THE FOREIGN TRABE OF COMMUNIST CHINA
1949:1960
A REGIONAL AND COMMODHY ANALYSIS

Thesis gel! the Degree 0? DI'I. D.
MICHIGAN STATE UNIVERSITY
Victor Mok
1964

This is to certify that the

thesis entitled

The Foreign Trade of Communist China
19A9-1960

A Regional And Commodity Analysis

presented by

Victor Mok

has been accepted towards fulfillment
of the requirements for

Ph. D. degree in Economics

Jig/M 6”

Majojfprofeshor

[gt-4w! ?, /?[’—/

Date /

0-169

 

LIBRARY

Michigan State
University

 

 

ABSTRACT
THE FOREIGN TRADE OP COMMUNIST CHINA

19‘9-1960
A REGIONAL AND COMMODITY ANALYSIS

by Victor Hok

The purpose of this study is to analyze the regional
distribution and commodity structure of the foreign trade of
Communist China with respect to-her economy and economic
development. In order to make estimates of the regional
distribution and balance of her foreign trade, a comparison
is made between her statistics and those reported by her
, trading partners. This comparison shows that the foreign
trade statistics of Communist China are on the whole reliaé
ble, with due understanding of two factors. First, the
official yuan-ruble and yuan-dollar rates were divorced
from the international dollar-ruble exchange rate. Second,
Communist China reported her foreign trade figures in ex-
ternal prices; that is, her foreign trade figures are cal-
culated by converting the foreign exchanges used into yuan
figures each at their official rates. The estimates them-
selves indicate that the foreign trade of Communist China
was heavily oriented to the Communist bloc; and, while
accumulating a huge deficit with the Communist bloc, she
had a considerable surplus from countries of the Free World.

In the analysis of the commodity structure of her

Victor'Hok

foreign trade, commodities are classified into four major
categories, namely, machinery and equipment, manufactured
goods, raw materials, and foodstuffs. Her trading partners
are separated into three groups: Russia, the developed
countries, and the underdeveloped countries of the Free
World. Simple regression coefficients are calculated to
determine the trends of various commodity groups that
Communist China traded with various groups of countries.
This analysis indicates that while Communist China stood in
relation to Russia and the developed countries as an under-
developed country, she was rapidly emerging into the 9081m-
. tion of an industrial country in relation to the under-
developed countries. Also to adjust herself to the Embargo,
Communist China concentrated her purchase from Russia only'
on those commodities that she could not get from the Free
World.

Because of the size of the Communist Chinese
economy and her policy of "balanced growth,” the foreign
trade sector was not an engine of growth in her economic
development. Quantitatively, it occupied a very small per-
centage .in the national income of Communist China; its
level depended heavily on her ability to export, which in
turn depended on the performance of her economy. Therefore,
despite its importance in transplanting the modern tricks of'
technology into Communist China, foreign trade would fall

an immediate victim in case of a failure in her economy.

THE FOREIGN TRADE OP CONNUNIST CHINA
ISQS-ISSO
A REGIONAL AND COMMODITY ANALYSIS

39

Victor Hols

A THESIS

Submitted to
Michigan State University
in partial fulfillment of the requirements
for the degree of

DOCTOR Of P811080?!"
Department of Economics

1966

ACKNONLEDGNENTS

The author wishes to express his profound gratitude
to Professor Anthony Koo, who first suggested the topic and
later directed the study. His unfailing guidance and sugges-
tions throughout the preparation of this dissertation have
been most constructive and are deeply appreciated.

In an early stage of this study, the author was also
benefited by discussions with Professors Herbert Kisch,
Hordechai E. Kreinin and Abba P. Lerner, to when his grati-
tude is expressed.

Special appreciation goes to Professor Alexander
Eckstein, of the University of Michigan, who, in addition to
giving a general discussion on the subject, actually read
the first draft of the second chapter and gave some helpful
opinions.

Further, thanks also go to Professor D. J. Mont-
gomery for>his permission in using calculating and drafting
facilities.

finally, the assistance of Mr. Prank Taylor and Hr.
Ruck-Pei Yeung in reading the manuscript is also gratefully
acknowledged.

ii

TABLE OF CONTENTS

ACGOWSO O O O O O O O O O O O O O O O O O O

“8! or TABLES O O O O O O O O O O O O O O O O O O O

us, or InwsrnrxouSO O O O O O O O O O O O O O O O

LIST OF APPENDICES . . . . . . . . . . . . . . . . .

INTRODUCTION . . . . . . . . . . . . . . . . . . . .

CHAPTER

I. THE PLACE OF FOREIGN TRADE IN THE ECONOMY OF

COWIST CH!“ O O O O O O O O O O O O O

II. ESTIMATION OF THE TURNOVER, REGIONAL DISTRI-
BUTION AND BALANCE OF THE FOREIGN TRADE

OF COMMUNIST CHINA . . . . . . . . . . . .

III. THE IMPORTS OF COMMUNIST CHINA . . . . . . .

IV. THE EXPORTS OF COMMUNIST CHINA . . . . . . .

V. THE NET POSITION OF COMMODITY TRADE OF
COMMUNIST CHINA. . . . . . . . . . . . . .

VI. THE CONCENTRATION OF FOREIGN TRADE OF
COMMUNIST CHINA. . . . . . . . . . . . . .

VII. SUMMART AND CONCLUSIONS. . . . . . . . . . .

Blnuwmm O O O O O O O O O O O O O O O O O O O O
APMICBSOOOOOOOOOOOOOOOOOOOOO

iii

Page
ii
iv

vii

viii

26
SN
19

100

116
ISI

152
ISO

LIST or TABLES
Table Page

1-1. Relation of Capital Goods Import to
COPIEOI IMVOOCIOHTO e e e e e e e e e 10

1-2. Rates of Increase of In ort, Export,
Industrial and Agricu tural Production
Of COIEMHIOT CHIHO. e e e e e e e e e 20

1-3. The Relation Between foreign Trade and
National Product of Communist China . 23

11-1. foreign Trade Turnover of Communist

China s e e e e e e e e e e e e e e e 2.
11-2. Regional Distribution of foreign Trade
Turnover of Communist China . . . . . 20

11-3. Foreign Trade Turnover of Communist

China s e e e e e e e e e e e e e e e 30

11-h. Regional Distribution of foreign Trade
Of COUIMDAOE China e e e e e e e e e 31

11-5. Turnover and Regional Distribution of
Foreign Trade of Communist China. . . an

11-6. Official Foreign Exchange Quotations of -
COflflMMIOE Chifll e e e e e e e e e e e “o

11-7e Sinc-Communist-bloc T’Qd‘ e e e e e e e “1

11-8. Turnover and Regional Distribution of
Foreign Trade of Communist China . . us

II-O. Balance of foreign Trade of Communist
China s e e e e e e e e e e e e e e a NO

11-10. Balance of foreign Trade of Communist
Chin. e e e e e e e e e e e e e e e e 52

11-11. Turnover and Regional Distribution of
foreign Trade of Communist China. . . 53

iv

Table
III-1e

III-2.

III-3 .

III-“ .

III-5e
III-6 a

III-7.

111-8 .

III-9.

III-10.

III-Ila
III-12.
111-13.

III-lb.

IVOIe

IV-2.
IV—3.
IV-“ .

I'US .

General Commodity Imports of Communist
Chi“. e e e e e e e e e e e e s s e e

Machinery and Equipment Imports of
Communist China s e e e e e e e e e e

Machinery and Equipment Imports of
comm“ni.t China e e e e e e e e e e e

Manufactured Goods Imports of Communist
China e e e e e e e e e e e e e e e e

Chemicals Imports of Communist China. .

Manufactured Minerals Imports of
COMMHBIHE China s e e e e e e e e e e

Other Manufactured Coods Imports of
Communist China s e e e e e e e e e e

Raw Materials Imports of Comunist
China a e e e e e e e e e e e e e e e

Animal and Vegetable Raw Materials
Imports of Communist China . . . . .

Crude Minerals Inports of Communist
China s e e e e e e e e e e e e e e e

Foodstuffs Imports of Communist China .
Exports of Russia to Communist China. .

