EMERGES AS AN ADVANCING INDUSTRIAL POWER
An unusually interesting estimate of the stage of technology in the People's Republic of China was featured by the Scientific American, the well-known New York monthly magazine devoted to popular presentation of scientific subjects, as the leading article in its November issue. The article, "Technology in China," is by Genko Uchida, the international economic secretary in the Ministry of International Trade and Industry of the Japanese government. As a member of the ministry's China Study . Group, he initiated the analysis three years ago. He had available, of course, the full resources of the Japanese government in gathering and assembling information. In estimating where China stands today, Uchida uses as his yardstick the Japanese experience in advancing from a primitive technological level to one of the most industrially advanced countries of the world. It should be noted that although Uchida approaches his subject matter from the viewpoint of a pure specialist, appearing virtually apolitical, he is not unsympathetic to China. He indicates his approach as follows:
"One should understand at the outset that, although the most conspicuous aspect of modern China is her system of communistic control, in a fundamental. sense she is more a 'developing' country than a communistic one. That is to say, her economic policies are rooted primarily in her needs as a still poor, backward nation. This may help to explain why her views on Marxism and communism differ in some respects from those of the more advanced U.S.S.R. It also accounts for the extremely aggressive, evangelistic role adopted by the Chinese central government in directing the development of the national economy. In a country seeking to transform itself rapidly from the primitive, impoverished state to a modern industrial power, patriotic zeal and strong central control over the economy are indispensable."
In Marxist terms -- China is confronted with tasks logically belonging to the capitalist stage, but has no way of achieving these except by means of planning methods that are socialist in principle.
Uchida notes that "zeal has tended to run far ahead of capability." Yet under “the lash of experience," a certain evolution is observable which is "subtly reflected" in changing slogans. "They began with a simple appeal: 'Catch up and overtake.' They believed that by heroic efforts their immense, determined country could soon establish a modern industrial economy and outdo the advanced nations of the West. To that end they threw all the capital and labor they could command into the industrialization sector. They soon learned that this was a self-defeating policy. It took too much labor and capital from the agricultural sector and thus left the population intolerably short of food. Furthermore, the Chinese leaders (like the politically oriented leaders in most developing countries) had underestimated the importance of technical know-how. They had failed to realize that industrialization requires not only capital and a work force but also an adequate staff of technically trained personnel who understand the machines. Without this third essential element much of the capital and labor was wasted."
Three years of bad weather between 1959 and 1962 which ruined crops compounded the agricultural problem. The government thereupon shifted its emphasis and introduced a new slogan: "Stable production and more crops."
Another setback had occurred however. As an outcome of the Sino-Soviet dispute, the Soviet bureaucrats suddenly withdrew their technical advisers and workers from China in August 1960, leaving factories uncompleted and those in operation without skilled personnel. "Faced with the necessity of training her own people to complete the construction projects and run the factories, the Chinese government issued a new slogan: 'Self-development.'" This meant depending on Chinese resources for training engineers, technicians and researchers.
"She became timid and notably suspicious in her dealings with other countries, Communist or non-Communist, friendly or unfriendly," Uchida observes. "Her feeling was that those with whom she could trade were out to 'pick her clean.' For this feeling there was some justification, as some of the equipment China had bought from Communist countries turned out to be obsolescent. The Chinese government in recent years has insisted on buying only the latest models of equipment, often overlooking the fact that the newest models are not necessarily the best for China's own needs. The Chinese also ask for a two-year or three-year supply of spare parts for the equipment, fearing that in the event of an increase in international tension the suppliers
might refuse to deliver parts. All in all, the Chinese suspicion of foreigmers is so strong and the drive for self-reliance so determined that there is a gemeral reluc— tance to use foreign machinery at all."
In Uchida's expert opinion, China now has a "well-organized establishment™ for the direction of science and technology. He notes how it is specifically organized and reports that the National Science Department "maintains about 100 research institutes, employing a total of about 7,000 investigators who work om research projects assigned by the government."
"The new generation of engineers that China is producing is am impressive national asset," he continues. "The profession is not limited to men; it is attracting increasing numbers of women. China's young engineers are confident, ambitious, eager to learn. They are acquiring, mainly from foreign publications, a detailed theoretical knowledge of the latest advances in technology."
He notes, however, that the Chinese engineering establishment is still weak in two "crucial" requirements: "seaSoned leadership and the resourcefulness that cam come only from practical experience."
The Japanese technologist explains: "In an industrialized country the engineers are imbued by education and job experience with a generalized expertise that enables them to cope with a wide range of tasks and with new problems as they arise. In addition to their specific training they have automatically absorbed a fund of basic knowledge and skills -- one may call it a common sense -—- that is the heritage of the nation's industrial traditions."
