eview

Vol. 30, No. 3 January 19, 1987 Combating Bourgeois Liberalization Disarmamenf: New Development

6U MUONI FOREIGN FUNDS A second-generation giant panda bred by artificiai insemination. The mother panda, Dandan, looking after her baby, LeIe, born September 8, 1986, in Beijing Zoo. U Shuzhong HIGHLIGHTS OF THE WEEK

VOL. ^U. No. 3 JAN. 19, 1987

CONTENTS

EVENTSARENDS 49 ()ITici;il Stresses the Four Piinctpies , C'oinpiiier Giani Eves Home Market Shanghai's Iiiditsfry:Fi"Cfitful Trends in 'M Memorial Meeting for Genera! P- 17 P. 6 . Hiiiing i Fabricated Letter Arottsls ; Concerrr • China Sticks to Socialism tiovertiment Changes University • Leaders • Two important pieces in Renmin Rihao (People's Daily) are 'A'ecklv Chronicle (Jan. .5-11) printed in full. They discuss the need to combat.the call for "complete Westernization." This is the central theme of the iNiERNATlONAL 10-14 current struggle against bourgeois liberalization (pp. 15-16). i:S\: Fcononiic Cirowth Slows Fang Lizhi, a Hefei. university vice-president, has been Down sharply criticized as typical of this capitalist trend. He was J.ipan: Defence Budget Stirs Con- dismissed from office alongside the president who was charged trcnersy with "seriously neglecting his duty" (p. 8). I'urkex; \cv. ^ear New Chal- Chen Junsheng, Secretary-General of the State Council, lenges expounds why China should follow the road of socialism (p. 4). Chad-l.ibyii: Hope of Unity Full text of this article, published in all major Chinese .•\pj'!cars in War • •' newspapers, will be printed in BR next week. .A.rgeiiitnva: Implement an In• dependent Foreign Policy \ Resolutely Combating Bourgeois Disarmament: Clianges in tlie New Context Liberalization 15 Compfete Westernization Ne- ' • The international struggle centring on disarmament today gates Socialism 16 has taken on some important new aspects because of the many Significant Advances for the Open changes that have taken place in the world in recent years, Policy 17 especially the changes in US and Soviet strategies. This article Facts and Figures: Development examines these new aspects and assesses their implications (p. Of Economic Sectors 21 24). Disarmament: New Aspects of an Old Issue 24 Foreign Firms: New Autonomy in Gu IVIu on the Use of Foreign Funds Hiring 26 BOOKS 27 • State Councillor Gu Mu in his interview with Beijing Review FROM THE CHINESE PRESS 28 29 elaborates the following points: as application of the open BUSINESS/TRADE 30-31 policy spreads from the coast to the hinterland, the number of CULTURE/SCIENCE 32-33 foreign-funded enterprises has increased to over 7,000; the LETTERS 34 special economic zones are developing an export-oriented COVER: fill Mu. economy; implementation of regulations encouraging foreign Ma Juntian investment has helped improve investment climate (p. 17).

Genera! Editoriot Office teli 893860 SubscripHon prices (t year;: USA ; US$22.00 &ubli5*t**d ©very Moncioy by Eigiish Pepartinent Teli 1 -546, Austcalia A.$22.00 Canada Con.$21.00 Distributed by Cliina In'ernotianal Book New Zealand NZ.$30.00 24 fioi /^anzhuang R6cjd, Beijing TrodinB- CorpotoMon (GOQirSHUDIAH) ^he Peopte's Repobiic ai China P.O. Box 399, peijjng, Chtaa UK £12.00 m EVENTS/TRENDS V^g^'-IE-^SJ^M:--

Official Stresses the Four Principles

senior official said on Jan. 12 are the main problems that should nation if it had not taken the A China will persist in the four occupy the minds of young socialist road. cardinal principles in carrying out people," Chen said. "Therefore, socialism is the reform and the policy of opening Those in favour of capitalism historically correct choice of the to the rest of the world. forget China's modern history and Chinese people," Chen said. In a long article in Renmin their views are at variance with Among the more than 100 Rihao (People's Daily), Chen China's actual conditions, Chen countries in the world today which Junsheng, secretary-general of the said. have capitalist systems, only about State Council. China's highest A poor economic foundation, a 20 can be considered affluent and governing body, said that reform large population and limited developed, while the rest are still and opening to the outside world agricultural land are the problems developing countries, Chen said. are China's established that China has been tackling. Although China's economic policies and the determination to Imperialism, feudalism and development now is not equal to carry out the four cardinal bureaucratic capitalism had made that of some developed countries, principles is also firm and China a poor and backward he said, there is no social unshakable. country. Though great progress polarization in China and, except The principles refer to adhere• has been made in economic con• in a few areas, the people across nce to the socialist road, to the struction since New China was the country are well-fed. people's democratic dictatorship, founded in 1949, China is still a If China gives up socialism, he to the leadership of the Commu• developing country. It is not easy said, the developed foreign nist Party of China, and to for a developing country to feed, capitalist economies will occupy Marxism-Leninism and Mao and provide adequate education China's markets and destroy Zedong Thought. and employment for a population China's national economy, and "Nowadays, a few people are of 1 bilhon, the official said, politically China will fall under arguing that socialism is inferior adding that "this is not the fault of their control and lose its to capitalism and nothing in China socialism." independence in foreign affairs. is as good as in the Western The article said it is not Thanks to socialism and an countries. Therefore, China must scientific to compare China, which economy with public ownership be Westernized," Chen said. has suffered so much and just playing the leading role, China Such an argument is nothing begun to prosper, with developed remains strong politically and new, because it was advocated capitalist countries. Such a militarily, stands independently in eight years ago, Chen said. But comparison can only make people the world and is respected by this time the advocates of this loose their national pride and people the world over. erroneous line have raised it under confidence in building China into In all, he said, China will neither the banner of "Speeding up a prosperous country. follow the capitalist road nor copy political restructuring" and Refuting the idea that if China the Soviet model nor return to the "fighting for democracy and takes the capitalist road it can be old track before 1979. The only freedom." economically developed, Chen way for China is socialism with China's senior leader Deng said the bureaucratic capitalism Chinese characteristics. Xiaoping said in 1979 that the then ruling Kuomintang once "We'll learn everything from although such people were few in practised led to the collapse of the other countries which is useful for number, their role should not be country. If New China had our construction," Chen said. underestimated. followed suit, it would not have "But the process of learning The article quoted Premier won popular support nor could it certain items of technology and Zhao Ziyang as saying recently have aroused the people's en• management from capitalist coun• that two questions must be made thusiasm to change the chaotic tries must not become worship of clear to young people: first, a situation left over by the capitalism, and lead to corruption developing country should not be Kuomintang. by capitalism and the loss of compared with developed capita• Morever, he said, the United national pride and confidence." list countries; second, the crucial States then supported Chiang It is understandable for the point is whether socialism or Kai-shek. China would not have people to be anxious for capitalism can save China. "These even survived as an independent accelerated construction and re-

4 BEIJING REVIEW. NO. 3 form and for more affluence, he \y will all come from the right to after-sales service and said. But two points must be made '[ corporation. training. This concentrated align• clear. First, the four moderniz• It will be able to build on the ment will spur development and ations programme needs hard great progress China achieved in husband scarce resources by work. Second, reform is a the computer industry during the avoiding costly duplication and complicated process which calls Sixth Five-Year Plan (1981-85). dispersal, because the successful for substantial efforts. The output value of the industry computer industry can only be Democracy is also a long-term increased at an average of 44 built where the necessary in• process, he said. Without democ• percent during this period. In tellectual resources and modern racy, there would be no socialism 1985, China produced more than industrial infrastructure is at or socialist modernization. But, 30,000 computers. In 1986, some hand. democracy and modernization 50,000 were produced. The industry demands the should progress step by step. Despite these advances, the people, the facilities and the The article concludes that to foundations of the computer institutions offered by a modern ensure stability and unity in industry are shaky and the city. Beijing is the birthplace of the China, the leadership role of the technology needs modernization. country's computer industry and Party must be strengthened. The scale of computer production is emerging as its future. It is Without such leadership, there needs to be further expanded and already home for 28,000 computer would be upheavals and social resources to be concentrated for professionals, one-third of the divisions throughout the country, expansion. Without these con• nation's total. The city, with its 77 he stressed. ditions, China's computers will colleges and institutions of higher remain uncompetitive in a cut• learning, almost one-fifth of the throat world market. This new national total, is China's single group is expected to bring China largest training ground for the into that market. highly skilled people essential to New Computer Giant As for the home market, China the computer industry. has to import almost all of its Moreover, the capital can Eyes Home Market medium and large computers. provide the rapid exchange of Only 10 percent of the small and information needed for growth in eijing, the capital of China, 40 percent of the nation's micro high-technology industries. It is Bwill become the centre of the computers are made at home. the hub of northern China's nation's growing computer indus• With foreign companies chasing communications and the focus of try with the establishment of the the lucrative Chinese computer international information ex• new Great Wall Computer Group market, there is little leeway for change. Beijing also boasts the Corporation. the domestic computer industry. manufacturing expertise as it The Great Wall group, es• Now, China's computer sector already maintains the most tablished officially on December still cannot meet the needs of the valuable computer output in all of 17, 1986, is China's largest country's modernization pro• China. associated computer enterprise. It gramme, and is facing the All these features add up to is made up of 6^ factories and challenge brought by the new make Beijing uniquely suited to be related institutions all located in worldwide technological China's computer centre, and are the capital. revolution. expected to contribute to the The group will be a fully The computer industry is still boom foreseen in the domestic integrated undertaking. It will developing and its growth computer industry. deal with computer hardware and needs a critical mass of knowled• The group's hardware will be software as well as semi• ge, facilities and investment. Until produced at 10 primary factories conductors and integrated circuits recently, China's computer sector which will share a unified which are the heart of computer • was made up of diverse units, so development, marketing and ac• technology. Computer engineer• essential personnel, financial and counting plan. Other factories will ing projects and modern commun=- material resources were spread manufacture components for the ication technology are also out. That is why there was little -corporation under contract. The included in its mandate. wonder its computer industry was ultimate goal is to turn this new Developing the productive use unable to compete with the computer giant into a joint-stock of computers, from desk-top cohesive foreign firms. enterprise. micros to large, powerful main• The Great Wall computer Computer enterprises outside of frames is also the job of the new group changed that situation. The the capital have not been enterprise with an emphasis on group will undertake all phases of forgotten. The group plans to fourth-generation computers. production, from scientific include the computer technology Computer-controlled switches for research through manufacture of other Chinese enterprises in

JANUARY 19. 1987 5 EVENTS/TRENDS

their overseas marketing efforts. with its industrial output value its industrial departments, spread The immediate challenge though accounting for 10 percent of that the new director responsibility is to carve much more than a niche of the whole country; its revenue, system in its factories, practised a in the domestic market. 14 percent of the country's total system which allows small and by Wang Yanjuan and its earnings from export. 16 medium enterprises to be leased to percent of that for the whole individuals, and pioneered fiiuui- country. The Shanghai Port cial reform by establishing monc} Shanghai's Industry: handles one-third as much cargo markets through issuing shares for as all the other ports in China put enterprises. Fruitful Trends in'86 together. The city also sent technical For many years, the state groups to study in other provinces he \,ear 1986 was a profitable mandatory plan used to cover 70 and seek greater co-operation with Tone for Shanghai's industry, percent of the city's industrial other parts of China. In 1986. over whose output value increased,by a production, with the state being 3,000 Shanghai-based enterprises surprising 4 percent to reach 86.3 responsible for the supply of raw sought co-operation with enterpr• billion yuan (USS23.3 billion), materials and marketing of its ises in other provinces. In after forecasts of a sharp drop at products. However, the propor• addition, the city managed to the beginning of the year, when the tion had dropped to below 20 develop raw material supply bases city was shifting towards a percent after the planned com• outside Shanghai. planned commodity economy. modity economy was introduced Thanks to these efforts, produc• The figure is 3.3 billion yuan in 1986, which meant that the city tion began to pick up in the second (US$890 million) more than that was given the right to dispose of its quarter of the year and the rate of of 1985. and the growth is own resources and seek the needed growth has witnessed steady equivalent to the total industrial | raw materials. expansion month by month. output value in 1949. Economic Finding it hard to adapt itself to According to Yu Xiangnian, an experts in Shanghai view this the changed conditions, Shanghai economist in charge of the city's achievement as marking the first faced a downslide in industrial economic planning commission. important step in the transition production in the first two months Shaniihai's gross product has from the old economic pattern to a of 1986 and people worried that reached 49 billion yuan (US$13.2 new one. the city would not be able to fulfil! billion), a 5 percent increase over its quotas by the end of the year. 1985. The city of Shanghai, China's largest industrial centre, plays a To make the situation better, The output value of service key role in the national economy. the city government streamlined industry, which accounted for a large portion of the city's gross product, amounted to 13.3 billion Workers in a Slianghai factory test the rotor for a 300,000-kw thermal power yuan (US$3.2 billion), a 10 percent generator. increase over the previous year. The city has also made great efforts to improve its infrastruc• ture, transportation and commun• ications facilities. The amount of cargo handled by Shanghai port has reached a record high. "Shanghai's economic develop• ment is now being set on a more rational and healthy course." Yu said. By the end of 1986, the city had placed 560 imported or newly introduced technical projects into operation, greatly updating the city's metallurgical, ball-bearing, television and broadcasting, electronic products, plastics, food, textile and printing industries. Meanwhile, production of low quality products, with high consumption of energy or raw

6 BFIJING RF.VIEW. NO. 3 materials and serious pollution risks, was stopped. However, attention still needs to be paid to other problems surrounding the city's industrial development, such as low elTici- iMic}. increased costs and poor economic management. Despite ihc cii\ 4 percent growth in industrial production, its revenues (or 19S(i remained the same as ill OS 1985.