Exports of Developed Countries to
Communist China s e e e e e e e e e 0

Exports of Underdeveloped Countries to
CONMHRIOE China s e e e e e e e e e e

General Commodity Exports of Communist

China a e e e e e e e e e e e e e e e

foodstuffs Exports of Communist China .
foodstuffs Exports of Communist China .

Raw Materials Exports of Communist
China a e e e e e e e e e e e e e e e

Animal and Vegetable Raw Materials
Exports of Communist China. . . . . .

Page
It
58
59

6:
SI

65
67
SS
69

7O
72
73

7|!
75

so
80
82

Table
Iv-s.

Iv07.

IVC8 Q
IV'g .

IV-lO.
IV'lle

IV-12.
IV-13.

IV-1k.
v-1.

v-2.
V-3.

V'“.
VI-10

VII-1.

vi

Crude Minerals Exports of Communist
Ctheeeeeeeeeeeeeeeee

Manufactured Goods Exports of Communist

China.................

Chemicals Exports of Communist China. . .

Manufactured Minerals Exports of
ComunistChina............

Other Manufactured Goods Exports of
CommunistChina............

Machinery and Equipment Exports of
CommunistChina............

Exports of Communist China to Russia. . .

Exports of Communist China to Developed
comtrieseeeeeeeeeeeeeee

Exports of Communist China to Underdeveloped

Countries...............

Net Commodity Trade Position of Communist

China.................

Gino-Soviet Net Commodity Trade Position.

Sino-Developed-Countries Met Commodity
Trade Pos ti

on.............

Sino-Uhderdeveloped-Countries Met
Commodity Trade Position. . . . . . . .

Geographic Concentration Indices of the
foreign Trade of Communist China. . . .

Manufactures Exports of Communist China .

Page

87
88

91
93

95

97

101
10k

107

110

119
1M7

Figure
I‘le

II-I.
II-2.
II-S.
III-1.

IV‘le

IVC2 e
IVC3.

IV-N.
v-1.

V-2 a
V-3.

V.“ 0

LIST Of ILLUSTRATIONS
Page

Import and Export as Percentage of
National Product of Communist China . . . 25

Comparison of foreign Trade figures . . . . SS
Reconciliation of foreign Trade figures . . as
foreign Trade Balance of Communist China. . “8

Exports of Underdeveloped Countries to
Communist China e e e e e e e e e e e e e 77

 

General Commodity Exports of Communist
Chin. e e e e e e e e e e e e e e e e e e 81

Exports of Communist China to Russia. . . . 9b

Exports of Communist China to Developed
COUDETIO. e e e e e e e e e e e e e e e e 96

Exports of Communist China to underdeveloped
Countries e e e e e e e e e e e e e e e e 98

Overall Net Commodity Trade Position of
COINHRIGE China e e e e e e e e e e e e e 102

Sine-Soviet Met Commodity Trade Position. . lOS

Gino-Developed-Ccuntries Net Commodity
Trade 9°.it10ne e e e e e e e e e e e e e 109

Sino-Underdeveloped-Countries Met Commodity .
Trade POOIEIOfle e e e e e e e e e e e e e 112

vii

LIST OF APPENDICES

APPENDIX

A.

C.

D.

F.

The Regional Distribution of the foreign
Trade of Communist China. . . . . . . . . .

The Regional Distribution of the foreign
Trade of Communist China -- Summary . . . .

The Commodity Structure of the foreign
Trade of Communist China in 1951. . . . . .

The Commodity Structure and Origin of Imports
of Communist China, lSSS-lSSO . . . . . . .

The Commodity Structure and Destination of
Exports of Communist China, lOSS-lSSO . . .

The Import of Complete Industrial under-
takings of Communist China. . . . . . . . .

Concentration Indices of foreign Trade. . . .
viii

Page

160

177

179

108

192

197
202

INTRODUCTION

The study of the foreign trade of Communist China
remains largely on a general-survey level. Either in

1 or in in-

general works on the economy of Communist China,
dividual articles on this subject,2 investigations usually
include an estimation of the turnover of Communist Chinese
foreign trade, its regional distribution, its balance, and
some discussions on its commodity structure and the terms
of trade problem. There are also two independent studies

on this subject. One is made by Main Ying in 1951:,3 most

 

1Some of the prominent works are: Cho-ming Li,
Economic Develo ment of Communist China (Berkeley and Los
KfigeIes: Universify of CaI1forn1a Press, 1959), Chapter XI;
A. Doak Barnett, Communist Economic Strategy: The Rise of
Mainland China (Wasi1ngton, . .: .at1ona anning Associa-
tion, ISSSI, Chapters 8-10; C. F. Remer ed., Three Essays
on the International Economics of Communist China (Ann
Arbor: Un1vers1ty of—7ICh1gan_Press, 1959); PYT'L. Wu, An
Economic Survey of Communist China (New York: Bookman
Associates, 19SST, ChapterEIS, Y. L. Wu, F. P. Hoeber s

M. H. Rockwell, The Economic Potential of Communist China
(Menlo Park: Sta-Ford RescarEfiInstitute, ISBSS, CHapTer 13;

and Bernhard Grossmann, Die Wirtschaftliche Entwicklun der
Volksregublih China (Stuttgart: Gustav Fiscfier VerIag,

, 3p er e

2for example: E. P. Szczepanik, "foreign Trade of

Communist China," Contem ora China, No. 3, (1958-1959),
pp. Su-ISO, and also "BaIance of Payments of Mainland China,”
Economic and Social Problems of the far East, E. P. Szcze-
paniE ed., {Hong Kong: Hong Kong Univer51fy Press, 1962),
pp. 113-129; and T. C. Li, "A Valuation of China's foreign

Trade,” Far Eastern Economic Review, Vol. XXVII, No. 1%
(Oct. 1’ 1959,, ppe 550-558.

aHsin Ying, The foreign Trade of Communist China
(Mong Kong: The Union*ResearCh ns 1 u e, .

1

 

2
of which is devoted to explaining the_trade practices in the
earlier years of the Communist regime. The other by Chang

Cho-yuan in 1956,1

which goes further to present some main
features of the commodity structure of Communist Chinese
foreign trade, but it is short of systematic analysis. There
are still other studies that limit themselves mainly or
entirely to Sino-Soviet economic relations and thus give
an incomplete picture.2
Evidently, many authors of these studies are not
aware of Communist China's manipulation of her foreign ex-
change rates and her special way in making foreign trade
reports, and therefore are confused when they find that
Communist China's foreign trade statistics are incompatible
with those reported by her trading partners. Besides, none
of these studies has a detailed and systematic analysis on
the changing pattern of the commodity structure of the
foreign trade of Communist China in relation to her economic
development. Moreover, none of them has assessed Communist
China's position in the international flow of commodities,

to say nothing of international comparisons.

This study consists of seven chapters. The first

 

1Cheng Che-yuan, The China Mainland Market under
Communist Control (Mong Kong: Tfie Union Researcfi Insfifute,

2For example: Alexander Eckstein, "Moscow-Peking
Axis: The Economic Pattern,” Moscow-Pekin Axis, H. L.
Boorman, et. al. (New York: Council on Foreign Relations,
1957), pp. su-111; Die Wirtschaftliche Verflechtun der
Volksre ublik China mi? Her Sowietunion (HamEurg: Insfitut
Fuer KsIenRunae, I959)

3
chapter is essentially an introductory chapter, which re-
lates the foreign trade of Communist China with her economy
and economic development. Chapter Two deals with the
compatibility of the Communist Chinese foreign trade statis-
tics with those reported by her trading partners, with an
estimation of the actual regional distribution and balance
of her foreign trade. Chapters Three through five are de-
voted to a detailed analysis of the commodity structure and
its changes in the foreign trade of communist China, and her
net position in various commodity groups in relation to
various countries. An international comparison with respect
to the concentration of foreign trade is made in Chapter
Six, with discussions on various factors that make the case
of Communist China somewhat special. Chapter Seven, the
concluding chapter, summarizes findings in previous chapters
and once more assesses the place of foreign trade in the
Communist Chinese economy and economic development and its
prospects in the future.

