Changes in the
party and state leadership were made during the First Session of the 10th
National People's Congress in China in March 2003. Though Jiang Zemin obtained
only 92% of votes (with 98 votes against and 122 in abstention), he remains the
one in control of the military. The new President of the State, Hu Jintao,
obtained 99% of votes (with 4 against and 3 abstentions), but he has yet to
consolidate his power in relation to Jiang.
The outgoing
Premier, Zhu Rongji, made a Report of the Government's Work, and gave a balance
sheet of his government's performance in the last five years. With fixed assets
investment amounting to 17.2 trillion yuan (US$1 = 8 yuan), the deficit has
also increased from 46 billion yuan to a budgeted 319.8 billion yuan for 2003
(this does not include 568 billion yuan of state bonds issued last year, and
140 billion yuan of state bonds expected to be issued in 2003). Zhu had thus
won himself the nickname of "Deficit Premier".
Zhu's Report
stated that reform of the state-owned enterprises was the gist of the entire
systemic reform. Two levels of governing and management mechanisms will be set
up to monitor state owned assets - at the central government level and at the
local level. A feature article in Hong Kong reported that this would incite a
new round of sale of state-owned enterprises by local officials; with the
so-called Management Buyout (MBO), most of the stocks of state-owned
enterprises would be sold to the management. Some economists pointed out that
this will be the last scramble for state assets.1
While
state owned assets have been squandered under corruption and bureaucratic
management, and was valued at 11 trillion yuan in 2001, privately owned
financial assets in China was valued at over 12 trillion yuan according to the
State Statistics Bureau. The Deputy Head of the State Statistics Bureau, Qiu
Xiaohua, while reviewing economic development of 2002, said that the state
owned economy contributed only to one-third of China's economic growth, whereas
the two-thirds were from non-state sectors.
Zhu's
Report said that since 1978, 27 million workers from state owned enterprises
have stepped down from their position, 90% have gone into retraining service
centres, and about 18 million have found a new job. (That means about 9 million
are still unemployed.) However, Zhang Zuoji, Head of the Ministry of Labour and
Social Security, said 7 days later that up to the end of 2002, China had an
unemployed rank of 7.7 million, as well as 4.1 million workers from state owned
enterprises waiting for a new job.2 (He himself had some while ago quoted a
figure of 7.52 million registered unemployed and 6 million stepped-down workers
from state owned enterprises up to the end of September 2002; that would mean a
decrease of 1.72 million among the total number of unemployed within three
months, yet he at the same time said that the unemployment problem was getting
more and more acute.
The
official figures had kept urban unemployment rate to 4% at the end of 2002.
Wang Menghui, Head of the Development Research Centre under the State Council,
reported that from the studies done by various groups, the urban unemployment
rate had reached about 8-10%; in addition, 10 million youths come to their
labour age every year.3
With
the acute situation, workers actions have been frequent. During the March
Congress period, it was reported that in the northeast where unemployment was
serious, over five hundred textile workers took to the street for consecutive
days in Jiamusi City, demanding unemployment subsidy to be raised; the current
meager subsidy was a monthly sum of 120 yuan. Workers from the paper and sugar
industries joined the protests.4 In Xi-an City, several hundred workers from
military arms factories protested dismissal, and launched a sit-in on the
highway. In Changchun City, 400 winery workers protested that the management
did not provide them with heating facilities. In Liaoyang City, over a thousand
workers from metal and textile factories protested against wages in arrears.
Fang Qinghui, a young worker from Heilongjiang unemployed for five years, broke
into the Reuters office in Beijing and held the staff as hostage in order to
draw attention to his plight and to China's corruption. These are examples of
the acceleration of social crises.
The
situation for the peasants is even more acute. Since 1997, peasants' income has
been on the decrease. Zhu's Report acknowledged that agricultural products were
in excess of demand, and the prices were falling, which was the main reason for
peasants' income to drop. The state's support of the agricultural sector was
very small. Of the 17.2 trillion yuan which was five years of total investment
into social fixed assets, input into the agricultural sector was a mere 400
billion yuan. The situation will certainly become graver after China's
accession to the WTO. Wu Shusheng, a professor at the Peking University, said
that more important than increasing investment into the agricultural sector was
increasing peasants' income, employment opportunities and purchasing power.
