estate, transport and com-

4 BEIJING REVIEW, MAY 2-H, 1988 EVENTS/TRENDS

State Council Duties Divided

hinese Premier Li Peng out• premier is responsible for the State C lined the new division of Council, assisted by the vice- labour among government mem• premiers and state councillors. bers at the first plenary meeting of State Council merhbers are to the State Council held on April 18 carry out the principles and in Beijing. policies of the Communist Party As decided at the first State of China in their work. The Council Standing Committee National People's Congress and meeting on April 14, Li Peng has its Standing Committee supervise overall responsibility for the the council's work. munications, commerce, agricul• activities of the State Council, The State Council must see that ture and forestry. These socio• with Vice-Premier Yao Yilin in departments and local govern• economic units will be run like charge of daily and economic ments at all levels play a full role. enterprises and operate in line affairs. Vice-Premier Tian Jiyun is Council members must maintain with the laws of the economy. responsible for agriculture, com• close ties with the people, listen Compared with China's other merce and trade, while Vice- attentively to their views and carry special economic zones, Hainan Premier Wu Xueqian will handle forward the fine tradition of Island is much better off in terms foreign affairs. serving the people. The regul• of resources. It has rich oil, natural Among the state councillors, Li ations also call for high work gas, iron and titanium reserves, Tieying will be in charge of efficiency and reducing bureauc• abundant tropical fauna such as cultural and educational affairs; racy in government work. rubber and coffee, and various Song Jian, science and technology; The State Council can hold marine products and superb Wang Fang, legal affairs; and Zou three kinds of meetings — plenary. beaches. These resources make it Jiahua, industry and transport. Standing Committee and work possible for Hainan to develop State Councillor Qin Jiwei is meedngs. All important issues chemical, mineral processing, concurrently minister of national must be discussed and decided at a textile and food industries as well defence; Wang Bingqian, minister Standing Committee or plenary as tourism. of finance; and Li Guixian, meeting. However, Hainan's most obvi• governor of the People's Bank of ous advantage is its geographical China. Chen Xitong will be in Main Principles of tlie New location. Situated between Japan charge of liaison between central Council's Work Style. In his and Singapore, it is very government departments and speech at the April 18 meeting. convenient to sea transport, which Beijing municipality as well as of Premier Li reiterated that the State is important for international planning and construction in the Council should put reform at the economic co-operation. capital. centre of all its undertakings and Formerly, Hainan's energy, push forward in various fields. transport and telecommunic• State Councillor Chen Jun- "The new government should ations industries were quite sheng, who is also secretary- inherit and keep up the good backward and its industrial general of the State Council, is to traditions of previous govern• infrastructure could not cater for assist Vice-Premier Yao in the ments while creating its own opening to the outside world. routine work of the council. At the unique work style," Li said, Since 1984, continuing efforts meeting Chen outlined the adding that honesty in govern• have been made to improve basic regulations that will govern the ment, tightening discipline and facilities and this will receive council's work. The regulations eliminating bureaucracy should be further attention after Hainan spell out the ' State Council's the main principles of the new becomes a province. So far, functions and powers; the re• council's work style. gradual improvements have .been sponsibilities of the premier, vice- Expanding on the topic of made in the island's power premiers and the state councillors; honesty in government, Li said the industry, water and air transport and systems and procedures for council and related bodies must facilities and telephone services. A council meetings, the approval of make strict demands on them• better investment environment is documents and social consult• selves and set an example for the slowly taking shape. ation and discussion. people. "We should start with Under the regulations, the whatever most displeases the

BEIJING REVIEW. MAY 2-8. 1988 5 m EVENTS/TRENDS people," he said. For example, president's friendship towards gap still exists between the easing strict control should be imposed China and the Chinese people, and of tension and disarmament, and on the construction of too many praised his efforts to further to achieve this end will require office buildings, hotels and bilateral relations. long-term hard work." auditoriums, and unnecessary "China and Greece, two of the Regarding China's domestic banquets must be stopped. world's ancient civilized countries, situation, Zhao told Sartzetakis Organization and discipline have no conflicts of interest," that the central government will should be tightened, he said. "The Yang said. "We are very pleased take further and more concrete State Council's decisions should with the smooth progress in our measures to develop the socialist be strictly carried out, and the relations since we established commodity economy, which is the unhealthy practice of defying diplomatic relations, and especi• key link in China's economic orders and prohibitions must be ally pleased with efforts over the structural reform. The key to the overcome." The State Council past few years." reform of the country's political welcomes criticism and proposal Sartzetakis said the Greek system is the establishment of a democratic political situation, he from the people on the council's people have always appreciated said. work. the great contributions Chinese On overcoming bureaucracy, civilization has made to the world. Commenting on China's devel• "A definite answer should be He agreed that relations opment strategy for coastal areas, given on matters submitted by between Greece and China are Zhao said, "China's economic subordinate departments, regard• good and that his visit would relations with foreign countries less of whether the problems can promote further co-operation. will be greatly strengthened be solved." But while the new On the second day of his stay in through this plan. I hope more government should work effi• Beijing, Sartzetakis met Chinese Greek business people will come ciently, Li said, efficiency does not Communist Party General Secre• to our coastal areas to do business mean granting whatever is re• tary Zhao Ziyang and Premier Li with us, so bilateral relations can quested. All issues must be Peng. Zhao told his guest, "An reach a new height." handled according to principles. easing of tension in the current • international situation is worth Li Peng told Sartzetakis that welcoming. This trend is partly a China is concerned about the result of the efforts of smaller problems between Greece and China Values Ties countries which are striving for Turkey because both are good With Greece disarmament and trying to friends of China. "China is happy safeguard world peace. But a big to see the positive changes that

hina considers thai developing General Secretary Zhao Ziyang meets Greelt President C long-term and stable relations Christos Sartzetakis. ^^^^ CHUANGUO with Greece is very important, Chinese President Yang Shang- kun told visiting Greek President Christos Sartzetakis. The Greek president and his party, which included his wife. Minister of National Economy Panayotis Roumeliotis and Mini• ster of Education and Religion Antonis'Tritsis, arrived in Beijing on April 19 for a six-day official visit. Sartzetakis is the first Greek president to visit China since the countries established diplomatic relations in 1972. At a welcoming banquet for the guests, Yang said the visit would promote relations and strengthen friendship between the two peoples. Yang spoke highly of the Greek

6 BEIJING REVIEW. iMAY 2-8. 1988 have emerged in the relations between the two countries follow• ing the two meetings between the Greek and Turkish prime mini• sters," Li said. The meetings were held earlier this year. Li expressed appreciation for both countries' efforts and said he hopes that they will continue to seek a peaceful, fair and reasonable settlement of their problems. At an April 20 press conference, Sartzetakis said prospects for economic and trade co-operation between Greece and China are growing and that Greece is willing to do more to develop these ties. The Greek president also said his warm reception from Chinese leaders reflects the current state of political relations between the two nations. When Sartzetakis and his party left for a tour of Xian on April 21, LIU SHAOSHAN Yang Shangkun bade them Chinese leader meets Masayoshi Ito, special envoy of Japan' prime minister. farewell at the state guesthouse in a western suburb of Beijing. such things and have taken Ito repHed that he also deeply "The visit was very successful," measures to try to resolve them. regretted the problems caused by a Yang told Sartzetakis. "We hold We thank them for their efforts. few people. "The majority of identical or similar views on many "Attention must be paid to the Japanese citizens attach great major issues and we share a activities of a handful of people importance to developing Sino- common desire to further our co• belonging to the 'right-wing' Japanese friendship." operation." forces, as you call them. Dealing Ito said he . understands that Sartzetakis visited with them too leniently might China is unhappy about the before leaving China on April 24. encourage their arrogance." activities of a small faction of • These incidents, if considered right-wing agitators. He promised separately, are not major, Deng that Japan will try hard to prevent Japanese Envoy said, but when seen together, they the recurrence of such incidents. represent a kind of tendency and a Chinese Premier Li Peng Visits Beijing force which could easily sabotage discussed Sino-Japanese Sino-Japanese friendship and economic co-operation with Ito hinese leaders told Masayoshi almost certainly arouse a strong during their meeting. Li said C Ito, a special envoy of Japan's reaction from the Chinese people. China and Japan can benefit and Prime Minister Noboru Takesh- learn from each other's strengths ita, that the Sino-Japanese "Such things will probably and compensate for each other's relationship is friendly and normal happen again in the future," Deng weaknesses on the basis of on the whole despite the several said, "but we hope that these equality and mutual benefit. unpleasant incidents that have matters can be resolved in a timely occurred in past several years. and proper way by following the Li mentioned that two Japanese Deng Xiaoping, chairman of principles of the China-Japan trading companies which had sent China's Central Military Com• Joint Statement and the Sino- exports to China had been mission, told Ito on April 19 that Japanese Peace and Friendship searched by Japanese police. He several troubling incidents have Treaty, and with the benefit of said Chinese businesses, scientific cropped up in recent years. "I both sides' years of experience in and technological circles are know that the majority of trying to develop friendly puzzled by this incident and that Japanese friends do not support relations." he hopes the Japanese will handle

BEIJING REVIEW, MAY 2-8, 1988 7 EVENTS ARENDS the matter carefully and lift more ing to China's World Economic improving economic control, restrictions on the transfer of Herald, there could be a gap of up perfecting various contract sy• technology to China. to 40 billion yuan (US$10.75 stems and strengthening legal and Ito said the Japanese side will billion). public supervision over commer• work hard to relax policies on Zhang cited the rapid increase cial activities. • technology transfer to China. He in the non-agricultural population apologized for the harm to China and the continuous reduction of Ctiina Launches caused by the "Toshiba case." vegetable-growing areas in the Ito also expressed Japan's hope past few years as the main reason Housing Reform for a better investment climate in for vegetable shortage. The frost China. He said the Japanese around the middle and lower he State Council, China's government will do its best to reaches of the Changjiang (Yangt• Thighest governing body, has encourage Japanese business ze) River further widened the decided to carry out housing people to invest in China. gap." reform across the country over the Li and Ito also discussed how to Poor market management has next three to five years. handle problems arising from the also led to arbitrary price increases The state has invested a lot in March 24 train accident near in some areas, he said. housing construction over the past Shanghai in which 27 Japanese Prices have triggered anxieties three decades and more. But under students and teachers were killed on the part of consumers, Zhang the current system, some people and 37 injured. Li said the Chinese said. But he added, "For a long abuse their positions and power to side will handle the case properly. time, prices in China have not demand several apartments, while Ito also met Wan Li, chairman been reasonable, and in better ordinary people frequently live in of the NPC Standing Committee. linking prices to value, higher overcrowded conditions. Wan mentioned that this year is prices are inevitable." People's Daily on March 8 the 10th anniversary of the signing The key to solving this problem, quoted one city dweller as saying, of the Sino-Japanese Peace and he said, lies in increasing people's "Trying to find an apartment to Friendship Treaty. "It is our hope salaries. These must be raised at a rent is harder than finding a that Sino-Japanese friendship and faster pace than prices. "The spouse." Urban housing problems co-operation will continue to people's standard of living won't are becoming more acute and grow," he said. • be affected if income increases housing distribution has become a keep up with or exceed price severe social problem. hikes." A survey conducted in Fujian Price Hikes Hit The government is experiment• and Heilongjiang provinces and China's Markets ing with other measures, such as Xiangfan, Hubei Province, subsidies for major non-staple showed that although some urban teep retail price rises are foods, and is considering extra residents were worried that their S turning out to be the major living allowances for families in standard of living would go down economic problem in China this economic difficulties. as rents went up and complained year, an official from the State Subsidies will differ from place they could not afford to buy their Statistical Bureau says. to place according to the local own apartment, more than half of price index. Some have already the urban residents in the areas Bureau spokesman Zhang been given out in Shanghai, surveyed were in favour of Zhongji told a press conference on Nanjing and Hangzhou, and reforming the housing distri• April 19 that the national retail Beijing residents are slated to get bution system. price level increased by an average them in one or two months, he Housing reform experiments in of 11 percent during the first said. several cities over the past couple quarter of this year. Experts say that prices will of years have proved successful "The average price rise in 32 continue to grow for the next few and paved the way for the large and medium-sized cities was years as the state tries to nationwide programme. 13.4 percent. Prices for non-staple rationalize the overall price system According to the plan approved foods grew by 24.2 percent, with a to stimulate production. But Vice- by the State Council, the aim of dramatic 48.7 percent rise in the Premier Yao Yilin vowed to keep housing reform is to replace the price of fresh vegetables," Zhang the annual price rises "below 10 current system whereby the state said. percent." builds apartments and distributes The underlying reason for the Minister of Commerce Hu Ping them through work units. Instead, price hikes is that demand greatly said his ministry will focus on apartments would be sold in line outstrips supply, he said. Accord• checking arbitrary price hikes by with the demands of the socialist