The time period under study is 19u9-1960. for
Communist China, this was a period of continuous, though
fluctuating, growth. In spite of the fact that her recent
economic crisis began in the latter half of 1960, foreign
wtrade still maintained its normal level in that year. Be-
cause of lack of statistics, detailed analysis is limited
to the period 1955-1960. Short as this period might seem,
it does not fail to provide certain evident trends indicat-
ing rapid changes in the commodity structure of the foreign

trade of Communist China.

Total value is used as the quantitative measure.

The problem of ”unit value" (price) is deliberately avoided
for two reasons. first, various countries made their trade
reports in various physical units even for the same commodi-
ties. There is no way to compare the ”unit value" of
commodities when some physical units are given in "pieces"
and "meters” while others are given in ”metric tons,” and

so on, not to speak of the more tricky problem of quality
comparison. Second, the problem of "unit value" is connected
with the terms of trade question, on which a few preliminary
studies have been made by some other economist by use of
sample commodities.1 No attempt is made here to repeat
their work, but their results will be discussed when they
are related to the context of the present study.

The following are abbreviations of titles of some
Communist Chinest publications and translation series that
are cited in this study.

Communist Chinese Newspapers:

JMJP Jen-min jih-pao (People's Daily)
TKP Ta-kung-pao (Impartial Daily)
Communist Chinese Periodicals:

‘MMYP Msin-hua yuch-pao (New China Monthly)

 

1for example: feng-hua Ma, "Price Problems in
Communist China's foreign Trade," Journal of Asian Studies,
Vol. XXI, No. u (August, 1962), pp. BSI- 33!. (ABsIracts of
Papers Presented at the fourteenth Annual Meeting): and A.
Yoshio, ”Terms of Trade of China and Underdeveloped coun-
tries in Relation to Their Trade with the Soviet Union,"
JPRS:9u9u (28 June, 1961).

It.

. 0""

HHPYK

CHCC
CHYTC

CKCKY

PC
PR

5
Hsin-hua pan-yueh-kan (New China Semi-
monthly)
Chi-hua ching-chi (Planned Economy)
Chi-hue yfi tung-chi (Planning and
Statistics)
Chung-kuo ching-kung-yeh (Chinese Light
Industry)
People's China
Peking Review

Translation series:

JPRS

SCMP

U.S. Joint Publications Research Service
(Washington, D. C.)
Survey of China Mainland Press

(Mong Kong, American Consulate General)

CHAPTER I

THE PLACE OF FOREIGN TRADE IN THE ECONOMY
OF COMMUNIST CHINA

The ambitious scheme of comprehensive economic
planning for development of Communist China shows an in-
patient giant's attempt to leap into prospective affluence,
with one foot still bound in deep-rooted economic backward-
ness of the past. China's economic backwardness was further
accentuated by eight years of Sino—Japanese war and four
years of civil hostility. when the Communist regime finally
took over in 19u9, it spent three years in restoring the
national economy, in spite of the Korean War which was be-
ing fought during part of this period. By the end of 1952
most outputs in major industrial and agricultural products
were reported to have surpassed the peaks in the "pre-
liberation” era.1 The ambitious first five-Year Plan was
then launched (1953-1957), followed by two years of the
"Great Leap forward,” in which major targets of the Second

five-Year Plan were claimed to have been fulfilled three years

 

1first five-Year Plan for Develo ment of the .
National Econom of {Fe Peo Ie's Re uSIic of China In 1953-
I§57 (Pe EIng: ForeIgn CEfiguages Press, I953), p. I3. (TEIs
worE will be cited in brief hereafter as the first five—
YCQE' Plan) a

7
ahead of schedule.1 Then came three years of devastating
catastrophe. Throughout these years, in days of achieve-
ments and in days of adversity, industrial development was
the focal point of all efforts. In the first five-Year Plan,
56.21 of total state investments in capital construction
was allotted to industry alone.2 It was contended that in-
dustrialization, and only rapid industrialization, was the
magic needed to rid the country of its economic backward-
ness. Such a contention, however, does not lead necessarily
to policies which the regime had consciously designed and
vigorously pursued, had it not been guided by other con-
siderations.

In the first five-YearfiPlan the Constitution of the
People's Republic was quoted:3
from the founding of the PeOple's Republic to the

attainment of a socialist society is a period of
transition. During the transition the fundamental
task of the state 13, step by step, to bring about
the socialist industrialization of the country and
step by step, to accomplish the socialist transforma-
tion of agriculture, handicrafts and capitalist in-
dustry and commerce.
Here it is unmistakably clear from the very outset
that the orientation was_ideological. It was not merely

industrialization, but socialist industrialization which was

1Li fu-chun, "Report on the Draft 1960 National
Economic Plan," Second Session of the Second National

Peo le's Con ass of {He Peo Ie's Re uBIic of Cfiina (Docu-
meng) (PeEing: Foreign Canguages Press, I935), p. I.
2first five-Year Plan, 22. cit., p. 29.
31bid., p. 21.

mi
ate;
ever
ccns

OCCR

1:

I
1132

‘1

A.

I
sat

for

m
zati
and
See:
tee
of t
the

3!};

S
desired. The first five-Year Plan did not map out the exact
steps by which the whole process would be achieved. How-
ever, it was made clear that a small-peasant economy, which
constituted the overwhelming proportion of the Chinese
economy, was incompatible with socialist industrialization.1
The transformation of the traditional economy was therefore
a matter of necessity. In this respect, industrialization
itself was not merely an end which symbolized higher economic
well-being, but by its very process, it was also a means to
shatter the traditional economy and help achieve the ideo-
logical goal of socialization.

The first five-Year Plan also quoted Mao Tse-tung
for saying:2

Without industry, there can be no solid national de-
ense, no people s welfare and no national prosperity
and power.

This reflects very well the vivid impressions of
the days of treaty-ports and extra-territoriality in the
minds of the Communist Chinese leaders. To consolidate
national defense as well as to increase national prestige
and power, industrialization was deemed to be indispensable.
Needless to say the aim was political in nature. Mere
once again industrialization was a means as well as an end
of the whole venture. With a low industrial basis to start,

the main goal to strive for was, of course, the development

of her own industrial sector.

 

11bid., p. 16f.
2first five-Year-Plan, 22. cit., p. 16.

9

It is upon these ideological and political grounds
that we should tackle the problem of Communist Chinese in-
dustrialization. And it is in the lights of these con-
siderations that we should look into the pattern of her
foreign trade as an integral part of her economy and

economic development.

Reguirement for Capital Goods Import

In view of urgent need for rapid economic develop-
ment, Communist China required a tremendous amount of
capital goods. She not only needed capital goods for the
production of consumers' goods, but also those for producing
producers' goods. The first five-Year Plan was enunciated
to establish a multiplicity of industries, the core of which
was to be imported. This consisted of 156 fabove norm"
industrial and mining projects which were designed and fur-
ther supplied with complete sets of the latest equipment
from Russia, and another 68 projects from the Eastern Euro-
pean Communist countries.1 In addition to these, Communist
China also imported large amounts of other capital goods
and raw material imputs from the Communist bloc as well as
from the free World. Of all imports, pointed out the Minis-
terof foreign Trade, more than ninety percent were capital

goods.2

 

1These projects will be discussed in greater detail
in Chapter 3, pp. 61-62, and Appendix f below.

2Yeh Chi-chuang, "Shih-nien 1ai wo-kuo ti tui-wai
mac-i,” (foreign Trade of Our Country in the Past Decade),
JMJP, Sept. 22, 1959.

of

th

IA

Ye

of capital goods with total capital investments will show
the importance of these imports in her capital construction.

