Chiang Ching-kuo The Relation Between Planning and Market A monk meets the camera. BeijingR^'r HIGHLIGHTS OF THE WEEK

Government Bodies to Be Revamped VOL. 31, NO. 15 APRIL 11-17, 1988 • State Councillor Song Ping makes a report to the National CONTENTS People's Congress explaining the proposal for restructuring the State Council. Under the proposal, the State Council will NOTES FROM THE EOITOIIS 4 reduce the number of ministries and commissions to 40 from Aquino Comes to Promote the current 45 (p. 5). Relations

EVENTSARENDS 5-9 Taiwan's Situation After Jiang Ciiing-kuo Government Bodies to Be Restructured • An analytical article by the deputy director of the Taiwan NPC Examines Draft Amendment Affairs Research Institute predicts the coexistace of both stable Li Calls Session on Rail and disruptive factors in Taiwan's political situation in the Accident post-Jiang Ching-kuo era. In the short term, stability will CAFIU Promotes International override any unrest, but in the long-term there will be a reversal Ties of this situation (p. 14). Bainqen Reaffirms Policy on Dalai Weekly Chronicle (March 28-April 31 Philippine President Visits China INTERNATiONAL 10-13 France: Tough Electoral • China and the Philippines have a tradition of friendly Contest Under Way relations. People hope that Philippine President Corazon Nicaragua: Truce Pact Aquino's visit to Beijing will further consolidate and strengthen Promotes Peace Process such relations and promote bilateral co-operation in all fields Israel-South Africa: Military (p. 4). Collusion Is Reprehensible

Taiwan's Potttical Situation China's Expanding Ocean-Going Fleets After Chiang 14 Relations Between banning • While the world's shipping industne were languishing in the And IMaritet 19 doldrums in the 1980s, China's shipping business has been Cliina's Ocean-Going Fleets 22 booming. Its ocean-going fieets, with a total deadweight Experts and Scttolars on Reforms 25 tonnage of 17 million, are now recognized as a major force challenging the traditional ocean shipping powers (p. 22). FROM THE CHINESE PRESS 2728 BUSINESSARADE 29-30 BOOKS 31 The Relation Between Planning and IVIarket CULTURE/SCIENCE 32-34 • The socialist commodity economy China is pursuing calls COVER: N!'C deputies Cai Zimin, Lin for the reduction of mandatory planning and an increased Liyun, Zhang Qia and Tian Fuda (right regulation by market forces. According to an official from the to left), all natives of Taiwan, visit the State Commission for Restructuring Economic Systems, both Taiwan Affairs Research Institute. can be effectively applied in an economy dominated by public Xu Jaangjun and Xue Ciiao ownership (p. 19).

Subscription rates (1 year): USA.. ... US$24.00 Published every Monday by General Editorial Office Tel; 8314318 Agstralla . A.$24.00 ..Can.$23.00 BEIJING REVIEW English Dept Tel: 831.5599 Ext. 546 New Zealand NZ.$33.00 24 Baiwanzhuang Road, Distributed by China International Book UK. £13.00 Beijing 100037 Trading Corporation (GUOJI SHUDIAN) The People's Republic of China P.O Box 399, Beijing, China • NOTES FROM THE EDITORS

Aquino Comes to Promote Relations by Our Guest Commentator Gao Shixing

hilippine President Corazon local reporters in Manila that she initiated a privatization pro• PAquino will visit China from wished to visit China to promote gramme, and adopted new April 14 to 16 at the invitation of the historic good relations be• investment code to provide the Chinese government. The tween the two countries. "Since incentives to investors. relationship between China and China is one of our neighbours, it Although the pace of invest• the Philippines is rooted in the is only natural that I go there to ment has been slow, the govern• countries" historical and geo• establish better relations with our ment plans to absorb investment graphical propinquity and their neighbour." of USSl billion in 1988, double common interests. Since diploma• last year's figure. The target She also said she wanted to visit tic relations were established in industries for investment are her great grandfather's home 1975, progress has been made in electronics, textiles, clothing, food village of Hongjia, near Quanz- developing friendly relations and production and processing, auto• hou, Fujian Pro.vince. bilateral co-operation. motive components and chem• With the formation of the icals. Industrial rehabilitation and Aquino government, opportun• modernization are also priorities. ities to consolidate and strengthen The government's economic ties increased. Since Aquino came to reforms have enabled the national In June 1986. Philippine Vice- economy to grow, in sharp President Salvador Laurel visited power in February 1986, the contrast to the contraction which China, and in September of the relations between China and hit the economy for three same year, Chinese Vice-Premier the Philippines have been consecutive years before Ferdin• Tian Jiyun visited the Philippines. strengthened in political, and Marcos was ousted. During these visits the two sides economic and cultural fields. The country's export earnings exchanged views on international in 1988 are expected to increase by and regional issues of mutual US$ 1 bilhon from US$5.2 billion concern. On many of the issues, in 1987. But the tremendous their views converged. Since Aquino's government problem of foreign debt totalling assumed power in a civilian- Both sides are interested in US$28 billion exerts enormous backed military uprising, it has seeking new ways to develop pressure on economic obtained initial results from its bilateral economic and trade development. efforts to steer -the Philippines relations, such as through barter On the social front, the towards constitutional rule and trade. Among the topics Aquino government has increased salaries economic recovery. The Aquino planned to discuss during her visit for the more than 1.2 million government has basically held its is the Philippines' trade deficit government employees to offset political ground since it came to with China. continued inflation. The govern• power, and the political situation ment aims to create 1 million jobs Since China adopted the policy is tending to improve in the wake this year. of opening up to the outside world of five crushed military coup Despite progress in all these in the late 1970s, it has been attempts. A new constitution is in fields, the Aquino government still seeking to expand its economic force, a new Congress is faces a lot of problems. It is our relations with other countries, functioning, and local elections hope that her administration will including members of the neigh• were held on January 18. successfully address these pro• bouring Association of the On the economic front, the blems and lead the nation to Southeast Asian Nations. government has lowered soaring greater political stability and President Aquino recently told inflation, dismantled monopolies. economic development. •

.4 BEIJING REVIEW, A'PRIL'H-.ii7, 1988 m EVENTS/TRENDS ••MBWMMIIIil^^

Government Bodies to Be Restructured

proposal to restructure gradually become indirect. A China's State Council will reduce the number of ministries To reduce the number of and commissions to 40 from the management levels, new ministries current 45, State Councillor Song and commissions will have only Ping said. two levels — bureaus and sections. Song told the Seventh National The establishment of the 10 new People's Congress (NPC) on ministries and commissions March 28 that under the proposal, should be completed three months 14 ministries and commissions will after the NPC session approves be abolished and 10 new ones will the proposal. be set up, while 30 ministries and commissions will be retained. In addition to 45 ministries and Xinhua, China's official news commissions, the State Council is agency, will be placed directly currently composed of 22 bureaus under the State Council. and five working offices. Its staff With the broadening of the totals more than 50,000 people. economic reform. Song noted, the There are also 14 bureaus directly defects of the present government run by ministries and commissions setup are becoming increasingly and 75 ad hoc groups. evident. These include non- separation of government and XUE CHAD The restructuring will reduce enterprise functions, irrational State Councillor Song Ping delivers a the State Council staff by about structure, overly rigid micro- report on the proposal for restructuring one-fifth or 10.000 people. Song management, insufficient macro- tlie State Council. said. Some current staff members control, overlapping institutions, will be transferred to units relating overstaffing, similarity of func• to taxation, finance, prices, tions and duties, and low working compared with the government auditing, supervision, statistics, efficiency. streamlining of 1982. the administration of industry and "We will not simply abolish commerce, and law enforcement. "Without restructuring the some offices, merge others and cut Many will join companies, government organs, the economic back staff. Instead, we will associations, social groups and reform cannot be carried out in a introduce changes to their func• institutions involved in inform• deep-going way, nor can the tions, according to the principle of ation, consultancy and research. achievements of the economic separating the functions of Some with professional knowl• reform be consolidated. And government from those of edge and managerial expertise will many measures for reforming the enterprises." work in enterprises. And some political structure cannot be young people will receive pro• implemented. Therefore, it is Government departments will fessional training, while staff imperative to reform the admini• no longer directly control enter• members reaching retirement age strative structure from the central prises" money and goods. These will retire. level down," he said. enterprise management functions In line with the requirements of will be delegated to lower levels. Transferring cadres to com• the political and economic At the same time, government panies and associations will cut reforms, the restructuring plan departments will strengthen their the size and budget of the will concentrate on implementing work in the areas of policy government. Song said. It will not changes in government functions making, consultation and inform• only help raise efficiency and while introducing a public service ation, regulation and supervision, eliminate bureaucracy, but also system. This is the main feature of so that the government's direct promote the introduction of the the current proposal, he said, as management of the economy will public service system. •

BEIJING-REVPBW. APRIL 11-17. 198S 5 EVENTS/TRENDS

NPC Examines Draft Amendment

he Tirst session of the Seventh T National People's Congress (NPC) held its fourth plenary meeting on March 31 to examine a draft amendment to China's Constitution. The amendment would give legal status to China's private business operators and permit the transfer of the right to use land. The Constitution to be amended was promulgated in 1982 after its adoption by the fifth session of the Fifth NPC. The March 31 meeting, presided over by the executive chairman of XUE CHAD Delegates from Llaoning Province air their views on the draft amendment to the the session's presidium, Rong Constitution. Yiren, also examined a draft decision from the presidium on the establishment of a committee to Dong, minister in charge of the corporate entity. The Chinese and draft the basic law of the Macao State Economic Commission. foreign partners' contributions to special administrative region. The draft enterprise law, with 68 the venture can be in cash or in According to the draft decision, articles in eight chapters, defines kind, or may include industrial or the Macao basic law drafting the separation of ownership and other property rights, technical committee will be answerable to managerial authority of enterpr• know-how or the right to use a the NPC and to the NPC Standing ises, enterprises' rights and site. Committee when the NPC is not in obligations, the factory director The draft law, formulated in session. The committee will be responsibility system, the status of line with experience and intern• made up of experts and other staff and workers, democratic ationally accepted methods of people representing all circles and management, and relations be• enterprise management and oper• will include Macao compatriots. tween enterprises and the ation, will help standardize the The list of members will be made government. form of contractual joint ventures public upon approval by the NPC Lu said the law was formulated and promote their growth, Zheng Standing Committee. to ensure the consolidation and said. development of state-owned in• Minister of Civil Affairs Cui dustrial enterprises, which pro• The meeting heard a report on Naifu and State Councillor Gu duce more than 70 percent of the the work of the NPC Standing Mu explained motions concerning country's gross industrial product, Committee delivered by Chen the establishment of Hainan as well as to define the rights and Pixian, vice-chairman of the Sixth province and the Hainan special obligations of enterprises, NPC Standing Committee, on economic zone. safeguard their lawful rights and behalf of the committee and its In proposing that Hainan interests and enhance their chairman, Peng Zhen. become China's biggest special vitality. Chen said that the previous economic zone, the State Council committee has done much fruitful The meeting also heard a report intends to allow the island to work over the past five years in the by Zheng Tuobin, minister of follow more open foreign invest• areas of legislation, supervising foreign economic relations and ment policies than the other and improving the country's trade, on the draft law governing special economic zones and to voting system, handling proposals Sino-foreign contractual joint adopt a more flexible economic and diplomacy. ventures. According to the draft management system so as to create A report on the draft law law, joint ventures will be a more attractive investment governing state-owned industrial permitted to exist either with or climate for foreign investors, Gu enterprises was delivered by Lu | without the status of a Chinese I said. •