8 BEIJING REVIEW. MAY 2-8, 1988 planned commodity economy. Weekly Chronicle Premier Li Peng tells a national The housing reform will begin (Aprir 18-24) meefing on tourism which closes with changes to the rental system. today. Gradually, housing distribution POLITICAL The State Council will set up a will be put on a commodity basis. April 19 tourism committee led by Wu to People will buy housing or the • The Chinese Foreign Ministry help co-ordinate tourism right to use housing, thus boosting issues a statement on the murder development. the development of the real estate, of Abu Jihad. It says, "We are • Construcdon begins on the construction and building deeply grieved over the tragic second railway-highway bridge materials industries. death by assassination of Abu over the Qiantang River near The housing reform will involve Jihad, member of the Central Hangzhou, Zhejiang Province. the following elements: Committee of the Palestinian 'Al A key project during the — Changing the system of Fatah" organization and deputy Seventh Five-Year Plan period distributing state funds from commander-in-chief of the Palest• (1986-90). the bridge will ac• subsidies for housing construction inian armed forces. commodate two railway tracks and maintenance to subsidies for "The Chinese government and and four highway lanes at the wage earners; people strongly condemn the same level. The 2,860-metre — Replacing the current plann• Israeli authorities for their railway section is expected to be ing and management system, despicable act of assassination and completed in 1990 and the 1,792- which considers housing construc• gross violation of Tunisia's metre highway section should be tion as fixed capital investment, sovereignty." open to traffic by 1991. with a system that regards it as • Speaking on the conflict in the commodity production; Persian Gulf region, a Chinese — Forming a housing fund to Foreign Ministry spokesman says, CULTURAL rationalize various funding chan• "We express our grave concern nels through reforms in financing, over the renewed US-Iranian April 22 taxation, wages and prices, and military confiict in the Gulf and • Farmers in Shandong Province real estate management. the resultant heightened tension have given 2.3 billion yuan (about — Launching a real estate there. US$620 milHon) to build new market and developing real estate "China is always opposed to big schools and renovate old ones in financing. powers' military involvement and the past eight years, Xinhua The tasks of housing reform in intervention in the Gulf and reports. the coming three to five years stands for maintaining Gulf This represents 92 percent of the include revamping the rental security and freedom of total provincial investment in system for state-owned apart• navigation." school construction and ments, easing the housing shor• April 20 renovation. tage and encouraging urban • A Lhasa police official says the residents to buy apartments. local police have arrested four The state will adopt laws and people accused of killing an armed SOCIAL procedures suited to the new policeman during the March 5 riot housing policies, and will inform in the capital of the Tibet April 21 people about them through public Autonomous Region. • More than 500 people, includ• education campaigns. Two of the four accused are ing a delegation from New According to the initial plan, students — one at Tibet Univers• Zealand, attend a meeting in every province, municipality and ity and the other at the Tibet Beijing to commemorate the late autonomous region will select Buddhist Theological Institute. Rewi Alley. several cities or counties as pilot The four were arrested on April 14 Alley, a social activitist, writer areas, for the housing reform. after an investigation by the Lhasa and poet, left his native New Experience gained in these areas People's Procuratorate. Zealand to devote his life to the will be used by other cities, which cause of the Chinese People. will begin to carry out housing Arriving in China in 1927, he later reform next year. By 1990, all ECONOMIC founded the Industrial Co• cities, except for those in border, operative (Gung Ho) Movement remote and economically under• April 21 and the Bailie Technical School developed regions, are expected to • Vice-Premier Wu Xueqian will which played an important role have implemented housing take charge of tourism, in addition during the War of Resistance reform. • to his other responsibilities. Against Japan. •

BEIJING REVIEW. MAY 2-8. 1988 9 m INTERNATIONAL

The loss of Abu Jihad PALESTINIAN STRUGGLE represents a setback in the Middle East peace process. Arab leaders have made tremendous efforts to Assassination Will Not Stop Uprising convene an international Middle East peace conference. Against The murder of Abu Jihad, the deputy commander of the this background, US Secretary of Palestine Revolutionary Forces, aroused a chorus of State George Shultz has recently condemnation in the international community. paid three shuttle visits to the region to promote an American peace proposal. But the Israeli halil al-Wazir, also known as Abu Jihad's funeral in Damascus. authorities have erected a new K Abu Jihad, the deputy com• The assassination shows that obstacle to peace by committing mander of the Palestine Revo• the Israeli authorities are at their this crime. lutionary Forces and the second in wits' end in face of the continued Over decades of hard struggle, command of the Palestine Liber• violence in the occupied ter• the Palestinians have gained the ation Organization (PLO), is ritories. The uprising that was experience and learned the dead. He was assassinated at his launched by Palesinian youth on techniques they need to wage a home in Tunis on the morning of December 8 last year continues successful fight to restore their April 16 by a group of gunmen. despite Israel's harsh crackdown. national rights and obtain a just, The atrocity was condemned by Shootings, beatings, jail, curfews comprehensive and rational reso• countries around the world. and deportation have all failed to lution of their situation. They have A Tunisian committee to stop the powerful torrents. won many supporters for their investigate the incident, set up by The Israeli authorities have cause. The facts prove it will not be Tunisian President Zine el- miscalculated if they think they defeated. Abidine Ben Ali, announced on can root out the core of the The assassination shows the April 18 that the assassination was struggle by assassinating Abu enemy's fear of the further planned and implemented by Jihad. A new generation of wise development of the Palestinian Israel. and courageous Palestinian struggle against Israel. But bullets Reports of the murder pro• leaders is emerging. cannot cow the Palestinian people, voked new waves of protest and The Israeli authorities call the who fight for a just cause. Bullets violence in the West Bank and PLO "terrorist," but Abu Jihad's will only increase their solidarity Gaza Strip. Palestinians in the assassination, the Israeli air attack and will to fight, and push to a new occupied territories immediately on the PLO headquarters in Tunis stage the struggle against Israeli launched a general strike, which in October 1985 and countless aggression and expansion and for lasted three days, and thousands other incidents show that it is they national liberation. of demonstrators clashed with who are the real terrorists. by Zhao Xin Israeli soldiers. The assassination sent shock waves through Arab Hundreds of thousands of people attend Abu Jihad's funeral in Damascus on April 20. world, and Arab countries condemned it with one voice. The PLO said the martyrdom of Abu Jihad will inspire the Palestinian revolution, fan the flames of the current uprising and reaffirm the Palestinians' deter• mination to continue the struggle until final vicotry. Condemning Israel for the murder, the PLO vowed to avenge Abu Jihad.

Events in the wake of the vicious Israeli killing prove that the assassination of Palestinian leaders will fuel, rather than halt, the Palestinian revolt. On April 20, some 500,000 people attended

10 BEIJING REVIEW, MAY 2-8. 1988 showed that the Japanese Marit• JAPAN ime Self-Defence Forces plan to equip themselves with light Paving the Way to Send Troops Abroad aircraft carriers which can carry fighter planes. A recent report calls on the Japanese government to dispatch troops to the Persian Gulf, an opposition newspaper says. The International concern over idea of Japan sending troops overseas has attracted worldwide these moves is based on a knowledge both of Japan's history attention. and its current military and economic strength. Japan's de• Japanese opposition news• even tougher tone. It said that fence budget for the 1988 financial Apaper recently disclosed the dispatching troops overseas year is US$27 billion, exceeding contents of a report to the should become part of Japan's the limit of 1 percent of its gross government by the Strategic general political strategy. national product for the second Research Centre of Japan. The The preparing of public opinion year in a row. The North Atlantic report urged the government to for dispatching troops overseas Treaty Organization calculates dispatch minesweeper and escort can be traced to Japan's strategic that Japan's defence budget is vessels to the Persian Gulf and to aim of continuously expanding its surpassed only by those of the strengthen Japan's security influence. The Self-Defence United States and the Soviet system. Forces were built to defend the Union. This gives Japan According to the newspaper, country from enemies on its own enormous potential to build up its the report sees sending Japanese territory. In 1985 the Japanese military might. troops to the Gulf as one way of government put forward the idea Japan's trend towards develop• exercising Japan's self-defence of "wiping out the enemy on the ing its armed forces has aroused right. It calls on the government to sea," thus extending the potential anxieties both in Asian countries exercise its right in this way; to battlefield. In 1987 the Japanese and elsewhere. In the United revise the principles of the Self- Defence Agency announced its States, Henry Kissinger recently Defence Forces Law, which plan to develop "air defence over pointed out that Japan could prohibit such action; and to define the sea" and its decision to completely rebuild its military new criteria for resorting to the procure CG-47 ships with advan• forces before the year 2000. He Self-Defence Forces. The report ced missile-launching and over- noted that Japan is trying to also suggests that strengthening the-horizon radar systems. The transfer production facilities ab• the "system for dealing with agency also plans to provide the road, which will encourage the crises" would contribute greatly to defence forces with planes that can establishment of a defence system perfecting Japan's wartime sy• refuel in midair and airborne to protect its investments. Kissin• stems and help prevent the warning and control system ger forecast that Japan will country from becoming isolated. (AWACS) aircraft. Secret inform• become a strong military power in ation published by the daily Asia. Japan has been steadily es• Yomiuri Shimhun on January 2 by Lui Wenyu calating its efforts to mobiHze public opinion for dispatching SOVIET UNION troops overseas. Former Japanese Prime Minister Yasuhiro Naka- sone said in the past that Japan Letter Sets Off New Debate on Reform could only provide financial support to the escorting action in The three-year-old reform programme in the Soviet Union has the Gulf because of the limits again been challenged—this time by the publication of a imposed by its peaceful consti• controversial letter. tution. At a cabinet meeting last August 27, however, Nakasone lengthy letter against the On March 13, the newspaper, said that the law permits Japan to Acurrent reforms in the Soviet an organ of the Central Commit• send troops to the Gulf to sweep Union has been published in tee of the Communist Party of the mines and escort vessels, but such Sovetskaya Rossiya (Soviet Rus• Soviet Union (CPSU), published a action would be politically sia). The letter launched a new signed letter by a college teacher inappropriate. The report of the round of debate over the country's questioning basic aspects of Soviet Strategic Research Centre took an reform programme. leader Mikhail Gorbachev's re-