TABLE I-1:--Relation of Capital Goods Import to Capital In-
vestments (value in million yuans)

A comparison of Communist China's import

10

 

 

 

Year Total Capital Goods Capital Total Capital Goods

Import Imp. as t of Goods Capital Imp. as t of

Total Import Import Investments Total Invest.
(l) (2) (3) (u) (5) (6)
1952 3,7“6.8 90.6 3,399.6 “,360.0 77.8
1953 u,611.3 93.0 u,2ss.s 8,000.0 53.6
195s u,u0u.u 92.8 9,087.3 9,070.0 us.1
1955 6,039.0 99.5 5,706.9 9,300.0 61.3
1956 5,297.0 92.9 u,ssu.u lk,800.0 33.1
1957 5,002.0 92.7 8,636.9 13,830.0 33.5
1958 8,137.9 93.7 5,750.3 26,700.0 21.5

l953-57
25,353.7 23,619.0 55,000.0 “2.9
Sources: Column (2): Table 11-1 below: Columns

(3) 5 (5): Ten Great Years, (Peking: foreign Languages

Press, 1960 , p.

lated from Columns (u) 8 (5).

an pp. 57-58 respectively: Column
(a): calculated from Columns (2) S (3): Column (6): calcu-

.d W
”I U 1‘“

11'

It should be noted here that the Total Import figures
were based on external prices,1 while the Capital Invest-
ments figures were based on internal prices. Disequilibrium
exchange rates would distort their actual relation. There-
fore this comparison should be considered as a comparison
of expenditures on capital goods import and capital invest-
ments from the standpoint of the Communist Chinese budget.
The comparison shows that for the first five-Year Piflfl
period more than forty percent of the State's expenditure
on capital investments was made in purchasing capital goods
abroad. The abrupt decrease of the percentage of capital
goods import to capital investments was due to an abrupt
increase of the latter, which probably included a substan-
tial amount of local investments in indigenous industries

made during the ”Great Leap forward."

foreign Credits and the Need for Export

In part Communist China was able to finance her im-
ports with the help of foreign credits. from Russia alone,
she obtained a total of 1720 million (old) rubles under
agreements made in 1950 and 1959.2 She must also have ob-

tained further trade credits, for in his budgetary report

 

1Communist China's manipulation of foreign exchange
rates and her way of reporting foreign trade figures will
be discussed in Chapter 2 below.

2Equivalent to 1763 million yuans. The exchange
rate between the yuan and the ruble will be discussed in
Chapter 2 below.

12
to the People's Congress, the Hinister of Finance indicated
that up to l957 Communist China had received a total of 529%
million yuans of credits from Russia.1 In his later
budgetary reports, no provisions were made for further
credits. Therefore the total credit received during the
period 1950-1960 was 529k million yuans. For the same
period, Communist China imported a total of more than 5»

billion yuans of goods.2

Therefore, Russian credits helped
to finance an amount slightly less than 10% of Communist
Chinese imports during this period.

Because these Russian credits were tied to imports
from Russia, a comparison of these credits with Communist
Chinese imports from Russia would be more revealing. From
1950 to 1960 Communist China imported from Russia a total
of about 29 billion (old) rubles of goods,3 in which complete
industrial undertakings amounted to about 6.8 billion

rubles.“ These were equivalent to about 30 and 6.9 billion

 

1bi Hsien-nien, "Kuan-yfi 1956 nien kuo-chia chueh-
suan ho 1957 nien kuo-chia yfi-suan tsao-an ti pao-kao,"
(Report on the 1956 National Final Accounts and l957 Na-
tional Draft Budget), HHPYK, No. 1%, 1957, pp. 16-28.

2From Table 11-9 below.
3See Appendix 8 below.
“See Table III-2 below; also H. Sladkovskie,

”Razvitiye Torgovli Sovyetskogo Sousa s Kitaeskoe Napodnoe
_Respublikoe,” (Trade Development of the Soviet Union with

the People's Republic of China), Vneshn a a Tor ovl a
(Foreign Trade), No. 10, 1959, pp. E-IU.

13
yuans respectively.1 Then we see that Russian credits
were enough to finance about 169 of Communist China's im-
ports, or slightly less than 80% of her imports of complete
industrial undertakings from Russia. The rest Communist
China paid in current exports. Moreover, repayment for
part of these credits were due as early as 1955 in form of
exports.2
Dictated by her urgent need for imports, Communist

China had to promote exports to the best of her ability.
The importance of foreign trade, it was contended, was on
the side of imports. And the other side was but a necessary
evil. This was stressed by the Minister of Foreign Trade,
who stated that:3

The purpose of export is to guarantee the import of

those complete sets of equipment and various important

materials necessary for our various constructions, es-

pecially our heavy industrial constructions.

In fact, every country has to export for the sake

of import. However, when this truism became a slogan, its
underlying implication was obvious. It constituted the

grounds for an all-out export-drive policy. It was not at

all surprising that the minister proceeded to lay down

 

. 1The exchange rate between the yuan and the ruble
will be discussed in Chapter 2 below.

2For information on the terms of these credits, see:
Cho—ming Li, 22, cit., p. 170.

3Yeh Chi-chuang, "Kai-chin wo-kuo tsu-kou, Pao-
cheng kuo-chia kung-yeh chien-she," (Improve Our Work in
Exports, Guarantee Our National Industrial Construction),
HHPYK, No. 21, 1956, p. 155.

1n

principles stipulating that:quotas be imposed on exports of
those commodities that were necessary for national construc-
tion and people's livelihood, economy be practiced on domestic
consumptions of those agricultural by-products and light
industrial products so as to provide more for export, and
priority be given to export in those commodities that could
be dispensed with in the domestic market.1, In other words,
all surplus over minimum domestic requirement should be ex-
ported.

Therefore, the foreign trade sector of Communist
China was essentially a tool to transplant into Communist
China modern technology from the advanced countries. Its
function was to turn part of her domestic surplus into
foreign exchanges, and then the foreign exchanges into
foreign supply of capital goods. All her foreign trade
operations were part and parcel of her efforts towards

economic development.

Organization, Nationalization and Planning
Recognizing so important was the task for foreign

trade, the Communist regime lost no time and further took

no chances in leaving its operation in private hands. Under
the provision of the Organic Law of the People's Republic,

a Ministry of Trade was set up in 19u9 as the administrative
organ for all trade operations. Trade departments were

instituted in major administrative regions, provinces, and

 

1Ibid., p. 156, passim.

 

Eff

'1!

If?

15

municipalities to take part directly in trading. In May,
1950 twelve national-wide state companies were organized,
six of which were foreign trade companies dealing in bristles,
oils and fats, tea, mining products, native manufactured goods
and import-export.1 The Ministry was divided into a Ministry
of Foreign Trade and a Ministry of Commerce when Communist
China was about to embark on her First Five-Year Plan.
Thus the Ministry of Foreign Trade became the supreme ad-
ministrative organ in foreign trade since August, 1952.
There were also increases and reorganizations in the state
operated foreign trade companies. By 1955 there were some
fifteen such companies covering all branches of foreign
trade operations.2

Since 1950 there were also Foreign Trade Control
Offices under the Ministry of Trade, as private foreign
trade was then still permitted to operate. Their function
was to register and grant business licenses to private
foreign trade concerns, issue export and import licenses,
and to check and fix price in each deal.3 In 1953 these
offices were liquidated and their staffs were merged into
local offices of the Customs Administration, which itself

1”China's Foreign Trade Arrangements and Activities,”

JPRS:3725, Communist China Digest No. 22 (18 August, 1960),
PP- ’3'!“-

2"Trading Organizations in China,” Far Eastern
Economic Review, Vol. XX, No. 20 (May 17, 1953), pp. 527-
W

3Hsin Ting, The Foreign Trade of Communist China,
Ole $1.3" ppe 21" 2e

m i

5639

1.1 s:'
;-:m

soon

16

was integrated into the Ministry of Foreign Trade at the
same time.~ .

As the state trading companies grew in number and
in size, as well as enjoyed monopoly in trading certain imp
portant commodities, the scope of private business concerns
soon began to contract. Those who survived still had to go
through a process of socialist transformation. The govern-
ment had them under control either by making investments in
their businesses, merging them with state companies, sending
workers to supervise them, or making them to operate as
intermediaries or commissioners of the state companies.1
By 1955, virtually all foreign trade transactions were under
state control.2

In a planned'economy, foreign trade planning can
play either the role of balancing domestic surplus and
deficit of different sectors, or of fitting the domestic
economy into the international economy. In the first case
domestic lines of production are determined by considerations
other than existing comparative cost-price relationships,
so that foreign trade only functions as a safety valve.