6 BEIJING 'REYIEW,,^IVELfll Chinese doctors and nurses and attending the NPC session said Li Calls Session Japanese doctors from the Sino- that incompetent personnel, loose On Rail Accident Japanese Friendship Hospital in discipline, bad management and Beijing did their utmost for the obsolete equipment are among the injured. By April 2, all 37 injured main causes of major railway n March 29, Acting Premier Li Japanese students had left hospital accidents. OPeng convened a work session for home. Zhang Tongsheng, director of of the State Council to hear a Chinese Vice-Minister of Fore• the Jinan Railway Administr• report on the country's latest ign Affairs Zhu Qizhen saw the ation, said that 70 percent of the railway accident. A total of 28 Japanese off at the airport. Zhu accidents on the lines under his people were killed and 99 were thanked Hamada. Takujiro, par• administration are the result of injured in the collision, which liamentary vice-minister of the loose discipline. occurred on the outskirts of Japanese Ministry of Foreign Shanghai on March 24. The chief engineer of the Harbin Affairs, for Japan's co-operation Railway Administration, Zhu At the session, Li called for a in dealing with the aftermath of Jieling, said that China's 50,000 meeting on transport safety, the accident. kilometres of railway lines have particularly railway safety. The "We are very much impressed long been overused and 11,000 report to the session was given by by the friendship and understand• kilometres are in need of a major Chen Junsheng, secretary-general ing displayed by relatives of the overhaul. Last year 1,600 rail of State Council. Chen was Japanses victims," Zhu said. cracks occurred throughout the entrusted by Li to attend to railway network, Zhu said. problems arising from the Preliminary investigation accident. showed that crash was mainly In a discussion of how to solve caused by a brake failure on one of the problems, people at the NPC A total of 27 Japanese were the trains. Further investigation is session called for the early killed and 37 were injured in the being conducted by two special enactment of a railway law. The crash. All of them were visiting groups. state should adopt special policies teachers and students of the Kochi to enable the railways to improve, Gakugei High School. China has been plagued by one they said. • Chen and Ye Qing, vice- accident after another since late minister of the State Economic last year. The problem was Commission, paid their respects to heatedly discussed at the first the dead and visited the injured in session of the Seventh National hospital. They also offered People's Congress (NPC). CAFIU Promotes condolences to the families. Two leading railway officials International Ties

An official of the Shanghai municipal govvnment helps carry an Injured Japanese s a non-government organi• student into the airport terminal. XIA DAOLIHG Azation, the Chinese Associa• • / 1. tion for International Under• standing (CAFIU) has played an active role in fostering friendship and understanding between China and other countries, an associa• tion vice-president says. Speaking on March 1 at the fourth session of the CAFIU Council. Chang Zhixiang re• viewed the association's work since the council's last session in 1985. "One of CAFIU's achievements is that it has expanded the scale of its international exchanges and overseas activities," Chang said. The association has ties with about 200 parties, organizations and research institutes in 78 countries. For many of CAFIU's

BEUINQ RHVl-EW, APRIL 11-17, 1988 7 m EVENTSARENDS

have been set free if there had not been a further riot in March," he Bainqen Reaffirin Policy on Dalai said. Referring to the March 5 riot, Bainqen said it was started by about 100 lamas who were later Dainqen Erdini Qoigyi Gyain- In reply to a question raised by a joined by several thousand other ^cain, vice-chairman of the reporter from the American people. If the onlookers are sixth National People's Congress Broadcasting Corporation, Bain• included, the total number was Standing Committee, reaffirmed qen said the riot on September 27 close to 10,000. the central government's five- last year was started by a small During the riot, he said, four point policy on the Dalai Lama's number of lamas who were people were killed and one person return to the motherland at a press followed by about 1,000-2,000 later died of severe injuries in conference held on April 4 in laymen. The riot on October 1 was hospital despite emergency Beijing. more serious. The police detained treatment. He said the five-point policy a small number of lamas and Bainqen announced that he was remains unchanged. The sole others who participated in the riot, being officially rehabilitated by condition for the Dalai Lama's but most of them were released the National People's Congress return is that he must give up his later. for the wrongful accusations activities for Tibet independence, Bainqen said that when he went against him in the early 1960s and acknowledge that Tibet is an to Tibet earlier this year, he found during the "cultural revolution." inseparable part of China's that 74 lamas and other people He said he was criticized for territory and join in the efforts of were stillbeing detained. Soon being frank and outspoken in a people of all nationalities to after his arrival, 59 lamas and 70,000-word report to the central safeguard national unity and build other people who participated government about the situation in a socialist country, including a directly in the riots were released. Tibet and other Tibetan-inhabited socialist Tibet. Most of the 15 people who are still areas. If the Dalai returns to the in prison committed serious Bainqen said he owed his motherland but continues his crimes such as burning, looting survival to the late premier Zhou separatist activities, this will not and assaulting people during the Enlai and his rehabilitation to be allowed, Beinqen said. unrest. A couple of lamas were Deng Xiaoping. His rehabilitation If the Dalai accepts the members of underground organiz• reflects the resolve and far• condition, Bainqen said the ations which instigated the unrest. sightedness of the central govern• central authorities have made it All the people who participated in ment, he said. (The full text of the known that he may become a vice- the riots were treated leniently, he questions and answers at the press chairman of the National People's said. conference will be issued in the Congress Standing Committee. "Most of the 15 detainees would next issue of Beijing Review.), u partners, it is their first link with Progressive Federal Party of that dialogue, negotiations and China. South Africa. It was the first mutual understanding are re• Last July, CAFIU received the delegation from an anti-racist, quired if relations are to improve. first non-government delegation white, legal South African oppo• In his speech Chang also praised from Indonesia to visit China with sition party to visit China. the role of the clergy in deepening the approval of the Indonesian "Another achievement is that international understanding. governrnent since the two coun• CAFIU has strengthened its CAFIU. founded in 1981, was tries suspended relations more relationship and exchanges with initiated by various organizations, than 20 years ago. Mangun some well-known foreign research parties and prominent figures. It Wijaya. the head of the delegation institutes, international organi• aims to foster mutual understand• and a famous columnist, pub• zations and scholars." These ing and co-operation between lished five articles about his include the Friedrich Ebert Chinese people and the people of impressions of China in Kompass, Foundation of Federal Germany, other countries and to promote the most important daily news• Bolivar Foundation of Colombia, world peace. Its main activities paper in Indonesia. These articles Chang said. include organizing exchange should help Indonesians get to In July 1987, the association visits, holding seminars, attending know China. and the Ebert Foundation held a international meetings and ex• Last November, CAFIU re• seminar on North-South re• changing publications. ceived a delegation from the lations. Both sides shared the view Chang called for the association

8 BEIJING REVIEWy/AJBRm imO, 1988 to expand its international ties, Weekly Chronicle years, with financing by domestic especially with Middle Eastern and foreign loans. (March 28-April 3) and Central and South American countries which do not have March 30 POLITICAL relations with China. • You Dexin, the vice-governor Recently the association re• March 29 of Fujian Province tells a press ceived its first delegation from • Yang Shangkun, vice- conference in Beijing that Taiwan Israel, led by Elazar Granot, chairman of the Central Military business people have set up 50 general secretary of the United Commission, says a plan for the enterprises in the province with an Workers' Party of Isarel reform of China's armed forces investment totalling US$50 (Mapam). will be worked out as soon as million. CAFIU President Li Yimang, possible. .You, a deputy to the Seventh Vice-President Zhang Xiangshan Yang, a deputy to the Seventh National People's Congress, says and Zhu Liang, head of the National People's Congress Taiwan residents will be granted International Liaison Department (NPC). says at an NPC panel even more favourable investment of the Chinese Communist Party session that while reform has been terms than foreign investors. Central Committee, held talks carried out in some areas, there with Granot. has previously been no compre• Mapam, which recognizes the CULTURAL hensive plan to reform the armed Palestine Liberation Organization forces' establishment, and person• (PLO) as the legal representative March 29 nel system, the education and of the Palestinian people and the • An exhibition on the history training of soldiers and other Palestinians' right to self- of the Tibetan people show that aspects of the armed forces. determination, holds that Israel they have always been important • Rong Yiren, vice-president of should end its occupation of Arab members of China's family of the All-China Federation of and Palestinian land and hopes nationalities. Industry and Commerce, says that that China will play a greater role Sponsored by Qinghai Pro• how to further develop democracy in the peaceful settlement of the vince, the exhibition displays is a question of top importance. Middle East question, Granot ancient pieces of bone and tortoise Rong makes the remark at a said. shell with inscriptions recording forum on how to improve the The Chinese hosts expressed the life of the inhabitants of the work of the Chinese People's appreciation for Mapam's stand Qinghai-Tibet plateau, and in• Political Consultative Conference and reiterated that China will scribed steles relating the history (CPPCC), sponsored by the continue to support the Palest• of early contacts between Tibet presidium of CPPCC. inian and other Arab people in and the Tang court (618-907). Rong says that after 1957 their struggle against Israeli nobody dared to speak the truth. aggression and expansion. SOCIAL The fine tradition of seeking truth They said Israel must withdraw from facts was not restored until from the Arab land it has occupied 1978, when China began carrying since 1967, and the legitimate April 1 out reforms and pursuing an open national rights of the Palestinian policy. people must be restored, adding • Zhu Xuefan, vice-chairman of that all Middle East countries the Standing Committee of the have the right to independence. ECONOMIC Sixth National People's Congress, They also expressed support for says the Central Government Mapam's stand on convening an March 28 should adopt fiexible ways to international conference to seek a • Construction of China's lar• bring about direct exchanges of peaceful settlement to the Middle gest dock will begin in the Dalian mails between the mainland and East question, saying that the shipyard, Liaoning Province, late Taiwan at an early date. PLO has the right to attend such a this year. Meanwhile, it is reported in conference on an equal footing. An official of the shipyard says Taiwan that the Taiwan postal Granot and his Chinese hosts the dock will give the yard the bureau has decided to entrust the agreed that people-to-people con• capacity to build one 300,000- Red Cross to take charge of the tacts are conducive to promoting deadweight-ton ship or two exchange of letters between the mutual understanding between 60,000-dwt ships at a time, as well mainland and Taiwan via Hong The Chinese and Israeli people. as offshore drilling platforms. The Kong, beginning later this month. by Chen Qiuping dock will be completed in three

BEIJIKG RIEraEW.,-APRIL 11-17, 1988 9 m INTERNATIONAL

attention. The new president will FRANCE be faced with the difficulties of forming a government and seeking Tough Electoral Contest Under Way stable support in Parliament. The problem will be especially acute if The candidates in France's 1988 presidential election are at Mitterrand is elected. He cannot recover the advantages he enjoyed the starting gate. The competition will be gruelling. at the height of his party's power in 1981 or re-establish cohabit• ation with a prime minister from a f France's many presidential is not as well known as rival party. It is guessed that he candidates, Francois Mitter• Mitterrand, the prime minister O would be likely to appoint a rand is given the best chances for can point to his achievements in Socialist prime minister whose success. Mitterrand, who did not the economic and social fields in attitude and work style would help announce his intention to take the past two years. Second, him unite with middle-of-the- part in the election until March 22, Chirac, whose party is doing its roaders. It is also expected that has long years of experience in best to support him, is running an Mitterrand would nominate some French politics. He is such a effective campaign. A recent poll centrists and even rightists to join familiar figure that the French indicates that Chirac's reputation the I abinet to enlarge his base in people have nicknamed him is growing. Former Prime Mini• Parliament and assure the stability "Tonton" (Uncle). During two ster Barre, although weak in party of the new government. However, years of political cohabitation support, is a powerful rival if the policy of favouring the with rightist Prime Minister because of well-known capacity to centrists failed, Mitterrand would Jacques Chirac, Mitterrand has stimulate the economy. Barre has have to dissolve Parliament and managed to keep away from recently been stepping up his move up the legislative elections. trifling partisan conflicts and put election campaign. This could result in pcflitical the general interests of the country tension and a recurrence of first. Many French people have As soon as Mitterrand announ• instability, which has not been been impressed by his ability to ced his candidacy, the two rivals seen in France since the 1970s. keep the country stable and started looking for ways to co• united. operate with each other to bring him down. One of their policies is The president's role and the For a long time, French to call for votes to the stronger division of labour between the political life has been on hold, as candidate during the second president and the government will the nation waited to find out round of vodng. Meanwhile, they be readjusted after the elecdon. whether Mitterrand would be a are attempting to pull Mitterrand The past two years have shown candidate in the election. In down from his exalted position as that in a situation where no delaying to declare his candidacy, the father of France. They are political party enjoys overriding Mitterrand's intention was prob• trying to associate him with the predominance, no president could ably to keep away from contention misfortunes of the Socialist Party. grab power as was done in the as long as possible in order to early period of the Fifth Republic. cultivate his image and gain a Since the early 1980s, the power As the country's top leader, the politically advantageous position. to rule France has been shifted president must avoid becoming The delay also allowed him to between the right and the left but involved in day-to-day govern• make a careful choice between neither has made notable accom• mental policies. Rather, he should making a second try for the top plishments. At the same fime, a use his authority only in affairs of prize and quitting while he is still series of scandals involving major significance. Mitterrand champion. various political parties reduced has pointed out that there should Mitterrand now has the upper people's confidence in pardes and be a reasonable division of labour hand over his two major left them cynical. The apolitical between the president and the opponents — current Prime Mini• trend is reflected in people's failure prime minister, with the president ster Chirac and former Prime to state which way they will vote. acting as arbiter and final Minister Raymond Barre, as the This poses a problem in predicting authority. many opinion polls indicated. But the outcome of the election. France's basic political orient• Mitterrand still faces obstacles on Apart from the election, the ation is not likely to change after the road to victory. First, he is not question of France's political the general election because all the far ahead of his two rivals in structure after the election is also pardes share similar policies on general strength. Although Chirac attracting domestic and foreign security and defence as well as on