BEIJING REVIEW. MAY 2-8. 1988 11 INTERNATIONAL forms. In the letter, entitled "I commodity economy in China and the paper also announced that it Cannot Renounce Principles," the the market economy in Yugo• would continue to publish articles teacher said that the Soviet Union slavia, the paper suggested. expressing different points of is deviating from the course of The reform programme, which view. socialism and that the criticism of began three years ago, has met Joseph Stalin has been distorted The current controversy in the with unexpectedly strong oppo• Soviet Union is considered and one-sided. sition from conservatives. They especially important because it Since the publication of the argue that the reform has betrayed came as the CPSU is preparing for letter, various Soviet newspapers the nation's ideals and principles the 19th National Representa• have published articles attacking and shaken its very foundation. tive Conference, to be held next conservatives who are against the They suggest that the programme month. The meeting is intended to reform. On April 5 the CPSU represents a revision of Marxism review the progress of the national daily Pravda printed a and Leninism. Some even suggest economic and political reforms full-page editorial criticizing the that it should be halted and an that have been made and discuss writer of the letter, which it said opposite course pursued. the problems that lie ahead. The was intended to "change policies On April 15, Sovetskaya reformers warn that the enemies of of the Soviet Communist Party." Rossiya published an editorial reform are powerful — whether The editorial called the letter "an saying it had acted irresponsibly they have come into the open or ideological programme and and shown the lack of a "balanced are acting behind the scenes — and manifesto against reform." attitude" in publishing the letter. will likely assail the reform Meanwhile Soviet scholars who The paper said it had not realized programme at the conference. are in favour of the reform said that printing the letter could lead Conference participants are ex• there has been contention between people to deviate from the pected to launch a final and the reformers and the conserva• revolutionary revamping of Soviet decisive attack on the attempts to tives since the programme started. society on the basis of democracy abandon the reform. The debate is entering its most and openness. At the same time, by Tang Xiuzhe & Xin Dao difficult and decisive period and will continue to escalate, they added. One economist who WORLD BANK-IMF supports the reform said that if the enraged moves of opponents of reform are tolerated, those in Uncertainty Lingers After IVIeetings favour of the reform will become confused, .vacillators will shrink Recent meetings of world financial leaders failed to dispel back and the reform will be uncertainties about global economic prospects. The meetings affected. The economist also made limited progress on major issues, especially the questioned whether the letter had been written by the teacher herself. international debt problem. Some foreign reporters in Moscow believe it was published under the inance ministers and central The most immediate concern of direction of a high-ranking official F bankers from 151 countries almost every country is the and reflects the conflicts and gathered in Washington last outlook for the US dollar. The differences among the Soviet month for the spring meetings of dollar's exchange rate has fluc• leaders in regard to the reform. the International Monetary Fund tuated for months. It is widely The Soviet Literaturnaya (IMF) and the World Bank. The recognized that any major change Gazeta (Literary Newspaper) meetings focused on the mid-term would trigger a ripple effect that proposed that a planned commod• stability of the US dollar and the would first spread to the securities ity economy should replace the unabating international debt markets and then the world highly centralized socialist model problem. economy at large. All talks of developed in the 1930s. when The IMF-World Bank meetings alleviating poverty and the third Stalin was in power. The old provide a rare opportunity for world debt burden would become model, the paper said, was tied to financial leaders to meet and empty at best. the Stalin personality cult and exchange views on a wide range of hindered the nation's economic international issues. This is Such a chain effect was seen in development. In seeking the way especially the case for leaders from the global stock market crash last to build socialism, the Soviet the industrial countries and those October, which occurred shortly Union should study the planned from the third world. after the World Bank and IMF

12 BEIJING REVIEW. MAY 2-8. 1988 reaffirmed the determination of international debt management. business risks. In addition, the major industrial countries to co• According to bank president bank is nearing its goal of ordinate their economic poHcies. Barber Conable, the bank may increasing its capital base from the October 19 — "black Monday" cancel some charges on its soft current US$90 billion to more on the New York Stock loans to lessen the debt burden of than US$170 billion, which will Exchange — showed that the mar• the low-income developing coun• enable it to raise its annual lending ket is extremely sensitive to, and tries and would also like to ease to the third world from the current critical of, what the major the terms on its variable-interest US$17 bilhon to US$20 billion. countries can and will do. loans to middle-income develop• The ideas of setting up a debt This time, only 18 hours after ing countries. conversion facility within the IMF the United States, Japan, West The World Bank has launched a and of providing global debt relief Germany, Italy, Britain, France multilateral investment guarantee to third world borrowers were and Canada issued a joint agericy that will insure investors killed at the meetings, mainly statement reaffirming their deter• who are willing to put money in bacause of US opposition. mination to strengthen their developing countries against non- by Zhao Zijian policy co-ordination, the Dow Jones industrial average fell by 101 points and the central banks of LAOS major industrial countries had to put US$500-700 million in the currency markets to shore up the Cautiously Taking tlie Road of Reform US dollar. This shows that the markets remain vulnerable to the "fundamentals" of the global Laos is slowly opening its doors and letting the winds of economy, and the fundamentals economic reform blow in. Its future depends on becoming a are not very sound. part of the world economy. The market reaction high• lighted the fact that as long as the In 1985 the Lao People's US trade deficit remains large, the he People's Democratic Re• Revolutionary Party gave selected markets will be jittery. And Tpublic of Laos has had a hard enterprises the right to make without a substantial reduction of time trying to carry out its policy decisions. This experiment, the US budget deficit, US economic tasks. In the more than which has been implemented in domestic demand will remain 10 years since the founding of the more than 100 enterprises, has strong and the lower dollar will republic, Laos has encountered proved successful. The policy of not bring as fast an improvement many economic troubles. giving enterprises responsibility in trade performance as people The winds of economic reform for their profits and losses has had had expected. have been blowing against the doors of Laos, which has always a rejuvenating effect on the The IMF reported progress in been closed to international Laotian economy, which had the form of a new lending facility commerce. The country must previously been stagnating. The which will enable member coun• enter the world economy if its country's second Five-Year Plan tries to get medium-term loans at attempts at development are to be (1986-90) further encourages this easier terms. successful. Faced with the new policy. The World Bank reported that global economic situation, Laos is With the easing of economic because of debt payments and the slowly opening up. Having restrictions, private businesses reluctance of commercial banks to decided on a socialist course, it has have also prospered. Private make further loans, the develop• re-examined its economic policy restaurants flourish on the streets ing countries' outflow of funds and cautiously embarked on the of Vientiane. The private economy topped inflow by US$85 billion in road of reform. has become a supplement to the the five-year period since 1982. Since 1983 the Laotian govern• public economy. During the previous five-year ment has allowed enterprises to period, inflow surpassed outflow keep 40 percent of their profits to The second Five-Year Plan is by US$140 bilhon. Total third expand production and raise the focused on development. The world foreign debt now stands at wages and benefits of their country's rich forest, water and more than US$1 trillion. employees. This represents a electric power resources give Laos The World Bank has been called fundamental change in the great development potential. on to play an increasing role in original system. by Guo Qing

BEIJING REVIEW; MAY 2-8. 1988 13 •i ARTICLES

Hainan Province — China's Largest SEZ

BY Our Correspondent Yang Xiaobing

Overlooking Haikou, capital of Hainan Province. CHEN XUESI

n April 13, with the approval 26°C and rainfall of about 2,000 The production target for the first Oof the 7th National People's mm, Hainan is a lush tropical stage of the project is 35,000 tons Congress, Hainan Island, for• island. China's second largest of steel. merly an administrative region of island (next only to Taiwan with Hainan is also rich in titanium Province, became a an area of 36,000 square km), it which is very much in demand in province and was proclaimed the covers an area of 34,000 square modern industry. Verified de• fifth and largest special economic km. Hainan also administers other posits of 1 billion tons of titanium zone in China. islands in the South China Sea. ore are concentrated in the east The move was publicly hailed as By sea, Hainan is convenient to coastal areas. Hong Kong, Taiwan and Japan. another major step by the Chinese Some foreign oil companies Its 1,500-km coastline is dotted government towards opening to have long coveted the oil and with over 60 well-equipped the outside world. It is also an natural gas reserves in the north of harbours. It could very well important part of the strategy for Hainan Island and the Beibu Gulf become an important shipping developing an export-oriented and Yingge Sea. Since 1980 China centre for the Asian-Pacific economy in China's coastal areas. has invited oil companies from region. The Preparatory Group for the France, the United States and Establishment of Hainan Province IVIinerais. Hainan is richly Australia to work in the area. has been formed to take care of the endowed with minerals. Iron ore Thus far, they have found some work involved in the development mines in Shilou boast verified oil-bearing layers and sunk one of the new province. reserves of about 260 million tons. well which gushes out 1.8 million The ore mined here has an average cubic metres of natural gas a day. iron content of 51 percent, and can Hainan is rich in about 30 Location and Resources be up to as high as a 70 percent different kinds of minerals iron content. Shilou is one of including brown coal, oil shale, Situated between the South the eight largest mines in aluminium, manganese, . lead, China Sea and the Beibu Gulf, Asia. Shilou also produces high- zirconium, gold, uranium, crystal, Hainan Island faces Leizhou grade cobalt and copper. precious stones, quartz, limestone Peninsula across the Qiongzhou An iron and steel complex will and refractory clay. Most of these Strait. With an average annual be built in Shilou with an expected reserves are still totally temperature of between 22"C and capacity of 1 million tons a year. unexploited.

14 BEIJING REVIEW, MAY 2-8. 1988 Tropical Plants. Hainan produces Hainan also has four primitive conditions for the breeding upwards of 130,000 tons of rubber forests with some 1,100 different grounds. a year, about half China's total species of trees, 20 of which have a Hainan boasts the world's most output. Rubber trees are to be seen great deal of economic potential. advanced pearl breeding tech• everywhere on the island. Marine Products. Hainan has 24 nology. The Sino-Japanese Nan- Pepper and coffee are also rich fishing ports and fishing grounds hua Pearl Breeding Co. began sources of income for Hainan which cover 100,000 square operations in 1984. In 1986 it farmers. The island now hasnautica l miles. Major marine harvested 2,300 pearls, each 10,000 hectares of pepper plants, products include groupers, Span• measuring over 10 mm in an output in the forefront of the ish mackerel, silver pomfrey, diametre. The largest measures 30 nation. At present, only one eighth hairtails, ink fish, abalone, tuna, mm and weighs 15 g, a record in of the 20,000 hectares of land lobsters, green turtles, sea China. Lingshui County has six suitable for coffee growing has cucumber, sea horses and agar- pearl breeding grounds. been exploited, but foreign agar. Annual catches amount to Tourism. One of Hainan Island's investors have expressed a willing• about 100,000 tons. Specialists most spectacular features is its ness to invest in coffee plantations estimate that the waters around tourism potential. The beaches are on Hainan. Hainan Island are 100-200 metres superb, particularly at Sanwan. Hainan is considering plans to deep, with potential annual Then there are the well-known process up to 60 million coconuts catches of over 200,000 tons. Dadong Offshore Bathing each year. The Haikou Canned The artificial breeding of Grounds and the Yalongwan with Food Factory exports coconut marine life in Hainan has a good its seven kilometres of magnificent jam and the newly developed future. Surrounding waters of 5- coastline scattered with white sand salted coconut chips and coconut 10 metres deep covering an area of beaches. The annual average milk. 25,000 hectares provide perfect temperature of the surrounding Hainan's economic crops also include sugar-cane, tea, oil, cashews and sisal hemp. The cultivation of these crops takes up GUANGXI an area of 400,000 hectares. Pineapples, lychees, mangoes, GUANGDONG bananas, Chinese flowering quinces, lemons, breadfruit and oranges have become the island's major export items. X^SOUTH Beibu Gulf \ \A SEA QiongzhouStrp^^

Haikou

Noda Wenchangt

Qionghai

Basuo HAINAN I.