Memorial Meeting For General Huang

ore than .^,000 people from M all walks of life in Beijing attended a memorial meeting for SUN HONGXIANG ihe senioi- general Huang Kecheng iield on .iariiiar} 7 in the Great Be Frugal With Food i Lili of ihe People. Cjcncrai Huang, an advisor to Early last December, an exhibition under the title "Honour ilie Central .Military Commission, Frugality, Shame Waste!" was held in the Xiangshan Primary passed away on December 28 at School in Huaibei City, Anhui Province. Holding bits of steamed the age of 84. He had dedicated his bread discarded by a pupil a teacher tells the boys and girls: "If whole life to the liberation of the every pupil in the country throws away a piece a day, it will Chinese people and China's amount to more than ten million kg. of grain in a single year." socialist construction. Preiriier Zhao Ziyang presided over the memorial meeting which was also attended by major Party poor peasant family in Yongxing National Defence, chief of the and stale leaders, including Deng County, Hunan Province, in 1902. General Staff of the army, and Xiaoping, l^eng Zhen. Nie Rongz- He joined the Chinese Communist member of the Secretariat of the hen. IJIanhu and Wan Li. Party in 1925 and took part in the Communist Party Central 1926 North Expedition against Party and state leaders Hu Committee. warlords. Later, he became an ^'anbang. Li Xiannian and Chen General Huang's great contri• \'un went to the hospital many outstanding commander of the butions to the formulation of Chinese Workers' and Peasants' times to see Huang Kecheng the national defence strategy and Red Army. before his death. At the ceremony,, the principles for the country's they all presented wreaths for the During the Anti-Japanese War military buildup was recalled in late general. (1937-45) and the Liberation War the eulogy. Yang Shangkun also In Ins memorial speech, Yang (1945-49), he made great contri• mentioned the general's consistent Shiingkun. vice-chairman of the butions to the establishment of the efforts in working out and implementing the major regul• (cnlral Military Commission, northern Jiangsu anti-Japanese ations of the army, and his spoke highly of General Huang as base area and to the liberation of contributions to the army's a ioyal and veteran Communist. northern Jiangsu and northeast

.'AM \RN' IQ 7 m EVENTSARENDS and the "people's communes" On January 9 Li Shunxing. Government Changes were not welcome at the time. But deputy director of the Foreign he always maintained faith in the Affairs Office under the State University Leaders Party and the communist cause, Education Commission, met with even when he was persecuted in nine representatives of African rofessor Teng Teng was that national "nightmare" of students studying in Beijing and P appointed new president of "cultural revolution." talked with them in a friendly and the Chinese University of Science General Huang Kecheng's earnest atmosphere, according to and Technology and dean of the death is "a great loss to the Party, an official attending the meeting. university's graduate school in the army and the Chinese people." On behalf of the commission, Li Hefei.Anhui Province, according Yang said. "We should always denounced the letter saying it had to a decision of the Chinese learn from his lofty revolutionary slandered African students and Communist Party Central Com• spirit and tine moral character." pointed out that the letter's mittee and the State Council. • attempt to sow discord between The decision was announced on Chinese and African students, and January 12 at the university by Fabricated Letter undermine friendship between Zhou Guangzhao, member of the Arouses Concern China and African countries, is CPC Central Committee and vice- doomed to failure. president of the Chinese Academy bout 300 African students in Meanwhile, a ^spokesman for of Sciences. Beijing went to the headquar• A the All-China Students Feder• ters of the African diplomatic Professor Tcng, 56, is an ation, an organization in charge of corps on January 8 to complain engineering chemist and served as the country's student affairs, made about a letter attacking Sino- a vice-president of Qinghua a statement on January 7 saying African friendship and demand an University and vice-minister of the that the letter "viciously attacks investigation into the matter. State Science and Technology Sino-African friendship." Commission. A Xinhua report says that the The student representatives students' protest march was attending the meeting with Zhou Guangzhao also announ• sparked by an English language education commission officials ced that Peng Peiyun, vice- letter distributed to African expressed their thanks for the minister of the State Education embassies in Beijing by a so-called attitude taken by the commission Commission, would be the Party "Chinese students association." and their willingness to co-operate committee secretary of the which has been accused of in an effort to trace the writers of Chinese University of Science and slandering African students and the letter. Technology, according to a sowing discord between Chinese Li assured them that China decision by the Party group of the and African students. guarantees the security of its Chinese Academy of Sciences, Before the students' departure citizens as well as all foreigners, approved by the Party Central from the Beijing Languages including foreign students in the Committee. Institute in the northwest suburbs country. All the foreigners in At the same time, it was of the city, the report says, China should'-abide by Chinese announced that Guan Weiyan was personnel from the Chinese laws, decrees and regulations, Li removed from his posts as the security and other departments said, adding that foreign students president of the university, deputy concerned tried to persuade them should also abide by the secretary of the university Party to stay off the streets and regulations of the schools where corhmittee and dean of the explained to them the Beijing they study. university graduate school. Fang municipal government's regul• He said that they can raise their Lizhi was removed from his post ations on demonstrations. concerns through normal chan• as vice-president of the university. Some of the African students nels if they meet with difficulties or Guan and Fang are to be agreed that the letter must have problems. Problems will be solved assigned as research fellows at the been written by a handful of in the spirit of friendly co• Institute of Physics of the Chinese trouble makers. However, the operation and in the light of Academy of Sciences and the students continued their march Chinese laws and regulations. Beijing Observatory respectively, and walked out of the campus. He said that it was not proper according to the decision. When they arrived at the for some African students to walk On the reorganization of the headquarters of the African out of class in defiance of leading body of the university. diplomatic corps, they aired their persuasions. "Instead of helping Zhou Guangzhao said that over a complaint to the head of it and solve the problem, the protest considerable period of time. Fang asked him to convey to Chinese march disturbed order at the Lizhi made many erroneous authorities their demand for an schools and public places," Li bourgeois liberalist statements investigation. said. • and deviated from the four

8 BEIJING REVIEW. NO 3 cardinal principles (socialist road, CULTURAL people's democratic dictatorship. Weekly Chronicle Party's leadership and Marxism- i (Jan. 5-11) Jan. 7 Leninism and Mao Zedong | Xinhua reports that Chinese Thought). Fang's idea of running POLITICAL medical specialists have made his school free from the Party's Jan. 6 remarkable achievements in pre• leadership and in contravention of CPC Central Committee Polit• venting and treating cancer of the the socialist road had an extremely ical Member Hu Qiaomu tells a large intestine by developing a bad influence on the university as meeting marking the first an• technique of transplanting anal fully illustrated in the recent niversary of the bimonthly Heroes tissue. student unrest there. of the Chinese Nation that selflessness is a moral standard the As the leading administrator of Chinese people endorsed for ages Jan. 8 the university, Guan Wciyan and it is wrong to negate it. A feasibility report about seriously neglected his duty with Jan. 9 China's first energy data bank the result that the ideological and The fourth session of the Fifth passes state examination in political work in ihe school was Central Committee of the China Beijing. weakened. Democratic League unanimously Li Guixian, secretary of the elected Fei Xiaotong central Anhui provincial Party commit• committee chairman and Chu SOCIAL tee, said at the meeting that his Tunan honourary chairman of the committee full supports the league. Jan. 5 decision of the Party Centra! Renmin Rihao reports that 239 Committee and State Council. Jan. 11 consumers' organizations above Security organs in F'ujian and He said, "Fang Lizhi advocated the county level have been Sichuan Provinces smashed a established in China. bourgeois liberalization, defamed Kuomintang spy ring on the the Party's leadership and Part\ mainland and five people were officials, negated the achieve• Jan. 6 arrested on charges of collecting Renmin Ribao says Deng ments of the Party over the past military information and conduct• decades, and slandered the Yingchao, chairman of the ing other sabotaging activities for Chinese People's Political Consul• socialist system. He also sowed Taiwan. discord among Party members tative Conference and widow of and the intellectuals, especially the the late Premier Zhou, has young intellectuals. ECONOMIC donated 20,000 yuan from the premier's royalties to a middle "What Fang has done runs Jan. 7 school in Yanan. counter to the fundamental The national conference on interests of the Party and the metallurgical production reveals people and the trend of history. It that China's gold output has FOREIGN RELATIONS is intolerable," Li said. expanded at an annual rate of 10 "Guan Weiyan committed a percent over the last six years. The Jan. 7 serious mistake by turning a deaf country has 33 counties or cities A Chinese Foreign Ministry car to the words and deeds in that can each produce 10,000 spokesman says at the weekly favour of bourgeois liberaliz• ounces of gold a year. news briefing that Chinese frontier ation," he added. guards have repulsed the recent Jan. 9 The great majority of the provocations by Vietnamese Jingji Rihao (Economic Daily) faculty and staff of the university troops along the Sino-Vietnamese reports that China earned US$2.2 disagreed with the erroneous border and the "battle achieve• billion in foreign exchange from words and deeds of Fang Lizhi, ments" announced by the Viet• exporting machinery and Many rejected and opposed his namese side were sheer boasting electronics products last year, 30 ideas, the secretary said. aiming at deceiving the Viet• percent more than in 1985. "Some comrades made erro• namese people and the world neous remarks under Fang's Jan. 11 opinion. intlucnce, but have since realized The CPC and the State Council their mistakes. That's well and promulgate three sets of new Jan. 10 fine. Some time should be given regulations to promote the system Chinese Premier Zhao Ziyang the few comrades who fail to see of factory diretors assuming full meets with Ugandan Foreign their mistakes, but they must responsibility for production and Minister Ibrahim Mukiibi in observe discipline," he said. • management. Beijing.

JANUARY 19. 1987 9 m INTERNATIONAL

USA mist at the Manufacturers Hanover Trust Company, said that consumer buying, business Economic Growth Slows Down investment and government spending, the three mainstays of economic growth, were tapering After five years of expansion, the US economy still has off and would grow very little room to grow. But trade deficits and other factors may during the year. slow expansion to a snail's pace. US consumer spending, which accounts for about two-thirds of the country's gross national ince 1982, the US economy has both government officials and product, grew at an average of Sexperienced an expansion private economists believe will about 6 percent during the first fueled by the drop in interest rates drop by some US$40 billion from nine months of 1986. This was dtie and the fail of oil prices. It will no I986's estimated US$170 bilHon largely to cut-rate financing of doubt maintain its momentum due to the substantial depreciation automobile sales. The US Com• through 1987. but the twin of the US dollar in the past 20 merce Department said consumer deficits — in the national budget months. credit stood at US$577 billion at and in trade — may prevent it During the past six years, the the end of last August, or an from booming. American dollar was so strong annual growih rate of more than Because this growth has been that it made foreign goods cheap 10 percent. In 1987, Americans, durable and recession-free, there is in the United States and US burdened by installment debt are still room for it to continue. exports too expensive in other expected to tighten their purse- Historically, upswings in the US countries. The resulting trade gap strings. business cycle have not normally has been a heavy drag on growth. lasted as long as this one because According to the Baker Plan put Business spending, another key when they develop too rapidly, forward by Treasury Secretary economic spur, is expected to they often build up constraints James Baker, the value of the remain fiat in 1987 because the that restrict further expansion. dollar has declined 38 percent current low rates of operation of For example, in a shorter-lived against the Japanese yen and 42 factories and mines give busi• expansion, plants usually operate percent against the West German nesses no reason to invest in at very high capacity. However, in deutsche mark since its peak in expanding their facilities. recent months, rates of production spring, 1985, and will continue to In addition, the new federal tax have been averaging slightly less fall by 10 percent against the reforms which go into effect this than 80 percent, compared with worid's major currencies in 1987. January will have an adverse effect nearly 90 percent during the very It is esfimated that economic on business spending, at least in long expansion of 1961-69. growth in 1987 will continue to be the initial years, because they Labour costs tend to rise in an fueled by falling interest rates, phase out many credits for capital expanding economy, but also keep which the government will try to • investments in plant and equip• climbing long after the expansion reduce further, at least during the ment and lessen the United States' slows down or ends. In the past first half of the year. Also, as a attractiveness as a site for business five years, however, the labour- major consumer and importer of and manufacturing. So in spite of cost barometer has shown little oil, the United States hopes to the administrations' intention of change and in fact is at a slightly continue to benefit from a plunge spurring the sluggish econolny by lower reading now than when the in oil prices that occurred in early giving consumers more money to last recession ended in the late 1986. Though the Organization of spend, shifting the tax burden 1970s. This is similar to such Petroleum Exporting Countries from individuals to corporations labour-cost control in the first half (OPEC) agreed at the end of 1986 ! will have a negative impact on of the 1961-69 expansion, the to push up crude prices from some businesses in the near future. longest US economic upturn ever. US$15 per barrel to US$18 per Some Western economists have At the end of 1986, the Reagan barrel, Washington believes that pointed out that the huge US trade administration esdmated that the the cartel's efforts will not deficit remains the heaviest economy would grow at an annual succeed. burden on the US economy and rate of 3.2 percent in 1987 and However, there are other will persist for years. They said ruled out the possibility of obstacles to the growth of the US that despite the dollar's decline, recession. Though this prediction economy which make I987's foreign companies were not may sound a bit rosy, it is based outlook not as bright as might be ii rushing to raise prices, but were primarily on an expected reduc• wished. '' trying to hold onto the share of US tion in the trade deficit, which Irwin L. Kellner, chief econo- '' market they gained during the