10 BEIJING REVIEW, ''k^Vln/h t-'f?,' 1988 the economy. But it will be can gain an advantageous position devote 50 percent of its budget to important to study the new in the West European internal military spending and its financial president's tactics in dealing with market; as well as the questions of deficits have been increasing key domestic and foreign issues, unemployment, education, im• sharply. Many productive install• including how France can main• migration and overseas territories. ations have been damaged by the tain a leading position in Western What the new president's life will contras and 30 percent of the Europe, and obtain a greater say be like during the upcoming seven- country's able-bodied workers are in East-West relations; how it can year term depends on how he being sent to war. The Nicaraguan safeguard its security interests and handles these issues. economy is on the brink of stimulate its economy; how it by Xing Hua collapse. Popular dissatisfaction and demands to maintain the basic NICARAGUA living standard have been on the rise. And the Sandinistas have Truce Pact Promotes Peace Process been under continuous pressure from the other Central American countries to speed up the The Central American peace process advanced significantly implementation of the regional with the reaching of a ceasefire pact between the Nicaraguan peace accord signed last August in government and the contra rebels. But a permanent truce is Guatemala. still a long way off. The contras have encountered even more difficulties. The US Three days of tense negotiations A combination of several Congress in February rejected ' between Nicaragua's Sand- factors led to theHruce agreement. President Ronald Reagan's call inista government and the contra The Sandinista government has for new aid to the rebels. This rebels — the first to be held on been locked in a war with the US- shook their confidence in the Nicaraguan soil — resulted in an backed contra rebels since 1981. In United States and made them feel agreement for a 60-day ceasefire 1985 the United States imposed an insecure. to start on April 1. The March 23 economic blockade and trade The rebels suffered heavy losses accord, which was immediately embargo against Nicaragua. The in a sudden large-scale govern• welcomed both in Nicaragua and US move was a major blow to the ment military operation that abroad, is widely regarded as a country's economy, which de• started on March 7. The significant step towards regional pends mainly on the export of Sandinista forces recaptured some peace. farm produce. The Nicaraguan areas held by the contras, forcing The process for negotiating a government has been forced to them to flee to their bases in permanent truce is to be worked out by the two sides during the Nicaraguan President Daniel Ortega (third from the left) explains the truce pact to ceasefire. The rebels agreed to Journalists. move to specified zones of the country by April 15. In accordance with the truce pact, 100 political prisoners were freed by the Nicaraguan govern• ment on March 27 under an amnesty agreement approved by the Nafional Assembly the night before. A new round of technical talks aimed at setdng up "ceasefire zones" started on March 28. On March 29 the two negotiating teams mapped out five ceasefire zones into which the rebels would move before gradually laying down their arms and returning to civilian life.

,BEIJI}s)Q p^,\^Je>V. yVPRJL 11-17. 1988 It INTERNATIONAL

Honduras. It was under these Honduras, the Reagan adminis• approved US$48 million in circumstances that the two sides tration still wants to provide humanitarian aid to the contras. sat down at the negotiating table military as well as humanitarian Some observers maintain that in Sapoa and finally agreed to a aid to the contras, maintaining the realization of permanent peace ceasefire. that peace prospects in Central in Central America will depend on In previous negotiations, the America depend on keeping up the the actions of the superpowers — contras insisted that democratiz• pressure on the Sandinista govern• the United States and the Soviet ation had to be introduced before ment. On March 24 Secretary of Union. Disputes will undoubtedly ceasefire talks could begin. The State George Shultz urged Con• arise in future negotiations. A Sandinistas demanded that the gress to provide immediate aid to permanent truce is still a long way contras put down their arms and the Nicaraguan rebels. And on off accept a government amnesty and March 31 the US Congress by Xin De then participate in the national dialogue. In the recent talks, both sides softened their positions. The ISRAEL-SOUTH AFRICA change reflected their needs and hopes and a genuine desire for peace. Military Collusion Is Reprehensible But there are shadows over the agreement. After the signing of the Massive military collusion between South Africa and Israel, truce pact, some contra leaders including munitions deals, exchanges of experts and co• said they will continue to keep up operation on conventional and nuclear weapons, has aroused military pressure on the govern• international vigilance and condemnation. ment. Adolfo Calero, a contra leader who participated in the truce negotiations, said in Miami that the contras will reserve their outh Africa and Israel have 155-mm guns to South Africa, right to break the truce pact if the S formed a de facto mihtary which were then smuggled into the Sandinistas fail to implement it. coalition, which the rest of the country. Later deals included sales He said the contras are still a world knows little about. of Israeli self-propelled guns, air- fighting force which will not give Military deals between South to-air and ground-to-ground mis• up its pressure or demand for Africa and Israel began in the siles, armed speedboats, patrol power. early 1960s. Israel secretly sold boats, radar equipment, un• missiles, anti-tank weapons and manned planes. Gazelle helicop• Soon after the ceasefire agree• light arms to South Africa in 1963. ters, Cheetah fighter planes and ment was reached, Nicaraguan When France stopped selling reassembled Boeing-707s which President Daniel Ortega urged the weapons to Israel after the June 5 can refuel in mid-air and are US government to respect the War in the Middle East in 1967, equipped for electronic warfare. accord and to take steps to South Africa provided parts for Pretoria has also obtained from negotiate the normalization of Israel's Mirage fighters. In return, Israel tear gas bombs and other relations with Nicaragua. The Israel sold South Africa some anti-riot equipment to suppress Reagan administration did not drawings of Mirage-lII engines resistance of South African respond. which had been stolen by its blacks. On March 17, about 3,200 US intelligence agency. infantry and airborne forces were In 1976, the two governments Israel has helped South Africa dispatched to Honduras. The US signed a series of long-term secret make large-scale weapons exports government alleged that the forces military co-operation agreements, to 25 countries in defiance of a were sent to help Honduras repel thus launching their plan for 1984 United Nations resolution invading Nicaraguan troops that major military collusion. Their which prohibits UN member had intruded into Honduran weapon deals — estimated at be• countries from buying South territory while fighting the contra tween US$400 and 800 million a African weapons. rebels. But observers saw the move year — account for more than 20 Israel has sent military experts as aimed at putting military percent of Israel's annual mu• to train South African troops in pressure on the Sandinistas to nitions exports. the use of Israeli weapons and squeeze further concessions from In the 1970s, with the help of military equipment. These Israeli them. Although the US troops personnel from the US Central experts have also been involved in were later withdrawn from Intelligence Agency, Israel sold South African military actions

12 BEUrNG REVIEW, APRSiL l:t>,l,7„1988 against neigtibouring countries centre, and South Africa has built such as Angola and Mozambique. its first nuclear reactor and an Israeli riot experts have provided enriched uranium factory which guidance to the South African have the potential to produce an international Studies police. atom bomb. Under an agreement signed in January 1987, South A quarterly in Chinese South Africa and Israel have Africa will increase its uranium also co-operated to produce exports to Israel by 13 percent. A Contents of Issue No 2. 1988 conventional weapons and mili• UN special committee on aparth• The U.S.-Soviet Arms Control tary equipment. Since the 1970s, eid recently confirmed the Talks and Their Impact on Israel's three major munitions existence of nuclear co-operation Detente — Zhuang Quhing makers have helped South Africa between South Africa and Israel. The U.S. Economy Before and set up a military electronics After the Storm in the Stock industry. The two countries have The two countries' military Market — Xie Yao jointly developed new weapons collusion tramples on the UN Gorbachev's "New Thinking" using South African raw materials resolution calling for an all-round and the Readjustment of the and investment and Israeli embargo against South Africa. Soviet Foreign Policy — technology. After the new weapon Co-operation with Israel has Rang Zhi and Zhang Wuzhuan systems are put into production, increased South Africa's military South Africa gets production and The Readjustment of the Soviet strength and has helped Pretoria purchase rights. Tanks, boats, Policy Towards Europe in the to maintain its regional military planes, submarines, missiles and Last Three Years — Zhu Yiqing hegemony. This has had an guns have been jointly developed The Situation of the Afghan War adverse effect on the situation in in this way. and the New Development in southern Africa. Relying on its the Efforts for Political military superiority. South Settlement — Hong Xicheng Since the 1960s, Israel and African troops have raided On the Defence Co-operation South Africa have been trying to neighbouring countries at will. Between France and Federal build nuclear weapons. In 1976, South African sabotage is es• Germany — Jiang Jianqing they signed an agreement to timated to have cost its neighbours The Chad War; Its History and jointly develop them. Under the £10 billion since 1980. pact. South Africa agreed to Prospect — Xu Gengcai and provide enriched uranium while Wang Yingving Israel provided the advanced The collusion has been re• COMECON Takes New Steps in technology for nuclear warheads peatedly condemned by the Its Reforms — Zhan Dingfang and launching systems. Observers international community. Under Economic Relations Between have concluded that three mysteri• the pressure of world opinion, Japan and ASEAN in the New ous flashes in the South Pacific in Israel was forced to announce in Situation — Jiang Yaochun 1979 and 1986 were nuclear tests March 1987 that it would carry Thailand's Economy Is Taking related to Israel and South Africa. out limited sanctions against Off—Shishun South Africa. But clearly, the announcement was only for show. * * * The two countries are reported During the visit to South Africa in to have set up a nuclear test base in January 1987 by Israeli Defence China's Foreign Relations: A "the Antarctic and to be planning Minister Itzhak Rabin, two Chronicle to establish a nuclear missile test bilateral agreements touching on base on an island 1,000 miles military matters were reached. southeast of Cape Town. Israel The pacts stipulated that the long- has successfully launched a 1,600- term bilateral military co• kilometre-range missile which can operation pacts will remain in be used in both conventional and force; Israeli experts' stay in South nuclear attacks. South Africa's G5 Africa will be prolonged until long-range gun is capable of 1990; and Israel will continue to launching tactical nuclear provide weapons to South Africa. weapons. The military coalition between Israel and South Africa seems to South African scientists have be solid. worked in Israel's nuclear research by Wei Wei

BEIJING.RE\5lEW/ APRIL INI7, 1988 13 •i ARTICLES

Taiwan's Political Situation After Chiang by U JIaquan*

n January 13 this year father and again three years later, groups have surfaced. The spear• O Kuomintang (KMT) Presi• but he had already arrogated to head of the Democratic Progres• dent Chiang Ching-kuo died in himself all powers of the party, sive Party, founded in September Taibei (Taipei). His death marked government, army and police 1986, is aimed directly at the ruling the end of the autocratic system when he took up the post of KMT. The "Taiwan indepen• ruled by two generations of President of the Executive Yuan in dence" movement has spread "political strong-hands," the 1972. ideologically and developed Chiangs. Chiang Ching-kuo actu• Although Chiang Ching-kuo through pohtical activities on the ally ruled the island for 15 years made some arrangements before island. Some Hong Kong new• after taking on the post of his death, he had not brought spapers commenting on this President of the Executive Yuan in them to completion. In particular, wrote: "The latent dangers 1972 and both his historical merits political restructuring on the confronted by the KMT have and demerits have since been the island and adjustment of main• become real threats." subject of much discussion. land policies were not finalized. The KMT had the strength to General Secretary of the CPC Preparations are still being made dominate Taiwan when Chiang Central Committee Zhao Ziyang for the 13th KMT Congress to be Kai-shek died. Although Taiwan's made an appraisal of him in one held in the second half of this year. economy took a heavy beating speech. When Chiang Kai-shek died, from the oil crisis which hit The question of interest now is Taiwan was totally in the hands of capitalist markets, Taiwan suf• what the political situation in KMT authorities and opposition fered no major problems. But now Taiwan will be like in the post- forces outside the KMT did not social problems are widespread Chiang Ching-kuo era. This get any where. Now, however, and confrontations are on the article looks at some of the Taiwan's opposition forces have increase in Taiwan. Particularly possible answers to this question. become full-fledged and some since the lifting of martial law and organized political parties and bans on other parties and the

Four Differences

The situation in Taiwan now, after the death of Chiang Ching- kuo, differs greatly from the situation after his father's death in 1975. There are four main differences: Before his death, Chiang Kai- shek had made proper arrange• ments for his successor. Chiang Ching-kuo took up the post of President of the KMT Central Committee and replaced the President of the Republic of China one year after the death of his

* The author is deputy director and research fellow of the Taiwan Affairs Research Institute under the Chinese Academy of Social Sciences.