BEIJING REVIEW. 'MAY 2-8. I9BH 15 Hainan which are more flexible than any offered to other parts of China. They include some inter• nationally applied measures which have not been adopted in the other four special economic zones. According to Xu Shijie, head of the Preparatory Group for the Establishment of Hainan Pro• vince, the island will operate on the basis of a market economy with basic socialist features. "Sino-foreign joint ventures, co• operatives and wholly foreign- owned enterprises will enjoy a Export iron ore is transported to tlie harbour by train. WEN RENGUANG good deal of the benefits Hainan's economy has to offer," said Xu. waters is 20°C. main force in the island economy. Preferential policies adopted by The hilly areas inhabited by the The province is now one of the central government for Yis and the Miaos also provide an China's seven major tourist areas Hainan are that: attraction for tourism. enjoying priority state investment. • Nocontrols will be placed on Construction of the island's 30- In 1987 Hainan received 350,000 investment in capital construc• square-km International Tourist visitors. A dozen foreign com• tion. Construction funding will Centre has already begun. The panies have approached Hainan come mainly from abroad as well project involves an investment of to co-operate in tourist projects. as Hong Kong and Macao. US$6.74 million from the well- Hainan is free to borrow overseas known Hong Kong businessman according to its debt servicing Fok Ying Tung. capacity. In 1986 Zhao Ziyang, then Preferential Policies • In principle, all enterprises premier of the State Council, formerly under the authority of proposed to make tourism one of The Chinese government has the central government or Guang• Hainan's main industries and the formulated special policies for dong will now be under the

Coconut trees on Hainan Island. XUE XIANGJUN

16 BEIJING REVIEW. MAY 2-8, 1988 Hainan provincial government, to incorporate them into the island's market economy. Foreign entre• preneurs will be allowed to manage, on contract, local enterprises owned by the state or the collective. • Hainan will assume all responsibility for profits and losses from trade with the outside world. Local exports will be free of state control. Capital goods, including raw and processed materials, parts and components, fuels and tools, are exempt from import duties. Imports of articles for daily use, including household electrical appliances and 23 other items subject to state restriction, enjoy a 50 percent tax reduction (on the condition that they are used locally). Wine and cigarettes are still taxable items. • Foreign-funded enterprises in Hainan (including Sino-foreign Lin Biping (front), an engineer with the South China Sea Research institute under the Chinese Academy of Sciences, worthing at pearl culture. joint ventures, co-operatives and wholly foreign-owned enterprises) are exempted from industrial and treatment as extended to foreign consulate. commercial consolidated tax in banks. All Hainan Island's banks Foreign investors and business the first two profit-making years are empowered to deal in foreign people staying in Hainan for and an 85 percent reduction in the exchange deposits, stocks and longer periods of time, may apply third profit-making year. Expand• securities, and to establish foreign for temporary residence cards ing industrial and agricultural exchange markets. They can also from the Hainan government; enterprises, high-tech industries, conduct foreign exchange borrow• each card will allow them a six enterprises manufacturing new ing and lending business with the month to one year stay and products, and infrastructural other four special economic zones. renewal may be granted on facilities (excluding power All the foreign exchange income application. stations) are exempt from tax on earned in Hainan will be retained profits during their first five years by the province. The Hainan government will be and enjoy an 85 percent reduction empowered to approve local Foreign banks will be allowed in the following five years. residents and cadres (not includ• to set up branches in Hainan; these Enterprises facing difficulties in ing governor and deputy gover• branches will be able to deal in paying tax may apply to the nors who will require state foreign exchange deposits, stocks Hainan provincial government for approval) to trade and travel and securities. exemptions or reductions. Foreign abroad. The Hainan government investors are free to remit their • Hainan Province will be able will also have the power to foreign exchange earnings which to engage in international tourism approve local enterprise plans to will be exempt from individual and have the power to endorse and establish commercial outlets income tax. issue entry visas. Compatriots overseas. from Hong Kong, Macao and Foreign aviation companies will • Hainan's financial system Taiwan, and foreigners will be be able to start scheduled flights to will be locally managed, that is, issued entry visas from Haikou or Hainan. the Hainan branch of the People's Sanwan for a 15-day stay in The sale, transfer or mortgage Bank of China will act as the Hainan on producing their ID of land-use rights will be allowed, island's central bank. The Haikou cards, travel licences or passports; such rights can last to 70 branch of the Bank of China will it will no longer be necessary to years and can be extended enjoy the same preferential apply to the Chinese embassy or by renewing the contract.

BEIJING.REVIEW. MAY 2-8, 1988 17 • ARTICLES

If not renewed at this point, the right to use the land and any buildings on it will be returned to the local government gratis. The state will also provide Hainan with any necessary financial and material aid. Com• pared to all other provinces, Hainan will have less obligations and enjoy more power.

Future Economic Ascent

Members of the Preparatory Group for the Establishment of Hainan Province are working hard. According to the group head Xu Shijie, a number of local laws and regulations will be drafted to implement state preferential policies. The Hainan government will bestow more decision making power on various enterprises and companies to mobilize their initiatives.

ainah resembles Hawaii in climate and natural resources. Hawaii developed on the basis of its agriculture, farm produce processing as well as tourism. We may be able to learn from Hawaii's Ceramics factory workshop in Baisha County, Hainan island. xu XIANGJUN experience to develop Hainan. district around Haikou, the trict will centre around Nada provincial capital, will concen• Town and feature production of trate on light industry, food titanium white, the processing of processing, rubber products, ma• aquatic products, and petrochem• Development Strategy. While chinery, electronics and service ical industries. The southwest with mainly developing its industry, industries. The southern district Basuo Town as its centre will Hainan will also attempt to will centre around the city of concentrate on iron and steel, stimulate agriculture, commerce, Sanya and concentrate on tourism cement and other heavy tourism and services. Inter• and high-tech industry. In the east, industries. national economic exchanges will around Qionghai and Wenchang, Huan Xiang, a noted Chinese be actively sought. agriculture, farm produce and scholar, said that Hainan re• According to plan, the island food processing, and textile and sembles Hawaii in climate and province will be divided into five light industries will be the main natural resources. "Hawaii devel• economic districts. The northern concerns. The northwestern dis• oped on the basis of its agriculture.

18 BEIJING REVIEW. MAY 2-8, 1988 FOCUS: HAINAN ISLAND by Our Photographer Xu Xiangjun

farm produce processing as well as tourism," said Huan. "We may be able to learn from Hawaii's experience to develop Hainan." Infrastructural Facilities. By the end of this year, a thermal power station with a generating capacity of 150,000 kW will be constructed near Macun, a suburb of Haikou, to help ease the pressure on the local power supply. A large hydro- power station will also be built in the western part of the island, and a thermal power station in northwest Hainan this year. Efforts will be aimed at building up a generating capacity of 1.95 million kW by 1995. Expansion projects are in full XU XIANGJUN swing at the ports of Haikou, Cattle farming on the Shifang pastures in Dongfang County, Hainan island, is guided Basuo, Sanya and Qinglan. by Australian experts. The expansion project at the Haikou Airport is nearing com• pletion. The airport now caters for The Haikou-Sanya Highway is 1987. Digital telephone ex• Boeing 757, with air routes to presently being rebuilt. changes, imported from Italy and Beijing, , Shanghai Hainan's railways extend 210 installed in the central and western and Chengdu. The Fenghuang km from Sanya City to the Shiluo parts of the island, have just been International Airport in Sanya Iron Ore Mine. Another 188 km of put into service. Plans for the City will be built and opened in rails will be laid to Haikou before laying of optical fibre cables in 1990, providing for regular flights 1995. east Hainan are being discussed to Hong Kong every day. The 1,800-line telecommunic• and revised. The 1,000 km of highways ations system, providing links The Telecommunications across Hainan are generally 12 with Guangzhou, Beijing and Building in Haikou will be metres wide and asphalt-covered. Hong Kong, started operating in constructed in September. Equipped with 5,000-channel programmed telephone ex• The Yingge Sea Salt Fields in Hainan Province, the largest in south China, produce changes, this building will make it 200,000 tons of salt a year. possible for Haikou residents to DUAN WENHUA make direct calls to Shilou, Basuo and Sanya. Talents. Hainan has four schools of higher learning. However, they can not meet the needs of the latest development, which explains why Hainan Province must recruit talent from other parts of China. Candidates for positions in Hainan numbered 20,000 by the end of last January; another 100,000 applicants submitted written applications to work in the province. About 84 percent of them had college education. The Hainan Talent Exchange Centre is using computers to process information on the applicants. •

BEIJING.'REVIEW; MAY 2-8. 1988 19 •1 ARTICLES Enterprise Law: A Milestone for Reform by Our Correspondent Yang Xiaobing

n April 13, the First Session of management. All these principles more than 70 percent of the Othe Seventh National People's and the experience gained through nation's total industrial output Congress passed the Law Con• their practice contributed towards value. But, the principles the law cerning Enterprises Owned by the the enactment of the law. embodies can also be applied to Whole People by a majority of During his term of office (1983- other types of enterprises owned 2,826 to two votes. The statute 88), Peng Zhen, former chairman by all the people, including heralds the freedom of enterprises of the Standing Committee of the transport and communications owned by the whole people from National People's Congress, and post and telecommunications the trammels of direct government headed a team of investigators industries, the building industry, control. Long predominating conducting extensive studies into agriculture, forestry, water con• China's economy, they are now set the draft of the law. The draft was servancy, foreign trade and to embark on a road of discussed and revised several times commerce. Its implementation independent management and by the NPC Standing Committee. will therefore make a massive enter the world of market On January 11 this year, the impact on the development of competition. NPC Standing Committee deci• China's national economy as a ded to publish the draft law in whole. newspapers to solicit opinions Legislative Procedure from the people as well as economists and legal experts. The Major Contents The new law was on the drawing conditions were now ripe for the board for over nine years, about law to be passed. On March 5, the The law has 69 articles set out in the same period of time which has NPC Standing Committee discus• eight chapters. The major contents witnessed the economic structural sed and revised the draft the fifth include: reform. At a CPC Central time and decided to submit it to • Separating Enterprise Committee working conference the Seventh National People's Ownersiiip From iVIanagement held on December 13, 1978, Deng Congress for approval. Powers. This is the essence of the Xiaoping proposed drafting a The law directly applies to the law. The aim is to provide a legal factory law. The Third Plenary more than 90,000 state-owned guarantee for turning enterprises Session of the 11th Party Central industrial enterprises now operat• into socialist commodity pro• Committee convened immediately ing in China, and accounting for ducers with independent man- afterwards, established the policy of reform and opening up to the General Manager of Jinchuan Non-Ferrous Metal Co. Wang Deyong (second left) outside world. In 1979, depart• discusses enterprise management with other NPC deputies ments concerned began prepar• ations for drafting the Industrial Enterprise Law. In the course of the economic structural reform launched in the early 1980s mainly to invigorate the enterprises, some important principles gradually evolved. More decision-making powers have been handed over to enterprises, the "monist" leader• ship of Party committees in enterprises changed, the director (manager) responsibility system introduced. Party organizations now play a supervisory role and workers take part in democratic