China, naturally, lacks this. "Her engineers’ knowledge is largely theoretical ; the questions they ask of foreign engineers often betray a naiveté that shows lack of experience in applying the theories. The lack of practical experience has led China's leaders into some serious errors in industrial policy."
Among the errors, one category has to do with imitation. "It is natural, and indeed inevitable, for a developing country to begin by copying the products of advanced countries. Unfortunately there are grave pitfalls in such a policy. First of all, one had better be careful about what one selects for copying. A case in point is an agricultural machine China began to produce a few years ago. It was copied from a machine that had been designed and produced by a small manufacturer in Japan. After a year or so the Chinese found that the machine was poorly designed -- and that the Japanese manufacturer who had produced it had gone into bankruptcy."
In China, the "corrective" of bankruptcy is lacking; and once the model went into production, “politics and bureaucracy made it very difficult to stop.
Uchida cites as two other examples, imitation of a badly designed laboratory oscillograph and an automobile displayed at a Tokyo trade show. The Chinese engineers copied a 20-year-old model of a Western car. By adding new equipment like air conditioning, they made the sedan as heavy as a small dump truck.
Inherent in imitation is another pitfall -- “it retards the development of a capability for design." China, observes Uchida, "has succeeded in copying many sophisticated machine tools of the U.S.S.R., Germany, the U.S., Switzerland and Japan. This itself is no small achievement. Yet although China has developed high skill in copying designs, she has not developed much ability to improve on them or to design new machinery of her own. Indeed I have seen no evidence that any factory in China has a research and development division for the design of new products."
Japan went through a phase like this and then recognized that the development of a technology of design was itself an essential step toward full industrialization. "China now seems to be coming to the same realization; she has begun to seek technical assistance and knowledge from non-Communist countries."
A second mistake committed by the Maoist leadership was to follow a policy of production first, what is called in the U.S. a crash program. "This is the policy of putting all the available resources to work at any cost to turn out some article for which there is an urgent need." Uchida cites what can happen:
"For example, the Chinese at one point found there was an acute shortage of steel angle irons for agricultural development, and all the steel factories were
therefore ordered to make angle irons, whether or not they had efficient equipment for doing so. The result was a deluge of angle irons and a sharp reduction in the country's total industrial output. This lack of balance or planned programming has been characteristic of Chinese factories and of the overall economy."
Uchida thinks that the leaders of China have learned a lesson in this and that they have begun to rectify the tendency to engage in crash programming. But there are other related problems:
"Ghinese technology shows many signs of severe imbalance. For example, the country is mass—producing agricultural machinery but has not yet persuaded the farmers to make full use of it. China is buiiding many dams and hydroelectric plants; however, because she has not mastered the technology of control of river systems, there are often harmful repercussions upstream from the dams. China's factories are producing machine tools of excellent design but so poor in the quality of the materials that their reliability is far below standard."
In manufacturing, the basic existing weakness, a heritage from the past, is the iack of feeder industries for making parts and components. "The plants producing final products (for instance the leading factory for building trucks) must make their own nuts and bolts. A factory that makes electrical measuring instruments assigns a con- Siderable proportion of its 4,000 workers to turning out precision screws on bench lathes and to die-casting metal parts. A plant that produces testing machines must . build its own oil pumps." The lack of feeder industries is thus, "a severe obstacle to the development of high special skills and efficient production."
The first steps toward remedying this situation are now being taken. "From Japan's experience," Uchida declares "it must be said that the full integration of satellite parts piants into the industrial system as a whole will take a long time."
Uchida makes one more observation on the general problem which he says Japan learned some time ago and which China's leaders now begin to show signs of appreciating. "A populous country is tempted to believe any project, however formidable, can be accomplished if one only puts enough people to work on it -- the ‘human sea' idea. This method has been demonstrated as working wonders in circumstances such as the restoration of a bombed road in wartime with only human hands as tools, but it is certainly an unsound one for building an industrial system or a modern civilized society. Man is not an ant. China, with all her hundreds of millions of people, is now turning to emphasis on modern tools -~ mechanization and automation -- for building her society."
As specific measurements of China's technical progress, Uchida considers three basic industries: iron and steel, chemicals, and machinery. He notes that the assess-— ment must be relative and that production figures alone cannot be taken as a guide. This is due to the structure and quality of management and the prevailing attitude toward productivity, all of which "are still in a highly primitive stage." In addition, "Chinese policies have given scant regard to production efficiency. The net result is that the productivity of labor in China's industries is very low: it averages only about a tenth to a fifth of the productivity of workers in Japan." Uchida leaves these considerations aside and singles out the state of industrial techniques. He comes up with some highly interesting conclusions.