Bf;iJlNG REVIEW. NO. 3 years of the strong dollar. In predicting that Western Europe, to US$220.7 billion in fiscal year addition to bringing the dollar which absorbs 23 percent of US 1986. According to the Gramm- into line even further, the United exports, is heading for another Rudman deficit-reduction act, the States should increase industrial lackluster year, as are Canada and federal government must reduce productivity and competitiveness. Japan, which purchase 22 and 11 its budget deficit to zero by fiscal But this will take lime. percent of US exports respec• year 1991. Economists estimate The economic growth of US tively. The US trade deficit is also that the deficit for fiscal year 1987 trade partners should be taken linked to the third world's debt which ends in October, will into consideration when efforts crisis, because their level of debt probably ease to US$190 billion. are made to reduce the trade has choked their ability to buy the But shrinkage in the government's imbalance. Japan and West goods and products they despe• purchasing power will contribute Germany both enjoy huge trade rately need. to the slowdown in the pace of US surpluses with the United States, Along with the trade deficit is economic growth. • but some Western economists are the domestic deficit, which came by Jiang Wandi

JAPAN

of the Soviet Union in Asia and Defence Budget Stirs Controversy the Pacific, the United States is The Japanese novemment has recently decided to allocate reluctant or, more accurateh 1.004 percent of its GNP for military spending in fiscal unable to contain the spread of Soviet Union infiuence and 1987— a budget slightly surpassing the 1 percent ceiling set in protect Japan alone. The Japa- 1976.

t the very end of last year, the A Japanese government deci• ded to abandon its limits on defence spending of I percent of GNP by allocating 3,517 billion yen (about US$22 billion) for militarv expenditures for fiscal 1987, which begins April I. The budget plan, approved at a cabinet meeting on December 30, is a 5.2 percent increase over the current fiscal year and, more importantly, it is 1.004 percent of Japan's GNP.

The one-percent-of-GNP ceil• ing on defence spending was set by the Takeo Miki cabinet in December 1976 to ease concern in Asia that Japan might re-emerge as a military power, and it has since been one of Japan's key defence policies.

Analysts have noted that there are many reasons behind the Japanese government's decision, Diplomatically. Japan has been under pressure in recent years from its Western allies, especially On November 30, 1986, on a beach in Fuktushima County, Japan, a group of young the United States, to shoulder people let go a balloon inscribed with their names and wishes for peace, hoping it more of Asia's defence burden. would sail across the Pacific to the United States. This event took place on the same With the growing military buildup spot from where Japan flew balloon bombs to raid America during World War II.

JANUARY 19. 1987 m INTERNATIONAL nese, on the other hand, have built because the old restriction was out United States and Western their country in the past three of keeping with the times. Europe, however, welcomed the decades into the second most F'inancial and industrial circles decision. powerful economic giant next to are divided on the decision. The The Chinese government has the United States. defence-related industries appreci• expressed its concern about the The United States and the ate the action because the budget Japanese military spending in• European Community also could stimulate their production, crease. A spokesman said on pressed Japan to spur domestic which has been hit heavily by the January 2 that " there has to be a demand and help reduce its sharp rise of the yen against the limit to the growth of Japanese massive trade surplus, which is US dollar. Others are worried that defence forces, which should not expected to surpass US$80 billion the step might jeopardize the exceed its defence needs and make for 1986. government's goal of rebuilding its neighbours feel uneasy. For Domestically, there has been a finance. reasons known to all, Asian conservative trend in Japan that countries have all along been very the country should rebuild its Southeast Asian countries, sensiuve to the Japanese govern• military forces and become a which were occupied by Japan in ment building up its military strong power again. In addition, a World War II, are generally strength." number of Japanese feel a sense of uneasy at Japan's decision. The by Hua Xin insecurity in the face of an increasingly tense international TURKEY situation in a nuclear age. They doubt whether the US protection umbrella will be sufficient in the event of a new world war. New Year — New Challenges The issue is delicate. The decision may well be considered as In the new year Turkey has to deal with new challenges in its a test case for further action since the original limit of I percent was relations with the West and other diplomatic fronts. surpassed by only 0.004 percent. The response has been predic- able. The decision drew immediate criticism from major opposition espite the progress made in since the 1980 military take-over parties. Takako Doi, chairman of D 1986, Turkey, an Islamic in Turkey, and the occasion the Japan Socialist Party, said she country bordering on Europe and marked a milestone in Turkey's would introduce a resolution in a key member of the North road towards integration with parliament calling for a vote of no- Atlantic Treaty Organization Europe. confidence in the Nakasone (NATO), still faces some chal• However, the crucial question is administration. Once defence lenges in its ties with the West in whether 1987 will see a European spending goes up above the 1 1987. decision entirely favouring percent ceiling, she said, there's no The new year, labelled by the Turkey's bid to join the EEC. Up way to keep it from climbing Ankara press as the "year of to now, the Europeans have higher. The Democratic Socialist Europe" for Turkey, may prove to tended to dismiss Turkey's Party said it would press for be a momentous one in the aspirations in this regard as far• measures to strengthen civilian country's relations with Europe. fetched and, therefore, not worthy control of the military, while the Turkish Prime Minister Turgut of urgent attention. They may still Japanese Communist Party called Ozal declared at a press confer• believe that time is not ripe for the st«p "an unpardonable act." ence on December 13 that his Turkey to become an EEC Other opposition parties also country would apply for full member. released statements, charging that membership of the European Furthermore, the Turks will the government is trying to build Economic Community (EEC) in face a more difficult situation if up the country's military might in 1987. the Social Democrats in West violation of the constitution's call Last year witnessed the nor• Germany and the British Labo- for maintenance of peace. malization of relations between rites, who have strongly criticized Turkey and the EEC, which was the Ozal administration's record The prime minister, in defence formally sealed at a special concerning the establishment of a of his policy, said in a New Year's ministerial session of the Turkey- democracy and the defence of Day press conference that the new EEC association council in human rights, win the upcoming budget was aimed at improving Brussels on September 16, 1986. general elections in their countries Japan's self-defence capabilities. This was the first such meeting and come to power.

12 BEIJING REVIEW, NO. 3 A general election will be held in \ Turkey's immediate concern is lorce the Ozal administration's West Germany later this month, the oil pipeline in Iraq, which conviction that its economic and several signs indicate that transports millions of tons of destiny should not be decided by there may be a general election in crude oil annually to Turkey. If the Middle East. Britain this year. Iran's forces endanger the oil Pushed by this conviction, the installations there, the Turkish Turks, while furthering their co• In addition to the cool response government will face a painful operation with the West, are also from West European nations, the ! dilemma: To what extent should it trying to maintain economic co• opposition from Greece is the intervene to protect its oil interests operation with the Soviet Union major obstacle to Turkey's entry in Iraq? and other East European coun• into the community. Turkish- The consequences of the Gulf tries. The construction of a fifth Greek relations have been tense war on the Turkish economy, pipeline to carry Soviet natural gas over periodic frictions on many including Iran's and Iraq's to Turkey will be completed this foreign policy issues including the inabilities to pay for their imports year. issue of Cyprus. The bloodshed from Turkey, have helped rein- by Hua Youzhong along their border late last December plunged their relations to a tow ebb and dashed hopes of CHAD-LIBYA any rapprochement. Thus the prospects for Turkey's relations with the EEC are still uncertain Hope of Unity Appears in War this year. At the end of 1986 Turkey and the United Stales agreed to extend Chad's domestic conflict has ended, at least temporarily, while their defence and economic co• government forces and rebel soldiers fight shoulder to operation agreement (DECA) for shoulder against Libya. another five years, ending several rounds of negotiations over the terms of the accord. The ince November !2, 1986, Libya ' the Libya-backed Chadian rebel agreement, first signed in March S has started large-scale attacks coalition - -CJUNT, has been 1980. allows US armed forces to on its former allies, Chadian rebel losing ground both militarily and use Turkey's 12 military bases in Goukouni Oueddei's forces, using politically, with the coalition return for US aid. tanks, bombers and even rocket internally divided. Realizing that guns. But it has met with severe it was difficult to gain power by Hard days, however, may be defeats. On January 2. Chadian relying on Libya's support, ahead for Turkish-US relations in government forces recaptured the Goiikouni was beginning to drift 1987. The American Democrats north-eastern oasis of Fada from apart from Tripoli. Ties between have assumed control of both the the Libyans. The regaining of GUNT and the Libyan govern• Senate and the House of Fada and Zouar, a north-eastern ment deteriorated when Goukou• Representatives, and are expected town captured earlier by Libya, ni announced last October that he to be tough in their stand on the has demonstrated that Chadian would like to hold unconditional Turkish question. There is the government forces have crossed negotiations with the Habre possibility that the US Congress the red line — the 16th parallel government in a bid to settle will vote against the extra military demarcation line between ter• Chad's domestic problems. grants to Turkey promised by the ritory held by the French-backed The split between Goukouni Reagan administration last year. N'djamena government and that and Tripoli has not only made occupied by the rebel transitional Libya lose one of its excuses for Besides its preoccupation with government of National Union grabbing the northern part of relations with the West, Turkey (GUNT) and its former Libyan Chad, but has also thrown it into a remains deeply concerned over the allies. Chad's government soldiers more difficult situation, since it turmoil-ridden Middle East this have joined hands with those loyal now has to cope with both Habre's year. to Goukouni to fight against government , forces and The Ozal administration has Libya. been striving to keep Turkey out Goukouni's National Forces. On of the quarrels and convulsions Since Chad's President Hissene December 28, Libyan troops besetting its neighbours, but as the Habre took office in June 1982, he bombed and took over Zouar flashpoint switches from one area has effectively implemented a which had been occupied by to another, it becomes more and series of reconciliation policies to Goukouni's forces. Chadian gov• more difficult for Turkey to help end domestic conflicts. In ernment forces then moved north remain a spectator. contrast, Goukouni, the leader of to reinforce the Goukouni defence

J.^NUARY 19. 1987 13 m INTERNATIONAL

against Libya's attacks. The cautious attitude towards Tripoli ina insists on its sovereignty over combined Chadian forces have since Libyan soldiers crossed the disputed Malvinas (F'aikland now successfully opened two Chad's 16th parallel demarcation Islands), while seeking ways ro fronts in northern Chad, line on January 2. In response to settle the contlict vvith Great the Libyan raid 'on the town of Britain through negotialion. As a These recent changes also Arada, the French government member of the Lima iiroiip. suggest advancement in Chad's said it would take "appropriate Alfonsin's administration sup• national reconciliation process. In measures," which might be "a ports Contadoran .erforts u< early 1985, about .3,000 guerrilla limited retaliation." On January 7, mediate between cop.niciir^;! soldiers in southern Chad joined French air force jets knocked out parties in Central America ;nu! Chad's government forces; then, Libyan radar installations at realize peace in the region. several influential rebel organiz• Ouadi Doum air base, north of Guided by the principle \h,drtional and independent foreign policy plans are now being friendly ties with the Lniied implemented. States. However, the developnicni of foreign relations between Argentina and the Soviet Union m uring the last year, Argentina potentially lays a foundation for 1986 prompted US Secretary of improved its foreign relations establishing a Latin American D State George Shultz to comment with other countries by strength• common market. that every country should aci \\!ih ening traditional ties with its Along with its efforts to realize caution when dealing with the neighbours, and by looking for Latin American integration, the Soviet Union. ways to make contact with Argentine government has been countries that either have different knocking at the doors of those In July last year. Argentina and social systems or are on different countries which had little to do the Soviet Union s'gned an economic development levels from with it in the past. In July 1986, agreement by which Soviet fishing its own. The guiding principles of Argentina's President Raul Alfon- boats would be allowed to operate Argentina's foreign policy are now sin made a goodwill tour of six in Argentina's economic zone in diversification and independence. countries in Asia, Africa, Europe the South Atlantic. In response n. Since restoring constitutional and Oceania. As an active member this move the British government rule at home, Argentina has made of the non-aligned movement unilaterally announced a i 50-niilc its relations with other Latin (NAM) in Latin America, Argent• (240 kilometers) fishmg limit American countries a top foreign' ina sent a delegation last around the dispuied Malvinas policy priority. In July and September headed by President (Falkland Islands). December of last year, the Alfonsin to the NAM summit in President Alfonsin slated la.st presidents of Argentina, Brazil Harare, Zimbabwe. In October, October that instead of seekntg to and Uruguay met in Buenos Aires President Alfonsin went to the position itself between world and Brasilia to discuss possible Soviet Union and Cuba, being the power centers, his govern mem agreements aimed at promoting first of Argentina's presidents ever should carry out a foreign policy Latin American integration. As a to visit the two socialist countries. in favour of Argentina's economic result of the meetings, Argentina Supported by much of the development. and Brazil signed an accord which international community, Argent• by Ju Qingdong