20 BEIJING REVIEW, MAY 2-8, 1988 agerial power. The law clearly stipulates that property of enter• prises belongs to the whole people and that enterprises can adopt various forms of management responsibility system, including contract and leasing methods, in line with the regulations of relevant government administra• tive departments. • Rights and Duties of Enterprises. Enterprises have the right to organize their own production, product marketing, use of funds, labour and personnel. In order to allow enterprises to gradually step into the international market, the law Director of tlie Guangzhou Railway Bureau and successful entrepreneur Yang Qlhua stipulates that they can enter into (second right) comments on the Enterprise Law during a meeting. negotiations and contracts with foreign businesses in line with "monist" leadership, but conduct work independently ac• State Council stipulations. It also "guarantee and supervise the cording to law and organize stales that enterprises can adopt implementation of the principles workers and staff to participate in various forms of distribution and policies adopted by the Party democratic management and while maintaining the predomi• and state in enterprises." supervision. nant status of the principle of a Relations Between Enter- distribution according to work. pirses and Government. Enterpr• Enterprises also have the right to' ises are no longer mere ap• hold shares in other enterprises pendages of government bodies. and issue securities. TThe Law Concerning In line with the principle of "the The law states the major Enterprises Owned by the state regulating the market and responsibilities of enterprises as Whole People heralds the the market guiding enterprises," fulfilling the state's mandatory freedom of these enterprises government organizations should planning quotas, ensuring product serve enterprises and exercise and service quality, following from the trammels of direct government control. Long control and supervision over them relevant state regulations and in accordance with their responsi• accepting state supervision, predominating China's bilities and relevant legal guaranteeing the maintenance of economy, they are now set to stipulations. fixed assets, and improving and embark on a road of upgrading equipment. independent management and • Implementing the Director enter the world of market Deputies' Comments (Manager) Responsibility Sy• competition. stem. This represents an import• NPC Deputy and President of ant change to the former the China Economic Law Society enterprise leadership system. The Gu Ming considered the Enterpr• law, in no uncertain terms, places • Status of Workers and Staff ise Law adopted by the NPC a in the hands of factory directors or in Democratic IVIanagement. To major breakthrough, saying it managers the power to make ensure the status of workers and would promote reform and decisions concerning production, staff as the masters in socialist increase vitality in enterprises. management and personnel. As enterprises, the law stipulates that Since the law confirms the legal the legal representatives of enterprises must introduce democ• status of enterprises, the enterpr• enterprises, they shoulder the ratic management through ises are responsible for their own responsibility for production and workers' congresses or other profits and losses. Performance is for the development of socialist channels. Trade unions in enterpr• thus linked with assets and ideology. Party organizations in ises should represent and protect employees' wages. Poorly man• enterprises will no longer exercise the interests of workers and staff. aged enterprises risk bankruptcy.

BEIJING REVIEW. MAY 2-8. 1988 21 •1 ARTICLES

In the past many people society's broader reforms, as they 19 unqualified middle-level cadres thought socialist enterprises will produce changes in the and 130 grass-root cadres, with should not declare bankruptcy. functions of government from the assent of almost all employees. However, many enterprises were direct to indirect management. Wang said that since the running at a loss and if they NPC Deputy and General performance of an enterprise has continued to do so bankruptcy Manager of the Jinchuan Non- been closely linked with the was inevitable. The Enterprise Ferrous Metal Co. Wang Deyong personal interests of employees, Law, which goes into effect on felt that enterprise ownership their demands on the cadres have August 1 this year, and the should be separated from manage• also changed. Incompetence and Bankruptcy Law, soon to be ment. Since the implementation of lack of sense of responsibility are implemented, will promote the open policy, enterprises have not welcomed. Wang, who in his China's economic structural re• been exposed to the ever-changing decisive handling of affairs, has form as a whole. international market. Any matter "offended" quite a few people. repeatedly submitted for collective However, when cadres were Wu Disheng, NPC deputy and discussion will mean the enterprise appraised at the end of last year mayor of Shenyang, one of the could lose any chances it may have more than 90 percent of the votes first cities to trial introduce for making a profit. Hence, a Wang received were affirmative. comprehensive economic struc• system in which the director tural reform, said that a law NPC deputy, 34-year-old Wei (manager) assumes full responsi• should be strict and accurate, but Lian is a worker of the Qiqihar bility must be introduced. Some the Enterprise Law has some No. 2 Machine Tools Plant. His people fear that directors might imperfections. Some stipulations main criticism of the Enterprise abuse .their power to promote are open to different interpret• Law concerned the rights and trusted supporters and make ations. Wu said that, during the interests of workers which he felt arbitrary decisions, however such course of reform, it should be were not covered in concrete a fear is unfounded. The efficient perfected but in the meantime it terms. For example, while it is management of an enterprise would help mobilize initiative in right for directors or managers to requires that directors set a good entrepreneurs and employees. form their own "cabinets," example and appoint people democratic discussions should be Wu said during the past nine according to their merits. held with workers beforehand, years and more, China's economic After the Jinchuan Company particularly in large factories. This structural reform has proceeded introduced the director responsi• is essential to build up in the down a tortuous road and Chinese bility system, its number of workers their role as masters of entrepreneurs have had to bear the middle-level cadres was reduced their factory and the state. greatest risks. The new legal 30 percent. Last March after a guarantees for enterprise rights democratic appraisal by workers The Enterprise Law does and interests are conducive to the and staff, the company dismissed provide safeguards to the democ• ratic rights and interests of

Chen Yanfa (centre front), mayor of Shantou, Guangdong Province, participating in a workers, and it is* stipulated that group discussion on the Enterprise l^w. photos by XUE CHAD questions such as housing distri• bution, the use of employees' welfare funds, wage rises and labour protection must be sub• mitted for discussion and appro• val by the workers' congress. But, if a director forces his employees to work overtime due to a fault in his management, who will superv• ise him? The trade union is also under his direct leadership so who will exercise supervisory power? This issue exposes the pressing need for a Trade Union Law to be drafted. The Enterprise Law cannot solve all problems, Wei concluded. Our legal system needs to be constantly developed and perfected. •

22 BEIJING REVIEW, MAY 2-8. 1988 Fang Lizhi's Academic Achievements by Li Chun and Liu Yusheng

n early 1987 astrophysicist Fang ing University and other insti• Academic Committee of the I Lizhi was transferred to the tutions of higher learning. He says International Centre of Theoret• Beijing Observatory after being China has made great progress in ical Physics. dismissed from his post of vice- astrophysics research despite the Early last summer, he visited president of the Chinese Univers• small number of researchers and Italy for the 12th time and assisted ity of Science and Technology in meagre investment in the field. in studying planned academic Hefei, Anhui Province, for Since 1984, Chinese astrophysics activities of the International outspokenly advocating bour• researchers have joined intern-, Centre of Theoretical Physics. geois liberalist ideas. In the year ational organizations and China During his one-month stay in the since. Fang has achieved a great has hosted four international European country he wrote two deal in his research work. academic papers and discussed the Fang's new home is in "science possibility of further co-operation city" in Zhongguancun in western between China and the EC Beijing. It consists of four rooms through EC Science and Tech• and an entrance hall, all wall• rr hen Fang was nology Committee members. He papered in pale yellow. In the also reached an agreement with entrance hall hangs a portrait of transferred to Beijing the Italian Foreign Affairs Einstein. The sitting room has two Observatory early in 1987 Ministrly to jointy build an huge bookshelves filled with after being criticized for international exchange centre for astrophysics books and a set of the outspokenly advocating astrophysics in Beijing. While he Encyclopaedia Britannica. bourgeois liberalist ideas, was in Italy, his friends tried to Taking down some of the five every day he cycled to his persuade him to stay abroad and books he edited or published in the promised to provide him with past year Fang begins to show office to read newspapers and everything he needed to live them to the reporters. The books chat with friends before going comfortably and continue his are Creation of Cosmology which back home to concentrate on academic work. Fang refused, he co-published with his wife Li his research. In the year saying that as a scientist he had a Shuxian, Collection of Works on social responsibility. the History of Science which he since, he has achieved a great edited. Observational Cosmology, deal in his research work. On his return, he busied himself From Newton's Laws to Einstein's with academic activities which Theory of Relativity and Quantum took him to all parts of the Cosmology which he wrote in country. In August, he visited English and published abroad. Guangzhou for an international "Writing and editing five books conferences. Many researchers symposium on gravitational in one ^ear is my record," Fang have published papers abroad and physics experiments and then Mt. says. "It may be the result of my China is already well-known Huangshan to participate in the concentrated effort." In that year. throughout the world for its academic activities offered by the Fang alsoAvrote a dozen academic activities in the field. "Huangshan Summer Vacation papers, half of which he published Fang Lizhi, 52, a physics College." In October, he went to abroad. graduate of Beijing University 30 Chengde for the Sino-Japanese Fang says there are about 300 years ago, is the youngest member Galactic Symposium and then astrophysics researchers in China, of the Department of Mathema• returned to Beijing for the Asian- mainly based in Beijing. Nanjing, tics and Physics under the Chinese Pacific Astronomy Symposium at Shanghai and Yunnan ob• Academy of Sciences. A world- which he presented a report. In servatories under the Chinese recognized astrophysicist. Fang November, he attended a confer• Academy of Sciences, the Chinese holds six positions in international ence held in Wuxi, Jiangsu University of Science and Tech• astronomical organizations and is Province by the Department of nology, Beijing University, Nanj• one of the 12 members of the Mathematics and Physics under

BEIJING RRyiF.W. MAY 2-8. 198S 23 m ARTICLES — the Chinese Academy of Sciences. postgraduates. people have placed high hopes in He then joined his old colleagues The Fangs form a family of the Party. "Although 1 am not a at the Chinese University of physicists. His wife Li Shuxian is a Communist Party member now, T Science and Technology in Hefei, physics teacher at Beijing Univers• am very concerned with the Anhui Province, to celebrate their ity, his oldest son is studying implementation of the general line winning the first national prize for physics in the United States at his put forward by the 13th Party popular science works with the own expense, and his youngest son Congress," he says. book Astrophysics Today written is a physics student at the Beijing Not long ago. Fang was 10 years before. Teachers' University. The Fang promoted from a fourth to Fang now works at the Beijing family has a housekeeper who second-class professor so he Observatory not far from his comes to clean the house and buy expects to be busier this year than home. Every day he cycles to his vegetables and food once every last. In March, he went to Yunnan office to read newspapers, collect three days. for an astrophysics conference and his mail and chat with his Asked about the campus in June he will give lectures on colleagues before going back upheavals and the anti-bourgeois particle physics and cosmology to home to concentrate on his liberalization campaign a year be sponsored by the Scientific and research. ago. Fang says these events at least Technological Centre and pre• While working at the Chinese made people think. "I have't done sided over by American-Chinese University of Science and Tech• an all-round, deep study of physicist Tsung-Dao Lee in nology, Fang trained nine post• China's politics and economy. I Nanjing. He will also be attending graduates (four studying for just speak my own mind." international academic doctorates and the others for Fang believes the 13th National conferences. master's degrees). This year, he Party Congress has made great (The authors are reporters of also plans to teach several progress in theory and feels that "China News Press")