In the second case considerations on comparative cost-price

relationships determine domestic lines of production. This

 

1”China's Foreign Trade Arrangements and Activities,"
22s Cite. pe 22s

'2Chao Chi-chiang, ”Chi-nien lai wo-kuo tui-wai mao-i
chung-ta pien-hua ho fa-chan," (Important Changes and
Developments of Our Country's Foreign Trade in the Last
Seven Years), Tui-wai mao-i lun-wen shuan (Selected Treatises
on Foreign Trade), (Peking, 195’), pp. 15-17.

.17
static dichotomy, however, precludes economic development.
When economic development is considered to be of paramount
importance, this dichotomy is then transformed into the
choice between development through “balanced growth,“ or
through ”comparative advantage.“ The choice of Communist
China was obviously the first one. Foreign trade planning
played the role of balancing domestic deficit and surplus,
which in the light of deliberate development, were but
capital goods and their necessary payments.

In her actual execution of foreign trade planning,
Communist China was not without difficulties. while im-
port requirements were heavy and pressures were high, and
were often pre-determined and thrust upon the Ministry, the
main task in planning rested on the arrangement of more
exports. Little information was available on the actual
planning procedure. All that which was known was that a
plan did exist. The agricultural sector remained the
main source from which exportable commodities were drawn.
With its unpredictability, there was no way to draw up a
plan of any precision in order to guarantee the rigid de-
mand for imports. Probably it was for this reason that, in
the First Five-Year Plan, there was only a target for the
total trade turnover in 1957 to increase 66.5% over 1952.1
No other information was given. This target, admitted the
Minister of Foreign Trade before the People's Congress in

1955, ” . . . is for controlling purposes and is only a

 

1The First Five-Year Plan, 22, cit., p. 163.

ta:
be}

fc]

{5’3

ts!

fit:

18
target to strive for."1 The difficulties in planning and

balancing were spelled out more explicitly by him in the

following year:2

In the past, because that the export plan very often
could not be handed down together with the national
economic plan, it could not be integrated into the
national economic plan of various provinces and
municipalities. This had caused a weak guaranty in
the source of exportable commodities.

Me also complained that:3
. . . in arranging or increasing import and export
plans, related government departments paid too much
attention on import requirements and neglected import
supplies.

and finally admitted that "not enough had been done
on developing the production of exports in a planned

.10

manner.

It was not until 1957, when previous Russian credits
came to an end and no further credits were foreseeable, that
import and export planned targets were reduced. The

planned import figure was cut to #755 million yuans for 1957

from an actual 5297 million yuans in 1956, while the planned

export figure was cut to 5200 million yuans for 1957 from an

 

1"Yeh Chi-chuang pu-chang ti fa-yen," (The State-
ment of Minister Yeh Ch -chuang), Jen-min shou-tse (People's
Handbook) (Peking, 1956), p. 232.

2Yeh Chi-chuang, "Kai-chin wo-kuo tsu-kou kung-
tso, Pao-cheng kuo-chia kung-yeh chien-she," (Improve Our
work in Exports, Guarantee Our National Industrial Con-
struction), HMPYK, Mo. 21, 1956, p. 155.

3161d.. 9. 155.

“Ibid., p. 155.

19

actual $569 million yuans in 1956.1 Thus a substantial
safety margin was provided. Also, it was not until the same
year that the export plan and the supply plan for export
commodities were ratified by the State Council to be inte-
grated into the national economic plan.2 Since then it was
advocated that export plan should not be based on import
plan alone. It should rather be arranged in such a way as
to balance basic construction, production, and domestic
market demand, and observe the principle of ”fixing import
by export."3

In fact this was quite a step towards more rational
planning. However, because of pressures on the side of
neededimports, long run planning and stabilization were not
achieved. As we shall see later, this only shows that her
foreign trade sector depended heavily on her domestic
economy, so that it would fall an immediate victim in case

of a mal-performance of the latter.

Foreigg TradeI Industrial and Agricultural Production

It was already mentioned that the export of Communist

China depended heavily on her agricultural sector, and that

 

1Yeh Chi-chuang, "Tan tui-wai mao-i," (On Foreign
Trade), MMPYK, No. 16, 1957, p. 91.

2Li Ming, "Mo-men shi chen-yang kuan-li tui-wai
mac-i chi-hue ti” (How we Manage Foreign Trade Planning),
CHCC NO. 5, 1957, p. 20.

3Li Po-fang, "Chi-chi chia-chiang tsu-chi tsu-kou
huo-yuan,” (Strenuously Strengthening the Organization of
Commodity Sources for Exports , CMCC, Mo. 2, 1958, p. 28.

Ilfl

m:
and

‘A
1:5

.- .a
C“’
m

J"
cu;
e,r
c.“

e'u'

(V,
in
)e,

a:

'5
(x10

20
her economic development depended heavily on capital goods
import. The following table is a comparison of the rates of
growth of her imports, exports, industrial and agricultural
pmdUCt 1 on 8 e
TABLE I-2:--Rates of increase of import, export, industrial

and agricultural productions of Communist China (percentage
increases over preceding year)

 

Import Export Gross Value

 

 

Year Gross Value Nature of
Indus. Prod. Ag. Prod. Ag. year
(1) (2) (3) (k) (5) (6)
1952 6.7 11.2 30.3 15.3 good
1953 20.8 28.1 30.2 3.1 normal
195“ -M.5 16.8 16.3 3.3 poor
1955 37.1 21.5 5.6 7.7 good
1956 -12.3 12.6 28.2 “.9 poor
1957 -$.6 -3.8 11.6 3.5 poor
1958 22.7 23.1 66.2 25.0 good
1959 12.3 15.2 39.3 16.7 good
Sources: Columns (2) 6 (3): calculated from figures

in Table 11-9 below; Columns (u) 6 (5): Yang Chien-pai,
"On the Internal Relationship between Industrial and Agri-

cultural Production,"
for 1952-1956, Po I-po,

1957 Draft National Economic Plan)
pp. 28-39; for 1958-1959, general

JPRS:563u, 26 Oct., 1960; Column (6):

uan-yU 1956 nien tu ching-chi
chi-hua ti chi-hsing chieh-kuo ho 1957 nien tu kuo-min

ching-chi chi-hue tsao-an ti pao-kao" (Report of the Re-
sults of the Execution of the 1956 Economic Plan and the

in?—

ormation.

napyx, Mo. 1u,1957,

21

In general, a rapid increase of export was corre-
lated with good or normal agricultural year, and slow in-
crease of expert with poor agricultural year. This shows
clearly the dependence of her export on the performance of
her agricultural sector. The same relationship holds be-
tween her agricultural production and import. Poor agri-
cultural yeare were correlated with actual decreases in her
import. This suggests that every year import was pushed as
far as the agricultural surplus would allow, so that in case
of a subsequent decline in agricultural production, it de-
creased in absolute value. Except in 1955 when there was
an inward transfer from Russia,1 the rates of increase in
export were higher than those in import. That is to say,
starting from a lower absolute level, export had to forge
ahead at a faster rate to sustain import and repay previous
credits.

The relationship between the rates of increase of
industrial production and that of the others was less con-
spicuous. In some cases there seemed to be a one-year lag
in the pattern of growth in industrial production behind
those of the others. The prime determinant was of course
agricultural production, which not only helped finance imp
port, but also furnished raw materials for industrial pro-
duction. The remarkable rapid rates of increase in indus-

-trial production in the latter years were mainly due to the

development of the ”indigenous industries" during the ”Great

 

1See discussion on p.62 'below.

_._'

£1“

I!

5a

th

22
Leap Forward," however, they were also partly fruits of prev-

ious imports.1

Foreigg Trade and National Income
Even though the role of foreign trade in the economic

development of Communist China was important, one might ask
'a further question, how important was it in relation to her
national income?