14 BEUlNCi Rt:,Vi;:.\V. \(). 3 • DOCUMENTS IliillB III MMMMMM— Resolutely Combating Bourgeois Liberalization Renmin Ribao Editorial he student demonstrations that spreading these ideas to confront brought grave disasters to our Thit some Chinese cities recently the four cardinal principles, and Party and people. But these have subsided. In China today, that some people within the comrades turn a blind eye to ihcre exists no ideological or Communist Party had failed to bourgeois liberalization. Now it is material basis for great turmoil. realize the dangers and had even time for them to sober up. The line, guiding principles and given direct or indirect support to Bourgeois liberalization is really a policies of the Party and govern• these ideas. In 1981, in his tendency which poisons our ment are correct and enjoy the Concerning Problems on the youth, is harmful to socialist support of the public. The Party Ideological Front, Comrade Deng stabihty and unity, disrupts our Central Committee is united. Xiaoping criticized ideological reform and open policy, and The Chinese people long for si)cial weakness, saying that "these impedes the progress of our stability and the "four moderniz• people want to abandon the road modernization drive. How can we ations" and dislike turmoil. The of socialism, break away from ignore it? 10-year "cultural revolution," Party leadership and promote To oppose bourgeois liberaliz• which caused so much turmoil in bourgeois liberalization." In the ation with a clear stand does not the country, took place because it last few years, we have done much contradict our adherence to was erroneously launched by the work in the ideological field and reform and the open policy. leadership and made use of by achieved some success. But we Instead, it is an indispensable counter-re\v cliques. failed to be clear-cut in our condition for continuing our Nov\e situation is different. opposition to bourgeois liberaliz• reform and the open policy. If the There exists no basis for the ation. This created conditions for tendency to bourgeois liberaliz• recurrence of great turmoil in the its growth and dissemination. ation is allowed to spread country. This estimate is doubtless There is a serious lesson for us. unchecked, our reform and open correct. What is bourgeois liberaliz• policy will definitely be distorted There is nothing terrifying ation? The Resolution on the and even suffer serious setbacks. about students taking to the street. Guiding Principles for Building a Just as our New Year Message So far as its nature is concerned, Socialist Society With an Advan• said: 'Adherence to the four however, it is a serious matter. It is ced Culture and Ideology adopted cardinal principles is the basic the inevitable outcome of the at the Sixth Plenary Session of the guarantee for making the reform weakness of some comrades in 12th Party Central Committee and open policy a success," and fighting the spread of bourgeois clearly states that bourgeois "to adhere to the four cardinal liberalization over the last few- liberalization is an idea negating principles, we should resolutely years. It is a good thing in that it the socialist system in favour of oppose bourgeois liberalization. " confirms the need to abide by the capitalism. The resolution also In combating bourgeois libe• four cardinal principles and fight asserts that it is totally against the ralization we should have a clear against bourgeois liberalization. people's interests and the histor• stand and be resolute, and the (The four cardinal principles are ical trend, and is therefore firmly methods should not be simplistic. adherence to the socialist road, the opposed by the masses. To solve the problem correctly, it people's democratic dictatorship, Today, there are a few people is important to strengthen the the leadership of the Communist who advocate bourgeois liberaliz• Party's leadership over ideology, Party, and Marxism-Leninism ation and propose to shift all the theory, literature and art, and and Mao Zedong thought. —Ed.) capitalist baggage to China. When education. Party committees at all In 1979, at a meeting on the we talk about economic structural levels should attach great im• Party's theoretical work. Com• reform, they want to take the portance to the question and put it rade Deng Xiaoping proposed capitalist road; and when we talk on their agenda. Among those in adhering to the four cardinal about political structural reform, our ideological and theoretical principles. While calling for they want to copy capitalist contingent's there should be a continued criticism of the ultra- practices. In fact, they intend to unified understanding of the Party left ideas spread by Lin Biao and lead China's current policies in the Central Committee's guidelines the gang of four, Deng em• direction of capitalism. and policies. Only in this way can phasized the importance of Some of our comrades detest we correctly guide our youth, criticizing the right-deviationist "left" thinking. They have sharp secure lasting political stability ideas which have doubts about e\es to see through it and dare to and unity, and expedite the and oppose the four cardinal fight it resolutely. This is progress of our socialist moderniz• principles. He pointed out then understandable and should be ation drive. that a handful of people were appreciated, since "left" mistakes (January 6, 1987)

.lANU.A.RY 1987 •1 ARTICLES 'Complete Westernization' Negates Socialism by Renmin Ribao Commentator

s China entered the latter half the attempt to build a bourgeois outside world and "complete Aof the 1980s its people, under republic in China and proved that Westernization" are two different the leadership of the Communist China could only take the socialist things. The Resolution of the Party of China, made universally road. Central Committee of the acknowledged achievements in The second stage is the 37 years Communist Party of China on the their efforts to turn China into a since the founding of the People's Guiding Principles for Building a modern socialist country. Yet at Republic. In this stage, our road Socialist Society With an Advan• such a time some people went so has been by no means smooth. But ced Culture arid Ideology says: far as once again to raise the nobody can deny the fact that Opening to the outside world is an slogan "complete Westerniz• China's prosperity and social unwavering state policy. We ation." stabiHty, the development of its should master the advanced What is "complete Westerniz• national economy, the improve• science and technology of other ation?" In the words of its ment in the quality of life of the i countries, including those of the advocate^ it "includes learning billion Chinese people, and the developed capitalist countries. We from Western science, technology, enhancement of China's intern• should adopt, test and develop culture, politics, ideology, ethics ational standing have all been their economic and administrative and all other things," and "it achieved under the socialist management expertise where it is involves our political structure system and the leadership of the applicable to China and learn and ownership system. All these Communist Party of China. from what is good in their questions can be considered." He Now that the socialist system cultures. But we should discard, explains himself by claiming that has struck its roots deep in the says the resolution, the capitalist "In terms of the socialist system land of China, proposing "com• ideology and social system which what we have done over the past plete Westernization" will lead safeguard exploitation and op• three decades is a failure." astray those young people who do pression as well as all its evil and These words send us a clear not know the history of modern corrupt aspects. "Complete Wes• signal: This "complete Westerniz• China. No Chinese who respects ternization" runs counter to this ation" simply means negating history and facts and cherishes basic principle of China's open totally the socialist system and national pride will agree with the policy. Criticizing it, therefore, practising capitalism in China propositions of "complete will only help the correct lock, stock and barrel. Does one Westernization." implementation of the open policy. want to know what bourgeois It is true that our Party has liberalization is? Here is a typical made mistakes during the socialist What road should China take? exam.ple. period. But this does not help the "Complete Westernization," i.e. The socialist road chosen by the proponents of "complete Wester• the capitalist road, or the road of Chinese people has undergone the nization." It is known to all that it socialism with Chinese character• test of two historical stages and is our Party which corrected its istics? The overwhelming majority has proved to be the only correct own mistakes and, after having of the Chinese people prefer the choice. In the former historical learnt its lessons, decided to latter and have no doubt about it. stage, or the period of democratic conduct reform and open the The 10-year turmoil of "cultural revolution before Marxist socialist country to the world. That it has revolution" when the gang of four theory was introduced into China, done so successfully has been held sway, has not shaken the there were indeed many people acknowledged the world over. All confidence of our Party members with lofty ideals who had tried to this testifies to the truth of the and the m.asses in the Party and seek the truth for China's statement that the socialist system socialism. The experience of the salvation from the Western conforms with the reality of China eight years since the Third Ses• capitalist world. But they never and is full of vitality. "Complete sion of the 11th Party Central succeeded and always ended up in Westernization," therefore, Committee has shown with ever failure. Comrade Mao Zedong means turning back the wheel of greater clarity the superiority of gave a vivid description of this history. the socialist system. The Party and historical period in his article On Some people worry that criticiz• entire Chinese people are confi• the People's Democratic Dictator• ing "complete Westernization" dent in the future of our socialist ship. The victory of the new will have an adverse impact on the country. We completely reject the democratic revolution led by the implementation of China's open theory of "complete Communist Party of China in policy. We think this will not be Westernization." • 1949, in fact, marked the defeat of the case, because opening to the (January 12. 19H7 j

16 BEIJING REVIEW, NO. 3 Significant Advances for the Open Policy

Gu Mu, state councillor and head of the Foreign Funds Management Group under the State Council; speaks to our correspondent Zhang Zeyu.

Question: Can you provide us For a period of time, some with an overview of tlie progress foreign newspapers were saying of Cfiina's open policy and tfie that special economic zones were influx of foreign investment? failing. This was of course Answer: In the end of 1978, China groundless. We have greater devised its open policy and began confidence than before in the to invite foreign investment in development . prospects of 1980. In the years since, China's Shenzhen. open areas have spread from Coastal open cities. Since the special economic zones to the spring of 1984, 14 coastal cities open coastal cities, from the have implemented the open policy economic development areas in and succeeded in bringing in east China to the hinterland in the foreign investment and advanced .west. technology. By the end of October Special economic zones. The last year, direct foreign investment development there is fast on the used in China (not counting loans) whole. Look at Shenzhen. Its totalled US$5.9 billion; and 7,300 annual industrial output value has foreign-funded enterprises were reached more than 3 billion yuan, decided upon. One-third have but six or seven years ago it was Gu Mu. MA JUNTIAN begun operations and 80 percent only a small town and the output of them are in the coastal areas. then was only 50-60 million yuan. remarkable achievements in its The economic results are good This sort of growth is very rare, efforts to boost productivity and and foreign exchange balances out and has been described as increase exports. That same year, in the foreign-funded enterprises "explosive." Shenzhen's industrial output ex• in the coastal cities, especially ceeded 3.4 billion yuan, up 27 In 1985, while affirming Dalian, Guangzhou, Qingdao, percent over 1985; It is gratifying Shenzhen's achievements, we also Shanghai and Tianjin. The to see that the proportion of its pointed out that it must not solely average profit rate on the foreign industrial production which went pursue speed and capital construc• investment in the 64 foreign- to exports rose from 32 percent in tion. We also stressed that funded enterprises in Tianjin 1985 to 45 percent last year. Direct Shenzhen should make sure that reached 19 percent; the profit rate foreign investment reached more of its products enter the of the industrial enterprises alone US$360 million, doubling that of _ international markets and more was 24 percent. up-to-date technologies are im• 1985. ported. It should also push In the spring of 1986, Shenzhen Shanghai has more than 50 forward economic structural re• cut a number of construction foreign-funded enterprises which form and set an example and teams. While the country tigh• have begun operations. Over 40 of precedent. tened its control on economic them have achieved a basic foreign Following this guideline, the activities and enterprises' purchas• exchange balance. The rest have four special economic zones have ing power, and cracked down on taken to buying from the domesfic since 1985 straightened things out profiteering, speculation, in market instead of importing from in every field of work, concentrat• Shenzhen reduced, but so did abroad, thus helping their foreign ing their efforts on production, sales, so some foreign newspapers exchange balance. quality, efficiency and developing asserted that "Shenzhen's market The technical level of foreign- an outward-oriented economy. In was in a slump." In fact, this was a funded projects is as yet not very 1986, Shenzhen cancelled more normal stage in a developing advanced. But we have imported than 70 construction projects economy. Since May, Shenzhen's some projects which are up to the which yielded poor economic sales volume has risen again. It is level of the late 1970s or early results, were technically unso• estimated that the retail sales 1980s, and we are prepared to phisticated or were not urgently volume in 1986 was 2.65 billion import more. On the whole, needed. Meanwhile, it scored yuan, a little more than in 1985. China's technical ability falls some

JANUARY 19. 1987 17 m ARTICLES

20-30 years behind the advanced updating a number of key southern Fujian Province were international level. In order to enterprises, Tianjin has been able declared economic development accelerate the four moderniz• to get about one hundred quality areas. In the last two years. thc\ ations, we not only must depend products into the international have had great successes in on ourselves to research and market. After the improvement, exporting their products. Accord• spread new techniques, but have the proportion of export from the ing to latest statistics, more than lo introduce advanced, useful Nantong textile industry is now 65 300 larger farm and side-line technologies from abroad. percent of the city's production. production bases ha\ been According to preliminary stat• Economic development areas. established there. In 1985. the istics, the 14 coastal open cities In early 1985, the Changjiang number of product-types offered have brought in more than 4,000 River and Zhujiang River deltas for export by these bases increased technically advanced projects. By and the triangular area in by 20 percent in 1985 over 1984 and the first half of 1986 saw an increase of 40 percent over the At the radio cassette player assembly line of the Sanyo Electrical Machinery Co. Ltd. corresponding period of 1985 YANG SHAOMING Hinterland. The polic> ui opening the coastal areas accele• rates the economic development in the hinterland which in turn is able to open wider to the outside world. We can back the coast witli ihe vast, rich hinterland. .As ihc coastal areas raise their technical level through importing, learning from and assimilating adsanced foreign technologies, they are now in a better position to spread ihcir improved technique to the hm- terland. The open policy is Cliin.as basic stale policy, and has to be implemented by the coastal itreas as well as by the hinterland. The only difference lies in which lev el is to impiemeni this policv'.

•In recent years, \no•^[ of the inland provinces and aiiiC'!ioiiii.iUs regions have succeeded m 'nrniging in foreign funds. 7hc_\, on the basis of iheir local coiidilit)ns and external possibilities, cont• inue to open to the outside world in a down-to-earth inanncr. Processing the local rav\s on the spot is more profitable than transporting them to the co;isial areas for processing. All foreign businessmen who are interested in investing in tins type of enterprises in the hinterland are welcomed and, with approval from the Chinese government, will also enjoy preferential treatment.