Changes in International Relations Faced with many new challenges and problems, all countries, even the United States and the Soviet Union, have found it necessary to focus on their domestic economic development. This worldwide economic concern will be conducive to stabilizing the international situation for a reasonably long period. by Song Ximin

elations between the United I. US and Soviet Economic more necessary for him to R States and the Soviet Union Troubles concentrate on domestic affairs. were tense during the first half of The Soviet leader had learned this decade. A turn for the better from others' past abortive at• appeared in the second half of The 27th Congress of the tempts at reform, and proposed 1985, while 1987 witnessed Communist Party of the Soviet that economic structural reform increasing detente with the signing Union (CPSU) in 1986 formulated be implemented via political of the treaty -concerning the a new policy that calls for giving restructuring. This policy has led elimination of intermediate-range priority to domestic affairs and to various bold actions aimed at nuclear forces (INF). Compared gearing diplomatic activities to the promoting democratization and with the detente that'emerged in needs of internal socio-economic glasnost (openness). Furthermore, East-West relations in the second reforms. When Mikhail Gorba• a plan of action to effectuate a half of the 1950s and the first half chev tried to translate the reform thorough reform of the economic of the 1970s, the latest period of plans into action the following structure was drafted at the relaxation is likely to last longer year, he encountered many plenary session of the Central due to the following new features. difficulties, which made it all the Committee of CPSU held last

24 BEIJING REVIEW, MAY 2-8, 1988 s

June. However, since the deep- "no part of the world" was not a in 1987 in US and Soviet going reforms of the past year Soviet "consideration" and ac• relationships with their allies have have involved redistribution of cordingly expanded Soviet arms demonstrated this tendency. interests among people of various and spheres of influence in the The US-allied countries in strata, they have naturally caused third world as Washington Western Europe welcomed but social turmoil. The situation has retreated. But now, according to also showed concern over the INF become even more difficult as many international observers, treaty. They feel increasingly perestroika (restructuring) could each of the superpowers has been suspicious about the will and the not possibly improve production weighed down by both internal capabilities of the US to defend and consumption within a year and external burdens and has a them. They even believe thai the but, on the contrary, would more reaHstic estimate of itself and US will not use the nuclear temporarily adversely affect the its rival. While Moscow has weapons deployed on its territory growth of the economy. The acquired a new understanding of in a conventional war launched by Soviet leaders admit that the next the principles of peaceful coex• Warsaw Pact countries. They are two to three years will be the most istence, Washington has realized also concerned that Washington difficult and crucial period for the the necessity of detente. will reduce the number of US reform. troops stationed in Europe some The events of 1987 have also day. Some people have pointed forced the Reagan administration II. Decline In Strength of out that the reaching of the INF to pay greater attention to the Superpowers and the agreement indicates that the US domestic affairs. These events Trend to Multipolarity nuclear forces will completely include the approaching pre• withdraw from Europe and this sidential election, the "Irangate" In 1971, when Richard Nixon means that the US nuclear affair and, more importantly, the was president of the United States, umbrella in Europe will cease to be bankruptcy of Reaganomics. he acknowledged that the power effective. Because of this the West With enormous long-standing of the United States had begun to European countries are deter• financial and trade deficits, which diminish and put forward the idea mined to co-operate to promote eventually led to the stock market that the world would have five their own self-defence strategies. crash last October, the Reagan poles. In recent years, leaders of This movement will continue administration had to increase the Soviet Union have also although it will be a long and taxes and reduce government admitted that Soviet influence on arduous process. This co• spending. Americans are now the world has dropped and they operation between the West speculating on whether another have begun referring to the European countries will heighten economic recession will come muUipolarization of the world. Of their ability to act independently earlier than expected. In an course, it must be admitted that and force the US to make new election year the political im• the United States and Soviet changes and adjustments in its portance of these economic Union still have great influence in relations with them. It will also troubles increases. the world and this situation will give rise to new complicating factors in the coming disarma• Currently both Washington's not be changed for a long dme. ment talks. and Moscow's freedom of action Nevertheless, the world is certain• in foreign affairs is limited by their ly moving into an era of The Soviet Union has also made strength — something not seen in multipolar powers. This tendency some adjustments in its relations the two previous periods of can be seen clearly in the world with the East European countries. detente. Back in the late 1950s, the economy. In politics, the time These have mainly concentrated United States, boasting a superior when the United States and the on the question of socialist strategic force, acted as the world Soviet Union had the final say on reconstruction. The Soviet Union gendarme, while the then Soviet world affairs has passed. The idea has negated its own rigid model of leader Nikita Khrushchev, overes- of acting independently and on the sociahst construction and hopes fimating his country's power, said basis of one's own initiative has that the East European countries that the Soviet Union could catch been developed in all countries will also reject such a model. The up with the United States in 20 because of the reduction in Soviet Union no longer forces the years and that he could "bury strength of the United States and East European countries to act capitalism." In the 1970s, when the Soviet Union, the rise of other according to its directions and the United States was on the forces in the world, and the recognizes that there is a diversity decline, Leonid Brezhnev, am• improbability of another world of methods of building socialism. bitious as he was, declared that war. The changes and adjustments The Soviet Union also admits that

BEIJING REVIEW, MAY 2-8, 1988 ARTICLES

there were some debatable points how to achieve security. Realizing pace in the implementation of the in its political relations with the that excessive expenditure of Strategic Defence Initiative (SDI) East European countries. In his resources on military development programme. Although it cont• speech celebrating the 70th will ruin the base of its national inues to talk about the Soviet anniversary of the October economy, Moscow has now begun military threat, it no longer Revolution, Gorbachev pointed to attach greater importance to considers the threat urgent and out that the principles of peaceful the economic factor when con• serious. coexistence are also vital to the sidering security. In the report at Partly as a result of the declining relations among socialist coun• the 70th anniversary of the importance of armament, the two tries. This was the first time he October Revolution, Gorbachev superpowers have signed the INF raised the point. He also stressed gave a positive answer to the treaty and are ready to discuss the that for a communist party, question "Can the capitalist reduction of strategic nuclear and responsibility to its cause is economy develop if the capitalist conventional forces as well as to tantamount to concerning itself countries do not carry out consider other disarmament steps. with the common cause of all militarism?" It is thought that the near future socialist countries. But for a long The Soviet Union has so far put will see a controlled arms race and period previously, the Soviet forward various disarmament partially successful arms talks Union emphasized the impor• proposals intended to reduce the continuing side by side. Mean• tance of the "common interests" arms race. It has indeed made while, on regional issues, both the of all socialist countries. The some compromises. It has advan• United States and the Soviet separate interests of all coun• ced the idea that it will only seek to Union will continue to strive for tries were not much discussed. reach a reasonable level of military resolutions favourable to them• The Soviet Union was also used to power, that is, enough to repulse selves through political pressure believing that the principles of an enemy attack. It will raise and by way of diplomacy. peaceful coexistence applied only lower its armament level at its own to relations between socialist and pace and may even make some The decreased tension between capitalist countries. Relations arms cuts that are deeper than the United States and the Soviet between the socialist countries those of its rival if it can do so Union is due to the focus of should exceed the level of these without letting Washington get an attention shifting from external principles. In fact, all these points edge over it. This new strategy is affairs to domestic ones. Similarly, created the foundation for disre• shown in the INF treaty. many other nations are beginning gard by the Soviet Union for the Gorbachev also indicated that the to concentrate their energy on sovereignty of a country and even Warsaw Pact countries might cut economic development. In the at times for infringement on the their conventional weapons with• current period of global economic sovereignty of other countries. out requiring a symmetrical change and development, coun• The changes in US and Soviet reduction by the North Atlantic tries have to solve many new relations with their allied coun• Treaty Organization. At the same difficulties and problems facing tries have provided advantageous time, Moscow is now paying great them so as to keep up with the conditions for the European attention to the scientific and changes in the world economy. countries to expand their influence economic challenges from the Because of these changes, the in the world. In 1987, the co• West, considering them to be the relations between the Soviet operation between East and West key factors in the competition Union and the United States, and European countries was streng• between the socialist and capitalist the international situation as a thened in all aspects. Their efforts systems. whole may remain stable for a in calling for improvements in Washington does not hide its relatively long period of time. East-West relations are playing a attempt to rely on its scientific and The most common difficulties great role in preventing serious technological advantages to get and challenges facing countries confrontations between the the better of the Soviet system. include, first, radical scientific as United States and Soviet Union. Over the past several years, well as technological changes, and especially during the last year, the the readjustment of industrial development of US military forces structure and enormous social ill. Emphasis on Compe• has been so heavily limited by the upheavals following these tition in Technological and country's economy that it can no changes. As the traditional Economic Fields longer develop armament at will. industries decHne, new industries The Reagan administration has develop rapidly, labour productiv• It seems that the Soviet Union had to reduce its military ity increases greatly, technology has partly changed its concept of expenditures and slow down its becomes more precise and the

26 BEIJING REVIEW. MAY 2-8, 1988 number of white collar workers growth of consumption outstrips raising the level of consumption grows while manual workers that of production. In the West the without taking into account the decrease. These changes caused by imbalance is deliberately caused level of production. They are the development of high tech• by implementing Keynesian trying to eliminate egualitarianism nology take place with growing policies to help ease social and instead tie wages to produc• speed as the time used for problems, but it has also brought tion and workers' performance, converting scientific and techn• about many economic defici• freezing increases in salaries for a ological achievements into actual encies. Because of this imbalance. temporary period, and imple• products is minimized. Many menting the retrenching policy to countries, including the Soviet pay foreign debts. The determin• Union and Japan, have felt the ation of these countries to deal pressure of the new changes. with these problems indicates that Soviet scholars estimate that by they are ready to abolish some of 1990 about 15 million-20 miUion their traditional social policies for workers (about 1/6-1/5 of all the purpose of improving Soviet workers) will have to y4 // countries, whatever economic benefits. This, however, change jobs. Some of them will be levels of development they are is certainly not easy to do. trained to improve their skills. at, are challenged with a Third, to reduce state inter• This will inevitably bring about scientific and technological further changes. Japan is ac• ference and fully use the market celerating the readjustment of its revolution which will decide mechanism have become the industrial structure by shifting its their fiiture position in the major components of the manufacturing industry to foreign world. economic readjustments in vari• countries, especially the United ous countries. This is a common States. It is estimated that by the phenomenon in nearly all coun• mid-90s, about 10 percent of the tries of the world since the 1980s. Japanese manufacturing industry The Western countries have in will be transferred to foreign many Western countries are recent years pursued a new laissez- countries along with 1.2 miUion troubled by "stagflation," while faire policy, which includes job opportunities. This will be a the socialist countries have to limiting the scope of state great change to Japan's employ• increase national subsidies or rely interference and changing the ment situation and a great shock on increasing foreign debts and methods of this interference. to its unique traditional culture. the developing nations have to These countries run their borrow heavily. Since the 1980s economies mainly through these All countries, whatever levels of many countries, regardless of policies and economic means and development they are at, are political and economic orient• do not accept direct interference. challenged with a scientific and ation, have begun to implement a The new policy concentrates technological revolution which retrenching policy, which has strongly on the role of the market. will decide their future position in curbed their production and The privatization which has the world. Many developing importing capacity and cut already spread in the Western nations are aware that if they do employment opportunities. The countries developed further in not seek to catch up, they may be United States, which has not 1987. During the period Prime again reduced to the status of carried out the retrenching policy, Minister Margaret Thatcher has "colonies." Not in the traditional became in 1985 the nation with the been in office, Britain has made sense of the word, but as "colonies world largest debt because the big steps in this respect, as has of high technology" just as we nation's high consumption has Japan. already talk of "computer been based on borrowed foreign The main components of the illiterates." money and expected income. At economic reform in socialist Second, the shared difficulties present, the Reagan administra• countries have also changed the facing countries include the tion has to cut governmental very concentrated system and reajustment of the relationship expenditure but this will lower the methods of administrative leader• between consumption and pro• standards of people's life and ship and guided the economy by duction and the new economic and productivity, resulting in decline mainly relying on the economic social problems as a result of the of the economy. lever. Many countries have readjustments. For many years it In 1987, some socialist countries adopted a formula of "small has been a common phenomenon carried their reforms a step further government, big market," stream• in various countries that the by correcting the tendency of lining or amalgamating some