For the purpose of comparison, the estimates of T.
C. Liu and K. C. Yeh for the national income of Communist
China are used. Their estimates are in 1952 constant prices.
As the Communist Chinese foreign trade figures are in current
prices, adjustments are made by using the United Nations'
export and import price indices as deflators.2

One point should be noted in this comparison. As the
National Product figures were calculated in internal prices,

the Import and Export figures were calculated in external

prices.3 Disequilibrium exchange rates would affect the

 

1By the end of 1959, it was reported that 113 Russian
projects, and some projects supplied by the Eastern European
Communist countries, were completed and put into operation.
See Appendix F.

2In the view that Communist China's foreign trade
was transacted in, or based on "capitalist world market
prices" (see p. 50 below), the use of the United Nations'
‘1rice indices is justified. Here the world export price
: dices are used to adjust the Communist Chinese imports,
and the world import price indices are used to adjust the
Communist Chinese exports.

 

See Chapter II, pp. 36-h1 below.

23

TABLE I-3:--The relation between foreign trade and national
product of Communist China (valge in billion constant 1952
yuans

 

 

~Year Nat'l Import Export Import, Export, Im. 0 Ex.
P’Oduct (adj'td) (de'td) e e e e “e 1Pe
(l) (2) (3) (u) (5) (6)

 

 

 

 

1952 71.81 3.75 2.71 5.3 3.8 9.1
1953 75.33 8.85 3.85 5.0 5.1 11.5
1958 79.28 “.57 8.07 5.8 5.5 11.8
1955 82.30 5.83 5.37 7.8 5.5 18.3
1955 92.08 5.52 5.92 5.0 5.8 12.8
1957 95.30 5.10 5.52 5.3 5.9 11.2
1958 108.00 5.85 7.29 5.0 5.8 12.8

 

I. “

Sources: Column (2): T. C. Liu and K. C. Yeh, The
Econom of the Chinese Mainland: National Income and
Ken's-{m 'c'15'e_ve'To""m'e'n"‘E 193331959 (2 voIs.: Santa Monica: The
Rand Co oration,1953),VoI. I, p. 98: Columns (3) 6 (6):

Table II-9 below, with adjustments as mentioned in the text;
Columns (5) through (7): calculated.

 

result of this comparison. It is known that the Communist
Chinese yuan is overvalued against currencies in the Free

world;1 however, evidence also shows that it was undervalued

2

against the Russian ruble. Then, the effects of these

disequilibrium exchange rates would balance each other out

 

1Yeh Chi-chuang, "Tan tui-wai mac-i,” (On Foreign
Trade), MMPYK, Mo. 16,1957, p. 93.

2Kang Chao, “Yuan-dollar price Ratio in Communist
China and the United States,” Occasional Pa are No. 2
James I. Crump, Jr., ed. (Center or nese u es: 1-
versity of Michigan, 1963), p. 19. '

2'6
to some extent. Since there is no way to determine the
net result, we can only keep this as a qualification.

The comparison shows that both the import and export
of Communist China were small compared to her national
product. While the percentage of import to national pro-
duct was quite constant (about 66), the percentage of ex-
port to national product showed a slight trend of increase.
For the whole period under study, the foreign trade turn-
over of Communist China.was only about 126 of her national
product. The percentage is about that of the United States,
and considerably lower than most industrial countries.1

 

1The same percentage for United Kingdom was 326
(1965-1952); for France was 256 (1986-1951): for Canada
was 306 (1950-1956): and for Japan was 206 (1950-195“).
See Simon Kuznets,

Six Lectures on Economic Growth
(Illinois: The Free Prwss of GIencoe, 1959), pp. 101-103.

25

FIGURE I-l
Import and Export as Percentage of
a ona ro uc o ommun s . na

PCEBIIE~

 

 

export

9 _ ----- import

 

 

 

1 1 1 u L
1952 165: 165» ilss 1655 1537 1953

 

Source: Table I-3.

U".
m

CHAPTER II

ESTIMATION OF THE TURNOVER, REGIONAL DISTRIBUTION AND
BALANCE OF THE FOREIGN TRADE OE COMMUNIST CHINA

There are two sources of information from.which we
can get statistics to estimate the foreign trade of Commu-
nist China: reports made by Communist China, and those made
by her trading partners. Theoretically, statistics derived
from these two sources should be identical. However, they
are found to have substantial differences when compared on
the same currency basis, and thus raise a host of possible
explanations among economists. The core of the entire prob-
lem, as I shall demonstrate, lies in Communist China's
manipulation of foreign exchange rates, and special way of
reporting foreign trade figures. On this basis, it will be
shown that these two sets of figures are essentially the
same, and we are enabled to arrive at the actual turnover,
regional distribution and balance of the foreign trade of
Communist China.

. Estimates from Communist Chinese Sources
Compared to other Communist Chinese economic
statistics, foreign trade statistics have been relatively

scarce, because they are classified as economic secrets

25

27
of the State.1 But it is still possible to compile the
following tables from information given in various Communist
Chinese publications, (Tables II-l, II-2). .

In Table II-2, all countries outside the Communist
bloc are grouped together under the heading of Rest of the
‘World, for which all absolute figures and percentages are
residuals. Incomplete statistics hamper the operation of
breaking down these figures into further sub-groups. What
is more, it is exceedingly hard to assess the connotations
of such terms as ”capitalist world,” “capitalist countries,”
and the ”Asian-African countries,” which are often seen in
Communist Chinese publications. Therefore, it is better to
classify them under one group. As for breaking down the
several trade figures into exports and imports, incomplete

information again hampers us.

Estimates from United Nations' Publications

In spite of the fact that foreign trade statistics
from Communist Chinese sources are scarce, such statistics
are far more readily accessible from Communist China's trad-
ing partners. Foreign trade reports of various countries
.to the United Nations, and occasionally some other informa-
tion, make it possible to have a more detailed picture.
For the purpose of comparison two following tables are

compiled,2 (Table 11-3, II-b).

 

IChoh-ming 1.1. 22. 233., p. 116.

2For detailed statistics and explanations, see
Appendices A and B.

28

TABLE II-l.--Foreign trade turnover of Communist China (in
million yuans)

 

 

Year Turnover Import Export
(1) (2) (3) (8)

1950 8,150.0 2,116.5 2,033.5
1951 5,950.0 3,510.5 2,839.5
1952 6,860.0 3,786.8 2,713.2
1953 8,090.0 8,611.3 3,878.7
1958 8,870.0 8,808.8 8,065.6
1955 10,980.0 6,039.0 8,981.0
1956 10,870.0 5,297.0 5,568.0
1957 10,850.0 5,002.0 5,887.0
1958 l2,870.0 6,137.9 6,710.6

 

Foreign Languages Press, 1960 , p.

1957) (Cambri ge:

BPVQI‘

Sources: Column (2): Ten Great Years (Peking:

; o umns (3) 6 (8):
1950-1955: calculated from (2) and indices given by Com-

munist Chinese source.
chang Yin, Economic Statistics on Mainland China (1989-

niversi y ress,

For indices, see Helen Yin and Yi-

s P0 535

I955: Yeh Chi-chuang, "Tan tui-wai mac-i," (On Foreign
Trade), MMPYK, Mo. 16, 1957, p. 91; No final official

figures were given for 1957.

Here estimates are made by

assuming both the import and export targets were overful-
filled by the same percentage.

chuang, Ibid., p. 91: 1958: calculated.

For targets, see Yeh Chi-
Import was 2.9

times and export was 3.3 times that of 1950, Ten Great

Years, 2p, cit., p. 168.