Q: What is the relationship between the open policy and building an advanced socialist culture? A: We have said that opening the

fJElJINCi RLVII \V. NO. 3 Q: Foreign businessmen have complained about the invest• ment climate in China. Why? A: In the first half of 1986. although China absorbed more direct foreign investment than in the same period in 1985, the number of enterprises contracted was fewer than at the same time in 1985. And foreign businessmen have complained about the investment climate. In my opinion, the main problems are as follows: First, problems do exist in the investment climate in China. Although airports, telecommunic• ations and other infrastructures have been somewhat improved in the past few years, they require further work. As a matter of fact, foreign businessmen generally show an understanding of stich problems. What they complained about most is oiir poor manage• ment, inefficiency, bureaucracy and decision-making problems. Second, there are many defects in China's management system. Foreign traders complain they need dozens of seals for one contract. There are many depart• ments responsible for their enterprises, and no one can solve their problems. This hampers foreign investment, and the domestic economy as well. It is time that something was done. Third, the Chinese legal system LIU SHILIN This assembly room In the Chongqing Engine Plant and Chongqing Oil Pump, fails us. Since 1979, we have done a equipped with American advanced technology produced 1,948 diesel engines last lot of work on foreign economic year. legislation. The Standing Com• mittee of the National People's Congress and the State Council cioor will bring in fresh air. but of there. have promulgated more than 50 course, flies and mosquitoes vvi!l In special economic zones laws and regulations concerning also fly in. The influence of people show a stronger sense of foreign economic relations which, decadent bourgeois ideas must be enterprise and pay more attention the foreign businessmen agree, are taken seriously. In the special to punctuality, efficiency and clear, although in need of further economic zones where socialism economic performance: and improvement. CNists side by side with capitalist young people are studying tech• practices, it is all the more nology and foreign languages in But such phenomena as not necessary for them to adhere to the their spare time. Criminality is no following the law or regarding four cardinal principles -- more widespread there than in the one's words as the law has adherence to the Party leadership, hinterland. So long as they stand prevailed in some places. .Also socialist road. Marxism. Leninism on guard and strengthen manage• some departments charge foreign- and Mao Zedong Thought and the ment, they can reject capitalist funded enterprses at random. democratic people's dictatorship. filths and assimilate the best from Such phenomena seriously tarnish The\d strengthen building the outside world and develop it in China's reputation and must be an advanced socialist culture practice. checked.

,i WtiARY 19. 1987 19 m ARTICLES

There are two basic reasons for text, see "Beijing Review" Vol. "22-article-regulations" explicitly these problems: Firstly, we do not 29, No. 43) say that foreign-funded enterpr• know enough about the outside A: This document, worked out ises' production plans be included world; specifically the basics of on the basis of an i.nitial summary in China's state plan, and that the international economic relations, of our experience in the utilization supply of water, electricity, raw and foreign investment. Neither of foreign funds in the last few materials and telecommunications do we properly comprehend years and in reference to some services should be charged for at China's policies, nor the psy• foreign methods, is in many the same rate as that local state- chology of foreign businessmen. respects more advanced than some owned enterprises pay. The Regarding the work of opening to of our previous regulations. document stipulates clearly that preferential terms for foreign- the outside world. Deng Xiaoping First, it stipulates in more funded enterprises include re• has said, "'On the whole, we lack explicit terms that foreign-funded duced labour service charges, knowledge. No knowledge, no enterprises have full autonomy in reduced charges for land use, ability. No ability, no courage. It production and management. reduction or exemptions in is impossible to quicken develop• This means that foreign-funded enterprise income tax and in tax ment if these problems are not enterprises may, within the on the remittance of profits. We solved." framework allowed by China's shall help foreign-funded enterpr• Secondly, we do not really law and in accordance with the ises keep their foreign exchange realize the significance of the long- contracts signed, independently balance in order. Through com• term basic state policy of opening plan their production, raise and prehensive compensation, allow• to the world. Many people have no use funds, purchase raw materials, ing foreign currency exchanges sense of urgency, and do not market their products and employ between enterprises, and mort• realize China now has a good or dismiss employees. Also, they gage loans in foreign exhange. opportunity to attract foreign may manage their enterprises by Products of technically advanced investment and introduce advan• adopting advanced international enterprises may be partly sold in ced technology. So instructing methods without being restricted some Chinese markets and import managers on current policies by China's current economic substitution may be introduced. becomes a pressing need. structure. The state will subsidize part of Q: How has the situation Second, it guarantees that their foreign exchange. changed since October 11,1986 foreign-funded enterprises, especi• when the State Council issued ally the export-oriented and Third, the regulations call for its Regulations on Encouraging technically advanced enterprises, raising work efficiency. The usual of Foreign Investment? (for full can profit from their work. The methods at present are regular joint work conferences held under the personal guidance of gover• China's first LliiVISV type screen printing machine co-produced by Zhengzhou Textile nors, deputy governors, mayors IVIachinery Plant and a Swiss company. and deputy mayors and with the participation of the departments concerned, to discuss and deal with matters concerning foreign- funded enterprises, and make decisions on the spot. Tianjin, Shanghai, Guangzhou and Fuz- hou have applied this method and seen good results. In cities where foreign-funded enterprises are concentrated, a service company and a unified authoritative organization may be set up to handle foreign investment affairs. The regulations have been welcomed by foreign business• men. They have said the decision demonstrates the confidence of the Chinese government, and is an advance in China's open foreign policy. But they have also siad they still have to wait and see

20 BEIJING REVIEW. NO. whether these regulations can be China will be short of foreign products are all sold on the fully implemented. We have currency. We depend wholly on Chinese market, and this is bound decided that they should be in use exports to seek an import-export to increase China's difficulties in by the end of the first quarter of balance. China is rich in natural balancing out its foreign exchange 1987. resources and has a large potential account. Technically advanced Q: Why do you only provide the market. Its economy is rapidly enterprises will help improve export-oriented and advanced- developing. However, exports and China's technology. technology enterprises with foreign currency income are This explains why we place special treatment? limited. Foreign-funded enterpr• more stress on export-oriented A: China is a developing socialist ises also need foreign currency, and advanced technology country. For a long time to come, they cannot earn this if their enterprises. •

FACTS AND FIGURES Development of Economic Sectors

(1980-85)

by the State Statistical Bureau n the last eight years, in ing under the contract responsi• Rural collective enterprises. I particular during the Sixth bility system) is predominant, These businesses are developing at Five-Year Plan period (1981-85), taking up 97 percent of China's a particularly fast rate. the Chinese government made farmland, agricultural output The development of enterprises efforts to promote the collective value and output of major farm has enabled industry, building and and private economies and to and sideline products. The state commerce to employ local farmers develop Sino-foreign joint ven• makes up 3 percent. who have quit farming work, and tures. This has allowed a healthy By the end of 1985, 0.3 percent diversified the rural economy. In economic pattern to develop of the farming households had 1985, of the rural enterprise where various sectors made formed various kinds of integrated workers (11.2 percent of rural progress with the state sector in economic units (490,000 in labourers), 67 percent were the lead (see Table I). Since 1980 number). They employ 4.2 million engaged in industry, 19 percent in both urban collective and private people or 1.13 percent of the rural building, 6.1 percent in farming enterprises have grown. labour force; over 70 percent of and sideline production, 2.8 Agriculture; Collective agricul• them work in industry and percent in transport and 5.1 ture (including households farm• construction (see Table II). percent in other trades. The

Table I. Numbers of People Working in Different Economic Sectors

Number (0,000) Increase (%) Proportions (%)

1980 1985 Jan-June 1986 1985 over Jan-June 1986 1980 1985 Jan-June 1986 1980 over 1980

Urban factory workers 10,525 12,808 12,853 21.7 22.1 100.0 100.0 100.0 Workers in state- owned factories 8,019 8,990 9,033 12.1 12.6 76.2 70.2 70.3 Workers in coll• ectively owned factories 2,425 3,324 3,326 37.1 37.2 23.0 26.0 25.9 Workers in jointly owned factories 44 47 — — 0.3 0.4 Individual labourers 81 450 447 460 450 0.8 3.5 3.4

JANUARY 19, 1987 21 m ARTICLES

Table it. Growth of Rural Enterprises

1980 1985 Increase from 1980 to 1985 (%)

Number of rural enterprises (0,000) 142.3 156.9 10.3 Number of township enterprises 33.8 42.0 24.3 Number of workers (0,000) 2,999.7 4,152.1 38.4 Number of workers of township enterprises 1.393.8 111.4 51.5 Total income (00 million yuan) 596.1 1,827.4 210 Income of township enterprises 332.2 1,039.1 210 Tax paid to the state (00 million yuan) 26 109 320 Net profit (00 million yuan) 118 171 44.9

* Township enterprises include only those run by township government while rural enterprises also include village-run enterprises.

Table III. Relative Growth of Industry in Various Sectors

Numbers (0.000) 1980-85 Proportions (%) 1980 1985 increase (%) 1980 1985

Total number of industrial workers 6,626 8,349 26 100.0 100.0 Number of workers in state-owned industries 3,246 3,815 17.5 49.0 45.7 Number of workers in urban collective industries 1,428 1,705 19.4 21.5 20.4 Number of workers in urban private industries 10 51 410 0.2 0.6 Number of workers in other urban industries — 37 — — 0.5 Number of workers in rural collective industries 1,942 2,741 43.3 29.3 32.8 Total output value of industry 4,992 8,295 66.7 100.0 100.0 ( 00 million yuan) Output value of state-owned industries 3,928 5,840 47.7 78.7 70.4 Output value of collective industries 1,034 2,301 130 20.7 27.7 Output value of township industries 281 742 150 5.6 8.9 Output value of private industries 1 34 40.7 0.1 0.4 Output value of the others 29 120 390 0.6 1.5

Note: Total output value of industry for 1980 was based on the constant prices of 1970 and total output value of industry for 1985 on the constant prices of 1980. Indexes are based on comparable prices.

Table IV. Different Commercial Sectors

Number ( 0,000) 1980-85 Proportions (%) 1980 1985 Increase ("/< ) 1980 1985

Number of people engaged in social retail. catering and service trades 926.8 2,526.3 173 100.0 100.0 State-owned 312.7 401.4 28.4 33.7 15.9 collectives 523.7 894.3 70.8 56.5 35.4 Jointly owned 0.7 8.8 12.5-fold 0.1 0.3 Individually owned 89.7 1,221.8 13.6-fold 9.7 48.4 Total commodity retail sales volume (00 million yuan) 2,140.0 4,305.0 100 100.0 100.0 State-owned 1,100.7 1,740.0 58.1 51.4 44.6 Collectively owned 954.9 1,600.3 67.6 44.7 37.2 Jointly owned 0.4 12,7 31.8-fold — 0.3 Privately owned 15.0 • 661,0 44-fold 0.7 15.3 Farmers trading to non-agricultural people 69.0 291.0 320 3.2 6.8

BEIJING REVIEW. NO. 3 development of rural enterprises private commerce has far out• Circulation of commodities be• has provided a significant source paced state commerce. The people tween cities and rural areas was of farmers' income, and ac• engaged in collective and private improved. Many of the fairs have cumulated funds for the state and commerce out-numbered those in grown in size too. For example, the collective. In 1985 the rural commerce owned by the state for there were over 500 fairs, each enterprises netted 30.5 percent of the first time since 1956, the year involving over 10,000 people in the lolai rural income (as against the socialist transformation was Shandong Province in 1985. Close 24.2 percent in 1980) andcompleted , (see Table IV). to 20 fairs involved over 50,000 CiMiiribuied 69.4 percent of rural people each. This has not been Collective and individually tax payment to the state (as seen for the last 20 years or so. owned commerce accounted for against 48.4 percent in 1980). 70.4 percent of the added sales Transport. The state has always Industry. The state-owned en• volume in the last five years and dominated China's communic• terprises lead China's industry. 94.5 percent of the increase in the ation and transport. However, the But the 1980-85 period saw rapid number of people involved in this collective and the individual development of ihe collective and service sector. In 1985 the number transport has been stepping in pn\ate sectors (see Table III). of retail stores, restaurants and recently (see Table V). The collectively owned in• other service outlets per Construction. Rural construc• dustrial enterprises in that table 10,000 people increased to 102.6 in tion teams have become vitally include only the township 1985 from 20.6 in 1980, while the important. In 1985 the number of industries and not the village-run number of people involved in people they involved, whether ones. If the village-run industries these trades per 10,000 people rose owned by collectives or indiv• are counted in, the industrial to 242.9 persons in 1985 from 94.5 • iduals, was 11,301 million, four output value generated by collec• in 1980. times more than in 1980. The tives is up from 28 percent in 1980 Trade fairs in cities and rural proportion of the rural builders in to 35 percent in 1985. During this areas developed too. From 1980 to the country rose from 25.4 percent period, the state began to allow 1985 the number of such fairs in 1980 to 54.6 percent in 1985. sonic small state industrial increased fiom 41.000 to 61,000. a During this period, the proportion enterprises to be managed by 48.8 percent increase. Business of urban collective builders fell collectives or contracted out to a volume increased 200 percent from 19.4 percent to 17.1 percent, group of workers or individuals. from 23.5 billion yuan in 1980 to and the proporfion of builders in Commerce. Collective and 70.5 billion yuan in 1985. urban state-owned construction

Tabic V. Transport and the Various Sectors

NuiTiber (0,000) 1980-85 Proportion ^ 1",, 1 1980 1985 increase (%) 1980 1985

I'coplc engaged ii; IransporlaUon 847 1.222 44.3 100.0 100,0 In slale-owned eiuerpri.ses 479 555 15.8 56.6 45.4 In urban collecUvc cnleipriscs 216 210 -2.8 25.5 17.2 in uilian individual enlerpriscs 1 22 22-fold 0.1 1.8

In otliev eeonomic units - 1 — — — In rural collective and private enter• prises 151 434 2.9-fold 17.8 35,6 tjiHids iransported i (X) million tons per kilometre)* 11,517 16,671 44.7 100.0 100,0 By collectively owiied enterprises 11,263 16.174 43.6 97.8 97.0 By collectively owned enterprises 253 492 94.5 2.2 3,0 By iitheis 1 5 5-fold — — Highways. 255 354 38.8 100,0 100,0 By siaie ouncd enterprises 200 228 14.0 78.4 64.4 By colleclively owned enterprises 55 121 2.2-fold 21,6 34.2 B\s — 5 — — 1.4 Rivers: 5.053 7.584 50.1 100,0 100.0 By stale owned enterprises 4,854 7.213 48.6 96,1 95.1 By collectively owned enterprises 198 371 87.4 3,9 4.9 B;. others

* This includes the goods transported by professional transport enterprises only.