14 BEUING REVIEW, .APRl'LiJil-it?; 1988 press, social contradictions which had been for a long time suppressed in the past are now intensifying. Again, hit by US trade protectionism and the growing revaluation of the New Taiwan dollar, tens of thousands of small and medium-sized enterprises are on the verge of bankruptcy and social instability is growing. When Chiang Kai-shek died, mainland China was still in the throes of the "cultural revo• lution." The United States and other countries still maintained close official relations with KMT authorities which made things easier for Taiwan internationally at that time. Since the Third Plenary Session of the 11 th Party Taiwan and mainland tourists meet in Hong Kong and exchange autographs. Central Committee and the implementation of the open policy and a series of sound reforms, the socioeconomic situation on the mainland has rapidly improved of a successor to Chiang Ching- roughly put together a leadership and China has resumed and kuo. group before his death, there are established diplomatic relations The KMT has always replaced indications that it is not so co• with the United States and many the party for government and the ordinated and some of his ideas other countries. Taiwan, on the two generations of the Chiang have not yet been carried out. The other hand, has become more family made good use of "power establishment of a leadership isolated internationally. This politics." When Chiang Kai-shek which will be well received and being the case, with the death of died, the choice of his successor compatible with Taiwan's present Chiang Ching-kuo, Taiwan's was clear. But Chiang Ching-kuo conditions is now the vital issue in political situation will enter an has no "obvious successor." maintaining political stability in even more difficult phase. After Li Denghui took up the Taiwan. post of president, he was also "Political restructuring" is, in nominated acting chairman of the the final analysis, also a problem KMT Central Committee so the of power redistribution. With the problem of finding a successor export processing and service Three Major Problems seemed to have been solved. But industry as the mainstay of things may not necessarily turn Taiwan's economy, individual Whether order or disorder will out that way. Taiwan has now capital is challenging official and emerge in Taiwan after Chiang entered a new "power transfer foreign financing. The middle Ching-kuo depends mainly on the period" and the autocratic system class and a wide strata of people following three problems: of the past can no longer remain with similar living standards are In a speech he made two years unchanged. While the old power increasingly becoming a major ago, Deng Xiaoping revealed that and structure are being replaced, force. Under these circumstances, Chiang Ching-kuo was "in bad contradictions will inevitably it will be hard to maintain the old health and I don't know when he arise. Factional struggles, con• superstructure in which powerful will suddenly go to meet God. tradictions between Taiwan na• and influential KMT members After he passes away, will there be tives and those entering from the kept the empire under their turbulence in Taiwan? As far as we mainland after 1949, between new control. can see, no one in Taiwan can and old ideologies and leadership It seems that the "political replace him." The leader of the groups are bound to be very restructuring" carried out by Chinese Communist Party obvi• involved. Chiang Ching-kuo before his ously recognized the importance Although Chiang Ching-kuo death has become an irresistible

BEIJING IREWfEWK. .M-RH,. 1'1-I7, 1988 15 •i ARTICLES trend in Taiwan. The question is by the "Three People's Principles" "difficult times" will linger on, how to achieve a reasonable (Nationalism, Democracy and the and the Kuomintang authorities redistribution of power, co• People's Livelihood). If both sides will continue to retain sovereignty ordinate relations between various shared a common understanding over the island and reject attempts sectors and solve past and on this issue, there would be some at reconciliafion. This is because emerging contradictions while a possibility of handling relations currently there is no authoritative new ruling structure is being between Taiwan and mainland successor in Taiwan although a established. It is not a problem China in a proper and reasonable new president has assumed office that can be overcome in one big way. In the long-term, it is vital to and a leading body has been leap and with little effort. the future order and stability of formed. "Political restructuring," The "mainland policy," for all Taiwan. including the lifting of martial law practical purposes, comes down to and bans on other parties and the handling relations between both press, are welcomed by the Taiwan sides of the Taiwan Straits. Three Possibilities people and are expected to be Compatriots in Taiwan and on the continued. Taiwan authorities have also readjusted and relaxed mainland are all descendants of In 1985, with the knowledge their "mainland policy," a move the Chinese nation. The division that Chiang Ching-kuo was in which received popular support of the people and nation cannot be poor health, people began to and is unlikely to be reversed. All maintained in the long term. The discuss the "time after Chiang these are factors which will help issue is a practical one which Ching-kuo." In late December stabilize the situation in Taiwan cannot be avoided. In the final that year, in a discussion on for a while. analysis, it is a question of Taiwan's political situation in the Taiwan authorities made an "reunification" or "indepen• following decade, Tsai Tseng-wen, important step forward with dence" on which Taiwan's future professor of the Taiwan Political Chiang Ching-kuo's "mainland hinges. There will be no real peace University, made three predic• policy." However, it is only a small in Taiwan, and Taiwan's economy tions for Taiwan's future — step. The principles of "people-to- can hardly proceed further and "difficult times," "troubled people, one-way, indirect and enjoy prosperity without its times" and "a time of reconcili• gradual contacts," like four reasonable solution. "Economic ation." He actually intended to defence lines, still persist, and the gaps" do not justify the separ• comment on the situation after "three nos" policy (no contact, no ation; nor do the "different Chiang, but since Chiang was still negotiation and no conciliation) is systems" provide any grounds for alive, he only talked about "the often emphasized by Taiwan rejecting peace. Progress must be next decade." achieved through seeking truths authorities. Even Chiang Ching- To my understanding, the and proceeding sensibly and kuo's "testament" announced "difficult times" Professor Tsai objectively from realistic goals. after his death talks about mentioned is a "dragging on" of "opposing the Communist Party Doubts in the past about the the present situation in which the and reunifying China," and sincerity of the Chinese Commu• status quo will remain unchanged. "reuniting China under the Three nist Party in their desire for The "troubled times" predicts People's Principles." It seems that peaceful reunification can well be ruthless struggles between the the new leading body in Taiwan understood. But today the general various political forces in Taiwan will loyally follow "the teachings trend of development in mainland and the uncertainty ahead for the of the deceased," at least in the China is apparent to all, especially island. The "time of reconcili• near future, and will not readily since the announcement of ation" presupposes the possibility open the door for peaceful principles and policies by the 13th of peaceful reunification with the negofiation. There looks like little National Congress of the Chinese motherland through contacts and possibility for either disorder or Communist Party. An adherence dialogues between the Kuomin- reconciliation in the foreseeable to the idea of "economic gaps" tang and the Chinese Communist future. The main likelihood is a and "different systems" is no Party. continuation of the present longer supportable. Some Chinese I am not a fortune-teller and situation — a predicament. newspapers and magazines ab• don't want to make any rash road reason that mainland China predictions. But I feel that, given Professor Tien Hong-mao of no longer emphasizes the reunifi• the current situation, the Wisconsin University, USA, said cation of China by socialism, so "troubled times" and "time of at a forum last January that, after Taiwan authorities should not reconciliation" are unlikely to the death of Chiang Ching-kuo, stress the reunification of China appear for some time. The Taiwan could pass through three

16 BEIJING REVIEW, .^'ArRtlH iMl, l?88 phases — the "sad phase," the "honeymoon phase" and the "period of turbulence." Now, the "sad phase" has passed and the "honeymoon period" has begun. Considering the recency of Chiang Ching-kuo's death and the difficulties confronting Taiwan, 4 Taiwan's political forces may restrain themselves and co• operate for a time. But what will happen later? "I don't believe the opposition forces in Taiwan will give in on important matters of principle," Professor Tien said. "Many thorny problems will place the new leadership in a very difficult position." Although Taiwan has some economic and political strength, it also has many problems which are ZHENG SHUFU Taiwan compatriots in Beijing sliare a 25-l(g mooncatie at a IVloon Festivai gatliering difficult to resolve. One is the in Zliongshan Park, Beijing. "legally constituted authority" of the Kuomintang. Taiwan autho• rities can hardly maintain their existing ruling systems under the nos" policy obstruct the over• the root of predicament and banner of a "whole China" while riding will of the people? The disorder. retaining sovereignty over a small world is changing and so is public The only difficulty in reconcili• island. Certainly the opposition feeling. ation is that it requires that forces will not agree to this. Taiwan authorities must also Taiwan give up its designation of change their old concepts and "country." But in fact, it is not Another problem is Taiwan's policies and it would be better for easy for Taiwan authorities to use "international personality." At them to make their own changes this title without reserve. In• the moment only a small number rather than passively continue on sistence on this point will trigger of countries still keep up the current path. If the Taiwan problems centred around the diplomatic relations with Taiwan authorities intend to rely on their Kuomintang's "legally consU- and this situation will continue to existing power to put off the tuted authority" and the future of change against Taiwan's favour. question of retaining sovereignty Taiwan and sharpen existing Can Taiwan "return to the over a part of China, they will only contradictions. Disorder would international community" end up harming the country, the then be unavoidable. through "money diplomacy" or people and themselves. Will the future of Taiwan be so "material diplomacy"? Commenting on Taiwan's terrible, will the Kuomintang be The other issue is public feeling. political future. Professor Tsai "swallowed up" and "identified" Today's mainland is no longer the saw "reconciliation time" as with the Communist Party if one of the chaotic "cultural equally damaging to Taiwan as Taiwan gives up the title of revolution." Reform, opening up the current predicament and "country"? We have only to look to the world and developing the possible disorder. 1 cannot agree at the examples of Hong Kong and national economy have won wide with him on this point. Certainly Macao. The Communist Party public support. The Taiwan predicament and disorder are both does not want to swallow them up, people and overseas Chinese harmful to Taiwan, but disorder but instead, likes to maintain these elsewhere all eagerly hope the two originates from predicaments. The two stable and prosperous places sides of the Taiwan Straits can Kuomintang and the Communist outside the socialist mainland, as remove the barriers imposed by Party have been facing each other this is conducive to China's man-made "fences" and restore on either side of the Taiwan modernization drive and to the normal relations. Under such Straits, neither fighting a war nor future of the Chinese nation as a circumstances, how can the "three becoming reconciled — this is at whole. Although the Taiwan case