29

TABLE II-2.--Regiona1 distribution of foreign trade turnover of
Communist China (in million yuans)

 

 

Year Total Communist bloc Rest of
Turnover o a oc . . . . es oc the World
Value a us 5 VaIue a us a ue
(l) (2) (3) (8) (5) (6) (7) (8) (9) (10)
1950 8150.0 33.5 1390.3 30.9 1282.8 2.6 107.9 66.5 2759.7
1951 5950.0 63.3 3766.8 88.7 2897.7 18.6 868.7 36.7 2183.6
1952 6860.0 78.1 5085.3 57.3 3701.6 20.8 1383.7 21.9 1818.7
1953 8090.0 75.5 6108.0 56.8 8562.8 19.1 1585.2 28.5 1982.0
1958 8870.0 80.0 6776.0 n.a. n.a. n.a. n.a. 20.0 1698.0
1955 10980.0 80.0 8788.0(62.0) 6797.0 (18.0) 1987.0 20.0 2196.0
1956 10870.0 75.0 8152.5 58.0 5869.1 21.0 2282.7 25.0 2717.5
1957 10850.0 75.0 7837.5 50.0 5225.0 25.0 2612.5 25.0 2612.5
1958 12870.0 (70.0)9037.0(88.0)6165.5(22.0)2871.5 30.0 3833.0

 

Sources: Column (2): Table II-l; Columns (3) to (10):

a.

b.

Ce

d.'

f.

All percentages in 1950-1953: Vneshn a a Tor ovl a
(Foreign Trade), No. 5, 1956, p. 12. *Bsquée figures
are calculated.

Percentages for Total bloc in 1958-1955: Jen-min shou-
tse (People's Handbook) 0 . cit., p. 522. Percentages
IEF'Rest of world are res duEIE’and absolute figures
are calculated.

Absolute figure for USSR in 1955 was 5.3 times that of
1950; Li Hsien-nien, "Shu-luan shih wo-kuo chien-she

she-hui-tsu-i ti pang-yang ho wei-ta ti yuan-tso-chieh,"

(The Soviet Union is a Model for Constructing Social-
ism and Great Helper of Our Country), HMPYK, Mo. 5,
1956, p. 50. Rest of bloc figures is a residual.
Percenta e for Total bloc: Yeh Chi-chuang, "Tan tui-
wei mao- ,” (On Foreign Trade), HHPYK No. 16, 1957,
p. 91: percentage for USSR: Peo Ie's China, No. 23,
1957, p. 81. Percentages for Res? of EIoc and Rest of
World are residuals. Absolute figures are calculated.
Percentage for Total bloc in 1957: Pekin Review, June
17, 1958, p. 13. Percentage for USSR in I957: "Chung-
shu soong-ti pan hu-tso ho-tso ti hsin-cheng-chiu,"
(New Achievements of the Sine-Soviet Fraternal Mutual
Assistance and Cooperation), JMJP (Editorial) Apr. 28,

1958.
residuals, and absolute figures are calculated.

Absolute figures for Total bloc: 6.5 times of 1950. Ten

Great Years, 2p, cit., p.168, Absolute figures for
over 57. SCEP’No. 1893, p. 81.
for Rest of bloc and Rest of world are residuals.

Percentages in parentheses are calculated from absolute

figures.

Absolute figures

Percentages of Rest of BIoc and Rest of world are

30

TABLE II-3.--Foreign trade turnover of Communist China (in
million 0.8. dollars)

 

 

 

Year Import Export Turnover
(1) (2) (3) (8)8(2)+(3)
1989 370.0 829.1 799.1
1950 808.9 703.7 1512.5
1951 955.9 872.5 1829.8
1952 836.8 817.3 1658.1
1953 1179.3 1072.0 2251.3
1958 1231.0 1157.8 2838.8
1955 1285.8 1352.8 2557.2
1955 1807.5 1535.0 3072.5
1951 f 1330.5 1621.3 3010.3
1958 1811.7 1950.8 3762.1
1959 1958.8 2182.8 8137.2
1950 1888.3 1918.1 3752.8
Source: Appendix B.

31

.m xwocomm<

«oemsom

 

 

 

 

 

 

 

~.eme m.aoe n.amsa m.mm« m.omm a.omo n.asa m.cam o.mmoa m.o:HH e.osaa a.mm~« coma
«.mma ~.oea a.~HsH a.esm m.:~m m.~em «.mmoa m.mmm m.~mo~ a.ossa «.meufl ”.muau omen
m.oee o.moe m.o:ma a.om~ p.90: m.moe m.omm 0.3mm c.3HmH m.aeua e.msoa «.mauu mama
.m.msm «.oam m.mmaa m.sm« «.oma H.omm H.mme H.33m ~.~m~m o.mam m.oam n.asma ems”
:.m:m o.e~s s.meoa s.:- m.es~ n.aom «.305 m.mme m.emsa o.eam m.omm «.maaa mesa
n.am: m.oom H.ame 3.5a“ o.om~ «.am: m.mso «.mse o.amma o.omo «.oem H.9moa mama
m.mmm a.mo~ «.meo o.mmfl s.mm~ o.-s ”.mem n.ame n.amma m.mme “.mao n.amea same
~.-s m.na« o.maa H.maa m.ema o.mmm 5.35: c.5mm n.aeaa o.osm m.moe «.mnma mama
o.~:n :.~m~ o.mem o.~o «.m: n.aoa e.mH: ~.:mm m.aom a.mes :.mmm H.maoa «mad
o.mm: m.ams m.:~m m.as «.5: c.2m ”.mmm s.me: a.mom m.oam o.mum n.acm Home
_.oam 3.3”: m.s~r n.~ m.o m.m n.ama «.mmn m.mem o.maH m.son H.oom ammo
«.0mu m.m- o.pms .e.: .6.: .e.: a.mma ~.m:H H.~sm a.oma «.msa H.~:m mama
one km“ am...“ he» 2%; “was: 2%.. 2%.“. sea We may mew“ “as. E
vamoz no poem uon mo whom .n .m .m. nonnHmwo b one»

oonm umwmnsFoo

“mooaaoe

.m.= no cownawa may enema wnamsaaoo no cushy cmwemom no cowwmnampman HocOMmom::.::HH mqm<a

32

Comparison of the Communist Chinese and United Nations'
Statistics:
(1) Overall Communist Chinese Foreigp Trade

To make these two sets of statistics comparable,
the United Nations' figures are converted into Communist
Chinese yuan figures. In doing so, the exchange rate 0.8.
81.00 a 82.85 is used, which is a cross-rate using the
British 1 as the medium“:L instead of the Communist Chinese
official rate U.S. $1.00 I W 2.38. The reason is that
there is no telegraph transfer rate between the Communist

2 and the official rate is

Chinese yuan and the U.S. dollar,
only the buying-rate for U.S. notes at which the dollar is
deliberately depreciated.3 In a Communist-type economy,

the official exchange rates are used for internal conversion
between the State Central Bank and the Foreign Trade Depart-
ments.“ It is possible, and indeed very often happens,

that these rates are pegged at disequilibrium levels. How-

ever, when it comes to international clearance, it is the

 

18ince 1953, Communist Chinese official rate:£ l 8
26.859, and at par,£.l = U.S.$2.80, therefore 0.8.31.00 :
82.85.

2Solomon Adler, The Chinese Econom (New York:
Monthly Review Press, 1957), p. 225.

3Using the Communist Chinese official rates, the
cross-rate is£1 s U.S.$2.92.

“Edward Ames, "Exchange Rates in Soviet-Type
Economy,” Review of Economics and Statistics, Nov. 1953,
pp. 337-382; aIso F. Bystrov, "Tfie Organization of Interna—
tional Settlements Among the Socialist Countries," Problem
_gf Economics, June 1960, pp. 56-59. '

33

international rates that have to be observed. In her trade
with the Free World, Communist China mainly uses the British
R as the means of transaction, which she must have also used
to finance her deficit with the Communist bloc. Therefore,
the cross-rate is deemed to be more appropriate. The con-
version rates used for 1950, 1951-1952 follow the same
rationale. They are different because the official rates
for the British‘é were different.1

Two observations can be made from Table II-S. First,
for the Total and the Communist bloc, the two sets of
figures are entirely incompatible. Secondly, for the Rest
of the world, the two sets of figures show much similarity.
Therefore, the big differences in the Total trade figures
are results of big differences in the Communist bloc trade
figures, not of differences in the Rest of the world trade
figures. These relations can be seen more clearly in the

diagram below. (Figure II-l).