23 •1 ARTICLES

teams fell from 55.2 percent to 28 and private was 52 percent in 1980 jobs throughout. This has implied percent, while the proportion of to 55 percent in 1985. a better life for people and urban individual builders rose The development of the mixed enlivened business competition. from 0.03 percent to 0.3 percent. economy has boosted commodity Given the low productivity in In the total output value of the production both in cities and rural China at present, a mi.xed building industry, state sector areas, accelerated commodity economy can be very beneficial accounted for 48 percent in 1980 circulation between cities and and will continue to develop. and 45 percent in 1985, collective rural areas and provided more

Disarmament: New Aspects of An Old Issue Since entering the 1980s, the world has seen many dynamic changes in the realms of international politics and economics as well as in the military and technological fields. A notable example has been the shifts in the strategies of the two superpowers — the United States and the Soviet Union. These changes have combined to lend to the international struggle centring around disarmament a number of new features which should not he overlooked. by Huang Tingwei and Song Baoxian

irst ol" all, the United States arsenals obsolete, substantial so, the two superpowers have held F and the Soviet Union have arms cuts are now not only talks separately on atomic energy escalated their arms race into a necessary but possible. It is against control, a ban on nuclear testing, new phase marked by their efforts this background that the US- non-proliferation of nuclear to improve their weapons systems Soviet arms control talks have weapons, and strategic weapons qualitatively rather than quantita• gained fresh momentum since the control. What they are engaged in tively. They have not only beginning of last year. now is a sweeping deal that extended their military compe• The year 1986 witnessed involves the whole gamut of arms tition from earth to OLiter space, Moscow and Washington putting control issues — space weapons, but they also have shifted their forward a series of disarmament offensive strategic weapons, emphasis from developing offen• proposals and counterproposals medium-range missiles, nuclear sive weapons systems to the and trying to narrow their testing and conventional arms. development of new systems with differences to varying degrees in Moscow emphatically stresses the both offensive and defensive almost all categories of the arms close link between negotiations on capabilities. They have switched control issue. Compared with the space weapons and other types of from producing just nuclear first half of the 1980s, they arms. weapons to manufacturing both apparently quickened the tempo Another feature of the US- nuclear and laser space weapons. of their negotiations in 1986. An Soviet arms reduction talks is that They no longer seek merely to illustration of this change was both sides are trying to reach a improve the accuracy of multiple provided by the Iceland summit, low-level balance in their military warheads but instead are aiming during which both sides advanced hardware, instead of seeking only at enhancing the penetration and what President Ronald Reagan to freeze or to set a ceiling to their surviability of these warheads. called "the most sweeping and arsenals as they did in the past. In These new developments, which generous arms control proposals the 1970s, Washington and obviously have oulreachcd the in history." The much- Moscow signed two strategic arms arms control pacts or agreements vaunted summit, however, ended limitation treaties (SALT 1 and signed by Washington and in a deadlock in the final stage SALT II) as well as the anti- Moscow in the 1970s, have precisely because both sides ballistic missiles limitation pact prompted both supcrpov/ers, the refused to make substantive (ABM). SALT I and SALT II Soviet Union in particular, to seek concessions on space weapons. treaties place a ceiling on the to establish new rules for The present US-Sovict arms number of offensive strategic competition in new areas, rules control talks involve all major weapons each side could possess, that each side hopes would be areas of disarmament, a change while the ABM accord restricts restrictive only to the other. from the previous practice of them to the deployment of only Because these new developments concentrating on a single one ABM system in their territory. have rapidly made parts of their category. In the past 40 years or Since 1985, however, both sides

24 BEIJING REVIEW, NO. ^ have come up with many balance to tip in favour of the missiles, a problem vital to West proposals and counterproposals United States. European security interests, they calling for substantial slashes in call for a balanced reduction by strategic offensive weapons, With these successes, the the two superpowers but will not intermediate-range missiles and Reagan administration seems to accept the "zero option." They conventional arms. have followed a hard-line policy fear this would disjoint European towards Moscow. It wants to and US defenses, upset the It appears that the Soviets are upset the Soviet strategy of existing US-Soviet balance and eager to reach an across-the-board "stepping up development" by expose Western Europe to the agreement on arms control with unfolding a new round in the arms the United States. This, perhaps, threat of the superior Soviet race. It hopes to widen the can be seen from the haste with conventional forces and short- which they put forward one technological and economic dif• range missiles. Furthermore, they proposal after another during the ferences between the United States refuse to be a bargaining chip in past year or so and from the and Soviet Union by energetically the US-Soviet arms control deals flexible tactics they employed. pushing its plan of a "second and stress that all countries, big or This change in the Soviet attitude American revolution," the small, have an equal voice in stems from the major readjust• centerpiece of which is the disarmament negotiations. They ments they have made in their development of high technology. want to increase their own defence strategies. It is hoped this will keep the capabilities while the British and Soviets from posing a serious French continue building up their As is known to all, the Soviet challenge to the US as it increases nuclear deterrent. Union under Leonid Brezhnev put its economic and military strength much emphasis on expanding its in the next century. Washington The third world countries are arms while neglecting technolog• also hopes to get some military equally active in the international ical and economic development. edge over Moscow by implement• struggle for disarmament. They This Gorbachev deems as a ing the SDI programme. It will have put forward a series of serious strategic mistake, 'and, permit the SDI to be included in influential proposals in the United therefore, after taking office in the the negotiating items but will Nations, the Geneva arms control Kremlin, he formulated a long- reject any agreement that would negotiations and the non-aligned term strategy to deal with the impede its implementation. nations" conferences. They stand United States. Aiming at the 21st for complete disarmament. They century, the new strategy calls for Overall, Western Europe and want nuclear disarmament under accelerating economic develop• the third world are playing an in• an effective international supervi• ment and increasing the nation's creased role in the international sion and oppose all nuclear testing comprehensive capability through struggle for disarmament. With and the militarization of outer a technological revolution. It their strategies adjusted, the space. They demand that the requires that Moscow try by United States and the Soviet United States and the Soviet all means to scuttle Reagan's Union have given the West Euro• Union, as possessors of the strategic defense initiative (SDI), peans larger room to manoeuvre world's largest arsenals, take the lest Washington would get between Washington and Mos• lead in disarming and commit military superiority and further cow. The Soviets need to enlist themselves to a ban on using, or broaden the existing gap between West European help to soften the threat to use, nuclear arms against the two countries in economic and tough US stand on disarmament, non-nuclear areas. They are technological development. The .while the Americans need to con• striving for the establishment of strategy also seeks to slow down sult and co-ordinate actions with "nuclear-free zones" and "peace the- superpower arms race and Western Europe to force Moscow zones." All these third world maintain a rough balance at a low into making major concessions. efforts have contributed much to level. Making use of this advantageous the easing of international ten• sions and to the unfolding of a On the part of the United States, position, the West European worldwide campaign against the since he stepped into the White nations are actively urging the two superpower arms race. House in 1980, President Reagan superpowers to hold talks in has concentrated his attention and earnest. They hope Washington Under pressure from the efforts on rebuilding the American and Moscow can reach an agree• international arena, the United economy and military strength. ment on balanced reduction of States and the Soviet Union seem After several years of painstaking both nuclear and conventional to have stepped up their arms work, he has succeeded in forces in Europe and maintain a control negotiations. But by all achieving a faster economic low-level balance so as to ensure appearances, the negotiations will growth and, more importantly, the security of their region. be a long, hard deal at the causing the superpower military On the issue of medium-range bargaining table. •

JANUARY 19, 1987 25 DOCUMENTS

Foreign Firms: New Autonomy in Hiring

The following "Provisions on the Right of Autonomy of Enterprises With Foreign Investment in the Hiring of Personneiand on Wages, Insurance and Welfare Expenses of Staff and Workers" have been issued by the Ministry of Labour and Personnel with the agreement of the Leading Group in Charge of Foreign Itivestment under the State Council.

he following provisions are (b) With respect to engineering different penalties including being T hereby formulated in order to and technical personnel, oper• dismissed. implement the Provisions of the ation and management personnel (2) On the wages, insurance and State Council Regarding the En• and technical workers whom welfare expenses of staff and couragement of Foreign Invest• enterprises with foreign invest• workers. ment (please see Beijing Review ment have decided to hire after (a) The wages of staff and issue No. 43, 1986), guarantee the examination, the original units workers in an enterprise with right of autonomy of enterprises employing them shall actively give foreign investment will be deter• with foreign investment in the their support and permit their mined by the board of directors. hiring of personnel, and to transfer. In the event 6f any They shall be no less than 120 appropriately determine the dispute, the department of labour percent of the average wages in wages, insurance and welfare and personnel in their locality state-owned enterprises with expenses for staff and workers shall adjudicate. similar conditions, of the same from the Chinese party: trade and in the same locality; the (c) Senior management person• wages will be adjusted gradually (1) On the right of autonomy of nel designated by the Chinese according to the economic enterprises with foreign invest• party to work in enterprises with performance of the enterprise. ment in the hiring of personnel. foreign investment should be Enterprises with good economic (a) An enterprise with foreign persons who are capable of performance may give bigger wage investment may. in accordance grasping the policies, knowledge• raises; those doing badly may give with its production and operation able about technology, know how smaller raises or none at all. requirements, determine on its to manage, bold in development (b) An enterprise with foreign own the organizational structure and who can co-operate and work investment shall pay into the and personnel system, and, with together with the foreign inves• retirement and pension funds and the assistance of the department of tors. The relevant departments unemployment insurance funds labour and personnel in its shall support them in their work for staff and workers from the locality, recruit and employ staff and shall generally not transfer Chinese party in accordance with and workers on its own through them to other jobs during their the stipulations of the people's examination and selection of the term of office. In the event that government in the locality.. »The best. they must be transferred, the insurance and welfare available to consent of the board of directors In the event that engineering staff and workers during their should be obtained. and technical personnel or employment shall be decided in operation and management per• (d) With regard to personnel line with relevant stipulations of sonnel needed by the enterprise who are not qualified for their the Chinese government concern• with foreign investment are not posts after having worked on a ing state-owned enterprises; ex• available in the locality, the probationary basis or undergone penses required shall be disbursed enterprise with foreign investment training, and'personnel who have from the costs and expenses of the may, after the department of become redundant as a result of enterprise. labour and personnel in the changes in the production or (c) Enterprises with foreign province, autonomous region or technical conditions of the investment shall pay housing municipality directly under the enterprise with foreign invest• subsidy funds in accordance with central government where it is ment, the enterprise may dismiss the stipulations of the people's located has consulted with and them. Staff and workers who have government in the locality. The obtained the consent of the violated the rules and regulations Chinese party to the enterprise department of labour and person• of the enterprise causing harm shall use such funds to subsidize nel in the district concerned, can, in accordance with the the building and purchasing of recruit outside the locality. seriousness of the case, be given houses for staff and workers. •