BEIJUWD: KEVIEW,-VAPRIL lt-17. 1988 17 ARTICLES

is different, the reasoning is the problems and disturbances are same. The Communist Party does possible. 5 WEEKLY not intend to "swallow it up." 2) In the long run, before the Non-stop Some overseas friends told us in normalization of relations be• Direct Service to private that to overcome Taiwan tween the Kuomintang and the with force would be difficult, and Communist Party and before a the Communist Party would solution to the struggle between probably have to pay a high price; "reunification" and "indepen• given Taiwan's island-type dence," factors harmful to economy, it would be easier to stability, such as the disturb and damage its economy. Kuomintang's "legally consti• Some high-ranking officials in tuted authority," "Taiwan inde• Taiwan and pro-Taiwan scholars pendence," differences between SHANGHAI (SHA) and abroad have also showed concern Taiwan's natives and those from BEUING (PEK) with about this. However, this is not an the mainland after 1949, and its action the Communist Party "international personality," will would even consider. For the same continue to develop. In this case, connections to ail domestic points in simple reason — a stable and confrontation and conflicts are prosperous Taiwan will do the inevitable. mainland good and help rejuven• 3) The only solution to these CHINA ate the whole Chinese nation. problems is to practically, reason• All in all, it is not reconciliation ably and carefully restore normal which will harm Taiwan's future relations between the two sides to The most frequent carrier development but the anti- safeguard the unity of China, on the US-China route. Communist and non- satisfy the wishes of the nation, reconciliation policy perpetuated respect the rights and interests of Three flights a week from by the Kuomintang authorities, the Taiwan authorities and New York and the Communist-phobia this people, and ensure Taiwan's every Thursday, Sunday and Wednesday policy stirs up in Taiwan society. future stability and prosperity. However, it is impos• One flight a weei< from Three Estimations sible to solve these problems Los Angeies without normal exchange and every Friday Stable and disruptive factors dialogue between the governments have been present in Taiwan's and people of both sides. Five flights a week from political situation since Chiang San Francisco Ching-kuo's death. In the short- In August 1987, United Daily every Thursday, Frij^ay, Sunday, term, stability will overcome any News of Taiwan published an Monday and Wednesday disturbance, but in the long-term article by Professor Fu Wei-hsun the situation will be reversed. My of the Temple University of the • New York: (718) 656-4722 views of the future can be United States. Fu stated that for or (212) 371-9898 concluded as follows: the resolution of relations between 1) The various factors condu• the two sides of the Taiwan Straits, Los Angeies: (213) 646-8104 cive to stability existing before the the Kuomintang authorities must or (213) 384-2703 death of Chiang Ching-kuo will readjust their present "three nos" San Francisco: (415) 877-0750 continue to hold sway. They policy and replace it with the or (415) 392-2156 include the formation of a active "reunification policy." CAAC the national airline of collective leadership, the continu• There is no other way out. I agree the People's Republic of ing development of the economy, with Professor Fu's proposal and I China with 5 direct flights the introduction of "political hope all patriotic Chinese in China weekly will give you a taste restructuring," and the readjust• and abroad will help bring about of the real China the ment of the Taiwan authorities' an agreement between the two moment you come aboard. "mainland policy." parties to end separation and Neither the Communist Party achieve reunification of the nor the United States wish for motherland as soon as possible, disorder in Taiwan. A relatively and further to fulfil the great cause stable situation can therefore be of rejuvenating the whole Chinese maintained there, although minor nation. •

18 BEIJING REVl'EiV', XfRiti'fi-'P?, 1988 Relations Between Planning and iVIarket

by Gao Shangquan, Vice-Minister of State Commission for Restructuring Economic Systems

conomic restructuring is a countries does not involve any something to be feared and the E complex process involving change in the nature of the socialist market is one which can many theoretical issues, but at its capitalist system. The introduc• be controlled. Improved macro- core is the need to acquire a sound tion of market mechanisms also economic control will encourage understanding of the relationship has no effect on the nature of the the unrestrained, oi;dered progress between planning and market. It is socialist system, but rather of the market. necessary not only in current improves economic management. Modern socialized mass pro• efforts to intensify reforms, but In the final analysis, the social and duction demands planning. Lenin also in establishing the new economic nature of a country is once said: "Large-scale machine framework of a planned commod• determined by its system of industry, unlike the preceding ity system. Without this under• ownership; the patterns of stages, imperatively calls for the standing, it would be difficult to economic operation and forms of planned regulation of production grasp the broader goals of management have no real in• and public control over it." economic restructuring and spe• fluence over its social and Socialized mass production cific reform measures would be economic nature. knits the various sectors of the altered, effecting the progress of Why is regulation through national economy into a mutually reform as a whole. planning and market becoming restricting and dependent organic (1) Regulation througii eitlier such a widespread trend in world whole through co-operation and planning or marltet is a metiiod economies today? Some reasons the division of labour. In order to and not a fundamental attribute are offered here. achieve an effective, ordered of the social system. Both Commodity economy, be it production, it is necessary to form methods can be turned to good capitalist or socialist, is based on a set of clear goals and basic rules use under the economic con• market. In line with the Marxist for overall control. Therefore, ditions of public ownership. point of view, the market is related regulation through planning has Capitalist countries, especially to the social division of labour. become a precondition for the developed ones, now lay much "The 'market' arises where, and to normal operation of social stress on government rpacro- the extent that, social division of reproduction. control of the economy as well as labour and commodity produc• Scientific and technological regulation by planning. To tion appear." (Lenin: On the So- development has prepared the overcome the drawbacks of the Called Market Question) There• physical conditions for the traditional planned economy, fore, both socialist and capitalist exercising of macro-economic socialist countries have launched a commodity economies can make control. The modernization of tide of reform which places use of the market mechanism. transport and communications, emphasis on a complete change The market, including the the rapid development of from rigid economic management capital funding market, expands electronics, telecommunications, through stereotyped administra• with the development of commod• and methods of information tive orders to an increased role for ity production and exchange. dissemination have loosened the market regulation. These changes Under such circumstances, we restrictions of space and time, are manifested in a form of should neither restrict the deve• making it possible for macro- "amalgamation" of the patterns lopment of commodity and money economic control to efficiently of economic operation and markets through administrative monitor economic processes and management under different means, nor discard them offhand provide effective, timely regu• economic systems. The "amal• when problems emerge. On the lation. Planning is an extremely gamation," however, refers only contrary, we should proceed from important part of this control. to the methods of economic the objective development of the In general, both planning and operation, but not the two social socialist market and learn how to market regulations are managerial economic systems. effectively guide and organize the processes; neither is identified with The introduction of regulation market through indirect control a special society, nor do they through planning in capitalist and legal means. The market is not conflict with each other. The idea

BEIJlNj^, 1988 19 •i ARTICLES

decision. Last June, Mikhail Gorbachev spoke about the need to abandon mandatory planning, saying that it was naive to think r that the central government could anticipate and cater for all possible contingencies in the economic field. The introduction .of state economic contracts to gradually reduce the sweep of mandatory planning is a concrete manifes• tation of planned commodity economies; the aim is to carry out planning on the basis of commodity exchange and the law of value. This is the direction reforms to the planning system

LI YIFANG should take. It involves the In an effort to guarantee the supply of grain rations at state-set prices, a grain marl

20 BEIJING REVlfeW, ^AliftttMi^-ft 1988 and market. They are also the economy and market, policies for regional development conducive to gradual change economic relations become in• and income distribution. Guiding within the functions of govern• creasingly sophisticated, calling policy plans are flexible and open ment bodies from direct allocation for the gradual replacement of to continuing evaluation, amend• of money and goods to enterprises material planning with policy ment and improvement. In to exercising indirect control planning. medium-term (five years, for through economic and legal The major thrust of policy instance) policy plans, material means, thus creating conditions planning involves enacting appro• production quotas should be for streamlining government priate macro-economic policies, abolished, and principles, policies organizations. including financial and monetary and goals laid down for develop• The replacement of mandatory ones; making a decision about a ment on the basis of analysis and planning with economic contracts reasonable economic structure economic forecasts; the imple• represents a major breakthrough and readjusting its orientation of mentation of the plans should be in both reform theory and development; and adopting ensured by market forces, includ- practice. While the process of transition must be a gradual one, full preparation is essential. It is A clothes market set up last year in ShiJIazhuang, capital of Hebel Province. necessary to acquire a sound WU OINGYUfc understanding of the concept of socialist commodity economy and of equal exchange. Governments at various levels must gradually change their functions, reduce their direct control, learn to exercise indirect control through economic means and establish the new approach of "the state regulating the market and the market guiding enterprises." With direct control generally reduced, the state should also improve its control over the few key enterprises and goods which still remain under direct control, and implement the principles of socialist commodity economy. Goods distributed according to state plan should go directly to enterprises and construction pro• jects via planning and supply departments. Government depart• ments' powers to distribute goods should be gradually abolished to do away with direct interference in production and construction. (3) Economic development and reform demand the replace• ment of material planning with policy planning. Integration between planning and market is changeable in form. In the early stage of industriali• zation, market immaturity can lead to more government inter• ference and planned production quotas. With the development of

BEIJING:REyiEW. APRIL 11-17, 1988 21 m ARTICLES

ing taxation, pricing, credit and various levels should formulate terprises, and government plan• monetary means. policies ©n industrial set-up, ning work will thus be established regional distribution and techno• on the basis of commodity The shift from material plan• logical structure, and taxation, exchange and the law of value. ning to policy planning represents banking and pricing departments This will make it possible for a major change in management should take measures for macro- enterprises to determine their through planning. The goals of economic control. production goals according to medium-term and annual plans market supply and demand, and should be well co-ordinated to To better co-ordinate planning for governments to regulate ensure the relative stability of and market through the replace• supply and demand through policies. In annual plans in ment of mandatory plans with economic and legal means. Once particular, policy goals must be economic contracts and material achieved, this will provide the clear and the measures effective. planning with policy planning, the economic and social environment At the same time, there should be new approach of "the state enterprises need to make their own feedback and supervision over the regulating the market and the decisions, and procedures will be policies' implementation. At pre• market guiding enterprises" will established for the government to sent, planning and economic emerge in economic operation. exercise indirect control over the administrative departments at Economic relations between en• economy as a whole. •

China's Ocean-Going Fleets by Our Correspondent Zhang Zhiping

ien the world's shipping was going transport with ever increas• Tianjin's wharf has seven berths Wlanguishing in the doldrums ing custom. Some 80 percent of for special purposes, more than in the 1980s, China's shipping China's foreign trade goods are any other port in China. business started to boom. China's carried by COSCO. The wharf, controlled by ocean-going fleets' deadweight COSCO boasts 600 vessels, computers, has a wireless com• tonnage (DWT) is now 17 miUion, including full container ships, roll- mand system, and its central ninth of all countries in the world. on-roU-off ships, bulk carriers, dry control room is equipped with In terms of the number of vessels, cargo ships, oil tankers and closed circuit television. This China has been placed sixth. In refrigerator freighters, with a total allows for comprehensive supervi• 1987, China's shipping-freight loading capacity of 13 million tons sion. However, because of discrep• volume was 65 million tons. It is and a total DWT of 11.6 million. ancies between the way the being recognized as a major force About 80 percent of the 600 vessels enterprise is run and the challenging the traditional ocean- were imported, most of them requirements of modern manage• shipping powers. second-hand, which is cheaper ment, the sophisticated equipment There are more than 80 sea than building them here. is not being fully utilized. transport enterprises in China. To keep up, COSCO has also Most of them are small with just been importing a great deal of one or two vessels, funded or advanced equipment. China now jointly operated with local govern• has 57 container ships with a total Service ments, and engaged mostly in of 33,300 TEUs (20-foot equiva• offshore transport. The China lent units) and 15 roll-on-roll-off COSCO is made up of its Ocean Shipping Company ships adding up to 160,000 tons of Tianjin, Dalian, Qingdao,'Shang• (COSCO) is the biggest ocean loading capacity. Shanghai has the hai and Guangzhou subsidiaries shipping enterprise and by far the biggest container ship fleet in the and has opened 37 international most important in China. Its country. cargo services. DWT accounts for 75 percent of The container ship wharf in In June 1986, COSCO im• China's total. Tianjin is 1,300 metres long and 47 plemented the "five-fixed things" The rapid growth of China's metres wide, and has an annual system for its international import and export trade in recent loading and unloading capacity of services: fixed lines, vessels, type of years has provided China's ocean• 400,000 standard • containers. cargo, berths and schedule.