However, 900 million peasants suffer from a reduction of the net income, and
cannot afford consumption.5
According
to Zeng Yanpei, Head of the Planning Commission, the well being for all the
population of China is at a low level of well-being. He said, in 2000, per capita
GDP was US$800, equivalent to 6,680 yuan. Official figures was that the income
of urban residents was 6,860 yuan, and the income of peasants was 2,366 yuan.
Qiu Xiaohua, Deputy Head of the State Statistics Bureau, said that 40% of
peasants' income was in goods, and cash income was only 1,800 yuan. With some
of it spent on pesticide and chemical fertilizer, only about 1,500 yuan could
be used for consumption.6
Wang
Xuchao, President of the China Poverty Alleviation Fund, said that there are
still around 30 million people in China's countryside who are below subsistence
level, and about 60 million at the subsistence level. There are 14.59 million
people in absolute poverty, with an annual income below 500 yuan. There are
90.33 million in poverty, with an annual income below 1,000 yuan. Those with an
income between 1,000 and 2,000 yuan are 310.79 million.7 They amount to about
half of the agricultural population.
At
the National Political Consultative Committee, Chen Mingde, Deputy President of
the China Democratic State Building Society, said that over half of China's
population had an income below 2,000 yuan, and the rich-poor disparity has
exceeded the international caution line.8
The
central government recognized that the burden on peasants had to be alleviated,
and had issued decrees to reduce tariffs on peasants. In over 20 provinces, a
reform turning fees into taxes has been experimented. There have been reports
of local governments finding ways to bypass decrees of central governments. The
different levels of the bureaucracy are still very much an obstacle to peasants
improving their lives. Sun Dawu, Director of Dawu Farming and Animal Husbandry
Group in Hebei Province, pointed out that a peasant intending to legally sell
boiled eggs would have to go through over 40 procedures. The compartmentalized
interests of different state departments and the excessive powers held by the
local rural power mechanisms made it difficult for peasants to increase their
income and for the countryside to develop.9
News
of peasants resisting oppression is usually blockaded, but some have found ways
to leak to the outside world. For example, the Xinhua Web reported on some
incidents: in January, at Nangwang Zhuan, Gucheng County, Hebei Province, 2,000
villagers refused to submit the agricultural tax and fought with about 30
tax-collectors sent by the township government. Three days later, 6 villagers
were arrested, but the villagers held the township party secretary and several
people as hostage. In the end, the county government gave in to the villagers.
Another incident occurred in Nanjing: over 300 workers coming from the
countryside took to the streets to protest against the construction company not
paying them their wages.
The
problems facing workers and peasants of China cannot be radically resolved
without a democratic political reform which does away with the political and
economic privileges of various levels of the bureaucracy. Such views are being
voiced by dissidents in China. In March, the magazine 21st Century Globe
Journal was banned, and one of the five charges was that it published an
interview with Li Rui who had served as Mao Zedong's secretary. Li said that
China's biggest danger is "non separation of the party and the state, the
party's rule superseding law, and the rule by individuals overriding the rule
by law". He also said, power corrupts, absolute power corrupts absolutely,
political reform should start from democratisation within the party, and all
party and state leaders should be elected by the 17th Party Congress.10 Two
editors of the News Weekly were dismissed for writing a review of Zhu Rongji's
performance during his term of office. These voices, though occasionally
repressed, allow us to see the changing scene of social transformation in
China.
6
April 2003
1 Hong Kong Economic Times, 29 March
2003.
2 Wen Hui Bao, 13 March 2003.
3
Hong Kong Economic Times, 26 March 2003.
4 Hong Kong Economic Times, 13 March
2003.
5 Hong Kong Economic Daily, 13 March
2003.
6
Hong Kong Economic Daily, 15 July 2002.
7
Ming Pao, 23 March 2003.
8
Apple Daily, 13 March 2003.
9
Apple Daily, 5 April 2003.
10
Sing Tao Daily, 15 March 2003.