26 BEIJING REVIEW, NO. 3 • wm BOOKS

'Atlas of the cultural project designated by the on Environmental Protection State Council. It is estimated that With Respect to Offshore Oil Palaeogeography of all volumes of the dictionary will Exploration and Development, have come off the press by 1990. Interim Regulations of the PRC China' So far, 120,000 orders for the Concerning the System of Licens• dictionary have been received ing Import Goods, Regulations of Chinese-English edition of an from Chinese and foreign buyers. PRC on the Inspection of Import A Alias of the Palaeogeography and Export Commodities. of China has been published by the All of the three include bilingual Cartographic Pubhshing House, glossaries. and is being distributed at home and abroad. The atlas has 123 Available in English maps covering the palaeogeo• graphy, palaeogeological struc• CHINA'S FOREIGN FOREIGN INVESTMENT tures and ancient climatic zones of ECONOMIC IN CHINA- China, and runs to 200,000 LEGISLATION characters. The atlas is an QUESTIONS important reference work in the (Bilingual edition, Englisli AND ANSWERS study of the mineral deposits — and Chinese) coal, oil, iron, manganese, etc. Published by: Foreign Languages Written by: Chu Baotai The atlas is jointly compiled by Press Published by: Foreign Languages Prof. Wang Hongzhen, a member Distributed by: China Interna• Press of the General Assembly of the tional Book Trading Corpora• Chinese Academy of Sciences, and tion (Guoji Shudian), P.O. box Distributed by: China Interna• other specialists of the Geological 399, Beijing, China tional Book Trading Corpora• Research Institute under the First edition (Vol. I, third tion (Guoji Shudian), P.O. box Chinese Academy of Geology in printing) 1986, 399, Beijing, China Beijing and the Wuhan Geological (Vol. II) Fall 1986 First edition 1986 Institute. The atlas gives some (Vol. Ill) Fall 1986 281 pages significant conclusions in study of China's palaeogeography, the Volume 1, first published in evolution of the earth's crust, and 1982 and now reprinted, contains What are the best investment some new theories on the future the English and Chinese text of 24 opportunities in China? What development of the structure of laws and regulations concerning should be the forms of investment? the earth as a whole. foreign trade and investment How do the terms compare with promulgated between 1979 and those offered in other countries? 1981. What is the way to establish a Volume II presents all the Chinese-Foreign joint venture? important laws and regulations What are the guarantees for the 'A Complete promulgated from the end of 1981 rights and interests of the foreign through September 1983 including investor? Can he send back home the economic Contract Law of the his earnings in hard currencies, Chinese Dictionary' People's Republic of China, and how? These questions and Regulations of Offshore Pet• he first volume of A Complete roleum Resources in Co• many more are answered in this TChinese Dictionary has been operation With Foreign Enterpr• book by one of China's leading published and is available in ises, Rules for the Implementation officials in charge of foreign Shanghai bookshops. The 12- of the Income Tax Law of the investment with accuracy, clarity volume dictionary has 370,000 PRC Concerning Foreign Enter• and authority. Chu Baotai is now entries, with a total of 50 million prises, Interim Regulations on the deputy director of the Foreign characters. This is the largest Han Supervision of Advertising, and Investment Administration of the language dictionary ever pub- others. Ministry of Foreign Economic Ushed in China. Volume III includes all the Relations and Trade. important laws and regulations The 103 questions and answers Several hundred linguists and from September 1983 through are given in both English and publishing workers from Shan• December 1984, such as Regul• Chinese, and so are the two dong, Jiangsu, Anhui, Zhejiang ations for the Implementation of appendices, the PRC Law on and Fujian provinces, as well as the Law of the PRC on Chinese- Chinese-Foreign Joint Ventures Shanghai, took 10 years to Foreign Joint Ventures, Admini• and the regulations for its compile the work, as an important strative Regulations of the PRC implementation.

JANUARY 19, 1987 27 •1 FROM THE CHINESE PRESS

9. The market system is taking shape. Various kinds of markets, Economic Reform Makes Headway such as a market for the means of production, as well as financial and labour markets, have been established in many cities. Con• sumer goods are in ample supply. "JINGJI RIBAO" separation of management from ownership. The market prices of Guangzhou, (Economic Daily) which is in the van of the reform, 3. Township (or rural) enter• tend to stabilize with each passing prises as well as individually day. All these heighten people's operated enterprises have spread confidence in reform. hina's economic restructuring all over the country. The number C made steady progress in 1986. of rural enterprises has grown 10. The study of economic "Both economic development and from about 1.4 million in 1984 to theory flourished across the economic reform need a stable more than 12 million, turning out country. situation because stability is a sign a total output value of more than With regard to reform in 1987, of vigour and prosperity," com• 330 billion yuan in 1986, Tong Dalin said that the Central ments Tong Dalin, vice-president surpassing agricultural produc• Committee of the Communist of the China Association for tion for the first time. In addition, Party of China has already Research of Economic the private ^sector is developing decided on the central tasks for Restructuring. rapidly. The number of individual urban reform in 1987. China's Tong notes that the economic economic entities has been urban econmic reform started reform in 1986 made considerable expanded to 11 million, employing with expanding the decision• headway. more than 17 million people. making powers of enterprises, as they arc the cells of the economy. 1. The barriers between depart• 4. A critical step has been made In order to deepen the reform, co• ments and regions, which for a in reforming the labour system. operation between various kinds long time hindered economic The four sets of regulations on of enterprises needs lo be development, have been brok"en reforming China's labour system, strengthened. For example, enter• down and inter-departmental and including the Provisional Regul• prises should actively promote the trans-regional economic associ• ations on the Extension of the separation of management from ations are springing up every• Contract Labour System in State ownership and actively implement where. China has established more Enterprises adopted not long ago the leasing, contract and shares than 10,000 productive and by the State Council, are the most systems, as well as the director scientific research unions and significant reform in the labour (manager) responsibility system in more than 20 trans-regional system since the founding of the line with their own specific economic co-operation networks. People's Republic in 1949. conditions. In distribution. etTcc- The economic alliances are 5 Financial reform has made a tive measures should be taken to developing from a low level to a satisfactory start, with trans- strengthen the enterprises' ability high level. The emergence of regional networks for the circul• to expand production — business blocs with large enterpr• ation of money and financial improving the wage and bonus ises as the mainstay will shoulder markets being set up in many system, and re-checking and heavy responsibilities in future cities. Moreover in some cities disbanding unnecessary admini• economic development and credit co-operatives, slock and strative companies within a stated reform. bond markets have been es- time. The external relations of the 2. The systems of leasing, i tablished by urban residents with enterprises should also be streng• contract and shares are now money they have raised. thened, by forming a socialist becoming increasingly common. 6. The Standing Committee of market system as quickly as By the end of 1986, more than the National People's Congress possible and by hastening the 60,000 state-run shops in China adopted a draft enterprise bank• reform of the financial structure in began operating under the leasing ruptcy law. particular. • system. Some small collectives and 7. A number of competent state-owned enterprises in entrepreneurs have entered the Shenyang, Chongqing, Wuhan economic arena. This will exert a and other cities have achieved tremendous influence in sub• good results after adopting the sequent changes in economic leasing and contract systems. management. Moreover, the system of shares in 8. Great improvements have various forms is being tried out been made in the climate for and this will contribute to the foreign investment.

28 BEIJING R12VIEW. NO. ?, with foreign countries over the past few years has emphasized Personal Diplomacy Expanding strengthening friendly relations among the young. In 1983, the association invited 180 Japanese for exchanges between China and young people to China. Since "RENMIN RIBAO" other countries. 1984,^it has played host to 3,000 (People's Daily, Overseas Edition) There is a notable increase in Japanese youth, as well as youth people-to-people exchanges with delegations from Australia, the the Soviet Union and other Federal Republic of Germany, y the end of November, 1986, Eastern European countries. The India, Japan, Norway, the United B the Chinese People's Associ• association has exchanged visits States and the Philippines. ation for Friendship With Foreign with its counterparts in the Soviet The association has tried to Countries had maintflined friendly Union, Democratic Germany, increase ties with the industrial contacts with 125 countries. The Hungary, Czechoslovakia, Bul• and trade circles of other countries association has also established garia, "Yugoslavia and Romania through non-governmental con• relations with more than 100 almost every year since 1984. tacts to promote economic and friendship organizations in 70 Non-governmental contacts technological exchanges. • countries. The peoplc-to~peopie friendly contacts with foreign countries is Leaving Officialdom for Business an important aspect of China's diplomatic work and an important base for China's foreign relations. Over the past few years the "WEN HUr BAO" two grocery stores and established Chinese People's Association for ,1(We n Hui Daily) a commercial group. By the end of Friendship With Foreign Coun• October 1986. the three shops had tries has established ties with gone beyond the requirements political, economic, cultural, ot long ago, the Benxi stipulated in the rental contracts. municipal Party committee educational, and religious entities N Li Ming said his purpose in gave a warm send-off to Li Ming, abroad while enhancing co• working in an individual business head of its policy research office. operation with friendship organiz• is to gain experience which can be Li decided to give up his official ations of other countries. Take applied to the further develop• position and become a business 1985 for example, the association ment of the leasing system. Li also assistant to Guan Guangmei who received more than 3.000 visitors hopes his move will help change has rented three grocery stores. -from more than 60 countries, 3.5 people's old ideas about attaining At the meeting, Cong Zheng- times that of 1976. In that year, it official status, and help break long, secretary of the Party also sent more than 50 delegations down the lack of initiative and committee, said, "I am all for Li's to 39 countries. From 1971 to overcautiousness in governmental actions. There are many able 1985, the association hosted more departments. He said that he people in the government offices. than 200 foreign theatrical troupes would be happy to be a successful Persons of noble aspirations and exhibition delegations and entrepreneur. • sent more than 100 Chinese should be able to go to grass-roots troupes abroad for performances. units to make full use of their In recent years, China's cities wisdom and crealiveness." have formed sisterly ties with Li Ming, a young official, is foreign cities. From 1973 to 1974, modest and eager to learn, and only three cities, Tianjin, Xian and concerns himself with urban Shanghai, had formed such economic reform. From the relations with Japan's Kobe, beginning of 1985, he regarded Nara, Kyoto, Yokohama and Guan's shop, the first one in Benxi Osaka. By the end of September, leased to an individual, as his 1986. however, 25 of China's "experimental plot" of commer• provinces, municipalities and cial reform. He helped Guan autonomous regions, along with improve her management and 65 cities, formed friendly ties with administration, resulting in Guan 226 provinces' and cities in 29 making gratifying achievements in different countries. This en• her business. In 1986, with the help deavour has opened new vistas of Li Ming, Guan rented another

JANUARY 19, 1987 29 m BUSINESS/TRADE

of Chinese garments. The export Textile First Among Exports volume to these places accounts for two-thirds of the corporation's he export value of textiles Winter plum brand women's total textile export. Tincreased to US$5,346 billion blouses, and Shanghai's Parrot Nevenlielcss. China still lags in 1986 overtaking oil as the brand Western suits, jackets and behind other major textiles greatest export earner. The figure women's dresses all sell well exporters. Primary products ac• is 25.73 percent higher than in abroad. Some have also entered count for a large proportion, its 1985 and double that of 1980, said the high-class European and exported garments are poorlv Zhou Yunzhong, general manager American markets. processed and it earns less foreign of the China National Textiles The China National Textiles exchange than those exporters. To Import and Export Corporation. Import and Export Corporation improve quality and develop new Zhou said that the export value has imported advanced foreign varieties, foreism businessmen of 20 categories of textiles technology and equipment in the in\esting in Chma in any co• increased greatly, and only one did last few years and improved the operative form will enjoy pre• not. Exports of polyester-cotton technical skill. qualit> and designs ferential treatments in raw yarn, cotton, cotton yarn, cotton- of its garments. Now the material supply and export linen yarn, garments, cotton corporation can make clothes with voltime, in addition to the knitwear, polyester-cotton knit• raw materials and samples I preferences stipulated by the wear, woollen-cotton knitwear supplied by foreign clients and has recently published provisions for and woollen blankets went up by some factories producing well- encouraging foreign investment. 30 percent. Before 1982 China was known brands. by Yao Jianguo a cotton importer of about Founded in 1960 the corpor• 900,000 tons a year. Since 1982 ation is the only unit handling China has increased cotton imports and exports of textile raw China Accepts 9,000 production and exported 520,000 materials, textile products, gar• tons in 1986. Now China is the ments, and some textile produc• Foreign Patents second biggest cotton exporter in tion materials. It has 50 branches the world. throughout the country, and five ince introducing the patent system m April 1985 the China The garments exports accoun• agents, eight subsidiaries and one S State Patent Office had by ted for the largest part of the total joint venture scattered in the October last year accepted and exported by the China National United States, Kuwait, Dubai, processed 28.963 patents. Of them Textiles Import and Expost Iraq, Panama, Canada, Japan, 8.956 (30.9 percent) were applied Corporation. China exported Australia, the Federal Republic of for by foreigners, and 8,513 of USS 1.309 billion worth of gar• Germany, Spain and Hong Kong, them had been published. ments last year, 29 percent more The corporation also has business than in 1985. The better quality relations with more than 150 Of the foreign applications 92.8 garments accounted for one-third countries and regions. Hong percent (8,248) were for mvcn- of the garments exported and have Kong, Japan, the United States tions, innovations to existing had good sales. Beijing's Temple and the European Economic items 1.93 percent (171) and 5.94 of Heaven brand men's shirts and Community are the main buyers percent (537) were for aesthetic designs. Ninety-one percent of foreign applicants were pro• Sheets produced by the Jiangyin Sheet Factory in Jiangsu Province are available in 20 fessionals while 9 percent came places abroad including the United States, Britain and Japan. from amatetirs. the reverse proportions were true of the Chinese applicants. Now China has accepted patent right applications from 40 coun• tries and regions. The table below shows the countries from where over 100 applications have been received. Japan 2,845 US 2 490 FRG 846 Britain 395 Holland 393 France 322