22 BEIJING REVIH)«V, VJtBRJIlM If-W, 19SS Shipping Company. The Trans- Ocean Acfing Company jointly set up by China and the Netherlands on January 1, 1980 was COSCO's first Sino-foreign joint venture. The 14 joint ventures in Asia and Europe form COSCO's global service network. The 9,000-ton luxury liner SS Jianzhen, owned by the International Shipping Company, a joint venture with Japan, has put an end to unscheduled passenger and cargo services between China and Japan. COSCO has also set up joint ocean-going transport companies with Jiangsu, Zhejiang, Hebei, Anhui, Jiangxi and Hunan provinces. It charters ships and provides crews for foreign ship• A container ship. ping companies. Up to now, 1,700 sailors have been assigned by COSCO to work on foreign ships. Adhering to the fixed schedule COSCO has representatives in The Chinese crews have been is a vital element in COSCO's the major ports of Japan, appreciated by their clients for making headway in its business. Singapore, Kuwait, Australia, their intelligence, competence and To achieve this, the Chinese fleet Egypt, the Federal Republic of diligence. has been known to take economic Germany, Britain and Hong risks. When the Shanghai Ocean Kong. It has also set up a Shipping Company opened its subsidiary in the United States. shipping service to the US^A, it did COSCO has established 14 History not get enough business — but it Sino-foreign joint ventures. Pre• persisted to make the scheduled parations are underway to re• China has a glorious navigation runs, much to the delight of its establish the Sino-Czechoslovak history. Zheng He, a politician clients. The safety record of China's tanker fleet is excellent. No A dry cargo sliip. explosion, fire or oil spillage has taken place on any of the 12 oil tankers operated by the Dalian Ocean Shipping Company in the past five years. The Guangzhou Ocean Shipping Company is responsible for services to the Middle East. Its vessels have plied the troubled Persian Gulf and never fallen behind schedule. As with any enterprise seeking good business, COSCO has always adhered to the motto: The customer first. It has also endeavoured to keep costs down. Its charges have always been lower than its international counterparts and are allowed to float with the market.

BEIJING. REVaBW, .VSiPRIL 11-17, 1988 23 ARTICLES and navigator of the Ming was released from military service the standard employees' pay in Dynasty, made voyages across the in the 1970s. During his service he China and they are allowed a seas from Indonesia to Africa was in naval logistics. Naval proportion in foreign exchange on seven times between 1405 and veterans like Lei make up a fair their voyages. As well as more 1433. His fleet had over 20,000 proportion of COSCO sailers and money, their travelling means they sailors and 60 ships. This scale of form the backbone of China's have more opportunities to spend endeavour was unprecedented in saihng personnel. on fancy consumer goods such as the world at that time. In recent years, more and more Japanese-made televisions and After that, China shut itself off university graduates have joined refrigerators, which are in great from international intercourse. the fleet and they are highly demand in China. There is a 20- Then foreign powers encroached valued. Of the 900 captains in inch Hitachi colour TV set in the on the country and war and chaos COSCO, 30 percent have univer• room of Wang Shen's newly ensued. China's ocean-going sity education and 20 percent are married eldest son. Wang also said navigation became extinct, and technical secondary school gradu• that they have two Japanese China lost its sailing prowess. ates. The heads of COSCO's five motorbikes. When New China was founded subsidiaries are graduates of The life of a seaman is generally in 1949, China's fleet dispersed to mercantile marine institutes. They dull and monotonous, but Chinese Taiwan and other Southeast have been captains, political sailors keep excellent discipline. Asian countries. Less than one- commissai's, chief engineers or Meanwhile, things are not all roses tenth was left; a depleted, obsolete first mates on ships. for these sailors' spouses. Hus• and useless force. When COSCO bands may spend eight or nine was founded in 1961, there were There are eight institutes or months a year at sea, leaving the only 25 vessels in the country, with schools which train ships' crews in wife with all the household a total DWT of 220,000, manned China. The more famous ones arc responsibilities and, besides the by 627 sailors. Of the ships, only the Dalian Mercantile Marine wives may have their own careers. four small 2.000- to 3.000-ion ones Institute, the Tianjin Mercantile Liu Qingxian's husband, Luo were flying the Five-Star Red Marine Institute, the Jimei Xingai, is a ship's pohtical Flag. At that time China was Navigation Institute and the commissar. He went to sea in doing most of its shipping on Dalian Seamen's School. New 1979. In the past eight years, he chartered vessels. crew members wilf all have some has spent the equivalent of no formal training before they set In the 1970s, China's navigation more than one year at home. The foot on a ship. began to develop. The late Premier couple have four children, the China's expanding ocean-going Zhou Enlai proposed that China eldest is 21 years old and the fleet requires more young people, stop chartering and start building youngest, 17. Liu is the account• and most of them join the ocean• up its own merchant fleet. By ant of the Tianjin Seamen's going fleet seeking adventure. 1975. China had 330 vessels School. In the past eight years, the Some are just in love with the sea. totalling 5 million in DWT. children have grown up, the only Captain Ge Mu, 31, said that his COSCO has never looked back. son has joined a ship, and Liu, too, love of the sea is like the farmers' Even during the ten chaotic years has made strides in her career. It affection for their land. of the "cultural revolution" (1966- has not all been plain sailing for 76), its ships continued to travel Two of the three sons of Wang Liu and the children, but Liu says: the world's seas, and these voyages Shen, of the Tianjin Ocean "That doesn't matter. So long as I were never completely suspended. Shipping Company, are now look after the hou.se well, my seamen. His eldest son Wang Crews and Their Families husband will have no qualms Guorong graduated from the about his work." Tianjin Seamen's School and his Over the last 27 years, China's Captain Lei Shouguo's wife second son graduated from the navigation industry produced a cultivates half a hectare of land in Tianjin Seamen's Technical body of sailors with distinctly his native place, Shanxi Province. School. Wang Shen says, "My Chinese characteristics. COSCO Each time Lei has home leave, he sons can steel themselves on the employs 38.000. returns to help his wife farm. sh ips and have good promotion In China the job of the seaman There are 17.000 COSCO crew prospects. It's good for their is a life-long commitment, and members whose wives are in the future and for their present, for retirement is set at the standard rural areas. In general, sailors' they make good money." age of 60. families are comparatively stable Lei Shouguo, 37, captain of 55 The wages of the Chinese and their rate of divorce is lower LuyiiiK came to COSCO after he seamen are generally higher than than the average rate in China. •

24 BELTING REVIEW, APR.1L;bM7. 1988 FORUM Experts and Scholars on Reforms

In its inaugural issue this year, "Reform," a bi-monthly theoretical magazine compiled by Director of the Chongqing Academy of Social Sciences and Editor-in-Chief Jiang Yiwei, carried articles by some Chinese experts and scholars on China's current reforms. The following are three abridged articles from the magazine.

"uniting with non-Party cadres Separating Party and Government Functions and the masses." To control this tendency, the 13th National Party Congress n his article on separating Parly • Principles and policies for• held last October revised the Party I and government functions, the mulated by the Party should Constitution. Leading Party mem• well-known jurist Zhang Youyu provide the guidelines for the bers" groups in state organs will be said, the success or failure of work of state organs. However, replaced by Party committees reform to the political structure when handling state affairs, or working committees, with finally lies in the rational division administrative organizations have only supervisory and guaranteeing of Party and government func• the right to flexibly apply Party functions. tions. During the revolutionary principles and policies according Of course, if necessary. Party war period, it was necessary for to specific conditions. Party organizations can directly put the Party to exercise "monist organizations should neither forward proposals to state organs leadership" and "make no monopolize nor intervene in the on important issues. In fact, any distinction between the functions work of administrative organs. citizen, group or party has this of the Party and the government." right. But the Party organizations With our country now in a stage of • Party organizations and cannot force state organs to peaceful socialist construction, the members in state organs should do comply with their suggestions. As continuation of the practices of their best to implement Party for proposals offered by Party "'no distinction between Party and principles and policies, but they organizations, state organs are government functions" and "nio- have no right to give orders. Even free to either accept or refuse them nist leadership of the Party Party members in leading po• on their merits. and government" will not benefit, sitions with decision-making Party organizations can give but harm our cause. power should follow the principle orders to its members, even those Zhang's main views on the issue of democratic discussion before in leading positions in state are: making decisions. Leading Party organs. Party members must • The Party should only members of a unit should imite adhere to decisions made by the exercise political, not organiza• with and encourage other leading Party organizations. But they can tional leadership over state members with no party affiliation air any disagreements through organs. The relationship between to work well; ordinary cadres formal channels within the Party the Party and government is not should do their best to perform the when they think the decisions are one of subordination. The Party tasks assigned by administrative unsound. However, they should should refrain from issuing leaders. not refuse to follow the Party's arbitrary orders to state organs Zhang pointed out that the decisions simply because they are but base its leadership on sound main problem now is that some leading members of state organs. principles and policies and Party organizations in govern• The success of the implementation effective work carried out by Party ment offices act as "overlords" of Party orders depends on the organizations and members in issuing orders, going against the level of competence of the leading state organs at various levels. Party Constitution which calls for members.

BEIJING REVIEW; APRIL 11-17. 1988 25 •1 ARTICLES

the quality of the people is an Improving the Quality of Cadres important factor. It is important to raise their sense of honour, uan Xiang, a Chinese specia• never read the printed materials responsibility and self-confidence. H list on world issues recently we provided them. At first, I They should be encouraged to returned from abroad, considers thought they perhaps didn't know gain a professional understanding the improvement of cadre quality any foreign language, but I later of their own trades. Only in this an urgent task in the reform found they did not even read the way can they become successful process. Chinese translations." negotiators and gain the respect of Huan said many foreign Huan Xiang said that raising foreign counterparts. scholars, politicians and reporters are showing great interest in China's reforms and open policy. From the nine years of reform, Focus Reform on Contract System they see China as having a bright future as long as it maintains its conomist Yang Peixin said in reform measure was not effective policies on reform and opening up E his article that the stimulation in stimulating enterprises and to the outside world. of state-owned enterprises should most enterprises have still not However, Huan Xiang also centre on implementing and achieved independence as com• heard complaints from foreign perfecting the contract system of modity producers. friends. One was to do with managerial responsibility. To further invigorate enter• product quality. Many exports Meanwhile, other reform mea• prises, reform of their manage• from China do not come up to the sures should be adopted on the ment systems is once again being standard of samples offered by basis of this central task. looked at by urban enterprises. Chinese producers and the return The reform is essential to handling of merchandise is a frequent In the 1950s, China established the relationship between the state occurrence. a highly centralized mandatory planning economy in which and enterprises and workers. Foreigners are also dissatisfied Now, the total amount of profits with business dealings with the various economic departments directly controlled enterprises by and taxes handed in to the state is Chinese. It takes a long time to stipulated in the contract. Enter• conclude business contracts with setting tasks for them. As a result enterprises lost their managerial prises prefer to seek higher Chinese counterparts and some• contract quotas in exchange for times, contract demands can not power. Reforms to the old system should start with transforming more decision-making power, self- be met. One Western businessman development and economic gain, told Huan Xiang that he made five enterprises into independent com• modity producers. because the contract system is business trips to China, and spent conducive to making them two and a half years conducting Chinese farmers were the first to independent legal persons. Under business negotiations, but has still find the key to reform in the the system, wage increases for had no success in concluding a countryside — fixing farm output workers are closely linked to contract. quotas for each household. The growth in enterprise profits and Some foreign friends have the reform made farmers shake off the the implementation of the prin• impression that the Chinese are trammels of the old distribution ciple of "distribution according to very "shrewd" in matters of trade, system characterized by "eating work, and more work, more pay" but they are also myopic, only from the same big pot." They have is ensured. seeking short-term profits. It is not since become independent com• Yang concluded that "fixed uncommon for Chinese to give the modity producers with the right to farm output quotas in the green light to negotiations after manage their products. countryside" and "the enterprise being offered some very minor Encouraged by the success of contract system in the cities" are advantages. the rural reforms, urban enter• effective solutions to the problems A businessman from the prises also wanted to adopt the of the old system. Therefore, Federal Republic of Germany told contract system. But at that time, implementing and perfecting the the author he had received seven payment of taxes to the state contract system should be made or eight trade delegations at the rather than the direct delivery of the focus of current economic provincial and ministerial levels, profits was considered an easier reform and applied to urban who all asked the same questions. method to irnplement. The past enterprises in an active but careful The bussinessman said, "They few years have shown that the way. •