BEIJING REVIEW, MAY 2-8, 1988 27 •1 ARTICLES government organs and reducing pendent of authorities and isolation. The situation in socialist the large number of government encouraging workers to take a countries was very similar to this. employees. At present there are more active part in management The debt problem in 1987 of the 18.6 million such employees in the and ensuing profit. Thus, 1987 developing countries was a more Soviet Union and they will be was a year in which many socialist serious problem, and creditors of reduced to about 10 million. Many countries put reform of the the Western countries are seeking countries have advanced their political system on the agenda to solve this problem because no theories about the role of It is undoubtedly necessary for country can risk the collapse of the commodities and money, and in enterprises to raise levels of world monetary market. Im• practice they place the importance enthusiasm and responsibility and balance between the developed of the co-operative economy at a create a suitable political situation nations is now appearing while a new high level. They have also for economic development. How• new imbalance between the removed various measures which ever, this has resulted in a developed countries and develop• limited the individual economy. weakening of the trade unions in ing countries has already The developing countries are Western countries. Among US occurred. rethinking their paths to develop• labourers only 15-17 percent are ment and adopting similar members of trade unions in All these points prove that the methods. contrast to 35 percent in the 1950s. technological revolution and de• velopment of world economic However, new problems have The number of British stock• integration have brought different appeared. The adjustments in holders will soon be higher than types of economies to a turning- some Western countries have had that of trade union members. point and a period of new an impact on the money allocated development. Production struc• for state welfare services. For Fifth, further internationaliz• tures and relations in production decades these countries used huge ation of the economy will exert and even political life in all sums of this money to ease the much influence upon the countries have changed immen• social injustice. When the socialist economies of all countries, a fact sely; they all are expanding and countries recognize the role of which is generally recognized. The promoting co-operation. The commodities and market, they international relations between scope and size of this readjustment have to change their price policies. the economies of countries are are unprecedented. In 1987 many countries said that closer now and their interde• they planned to manage without pendence is deeper, and thus Under such circumstances the subsidies for commodities which mutual influence and clashes are role of the economic factors in earlier on would have received stronger than ever before. The international relations has greatly them. economies of various countries expanded. In comparison, the Fourth, management has been have increasingly become part of danger of military confrontation decentralized and political life is the world economy. Whenever has been lessened and ideological becoming correspondingly more countries conduct economic ana• standpoints have assumed a less democratic. In the West decen• lyses and work out their economic prominent position. Friction and tralization of management means policies, they must consider these contraditions are taking place, but that employees participate in a on a global basis. Production and they are not defined by military company's decision making and employment in one country are blocs or social systems. New have a share in the company. It is becoming increasingly dependent alliances as well as differences developing quickly in these two on the consumers, enterprises and have emerged on varying issues. respects. Ten years ago there were government decisions in other To sum up, this development half a million workers with stocks countries. The development of the reduces the danger of large-scale in the United States and there are internationalization of economic military conflicts, but it also now 10 million. It is predicted that hfe has added further complexities makes various relations more by the year 2000 more than 25 to the economic development of complex and changeable. There• percent of the workers will have every country. In 1987 the fore, although the prospects for stocks in their own corporations. contradictions and economic safeguarding world peace are The momentum of privatization frictions between the Western good, the world is not stable. has promoted this development. countries were deepened. At the Consequently, we must expand In Britain, 8 million employees same time these countries also our knowledge of what is have become the stockholders. strengthened their mutual co• happening in the world and make The decentralization in socialist operation. This also meant, new analyses on which to base countries focuses mainly on however, that no single country decisions which are conducive to making enterprises more inde• could be affected economically in lasting world peace. •

28 BEIJING REVIEW. MAY 2-8, 1988 •TOURISM China's Exploration Tours

xploration tours are part of a International Taishan Mountain Autonomous Region) in which E new programme recently Expedition sponsored by Shan• one thousand participants are introduced to China's tourist dong Province. expected to take part. The rally industry. According to incomplete will cover a distance of 8,000 • Mountain Tours are carried statistics, nearly 10,000 foreign kilometres. Competitors will pass out mainly in sparsely populated tourists have already joined in the through high mountains, and high mountain areas such as Tibet, programme. desert and marsh lands along the Qinghai, Sichuan and Xinjiang. At present the China Inter• mysterious ancient Silk Road. Tourists can choose from 27 treks national Sports Travel Cor• This year China tours will offer which generally take about 15 poration— the principal sponsor many exciting opportunities. Tou• days. for these tours — and more than rists will be able to swim across the • Mountain Horse-Riding. ten of its branches in Heilong- Changjiang River, go sailing in the This tour is available once a year. jiang, Xinjiang, Tibet and other Pacific Ocean in a motorless boat, The one-month tour on Alima- provinces and autonomous walk the entire length of the Great qing Mountain in Qinghai Pro• regions have set up a national Wall or take part in a motor car vince has already attracted visitors network to receive tourists tour along the famous 25,000-//' (1 from France and Italy. interested in exploration tours. //= 500 metres) Long March route • River-Drifting. Over 10 walked by the Chinese Workers' China is a vast land, incredibly rivers including the Changjiang and Peasants' Red Army. diverse in terrain, landform and (Yangtze), Huanghe (Yellow), Tourists who have ventured on climate. It has some of the world's Jinsha and Lancang 'ivers are these exploration tours are from highest peaks including Mount now accessible to tourists. River all walks of life. The eldest was 70 Qomolangma, the Changjiang trips may be taken along the whole and the youngest, 17. Some of the (Yangtze) River, the world- length of the river or only along tours are very difficult and tiring. famous limestone caves in the certain sections. Some Japanese Sometimes the tour group will be southwest and the vast deserts of and American tourists have miles away from anywhere but the the northwest. Then there are the already joined this programme. Chinese travel guides are well many places of historical interest • Hot Air Ballooning. The first prepared for all the needs of the dating back thousands of years, tour of this kind set off in Henan tourists. and of course the cultural Province in October 1987. The by Han Guojian traditions and customs. participants were mainly from China exploration tours try to Japan. In December this year bring these places within the reach ballooning expeditions will be Suzhou Garden in of tourists. available in Guilin, Guangxi • Mountain Climbing. Zhuang Autonomous Region. Friendship Hotei China's 30 high peaks include • Motocycle Rally Tour. A 60- Qomolangma (Tibet), Yulong day round trip covering a total of uyuan — a new garden has Snow-Capped Mountain (Yun• 13,000 kilometres from Beijing to S been completed in the Friend• nan), Gongga Mountain (Si• Urumqi and back. In September ship Hotel in Beijing. It is a chuan), Jilian Mountain (Qing- 1987, five Japanese women took Suzhou style garden, a style which hai), Taishan Mountain (Shan• part in this tour. This year eight was the model for China's ancient dong) and Hengshan Mountain groups of about 100 Japanese plan gardens south of the Changjiang (Shanxi). All have their own to take the tour. (Yangtze) River. It covers an area uniqueness. Foreign tourists may • Bicycle Rally. In 1987, 20 of 8,000 square metres, and choose any peak to climb Japanese tourists cycled the 3,000 includes proportionally located accompanied by experienced kilometres from Harbin in cloisters, a pool, a rockery, a Chinese mountaineers. Large- Heilongjiang Province, north waterfall and a waterside and scale international mountaineer• China, to Shanghai. other pavilions. There are also ing expeditions can also be many flowers and trees there. arranged. In September 1987, In October this year, China will Bordering the garden is a more than 300 tourists from nine host an international motor car restaurant which serves Suzhou countries including the USA, rally from Beijing to Urumqi food. Japan and the USSR joined in the (capital of Xinjiang Uygur by Han Guojian

BEIJING REVIEW. MAY 2-8, 1988 29 BUSINESSARAOE

Hitting Out Against Smuggling

ast year China made great smuggled cigarettes were un• 1. Strengthening legislation and L progress in controlling smug• covered. Chinese customhouses punishing smugglers according to gling activities but there are still also discovered 8,576 pieces of law; many problems to be confronted. cultural relics set to be smuggled 2. Increasing the number of Statistics from the Chinese out last year, a 27 percent increase customs officers and their capacity General Administration of Cus• over 1986. Both the number and to handle cases according to the toms reveal that in 1987 grade of smuggled cultural relics law; customhouses handled 13,018 increased from previous years. 3. Bringing advanced scientific cases of smuggling and discovered Some pieces date back to the New and technological means into full 166.9 million yuan worth of Stone Age, the Spring and play to obstruct smuggling; and smuggled goods, a 30 and 19 Autumn and Warring States 4. Co-operating with other percent drop respectively from periods (770-221 BC), the Qin departments concerned and at the 1986. Dynasty (221-207 BC) and the same time improving co-operative While the number of cases Han Dynasty (206 BC-220 AD). relations with other countries in decreased, the percentage of 3. More methods of smuggling this field. • serious cases rose: of the total, 28 are being used. Smugglers are involved more than 1 million yuan finding more ways to disguise worth of goods and 305 involved illegal goods with forged seals and goods worth between 100,000 bills and through channels both Sino-Pakistan yuan and 1 million yuan. Another inside and outside the country. Trade Increases 218 cases to determine criminal Last year, there was a serious rise responsibility were investigated by in the illegal sales of semi-finished ccording to an official from the judicial organs, a 30 percent goods or raw materials imported Ministry of Foreign increase from 1986. under preferential customs duties A Economic Relations and Trade, Of the cases handled last year, for further processing. China plans to import a 17,000- 851 were government underta• Smuggling became a more ton bulk container ship from kings and enterprises, and the troubling issue last year for the Pakistan this year. The design smuggled goods were worth 80 following reasons: programme has been affirmed by million yuan or 48 percent of the 1. At home and abroad lawless the two sides and trade talks are total value. now in progress. Last year's cases of smuggling people began taking advantage of have the following features: China's opening to the outside and In recent years, economic 1. Goods were smuggled used every means possible to make relations and trade between China through import and export profits through smuggling. At the and Pakistan have been develop• channels. The value of the goods same time some enterprises and ing steadily. Bilateral trade smuggled as import and export establishments considered their totalled US$300 million. But due goods accounted for 55 percent of own units' interests at the expense to the two countries' similar range the total value of smuggled items. of the state interest and interfered of commodities, China has maintained a large favourable The value of goods smuggled by in investigations into some balance of trade with Pakistan for sea made up 13 percent. smuggling cases. 2. Smugglers took advantage of a long fime. The import of a 2. The variety of goods flaws in management, rules and Pakistan ship is part of China's changed. In the past, household regulations. efforts to reduce the trade surplus. electrical appliances and motor 3. Customhouses are China has also adopted some vehicles were mostly the goods shorthanded. measures to increase the variety of smuggled into China. They have 4. Some customs officers were its import commodities and re• now been replaced by cigarettes. bribed by smugglers with money establish imports of certain Goods shipped out illegally are and beautiful women. commodities. Last year China usually precious relics and grey This year, customhouses have resumed its import of cotton cotton cloth. Last year, cases decided to improve their work in which has been suspended for involving 15 million yuan worth of the following areas: many years, and will increase the