Bt:iJING REVIEW. NO. 3 Switzerland 311 US$1 million's worth of equip• concluded 52 contracts on foreign Hong Kong 182 ment and technology for treating economic co-operation in 1986. Italy 171 wool, US$300,000's worth of By the end of last year it Australia 158 equipment for producing washers, established business relations with Sweden 137 a switch and plug production line, 300 firms and banks from 44 Canada 114 a high polymer bandage produc• countries. Hong Kong and Macao Hungary 103 tion line and a package sealing line and opened 16 Sino-foreign joint by Li Fuying valued at US$200,000. ventures. In 1986 the corporation The township enterprises are invited 720 foreign experts to work the backbone of the city's in China. It also provided services economy and in 1985 turned out through compensatory trade, Zhangjiagang 3.1 of the 3.3 billion yuan's worth labour services abroad, processing of the city's output. with supplied materials and Opens Wide by Yang Xiaobing leasing. • The reconstruction of the hangjiagang city, known until Santa Marta Port in Colombia Z last October 7 as Shazhou which was contracted by China's County, has, with its change of First Sino-Soviet Ministry of Communications status, also opened wider to the Contracted Project began on December 15, 1986. The world. work includes re-equipping two Covering an area of 1,000 wharves and reconstruction two he renovation work on the square kilometres, the city has a more. The investment is worth Beijing Hotel in Moscow, the natural port at the mouth of the T US$7.98 milHon. This is the first first Sino-Soviet project, is Changjiang (Yangtze) River, port project China has won in expected to finish in June this year. which will be developed during the South America. Seventh Five-Year Plan period After that the hotel with its (1986-90) into one of the main classical Chinese style will begin • China and the Republic of container ports in China with nine receiving guests. Surinam recently signed an 10,000-ton-class berths instead of The renovation work was economic co-operation agreement the present four. started on November 6, 1986 in Parmanribo, the Surinamese To realize the rich agricultural under a contract signed by the capital. The contract stipulates and sideline potential, farmer-run Beijing Corporation for Intern• that China will help Surinam build township enterprises have been ational Economic Co-operation a shrimp breeding farm to produce rapidly developed and foreign and the Soviet Foreign Trade and 8 million shrimp a year, a fodder- technology and equipment have Construction Import Corporation mixing factory to produce 300 been imported. By the end of in April 1986. According to the tons a year, a 30-hectare September 1986, 27 pieces of contract, the Chinese side will aquiculture farm and a freezer to equipment valued at US$12 renovate the inside of the building, freeze one ton and store 30 tons. million were introduced from transform the kitchens and China will help the country foreign countries, including equip• provide new equipment for the develop freshwater farming and ment for producing stainless steel hotel. The work involves more methane energy technology. For hunting knives imported from the than 50 Chinese technical these projects, China will provide Federal Republic of Germany by workers. interest-free loans. the Jinfeng Medical Apparatus The hotel was a Western build• • Last year the China Ocean and Instruments Plant; a PVC ing located in the centre of Shipping Company opened 89 wall-paper production Hne bought Moscow which was rebuilt in new international shipping ser• from Japan by the New-Type Chinese style in 1957. Chinese vices to 48 ports in 29 countries Wall-Paper Plant; and equipment engineering was involved in the and regions. The company for producing polyester fibre reconstruction of the hotel and provides passenger and cargo bought from the United States and Chinese cooks made Chinese food shipping and charters Chinese Japan by the Deji Polyester there. It is still a pace where people ships through agents in London, Factory. go to eat Chinese food. • New York, Tokyo, Singapore, In the coming four years, the Bangkok, Sydney, Hamburg and city will absorb US$40 million in Hong Kong. The ships include foreign capital, and import Trade News in Brief cargo ships, oil tankers, bulk ships technology and equipment and passenger ships. The company through joint ventures, co• has also concluded contracts with operative enterprises and com• • The China National Petro• many international shipping com• pensatory trade. They include chemical Industry Corporation panies to provide crews.

JANUARY 19, 1987 31 m CULTURE/SCIENCE

Chinese composer Chen Yi and China's Symphony Orchestra to Visit West The Moon Over the Fountain by Hua Yanjun and Wu Zuqiang.

aking its first official visit to common language to promote During his visit to China, a M Europe, China's 90-member cultural exchange and to link manager from France's Pompidou Youth Symphony Orchestra will different peoples. This time Art Centre highly praised the perform in European Community Chinese youths will take the China Youth Symphony countries like Italy, Federal Chinese people's friendship and Orchestra after he attended one of Germany, France, Belgium, and greetings to the European peoples. its concerts. "Most Westerners Britain from January 23 to I believe their visit will be welcome know that you have acrobatics, February 16. and further the co-operation folk music and Beijing Opera," he between China and the E.C. said, "but they have never thought The China Youth Symphony countries. I wish their visit that you had such outstanding Orchestra is making a "return" success." symphony orchestras. I believe the good-will visit, after the European French people will be overwhel• The orchestra's musicians, with Community Youth Symphony med by your visit." an average age of 21, will present Orchestra left a lasting impression several world famous pieces Professor Zhu Tongde, head of on Chinese audiences during its during their tour, including the orchestra, is vice president of initial visit in 1984. Symphony No.9 by Beethoven, the China Central Conservatory China's Premier Zhao Ziyang violin concertos by Tchaichovsky of Music as well as a flutist. expressed encouragement for the and Saint-Saens, Don Juan by Conductor Shao En, a young, tour saying. "I'm glad that Richard Strauss, and the Free- active musician in Beijing, has the China Youth , Symphony Shooter prelude by Weber. They impressed his home audience with Orchestra will visit E.C. will also introduce to their foreign his passionate and expressive countries. Music is an artistic audience Symphony No.l by style. He graduated from the

16-year-old first violinist Huang Bing.

32 BEIJING REVIEW, NO. 3 Central Conservatory of Music in Academy of Art. and did well as painting, while borrowing appro• 1983. The second conductor is an artistic designer, especially in priately from the west. Tang Muhai. Tang received the calligraphy, poetry, seal carving Soaring shows a mighty dragon highest academic certificate awar• and painting. This formed the behind a cloud fiying into the ded by a Federal German art basis for Wu Mo. sky, and is said to represent the school in 1983, and in the summer i When he graduated from the art painter's patriotism and aspir• of that year he was awarded a academy in 1962, Dong returned ation to make China strong. scholarship by the Wagner to Suzhou, a centre for silk, and Qu Yuan's Poem "Questioning Foundation which enabled him to determined to make his combin• Heaven" depicts the great poet of take part in the Baruth Opera ation of silk and paint meaningful, I ancient time demanding of heaven Festival. In the summer of 1984, romantic and imaginative, and to why injustice is everywhere. The he was invited by world-famous merge symbolism with realism. He painter devotes only the lower left conductor Seiji Ozawa to partici• spent 10 years exploring this virgin corner to the poet, all the rest is pate in the Tanglewood Music territory. Inspired by Chinese silk used to describe the mighty Festival, held near Boston, painting of over 2,000 yeais, he heavens of hghtning and thunder Massachusetts. While participat• succeeded in establishing the new ; as if inviting the viewer to rail ing in the world conductor's Wu Mo school of painting by against them with the poet. competition in Berlin in 1982, using Suzhou's crepe de Chine, ', Tang demonstrated his talent and Flowers in the Vase, the flowers' self-made dyes and other won the praise of Herbert von symbolic colours of spring's materials. Karajan and the judging panel. He coming dominate over their puny The name of this school has its was soon invited to be a guest stems. origin in the "cultural revolution" conductor of the Berlin Phil• when people were forbidden to harmonic Orchestra, which put him under the direct supervision create "classical works." Dong Molecular Biology of Karajan. had to paint in secret. Since Wu is i the old name for Suzhou and Mo Lab in Shanghai The first violinist of the China in Chinese means "working si• Youth Symphony Orchestra, he Shanghai Molecular biology lently," or "publically unknown," H uang Bing, a first-prize winner in I Laboratory, will soon open to Dong gave the name Wu Mo to his T the juvenile group of the world scientists at home and abroad. painting. violinist contest held in Poland in Set up by the Shanghai September 1985. Last September In 1976 when the turmoil ended, Biological Chemistry Institute, the Huang was placed third in the the new painting burst forth with lab will help in the study of International Youth Viohn com- exuberant vitality and a new sense I international molecular biology. petifion in Beijing. Another of beauty. Dong toured China's The lab is equipped to look into violinist, Cheng Yun, and cellist best-known scenic spots and complicated scientific subjects Tu Qiang have also won awards in borrowed ancient poems, fairy such as the structure and function world level competitions. tales, legends and historical stories of biological molecules, molecular for his work. His paintings are genetics and biomembrane, he characterized by the clarity of said. Chinese painfing, the bright i An official of the State Planning Dong Wenzheng's colours of Western impression• Commission said, 50 major labs ism, the boldness of stage art and will be built in the 1986-90 period, Wu Mo Painting the textures of -nature. with their research fields including The mixture of concrete and biological technology, micro- ong Wenzheng's skill would abstract in the paintings keeps electron studies, information D have allowed him to excel in them looking fresh. The paintings science, chemistry, physics, geo• traditional Chinese painting, or in often feature people, boats, trees, logy, agriculture sciences and impressionist painting. So he flowers, a pavilion or some other I medical sciences. combined the two into one and specific object, set in a huge Those labs, mainly used for created a new style of his own — majestic background allowing basic science study, will also open using big splashes of colour and plenty of room for the imagin• and become the centres for minute details on silk. He named it ation. It is more romantic than academic activities, he said. Wu Mo painting, a fresh school in traditional Chinese painting, and Visiting scholars will help with Chinese art. less abstract than the pure I study projects at the new lab and Dong, 49. comes from Suzhou, abstractionism of the West. Liu also use it for their own study a beautiful ancient city in Jiangsu I Haisu, a noted Chinese painter, subjects. They'll be invited to Province. He was named one of | credited Dong with keeping the work in the lab for one to three the best students at the Nanjing ' flavour of traditional Chinese years," he said.

JANUARY 19. 1987 33 m LETTERS

To Our Readers article "Introducing Compulsory I understand more about the real Education" which told how China ' China — to show the way China plans to implement a policy of I really is, and help understand Tliis is the firs! time for your nine-year compulsory education what a warm, friendly, sincere and letters to appear this year. On and set up schools for disabled hardworking people the Chinese behalf of the 'staff of "Beijing children. Important topics are also are. Perhaps you could include a Review," I would like to express covered such as "Balancing question and answer page in your our gratitude to you for your help Foreign Currency in Enterprises" magazine, where readers from and inspiration in our work. We and "Legal Guarantees for around the world could write also thank you for sending letters Foreign Investors" (issues Nos. 20 letters to you, then you print some and cards for the new year and wish and 22). of the best letters each week, and you a lucky and healthy new year. your answers to the letters. "Letters" editor Overall. Beijing Review is a true and interesting weekly. I feel something along these E. Sarria G lines would perhaps make people Call, Colombia feel a personal connection with Uphold Basic Principles China, and increase their interest in China. I myself am proud to 1 visited your country ten years have been to China, and to haxe ago and have been your reader for New Reader's Comments Chinese friends. ahnost twenty years. Now, I'm SanJokan Sa'htra-khan seventy-three. Beijing Review is a I Australia I felt pleasure after reading your good teacher for us students of magazine for the first time. 'Your China. All these years I have read front cover and inside front cover your magazine, I have had are very good. reactions to your articles but never Women's Double Duty I liked the "Business/Trade," actually put pen to paper. "Culture " and "Notes From the We have many educated and My worry now is about the Editors " columns most, although I talented women in Australia, but harmful effects of capitalism on others were also good. although our Women's Liberation young people, that came in the The "Articles" section was fine movement has basically come wake of the open policy. I hope too, it gave readers information through to realization, we loo you will do your best to realize the about China, about its famous have the problem of working modernization and uphold the scientists in physics and chemistry, women having a double responsi• four basic principles. and China's successes in its bility, both in workplace and in Yoshiyuki Kaheya modernization. the home. Although we have won Aichi, Japan In your "International" our legal rights, the idea lingers on column, I was interested in the in most men's minds lhal we are news about the relations between inferior, and men are fighting back True and Interesting China and Argentina and other on an individual basis. Even quite countries, and the news about I young men are at fault here. politics, economics, cultureelc. Unfortunately, a woiTsen is Since 1986, there have been one Your layout and pictures are sometimes confronted with the or more articles from Beijing suitable. I suggest you introduce choice between her marriage or Review in my reading plan every more colour pictures in the centre her rights. And then, when the day. page. Of course, more photos man loses custody of his children would be welcome on other pages The front covers of a number of i in the courts at the point of divorce loo. issues last year fitted well with the ! all too often he refuses to pay for I suggest you publish more subject matter. The advertise• the upkeep of his children, as sports news, your national sports ments on the back cover are also \d by the courts. This and new sports subjects. praiseworthy. I wish you would I particular assertion of male C. Baird publish more commercial propa• independence is commonplace. "Villa Maria, Argentina ganda on the international level. Also, reliable child-minding facil• In your "Notes From the ities (while the mother is working) Editors" column, I saw several are still in short supply, and of ' unique articles which help readers Better Letters Page course, in this country, work- learn about China's politics, trade, \s do not assume an\ social reform and five-year plans I feel that part of your magazine responsibility for child care. from different angles. Especially should be directed more towards Rosemary Henderson interesting was issue No. 19, the Western readers, to help them Melbourne. .Austialia

BfLllNG R!:Vn!\V. NO. 3 ART PACE

Little girl.

Young woman.

Old man.

Stone-Relief Carvings by Li Hongren

Li Hongren, born in Beijing in 1 931, teaches at its Central Academy of Fine Arts. He is noted for his reliefs which portray people in a unique national style. . CHINA NATIONAL cA> AERO-TECHNOLOGY cATic IMP. & EXP. CORP.

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