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China The First Five-Year Plan, 1953-57
Having restored a viable economic base, the leadership under
Mao Zedong, Zhou Enlai, and other revolutionary veterans was
prepared to embark on an intensive program of industrial growth and
socialization. For this purpose the administration adopted the
Soviet economic model, based on state ownership in the modern
sector, large collective units in agriculture, and centralized
economic planning. The Soviet approach to economic development was
manifested in the First Five-Year Plan (1953-57)
(see The Transition to Socialism
, ch. 1;
Organization
, ch. 7). As in the
Soviet economy, the main objective was a high rate of economic
growth, with primary emphasis on industrial development at the
expense of agriculture and particular concentration on heavy
industry and capital-intensive technology. Soviet planners helped
their Chinese counterparts formulate the plan. Large numbers of
Soviet engineers, technicians, and scientists assisted in
developing and installing new heavy industrial facilities,
including many entire plants and pieces of equipment purchased from
the Soviet Union. Government control over industry was increased
during this period by applying financial pressures and inducements
to convince owners of private, modern firms to sell them to the
state or convert them into joint public-private enterprises under
state control. By 1956 approximately 67.5 percent of all modern
industrial enterprises were state owned, and 32.5 percent were
under joint public-private ownership. No privately owned firms
remained. During the same period, the handicraft industries were
organized into cooperatives, which accounted for 91.7 percent of
all handicraft workers by 1956.
Agriculture also underwent extensive organizational changes. To
facilitate the mobilization of agricultural resources, improve the
efficiency of farming, and increase government access to
agricultural products, the authorities encouraged farmers to
organize increasingly large and socialized collective units. From
the loosely structured, tiny mutual aid teams, villages were to
advance first to lower-stage, agricultural producers' cooperatives,
in which families still received some income on the basis of the
amount of land they contributed, and eventually to advanced
cooperatives, or collectives. In the advanced producers'
cooperatives, income shares were based only on the amount of labor
contributed. In addition, each family was allowed to retain a small
private plot on which to grow vegetables, fruit, and livestock for
its own use. The collectivization process began slowly but
accelerated in 1955 and 1956. In 1957 about 93.5 percent of all
farm households had joined advanced producers' cooperatives.
In terms of economic growth the First Five-Year Plan was quite
successful, especially in those areas emphasized by the
Soviet-style development strategy. A solid foundation was created
in heavy industry. Key industries, including iron and steel
manufacturing, coal mining, cement production, electricity
generation, and machine building were greatly expanded and were put
on a firm, modern technological footing. Thousands of industrial
and mining enterprises were constructed, including 156 major
facilities. Industrial production increased at an average annual
rate of 19 percent between 1952 and 1957, and national income grew
at a rate of 9 percent a year.
Despite the lack of state investment in agriculture,
agricultural output increased substantially, averaging increases of
about 4 percent a year. This growth resulted primarily from gains
in efficiency brought about by the reorganization and cooperation
achieved through collectivization. As the First Five-Year Plan wore
on, however, Chinese leaders became increasingly concerned over the
relatively sluggish performance of agriculture and the inability of
state trading companies to increase significantly the amount of
grain procured from rural units for urban consumption.
Data as of July 1987
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