China’s technological change of gear

Press, 17 January 1979, Page 14

China’s technological change of gear

By

COLIN NORMAN,

a researcher with the Worldwatch Institute, Washington, D.C.

During recent months, Chinese officials have stunned the world by embarking on an ambitious, worldwide shopping spree for industrial technology. In 1978, they placed orders worth $27 billion for equipment such as coal-mining machinery, steel mills oil rigs, chemical complexes, nuclear power plants, and electronics factories. Japan, Germany, France and Britain have received the lion’s share of these, but with the establishment, in January, 1979, of full diplomatic relations between Washington and Peking, businessmen in the United States are now savouring the prospect of a surge in orders for American technology. It is ironic, however, that China’s decision to import billions of dollars worth of Western technology coincides with growing interest among many development experts in China’s own technological development. China’s self-help socialism has spawned a technological system that has many unique features, some of which may provide useful models for other developing countries.

In the early years following the 1949 revolution, China turned to the Soviet Union for technological assistance, particularly in building up heavy industries jn the cities. But after the Sino-Soviet split in 1960, China turned inward, relying largely on its own resources to meet its needs. Along

with this policy of national self-reliance, local selfreliance was stressed, which has had a strong influence on technological developments in the countryside.

China’s rural industries are a case in point. Half the nation’s fertiliser, cement, and iron and steel is produced in relatively small plants that use local materials and serve local agricultural needs. Such plants would be economically inefficient in rich industrial countries where goods and materials can be moved cheaply from large factories to dispersed consumers. But in poor countries that lack cheap transportation facilities, small plants serving local communities can be a definite advantage. Not only do they eliminate transportation costs, but they can also be built much faster than large plants, and they help to provide employment in the countryside. The self-sufficient, self-help philosophy has also enabled China to develop a capacity to tackle local problems that is missing in many other developing countries. While most poor countries have poured the bulk of their health budgets into sophisticated urban hospitals akin to those in the rich countries, for example, China has trained armies of “barefoot” doctors to dispense medical care in the villages, where four-fifths of the people live. These developments have produced mixed results. Contrary to some recent reports,

China’s over-all economic performance during the past quarter-century has been relatively good. Between 1952 and 1974, the economy grew by about 6 per cent a year, a rate matched by few other developing countries. Industrial production doubled every six to 10 years; while agricultural growth rates have been more modest. China manages to feed almost one-quarter of the world’s population with only about 7 per cent of the world’s agricultural land. But there have also been some conspicuous failures.

In the late fifties, for example, an ambitious effort to build thousands of tiny “backyard” iron and steel plants in the countryside fizzled out when it became clear that the plants were grossly inefficient. Political upheavals during the Great Leap Forward and Cultural Revolution, and in the months following Mao’s death, also depressed China’s economic performance. And in some cases the emphasis on local self-reliance has led to inefficiencies — factories have sometimes made their own machines when it would have been better to have imported them from factories in other provinces, for example. Nevertheless, if China’s economic performance has been relatively successful, why has the new leadership decided to alter course? One reason is that new technologies are required in some areas to raise productivity.

Chinese farmers, for example, have relied for centuries on composted human and animal wastes for fertilisers, a system that has effectively maintained soil fertility. By the early sixties, however, the

need to boost agricultural yields led to increasing production of chemical fertilisers in a mixture of numerous small-scale rural plants and a few large ones. More recently, additional require-

ments for fertilisers have led China to import 13 modern nitrogen fertiliser complexes that use the latest American technology. Similar demands for increased production have occurred in other basic areas of the economy such as -nergy supply and iron and teel production. Unlike many developing

luntries, which have allowed lie uncontrolled introduction •f foreign technologies and lave lived to regret the adverse social and economic effects, China has laid a base from which to pick and choose the technologies it needs. At this stage in its development, sophisticated foreign technology can make a key contribution to economic progress. However, the policy shift will not be without costs. Massive imports of modern technology cannot easily be grafted onto China’s decentralised political system. Centralised production of key goods will require closer economic integration between communities and between the countryside and the cities. And China’s attempt to establish a corps of highly trained scientists and engineers by sending 10.000 students abroad for university education is also likely to violate the egalitarian principles of the Cultural Revolution.

It will be a tough task for the new Chinese leadership to ensure that the massive influx of foreign technology is assimilated without causing political upheavals, and without abandoning the successful aspects of the nation’s past technological developments.