26 BEIJING RpYJJf^V, j>^pty h'^: ^^^^ FROM THE CHINESE PRESS

and ally with other enterprises Three Types of Socialist Monopolies which find each other attractive for various reasons. The members of the monopoly are mutually complementary in key elements of "LILUN XINXI BAO" —The group monopoly. This production and productive capac• (Theoretical Information) refers to cases where a small ity and share out the work and co• number of big industrial groups or operate with one another. This alliances of enterprises jointly kind of monopoly enjoys great nder socialist conditions there control one or several depart• advanages and can manufacture Uare three basic kinds of ments' production and marketing. high-quality products. monopolies. This monopoly is an outcome of The three types of socialist —The state monopoly. To lateral economic ties moving monopoly are different from the facilitate the overall development towards centralized production. capitalist monopoly in character• of the national economy in a In the current Chinese situation, istics and goals. State laws, favourable direction, the socialist this kind of monopoly is the policies and plans may restrict countries retain total ownership precursor of the trans-regional or monopolies in capitalist countries, and control of some sectors and trans-departmental monopoly. but the sphere of interference is natural resources. State industrial Group monopolies can be divided limited. The implementation of and other economic monopolies into two types: First, those whose laws in the capitalist countries are vast in scale and involve huge main goal is to produce exports to proceeds in all cases from the investments. No individual or bring in more foreign currency; interests of the monopoly capita• group could control them. A stale and second, those which are trying list class. In sociahst countries monopoly involves both public to create conditions favourable to both group and regional mono• ownership and total control of competition in the domestic polies must subject themselves to management and administration. market. In a group monopoly, an control, regulation, guidance and enterprise with rich human and supervision by the state. —The regional monopoly. material resources acts as the core (January 18, 1988) Different regions or departments can secure a monopoly by putting up administrative walls. There are three basic types of regional monopoly. The first is the Raising the Nation's Level of Education commercial monopoly. In this case, areas or departments carry out a policy of regional economic "ZHONGGUO JIHUA SHENGYU education. The percentage of blockade. They try to prevent primary-school students entering commodities made elsewhere BAO" (China Family Planning News) middle schools in 1982 was only from entering their areas and 30.75 percent. Imbalances in the promote sales of poor-quality, structure of secondary school high-priced goods made within he tremendous success of the education have seriously inter• their areas. The second is the TChinese government in control• fered with the development of production monopoly. Areas or ling population growth has been medium and higher-level technical departments make profits not the focus of much world attention. forces and with the level of from the division of labour in But with regard to tlie task of technical competence of workers. society through lateral economic improving the educational level of — Higher education is rather ties but from the establishment of the people, there has not been such backward. In China, university regional or departmental produc• rapid progress. This task has students account for a very small tion systems. The third is the become the most pressing one in proportion of the country's total monopoly of resources. In situ• China today. population. Every year only ations where materials and goods — Compulsory primary edu• 330,000 students graduate from are in short supply, areas or cation still has to be populariz• 675 colleges and universities. departments carry out a policy of ed. Officially 95 percent of the Moreover, owing to the irrational regional protection and restrict or country's school-age children structure of educational insti• prohibit exchanges of means of attended school in 1984 but only tutions and curricula, the avail• production among regions or 60 percent of them actually able pool of senior technicians is departments. completed their primary school limited.

'BEIJI>Jd kiVi'l^, iT^kFLli:)?, 1988 27 m FROM THE CHINESE PRESS

—Adult education leaves much to be desired. China now Better Students Are Rewarded has 115.15 million workers and government employees. Accord• "GUANGIVIING RIBAO" evaluation has been introduced. It ing to statistics, about 80 percent (Guangming Daily) aims to form an overall appraisal of workers and government of students — morally, intellectu- employees and about 70 percent of rally, physically and aesthetically. base-level leaders only have ast year 826 students with bad Students scoring highly will be middle or primary school levels of L examination results from rewarded or be given priority education. Shanghai's 43 colleges and when choosing jobs. Half — Funds for education are far universities were ordered to quit Shanghai's colleges and univer• from adequate. Every year school or repeat the year's work. sities have now implemented this educational funding only accounts This process of elimination has form of evaluation. for less than 3 percent of the been widely carried out in (February 2, 1988) country's total expenditure, while Shanghai's institutions of higher in developed countries it amounts learning in recent years and made to about 7 percent. some contributions towards im• proving educational practices. — High proportion of illiterate Shanghai's colleges and univer• women. According to a national sities actively adopted a range of survey, about 12 percent of the measures. Chinese population between the — The grants system will be ages of 15 and 49 cannot read or cancelled and a scholarship system write. But among child-bearing established. The 1987 ceiling for women, the percentage is as high scholarships was 350 yuan which as 35.6. It is therefore very went to about 45 percent of important to immediately enforce students. Of this number, the compulsory nine-year education. majority received scholarships for — Low-level urbanization. At their special subjects. Students in present about 80 percent of the financial difficulty can borrow Chinese population still lives in money from the school authorities rural areas, and the level of and repay them after they have a education for this group is very job. low. — University authorities have To sum up, the Chinese begun collecting 300-400 yuan a education system and the level of year in teaching fees from students intellectual development of the who failed to qualify for the next people fall far short of the needs grade. for rapid development of the — Second or third year college socialist economy. Zhao Ziyang, students who perform very well in general secretary of the Commu• their ex^aminations can transfer to nist Party of China, stated at the undergraduate courses in univer• 13th National Congress of the sities after their schools report to CPC that to accomplish the the higher authorities concerned. second step of the plan for Second or third year undergradu• economic development, priority ates who fare badly are transferred must be given to the expansion of to training classes or schools after science, technology and educ• their university authorities report ation. Only through effectively to the higher authorities tapping intellectual resources and concerned. respecting knowledge, will it be — Some institutions of higher possible to make great achieve- learning in Shanghai are catering riients in the development of the for the very good students by Chinese education system and the offering special classes, allowing improvement of the people's level them to skip a grade and moving of education. An astonishing cliange after a few days up the date of their graduation. of leave. (Fehruarv 1, 1988) — A comprehensive method of Cartoon by WANG JU

28 BEIJING REVIEW, APRJtj IW7, 1988 BUSINESSARADE

6 Export Bodies to market. The establishment of the Institute, the Dahan Engineering chambers will help maintain order Insfitute and the PLA General Be Established on the infernational commodities Hospital since 1986. Progeni has market. developed POLY (C) micro• ccording to an official of the All officials in charge of computers, which are especially A Ministry of Foreign planning for the chambers of suited to Chinese clients because Economic Relations and Trade, to commerce will participate in or they can use not only Chinese or facilitate the reform of its foreign lead export co-ordination work as English but also forge language trade system, China will establish deputy heads of trade delegations for people who do not understand six export chambers of commerce at the Guangzhou Export Com• any kind of computer language. after May this year. The chambers modities Fair this month. Harpham said he is confident will focus on cereals, oils, farm Since the Third Plenary Session about the future of the venture. produce and animal by-products; of the 11th Party Central "Relying on Progeni's advanced textiles and garments; light Committee in 1978, with the technology and the talents of the industrial products; arts and reform of its foreign trade system, Chinese people, we expect to crafts; metals and minerals; China has delegated export and become a world centre for machinery and electric products; management power to local computer software technology for and medicines and health care authorities. So far, about 1,000 use in educadon," he said. goods. Planning groups are now import and export companies and by Li Ning developing regulations, selecting large export-oriented enterprises members, and studying the have been set up. Shandong Invites production and sales of com• The transition has led to some modities as well as prices. confusion in the management of Talented People export commodities. So since The new chambers of commerce April 1985 China has set up more ast China's Shandong Pro• will link the government with than a dozen export associations Evince is inviting talented foreign trade enterprises. Their deahng with carpets, furfural, people with an understanding of tasks will include: pearls and jewellery, tungsten and foreign economics to join in its — Helping government depart• tungsten products, non-metallic international economic exchange ments in charge supervise member minerals, electrical machinery and programme. Governor' Jiang enterprises' implementation of motor vehicles. Chunyun issued this statement at a rules and laws relating to trade press conference in Beijing's Great and strengthening the control of These associations will become Hall of the People at the end of export trade to promote its orderly branches under the new chambers March. development. of commerce. According to Jiang, Shandong — Helping member enterprises by Yao Jianguo needs 26,800 more trained people formulate plans for developing to help with the re-equipping of export commodities and offering foreign-oriented enterprise in the suggestions to government offices. Progeni Plans areas of administration, foreign — Promoting links among Computer Venture trade, economic and technological member enterprises, exchanging exchange, foreign law, inter• information, studying the export national finance and foreign Tce Harpham, chairman of commodities market, and offering language. consulting services, on how to Pthe board of New Zealand's With a long history of foreign expand exports. Progeni, said at a meeting on March 23 in Beijing that his trade, Shandong has six open — Organizing exhibitions, pub• company has filed an application cities and six open ports and has licizing export products, and to set up a company in Beijing to established economic and trade participating in international develop and market computer ties with over 150 countries and conferences. software. It will be New Zealand's regions. Foreign investment invol• The official pointed out that the first wholly owned enterprise in ved in contracts with overseas chambers of commerce are the mainland China. businesses so far has totalled result of reform to the foreign Founded in 1968, Progeni US$2,550 million, and 130 trade system. Their main task is to markets its products in many foreign-funded enterprises have co-ordinate the export of China's countries. Harpham said his been established. One of the staple goods which enjoy great company has been co-operating country's main export commodity prestige on the international with the Beijing Aeronautical production centres, the province

BEIJING BEriEW,//APRIL 11-17. 1988 29 CKHDC's business superiority. Through leasing, subleasing and export leasing, the company helps Chinese and overseas enterprises and institutions import tech• nology and equipment, and promotes the development of export-oriented economy in China's coastal zones. Leasing is a newly established business in China, welcomed by thousands of enterprises in need of advanced technology but short on funds. Since its establishment in 1981, the China Orient Leasing Co. Ltd., the first Sino-Japanese joint venture in China, has set up about 40 leasing companies. Sino- foreign joint ventures account for 50 percent of the total and are mainly Japanese invested busi• nesses. The establishment of this exported US$2,970 million worth cational and economic circles in new company further indicates of goods last year. Beijing and other provinces are Japan's interest in China's leasing Shandong is one of the coastal also being looked to for co• business. zones opening for foreign trade. operation. Shandong also plans to The government recently re• take in a large number of overseas by Yao Jianguo cognized Qingdao, Yantai, administrative personnel and News in Brief Weihai, Weifang, Zibo and technicians. The procedures for Rizhao as economic development the economic development pro• • A senior official of China's zones, which means one-third of gramme are receiving careful General Customs "Administration the province will enjoy preferen• study and are expected to be says the country will establish tial treatment in their foreign pubHshed in May 1988. about 100 new customs houses in economic activities. by Zhang Zeyun the next two or three years as part Shandong is also rich in natural of the plan to promote the resources. Its raw materials economic development of coastal industry is now being replaced by Japan Invests in areas. processing industries, but progress China's Leasing China currently has 161 cus• is being slowed by backward toms houses with 20,000 em• technology and a shortage of jji Bank recently invested ployees. To improve the manage• scientists and technicians. Many PUS$2 milUon to set up a joint ment of imports and exports of industrial enterprises are still venture — the Kang Fu Inter• goods made from imported raw equipped with technology from national Leasing Co. Ltd. — with materials, 852 bonded factories before the 1960s and few have the China Kang Hua Develop• and 994 bonded warehouses had advanced since so the moderni• ment Corp. (CKHDG). The been set up by the end of last year. zation process will not be a simple second joint leasing company • China will soon launch its one. funded by Japan in China this weather satellite. The National year, the venture opened in Beijing Meteological Bureau is set to To solve the problem of the on March 25. The first one, funded launch the satellite and to receive shortage of skilled people, the by the Trust and Banking Corp.of satelHte weather data at ground province has formulated pref• Japan, opened in early March. stations in Beijing, Guangzhou erential policies to encourage The Japanese side holds 40 and Urumqi. Each of the three scientific research institutes, uni• percent of the new leasing cities is more than 2,000 versities and colleges, experts and company's shares. During the 20- kilometres apart. At present, technicians of the province to join year co-operation, both sides will China's satellite meteological data in local economic construction. make full use of the financial comes from US and Japanese Scientific and technological, edu• resources of the Fuji Bank and sateUites.