.3(1 BEMING REVIRW. MAY 2-

BEIJING RjEVIEW, MAY 2-8, 1988 31 CULTURE/SCIENCE

ible dancers lift her to complete various dance movements and actions which reveal her strong Dance Drama Wins Acclaim desire to escape the imminent threat. Another scene shows Mingfeng fighting against two huge lanterns with the red The Opera and Dance Drama and Juehui, her young master, tells characters for "Happiness," por• Troupe of Sichuan Province of the struggle of young people as trayed by dancers, which obvi• recently brought its newest they try to pursue their dreams ously symbolize the forced production — a trio of dance under a system of feudal marriage. dramas entitled Sound of Souls. suppression. Mingfeng and Juehui The Death of Mingfeng won the The show was impressive both for love each other but they are Golden Crown Cup at the third its bold and creative conception ruthlessly torn apart by feudal international dance works compe• and its artistic presentation. overlords. Mingfeng is forced to tition held in Japan in January Sound of Souls consists of three become the concubine of Feng 1986. The jury praised the piece independent dance dramas adap• Leshan. an old eccentric. Hopeless for its creativity in combining ted from modern Chinese litera• and helpless, she has no choice but traditional Chinese dance idioms ture, which concentrate on to kill herself as a protest. with modern Western techniques. exploring the inner world of Mingfeng's dance at the mo• Chinese women tortured by their ment of her death is especially The second drama on the tragic fate in the old society. outstanding for its portrayal of the programme was Meditation in the The first piece is Death of violent contradictions between life Sun, based on Cao Yu's play The Mingfeng. an exquisite senti• and death, and the love and hatred Sunrise. A long piece of white silk, mental work based on a segment in the heart of the heroine. The a symbol of feudal bondage to from Ba Jin's novel Family. The dance movements accurately con• Chinese women, divided the stage drama, which relates the tragic vey the complex mental state of into three small performing areas. story of Mingfeng. a housemaid. Mingfeng, who is deprived of even Three women dancers appear on the right to her own body. the stage. They dance —

"The Death of Mingfeng.' AO YtNZHANG sometimes together and some• The drama, which focuses on times separately — revealing their the night before the wedding, is different characters and their divided into seven scenes. It opens sufferings in feudal society which with Juehui protesting in the tortures their bodies and robs house. His silhouette by the them of their human value and window frame symbolizes the dignity. The stage lights change small world he can live in. Then with the development of the plots, Mingfeng dances outside the reflecting the characters' good window, recalling their love, nature, their yearning for happi• which is actually partitioned by a ness and the hopeless situation high wall. The drama builds to a they have been plunged in. climax with the scenes "Death The third work was The Farewell" and "Death Night." Wilderness, adapted from a play of The last scene is "Fire Sacrifice." the same name, also by Cao. It One unique quality of the drama is tells the tragic love story of a rural that while each scene uses stage man and a married woman. iThe settings or props to create the drama is divided into four scenes. atmosphere and stand for certain The first shows the suffering of characters, it is the dancers and Jinzi, the heroine, after she is dance movements which delineate forced to marry into the Jiao the thinking and emotions of the family. The following scenes tell of hero and heroine. For example, a the meeting between Jinzi and her Chinese robe hung over a wooden lover Chouhu; their escape after cross stands for Feng Leshan, Chouhu kills Jinzi's husband; and whom Mingfeng is being forced to Chouhu's suicide in the dark marry. To portray Mingfeng's forest. night-marish struggle, two invis• Unlike the previous pieces, the

32 BF.I.IING REVIEW. MAY 2-8. 1988 Prehistoric Fossiis Shown in Beijing

n exhibition of prehistoric A animal fossils was recently held in Beijing by the Institute of Vertebrate Palaeontology and Palaeoanthropology under the Chinese Academy of Sciences. The exhibition served as an introduc• tion to basic scientific knowledge about fossils and featured some rare specimens that had never been shown before. China is one of the countries rich in vertebrate palaeontological fossils. The exhibition also showed

A scene from "Meditation in the Sun." XIAO YINZHANG the masters of the earth found in China in various prehistoric Structure of The Wilderness is outstanding. The dance pace periods. typical of traditional drama in changes from slow and smooth to The display included fossils of that the story develops in the rapid and passionate with the flow Eugaleaspis, the earliest and correct time sequence. But the of the story. lowest vertebrate fish. The fish work is full of dramatic suspense, lived 410 million years ago and including the hero and heroine's Although the show still has were found in what is now China's conflicts with the Jiao family. room for improvement, the artists' Yunnan Province. They were Several dances in the dramas are effort to introduce innovations jawless and lived by eating especially successful and clearly into national dance and adopting microbes and other organisms show off the dancers' talents. For modern techniques are highly pushed into their mouths by instance. Jinzi's dance to show her commendable. The show has been flowing water. craving for a happy life at the warmly received by audiences, and beginning of the second scene is has won the praise of many well- The emergence of the Agnatha light and graceful. The four pas de known artists as "representing the was a milestone in the history of deux which depict the meeting of future for China's dance drama." vertebrate evolution. This kind of Jinzi and Chouhu are also by Hong Lanxing fish had jaws to actively capture food. Agnatha are divided into

A scene from "Tlie Wildderness." XIAO YINZHANG Antiarchi and Arthrodira. The exhibition showed that the earliest Antiarchi originated in China and then spread all over the world. Traditionally it was believed that typical Antiarchi emerged 400 million years ago, but fossils of extremely primitive Antiarchi found in China date back 440 million years. This conclusion, drawn by Chinese experts after more than 20 years of research on the specimens, has generally been accepted by scientists in other countries. The most conspicuous speci- mens'on display were the remains of four large reptiles. The Lotosaurus, discovered in Hunan

BEIJING REVIEW, MAY 2-8. 1988 3.^ CULTURE/SCIENCE

Province, has no teeth but has a exhibition in the second half of exclusively for sopranos. This very high dorsal spine. It has never this year. bold initiative and her artistic been found in other parts of the by Wei Liming treatment of different songs, as world. The Mamenchisaurus, a well as her personality were well large dinosaur found in Sichuan received by her audience. Province 150 million years ago, Dedema was born into a family was 22 metres long and 9 metres 'The Grassland, of herdsmen. She began her tall when its neck was stretched My Homeland' singing and performing career at out. It is estimated that its live the age of 13. Later, having gone weight reached 40 to 50 tons. through professional studies and The Lufengosaurus discovered training, she became a solo and er sweet and mellow voice tells in Yunnan Province is a medium- opera singer in the Inner people that she is Dedema — sized dinosaur, 6 metres long from H Mongolian Song and Dance "the skylark of the grassland." head to tail. It is an ancestor of the Ensemble. She is a favourite of the Beijing residents were recently dinosaurs that walked on all four people of the grasslands. feet in a later period. The treated to their first solo concert Lufengosaurus and the Mamen• by the mezzo-soprano, following In 1982, she moved to the chisaurus have been studied by similarconcerts in her native Inner Central NationaHties Song and palaeontologist Yang Zhongjian, Mongolia. Dance Ensemble as a solo singer. who has made outstanding contributions to the development From that point, her fame spread. of palaeontology in China. Her rendition of The Beautiful Evening on the Grassland won first Also on display was a Dzungaripterus found in Xin• prize at the 1984 National Song jiang, dating back 120 million Competition held for the 35th years. Its front limbs were turning anniversary of the People's into wings and its neck and tail Republic of China. In 1987, she degenerated, which enabled it to was chosen as one of the best ny. singers by listeners across the China is one of the world's country in a contest co-sponsored major sites for dinosaur fossils. by the Central People's Broadcast• Since the first dinosaur fossils in ing Station and the Leyou Audio China were found in 1904. more and Video Company, which is than 100 of the dinosaurs that affiliated with the Chinese Musi• once roamed the country have cians' Association. been identified. XIAO YINZHANG Dedema performs "The Beautiful Gra• The exhibition also included a ssland, My Homeland" in Beijing. In Beijing Dedema sang, "There stegodon dating back 2 million are gold rivers and silver rivers on years. This ancient elephant, In addition to the traditional earth, but the one I love is the Ejin discovered in 1973 in China's Mongolian folk songs which are River, my mother river " The northwest Gansu Province, was her speciality, Dedema sang folk song came from the heart of this found completely intact — even its songs of China's other nation• daughter of the grasslands. She more than 100 toe bones. It is the alities,- traditional ballads and incorporated her yearning for her only complete skeleton of a popular Chinese songs, as well as birthplace into every word and stegodon that has been found in foreign folk songs and opera note. One listener said, "Her Asia. The skeletal remains of a selections, displaying her varied singing makes people smell the Rhinotitau, dating back 40 million talents. sweet smell of milk tea and years, are also unique in Asia. experience the flavour of the Since 1980 China's palaeoan- Her singing is simple, natural grassland." thropological and dinosaur fossils and full of feeling, combining the have been exhibited in Japan, folk idiom with bel canto style. Dedema is full of confidence. Hong Kong, Thailand, Singapore, This enhances not only her fine She says she will sing thousands of Malaysia, the Philippines, Britain tone quality but her artistic songs and dedicate them all to her and the other countries. They will expression and power as well. homeland. go to the United States for an Dedema sings songs meant by Hong Lanxing

34 BEIJING REVIEW, MAY 2-8, 1988 Yu Ping and his wife Ren Ping were both born in 1962 in Shandong Province. They teach art at Homeward bound with the catch. the No. 1 Vocational Secondary School in Yantai. Shandong city of Yantai.

Spinning. nning a Trip to China?

This is the year of dragon — a particularly good time to visit China. Throughout the country, special activities are being planned. We recommend the following books and tourist maps to help make your trip pleasant, interesting and rewarding.

How to Tour China (in English) Handbook of Investment and Tourism in Guangzhou China — An Introduction (in English, French, German, (in Chinese and English) Spanish, Russian, Japanese, Thai, Portuguese, 14 Open Coastal Cities & Hainan (in German and Swahili and Bengali) Sponish) An Illustrated Guide to China (in Japanese) Beijing Tourist Map (in English) China Travel Guide (in English) Guangzhou Tourist Map (in English) 60 Scenic Wonders in China (in English) The Great Wall of China in History and Legend (in English, French, Spanish, German, Japanese, HOW TO ORDER: and Bengallf) Readers in China can order the above books from any branch Home of the Dragon—Tourism and Reunion (in of the Waiwen Shudian (Foreign Languages Bookstore). Chinese) Readers in Hong Kong and Macao can order from Peace Beijing Old and New (in English) Book Co. Ltd. Rms. 901-3 Wing On house, 71 Des Voeux Beijing (in French, Spanish and German) Road, Central, Hong Kong Tourist Map of Beijing (in Japanese) Readers abroad con order at local bookstores or directly Sights & Scenes of Guilin (in Japanese) from: West Lake Reflections (in English and Japanese) Sights and Scenes of Suzhou (in English and Japanese) Mount Taishan (in Chinese-English) A Visit to Confucius' Home Town (in English) Tourism — China Handbook Series (in English, French, Spanish, German and Japanese) China International Book Trading Corporation (Guoji Shudian) Journey Into Revolutionary China (in English, French, Spanish, German and Japanese) P.O. Box 399, Chegongzhuong Xilu 7^, Beijing, China Handbook for Investment and Tourism in Shantou Cable: CIBTC BEIJING (in Chinese and English) Telex: 22496 CIBTC CN Tel: 896272