"China's iron and steel industry is a mixture of large-scale and small-scale operations, of modern methods and primitive ones. In her hurry to industrialize, the new Chinese nation urged the farmers to turn to making iron and steel in their spare time. Some 400,000 small shops, hardly more than smelting sheds, sprouted all over the country. This effort proved to be so inefficient and so injurious to agriculture that only about 300 of the small mills are still operating. They supply, however, about a third of China's pig iron and steel, and they remain politically important because they enable farmers to contribute to the nation's industrialization."
Aside from the famous backyard furnaces, China does have some big steel plants. There are about twenty of them. They do not have the most modern equipment. The rolling mills are mostly imports from the U.S.S.R. and East Germany "that are not up to date and are operated by control instruments that had to be improvised by Chinese engineers, Since the Russian technicians left in the midst of the installation of the mill machinery. The Chinese plants have no strip-milling equipment. Nor are they yet able to produce or process high-grade special steels (such as stainless steel) in any substantial quantity."
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However, Uchida offers an encouraging prognosis: "On the whole I estimate that in steel technology China today is about 15 years behind Japan (which is the world's third-largest producer of iron and steel, behind the U.S. and the U.S.S.R.). It is quite possible that China, as a larger country, will achieve her goal of passing Japan and becoming third in total steel production by 1973, but that does mot mean she will have caught up in technology. If she depends only on her own resources, it will take her considerably more than six years to develop her own strip mills and reach the pres-— ent world standards in modernization of steelmaking. In this connection it should be remarked that China has recently signed a contract with several companies in West Germany to obtain a complete rolling mill for the production of thick steel plates.”
In chemical technology, Uchida estimates that China stamds at a similar point -some 15 years behind Japan. "There too her development is repeating Japan's history. In a developing country the first chemical industries to receive attention are those. required for the production of fertilizers, acids (principally sulfuric acid for fertilizers) and alkalis (comprising two main industries: scap and detergents and soda, which supplies raw materials for glass). China's fertilizer industry is already siz— able: she produces some 7.5 million tons of chemical fertilizer a year. This is still far short of her needs, however. Although she adds to her own production by importing upward of four million tons a year (which makes her the world's largest importer of fertilizer), her total supply amounts to only 12 pounds per acre of cultivated land —— about a tenth of the amount used per acre in Japan. Moreover, her production consists mostly of ammonium sulfate and includes only negligible amounts of urea and high-grade compound fertilizers that are now in common use in Western countries. It appears that unless China obtains substantial help from outside it will take at least five to 10 years to raise her agricultural productivity to a level at which it can provide her with sufficient capital for a major breakthrough in industrialization."
Uchida forecasts, on the basis of Japanese experience, that the next stage in the development of China's chemical industry will be the extraction of products from coal tar. This will then be followed by "the age of synthesis, meaning the production of new chemicals from basic raw materials." The possibility of combining the two stages is suggested by Uchida's observation that China has already made a beginning in the establishment of synthetics industries by importing complete piants from abroad.
"In oil refining and the production of petrochemicals China is held back, as are all but the most advanced countries, by the fact that modern large-scale operation in this field depends entirely on automation. Like some other developing countries, however, China has recently made a beginning by entering into contracts to buy oil refining plants (from Italy, West Germany and France in her case)."
Efforts to speed up development of the chemical industries have been undertaken by the Chinese government through the purchase of plants of various types from a number of countries. "Experience has shown, however, that a country cannot make great progress in industrialization until it has acquired the ability to build its own equipment....China is now taking the first steps toward such self-reliance in chemical technology."
Turning to the machinery industry, which is the "clearest index to a nation's industrial development," Uchida again offers some instructive observations. "As in the chemical industry, in launching a machinery industry a developing country's first concern must be the needs of agriculture. The Chinese have put great emphasis on the production of farm tractors. A single large factory in Loyang is turning out 400 to 400 45-horsepower tractors a month, plus some power shovels and graders. The production cost of the tractors is reported to be about $10,000 apiece -- 30 to 40 percent higher than the standard in industrialized countries. To Japan, which produces tractors mainly for construction jobs rather than for agriculture, China's investment in tractor production seems disproportionately large, since labor>saving in farming is less urgent than increasing the productivity of the soil."
Besides tractor factories, China has also developed "a substantial industry in fhe manufacture of pumps, which are used to a large extent for agriculture." The pumps are "quite modern, and so is the equipment employed in producing them, except for the final testing instruments."
In railroad rolling stock, Uchida cites Japanese experience. When Japan started producing this equipment some 90 years ago, it took her nearly 20 years to catch up with the technical level prevailing at the time. "China began to build locomotives 15 years ago and is now reported to be producing almost all her supply of
these machines in her own shops."
In shipbuilding, however, China is lagging considerably. It took Japan 20 years to catch up in the nineteenth century. China, having relatively little foreign trade and depending “mainly on overland and inland-waterway transport within her own country™ is not under great impulsion to develop shipbuilding. She has no facilities yet for building a ship of more than 12,000 tons and lacks modern techniques such as the block-building system or construction of giant tankers."