30 BEIJINQ KBYim^.fAmiwhn, \m •i BOOKS warriors, horses and chariots photographed on p. 74, the An Accurate and Up-to-Date Guide ancient temples, pagodas and grottoes illustrated on pp. 599- Encyclopedia of New China launched in 1979 when per- 603, the gold-filigree teapot on p. capita GNP was US$250 665, the cloisonne urn on p. 669 Edited by Luo Liang et al (p. 123). are a few examples of China's Foreign Languages Press Illiteracy dropped sharply cultural heritage and give some First edition, Beijing, 1987 after 1949, but the rate was idea of its tourist resources. Those 990 pages, 187 x 258 mm still 23.5 percent in 1982 leading or participating in spec• ISBN 7-119-00086-1/Z 17 (p. 39). ialized tours will find helpful List price: RMB 150 yuan An enormous population to information in relevant sections of feed, a low productivity and a low the book. The facts and figures educational level are some of the given in the section called "Life" factors which make it impossible (pp. 471-488) provide a clue to the for China to achieve moderniz• everyday life of ordinary Chinese. ation overnight. Special mention should be made The book presents the basic of Appendix IT, "Brief Guide to facts about China today in a China's Leading Officials" (pp. down-to-earth style. While outlin• 831-908). The more than 200 ing the achievements of the PRC, biographies were prepared before it also discusses, or at least touches the 13th National Congress of the on, some of its problems. In spite Communist Party of China held of its inadequacies, which will be last October. But since the dealt with later in this review, the emphasis is on the younger, book can be useful in different recently promoted officials, ways: readers can find information on Political analysts will find the practically all those elected to key section on Chinese history (pp. 63- posts at the congress and those 124), the Chronology of the PRC who will receive important (pp. 909-970), and the section on appointments at the First Session hina will be major industrial the Communist Party of China of the Seventh National F'eople's Cpower in 20 years." This is an (pp. 155-163) helpful in judging Congress opened on March 25. observation I have heard several political trends in China today. The names are in alphabetical times, particularly during my The section on foreign relations order in pinyin, the Chinese recent trips abroad. (pp. 207-275) is the first systematic characters are also given. This is "Not so soon," 1 have always Chinese examination of the PRC's probably the only Who's Who of told my friends. According to foreign policy to come out in its kind available anywhere. official Chinese forecasts, the English. The Encyclopedia is an accurate country's per-capita GNP will To economists and business up-to-date guide for anyone who only be US$800 by the end of the people, the book offers an wishes to learn something about century. In another 50 years, industry-by-industry description present-day China, from univers• China may be able to approximate of the Chinese economy (pp. 283- ity professors to school children. the level of the world's developed 470), including special sections on Though commendable as a first countries, but not much sooner. foreign trade and foreign invest• attempt by a PRC publishing The reasons for this can be ment (pp. 445-470), and relevant house, the book suffers from found in Encyclopedia of New laws and regulations are given in certain obvious inadequacies. China, a comprehensive manual the appendices. This offers an There is no list of illustrafions (of just published by Foreign Lan• opportunity to look at the Chinese which there are over 200). On p. guages Press. It enumerates the market and areas where business 356, the text says that "the relevant facts; can be successful. commune is no longer the grass• China's population was Travellers and the tourism roots government in the country• 1,046,390,000 in 1985, almost industry will benefit from a side," but the people's communes double the 1949 figure of number of sections in the book, are officially abolished in 1983. 541,670,000 (p. 40). not just the one on tourism (pp. {Continued on p.34 and for North The modernization drive was 417-427). The life-size terra-cotta American Edition p.46) BFJJlNdiRti^ffeW.V^RlL-11-17, 1988 31 m CULTURE/SCIENCE Zhao Zhunwang—A Creative Artist

In the autumn of 1985. Zhao left photographs. The album was a hit, Beijing to trace the Red Army's with about 10,000 copies sold. route. He spent several months making observations and sketch• As a Beijing artist, Zhao feels he ing, and took almost 2,000 must paint scenes of the old photographs. After an additional capital. He has chosen the ancient two months of hard work, he trees in Beijing as his subjects. finally completed the scroll. Trees are a traditional subject in The work was a success. On 2,2 Chinese painting; artists like to use by 20 metres of paper, a dozen or them to depict human characters, so mountains and big rivers are emotions and thought. Zhao has ingeniously laid out, with Ruijin, tried various techniques to capture where the Long March started, at the different styles of trees, one end, and Yanan, where it including hai miao (line drawing in finished, at the other. traditional ink and brush style) People's Liberation Army Pic• and po mo (splash ink). One of his torial published a picture album tree paintings was awarded first entitled Across Crags and Torrents prize at the exhibition marking containing Zhao's scroll, 120 of World Environmental Day in his sketches and 100 of his 1985.

One of Zhao's works: A Scene of south China.

Zhao Zhunwang.

IJeijing painter Zhao Zhunwang ^'has aroused a lot of attention in the city's art circles since he was commissioned to paint a scroll commemorating the Long March which the Chinese Workers' and Peasants' Red Army embarked on in the mid-30s. Under the iniluence of his mother, Zhao acquired a great love for Chinese painting at an early age. Later he received professional training at the Academy of Chinese Painting of Jiangsu Province in eastern China, and become a landscape painter. The turning point in Zhao's career came in 1985 when he was invited to paint a scroll showing the mountains and rivers along the route of the Long March. He accepted the challenge of conden• sing all the different landscapes into one painting, and at the same time capturing their beauty.

32 BEIJlNCr REVIEW. Al^ftH.'M-f?. I98S As he matures in art, Zhao, now mountainous areas and oxen are 43, pays more attention to the use their most important means of of water. Traditional Chinese production. In one Miao legend, painting paper — Xuan paper — the wild animal who made the is highly hygroscopic. Taking world is an ox dragon, who carves out rivers with his horns and helps advantage of this quality, a people plough the fields. The painter may get the specific mountain dragon, which is atmosphere he wants by giving believed to be in charge of the different tones and shades to the land, also has horns of an ox. subjects through the subtle use of water. In his recent works, Zhao One of the dragon designs. mainly uses the skill of "combin• ing strokes and spaces." For example he uses the splash style to paint distant objects and delicate lines to paint the nearby trees. As a result his works have a dream-like quality and convey his unique feeling for the landscapes of his motherland. In recent years Zhao has taken part in and supervised the decorations and paintings for several big hotels in Beijing. Along .lyiountain dragon. with other renowned artists, he designed and painted the murals in the Great Wall Sheraton Hotel Miao women are good at Beijing and the 70-metre-long embriodery. They use papercuts to mural at the Beijing subway stencil images for their embroid• station. His works have been ery on cloth. The exhibition exhibited in the United States, featured Miao dragon papercuts Japan, Australia, Britain, Den• made by well-known folk artists mark, Federal Germany and from the southeastern part of Singapore, where they received Guizhou Province. high acclaim. Professor Zhong Tao. an expert by Wei Liming on the folk arts of the Miao, says Dragon with a human head. Miao dragons can be considered as contemporary fossils of ancient Chinese dragons. They have a great similarity to the dragon Miao Dragons Are designs for the clothing of women designs on the painted pottery of and children. Something Special the New Stone Age (about 7,000- Miao dragons take a variety of 8,000 years ago) and the jade he Miao people, a minority in forms. Visitors to the exhibition pieces of the Yin and Shang T southern China, have their saw many of them, including (c. 16th-11th century BC) dy• own dragons — as shown in their centipede dragons, dragons with nasties. The Miao dragons direcdy traditional artistic works. An heads of the cat and other animals, inherited the forms of ancient exhibition of papercuts and dragons with human heads, Chinese dragons, while both Miao embroidery with various kinds of flowered dragons, lobster and Han dragons have developed dragons, recently held at the dragons, earth-worm dragons, forms of their own in the long Chinese Museum of Fine Arts in dragons with bodies made of the evolution process. The Miao Beijing, reflected the vivid imagin• leaves of the Chinese locust tree or dragons have great academic ations of the Miao. palm leaves and dragons with significance for the study of While the Hans used dragons to bodies like a tree in blossom. But it China's ethnology and human represent monarchy and imperial is ox dragons which are most cultural history. power, the Miao people have popular among the Miao people, always used them as ornamental for most of the Miaos live in By Wei Liming

BEIJINGiREMiPW, 4PRIL ll-f7, 1988 33 • CULTURE/SCIENCE

quadruple the normal price. A Movie Makers Face a Criticai Public poorly received film, meanwhile, could cost only 0.25 or 0.3 yuan for each ticket. The better a film is received by the public, the more prints or some Chinese film pro• Slandering Letters in the Women's distributing companies will buy, F ducers, the first quarter of this Kingdom, for example, sold a rare the higher ticket prices they can year is one they would like to low of 28. set, and finally, the more profits celebrate. But for others, it is one A similar situation occurred in they will make. they would rather forget. other film studios. A well received The popular and profit-making While some films did extremely film could sell 200-400 prints while films now are those made solely well in the first three months, a poorly received one would only for entertainment and profit such others suffered failures. The sell 20-30. as detective stories and comedies. Beijing Film Studio put 13 films Film studios and distributing They are usually full of drama and on the market, five of which sold a companies attribute this situation are lively. total of more than 1,200 prints to the adoption of the system of Serious, artistic or intellectual throughout the country. Overlord floating prices for film tickets in films, such as those on current Huang with a Gold Dart topped the recent years. This meant that, social issues, seem to be pushed hst, with 313 prints. although one print of any film — into the background. Slandering On the other hand, the good or bad — would cost 9,000 Letters in the Women's Kingdom is remaining seven films mustered no yuan, the ticket price for a well one of them. Such films used to sell more than 300 prints in total. received film could be double or at least 70-100 prints. •

another important foreign- China's reforms bring changes exchange earner. The sections on which affect the interests and {Continuedfrom p.31 and for North economics would have been much outlook of millions of people. American Edition p.43) more interesting to the foreign What are the differences which Encyclopedia of New China reader if the authors had linked have arisen between them? What their discussions with the world are the controversies? What are China is beginning to build an market. the good and bad things that have export-oriented economy, parti• China is a country in transition. appeared in the course of the cularly in its coastal areas. The While the book gives the basic reforms and the increasing present book is also mainly facts about the changes that have contacts with the outside world? intended for export, but the taken place since 1949 and How do people look at them? authors do not seem to be particularly since the reforms got Discussions of .these questions sufficiendy aware of what the underway in 1979, it does not through the presentation of foreign audience is interested in. relate the complexities involved in relevant facts would add consider• In the long section on industry these changes. ably to any future edition of the (pp. 306-347), there is no mention The history section refers to the Encyclopedia. of China's burgeoning space pubhcafion of the article "Practice industry which is beginning to Is the Only Criterion of Truth" in Still, the publication of this, attract international customers. the Guangming Rihao (Guangm- volume, with its degree of Except for a few scattered ing Daily) in May 1978 (pp. 116- openness and objectivity, would references in the PRC chronology, 117), without mentioning that it have been inconceivable either the space industry is left out. In the was the debate over this before or during or even a few description of the textile industry proposition, apparently purely years after the "cultural - revo• (pp. 340-343), only eight lines are academic, which heralded the lution." Bigger changes in China, given to textile exports, the complete negation of the "cultural more exposure to the world make country's major foreign-exchange revolution" theories and pract• possible a more meaningful and earner, and under the heading of ices, and the reappraisal of Mao sophisticated edition of the "Woolen Textiles," there is no Zedong's merits and demerits Encyclopedia. mention of the carpet industry. three years later. —Zhao Yihe

34 BEIJING REYf^. t.'^l If^J^, 1988