As for trucks and automobiles, China “does not yet have an automotive industry in the modern sense.“
After the development of machines for agriculture and transport, the next stage in the development of a modern industry is the production of machine tools and major power sources. This means making boilers, turbines and heavy electrical machinery. "China has entered this second stage. As I have mentioned, many of her factories are equipped with modern machine tools that were imported from various countries: East Germany, Czechoslovakia, Switzerland, West Germany, the United Kingdom, France and Japan. China herself is only beginning, however, to produce machine tools of her own, and her progress so far is very uneven. Her output of tools of the grinding class, for example, is good, but her boring tools are below standard. We can estimate the level of the Chinese machine-tool industry by noting that it does not produce transfer machines, roli grinders or jig borers and it cannot turn out really large machines; the boring machines are limited to 150 millimeters (about six inches), hobbing machines to 2,500 millimeters, vertical boring and turning lathes to 6,000 millimeters and planomillers to 3,000 millimeters."
Uchida notes that China's dependence on foreign machine tools has held back her own education and practice in designing such tools but on the other hand has given her engineers an advantage in not being inhibited by experience. "They can boldly explore unorthodox approaches. For example, in a machine-tool factory in Shanghai they have put all the operations, from machining of the various parts to final assembly, in one huge, temperature-controlled room —- perhaps the largest room in the world for making machine tools. With increasing sophistication in the techniques and synthesis of the various operations, this room might eventually turn out the world's best machine tools.'
: Judging from Japanese experience, Uchida thinks that China is about 15 years behind in the machine-tool industry, but, by importing foreign know-how "might easily catch up in a decade."
He believes that the same holds true in the production of heavy electrical machinery.
As for automobiles, Uchida estimates that it will take China "more than 20 years to develop an industry capable of producing automobiles comparable to those of the advanced countries. The same is true of her production of aircraft. She has begun to produce small planes by herself, but almost all are complete copies of Russian models."
In electronics, China has not yet gone much beyond laboratory investigations although keen interest is being shown in this field.
Taking Japan as “typical" of a modern industrialized country, Uchida concludes that by nearly all the indexes China is 10 to 15 years behind in technology. "It is a striking fact that the Japanese engineers who have visited China recently have in almost every case found Chinese engineers today confronted by the same problems Japan attacked about 15 years ago."
Uchida makes the following forecast: "In 1950 Japan's income as a nation was $9.3 billion, amounting to $93 per capita. She soon passed the level of $100 per capita, and thereafter she was able to devote an average of about 30 percent of her annual gross national product to capital investment; in 1961 she actually allocated 4% percent of her G.N.P. to expanding her productive capacity. This high rate of investment enabled the nation to generate a growth rate of 10 to 20 percent a year in G.N.P. By 1965 her national income had risen to $62 billion, or $620 per capita. In 15 years it had multiplied sevenfold.
"China's present national income is estimated to be about $100 per capita, or $60 billion in total for her estimated 600 million population. Most of that income
of course comes from agriculture. She has emerged from the 'takeoff' stage (to borrow a term from the U.S. economist W.W.Rostow) and entered the industrialization stage. If she follows the experience of Japan, she will soon accumulate enough technical knowledge and capital to make a breakthrough into a period of rapid economic growth, a growth that is driven by industrial investment. In 10 to 15 years she might attain a per capita income equal to Japan's present figure (#620). In that case China's gross national income would be about 70 percent as large as that of the U.S. ”
"How far off is the impending breakthrough for China? My own estimate is five to 10 years. One may wonder, of course, whether recent political events in China, apparent to the outside world largely in the activities of the so-called 'Red Guards,' will affect this timetable. In this connection I shall observe that Japan suffered from similar political instability in the years before World War II. Thereafter the pace of her progress toward industrialization was quicker."
Two items are to be especially noted in Uchida's forecast. (1) He agrees that China has definitely crossed the threshold and entered the industrialization stage. (2) He thinks that outside of unpredictable contingencies the period of rapid economic growth may begin within five to ten years. .
These conclusions, which seem to be solidly based on the evidence emerging from the three-year study undertaken by the government department which Uchida heads, are of enormous world importance. Their significance can be judged simply by comparing the status of India. India is still stagnating. Under the rule of Indian capitalism and its American and British backers, the perspective facing the masses is hopeless.
And what opened a bright perspective for China? Two events: a profound revolution that overthrew capitalist rule and the establishment of a planned economy. Whatever the errors, shortcomings and backslidings, the possibilities inherent in a planned economy based on the destruction of private capitalism have been proved once again as in the case of the Soviet Union.
This lesson will become more and more deeply imbedded in the consciousness of the masses throughout the world as China forges ahead.