(2) Sino-Rest of world Trade

Because relatively small differences are found in
the two sets of trade figures concerning Communist Chinese
trade with the countries in the Free World, little explana-

tion is necessary. However, it is of interest to review

 

1For 1950 the.£ rate used is only an average because
of changing official quotations.
.51 8 89.018, sincet l 8 0.3.82.80, therefore
U.S.$1.00 I 83.22. ,
For 1951-1952,11 8 26.235, therefore, U.S.$1.00 8 82.23.
The official exchange rates are listed on p.80 below.

- I ‘ :IIII'I'I.

I.“

IIII" I

[III I 'IIOI‘

‘

fll‘llllll-‘d.~.'ull I a I.” -

..:~ 1‘ I‘ '6‘.”,

38

some annu one muHH nuance soon she comsmam .z.= muuHH manna soon ems momsmmu .o .u

.ms.~» . oo.~e.m.a .. mama ocean .m~.~» . oo.Hs.m.a
-- «was a Head .««.m» . oo.a».m.a .. ammo ”oust «macaque on» we consume can» coca sopeo>eoo

«eeossom

.nces> owe“ oeumoscco nomsumu comma .ecowuez pupae:

 

 

  

 

 

 

 

 

 

 

monoceo .:.D eawns moomsoe omecwnu unwcsesoo scam momsuwu some» monocov .o.o o>omc ranch cH
m.mm~m o.mmmm m.mapa n.ahou m.oa>m m.moao m.h~:m c.5mom H.5Hum o.oho«a mama
o.umm~ m.uamu u.numa m.~Hmu :.H:Hm o.munm o.mam: n.5noh m.mhmp o.om:od puma
m.m~m~ m.bnhu «.muua s.«o~n s.momm H.mmmm m.sma: n.aodo m.h~mh o.o>ooa mama
”.mmma o.moau n.asaa o.pama :.oa:m c.5mso m.:mm: c.3m5a H.0Hmo o.ommoa mama
o.moma 0.3mma m.mnoa .c.c H.55Nm .m.c o.HHm: o.mseo a.mhmm c.0530. smma
«.smsa o.uoaa :.omm «.msma H.nsmu m.~mm: n.amhm o.ooam h.mHmm o.omom «mad
«.doua n.aaea H.mmu 5.»:ma :.mmau m.aohm n.5mmu «.maom o.owmm o.om:o «mad
m.~mou m.moau :.Ha« n.aom o.mooa p.5oou c.5aou :.oohm o.mho: o.ommm Hmaa
o.oha«. h.mmha h.u« m.poa o.mooa :.~m~a h.mmma m.omma m.ono: 0.0m”: omoa
Andy «adv Amy Ame “so Amy any «so any nay Adv
. . . . .26 .p.p .F.P .0.” .35 .bhb. .zS Bub.
onmoz AmmHEWmeMi . ooHc Human Hewoa see»
no poem ooam wmmcseeoo
“enema

53.3... 53 65.8 «3558 no 893 c328 no 5338536 8532 . 8653--.»..3 was:

35

FIGURE II-1

Com arison of Forei Trade Fi ures
i '; IE" Wo'us'ana BIIIon 'yuans' 5 '

----- - total trade .’ C.C.

12* - — - Communist bloc trade '
rest of world trade '

 

 

I l J j 1 L J l
I 1 l T l I r 1*—

1950 1951 1952 1953 1958 1955 1956 1957 1958
Source : Table II-5.

 

 

ll

36
certain explanations advanced by other economists.

In his study, R. F. Dernberger finds that the
figures from Communist Chinese sources are in general higher
than those reported by her trading partners, and thus ad-
vances the argument that this is due to the over-valuation
of the Communist Chinese yuan.1 But this argument simply
does not apply in this case, even if the yuan is overvalued.
In Communist China, the state operated foreign trade con-
cerns serve as the bridge between the foreign and the in-
ternal market. Then, the Ministry of Foreign Trade can
report her total foreign trade figures in two ways. It can
either report the sum of all foreign exchanges used, con-
verted into the local currency each at its official rate;
or the sum of the values of all traded commodities at their
local prices. If the local currency is overvalued, the
latter sum will be higher than the Former. Evidence shows
that Communist China used the first method of reporting.2

Then, the sum should be exactly the same as that which is

 

1R. F. Dernberger, "International Trade of Communist
China," Three Essa s on the International Economics of Com-
munist Cfiina, e3. 5. F. Remer (inn Arbor: Universiiy of

Michigan Press, 1959), p. 136.

2We shall see later that when the Sino-Communist-
bloc trade figures as reported by the Communist countries
are converted into yuan figures at the official ruble rate,
they are almost the same as those reported by Communist
China. This shows that Communist China reports her foreign
trade by converting the total transacted value of foreign
exchanges into the local currency, not by summing up the
total value at local prices.

37

calculatedby converting the United Nations' figures into
yuan figures at official exchange rates. In other words,
Columns (10) 6 (11) in Table II-S should be identical.
It is known that the Communist Chinese yuan is overvalued.
But as long as she reports her foreign trade in the first
method, internal prices are not involved and overvaluation
does not come into the picture.

The same argument applies to show that the differ-
ence can not be due to "difference in pricing," as advanced

1 In the trade between Communist China

by Choh-ming Li.
and the Free World, prices are most likely quoted in foreign
currencies, and most unlikely quoted in yuan. Then, the
total trade value announced by Communist China is only a
summation of these prices, each multiplied.by its quantity
and converted into yuan. Again, this summation should not
be different from that reported by her trading partners,
when their reports are also converted into yuan figures.

The argument that the differences are due to differ-
ences "in c.i.f. and f.o.b. valuations" and "in timing of
arrivals and departures" do have some weight.2 It is diffi-
cult to assess the effects of timing, since it affects both
sets of figures in both directions. Most countries in the

Free World report their trade c.i.f. import and f.o.b. ex-

port. While Communist China probably reports in the same

 

1Choh-ming Li, 93. cit., p. 188.
2Choh-ming Li, Ibid., p. 188.

38
way,1 the U.N. figures would overstate Communist Chinese
exports and understate her imports. The net effects on the
total value is hard to determine. Probably the result
would be an overstatement because Communist China exported
more than she imported from the Free World in the years
under study.

Some other explanations also help to make up for the
differences. (There were trade activities kept unreported
in the United Nations' publications, the most important of
which was the smuggling trade of embargoed commodities
through Mong Kong, Macau and Japan.2 Another explanation
lies in the statistics themselves. Many countries made no
report at all, especially in the earlier years under study.
,These two reasons are important enough to explain why in
general the Communist Chinese figures are slightly higher
than the United Nations' figures.3 '

With all these facts in mind, it can be stated that
these two sets of statistics are on the whole compatible,
and there is no evidence of deliberate falsification on the

part of Communist China.

 

1See discussion on p. 87.
2See Hsin Ying, 2p, cit., pp. 115-116.

3Another unreported trade activity is probably
narcotics traffic. See Feng-hwa Mah, ”The First Five-
Year Plan and Its International Aspects,” Three Essazs on

the International Economics of Communist C 1na . .
REmer, e3. (Kin KrSor: Universiiy of”flicfiigan Press, 1959),

9. 96s

39
(3) Sino-Communist-bloc Trade

The Communist Chinese and the United Nations'
statistics markedly differ from each other in the Sino-
Communist-bloc section. Such differences can, in no case,
be explained by any or any combination of explanations
given above. We have to look for other clues.

In his speech delivered at the National People's
Congress in July, 1957, Yeh Chi-chuang, the Minister of
Foreign Trade, pointed out that:1

Our Country's internal conversion rate between the
ruble and the PeOple's currency was also fixed at
the People's Bank's quotation at that time. This is
what we now call the "trade ruble.”

”That time" which was referred to was April 19,
1950, the date of the signing of the first Sino-Soviet
Trade Agreement. Little is known about this internal con-
version rate, so that many economists had tried to derive
it by various methods.2 However, a thorough checking of the
foreign exchange rate quotations of the Bank of China3 will

make all these efforts unnecessary, and give us the clue to

 

1Yeh Chi-chuang, "Tan tui-wai mao-i, " (On Foreign
Trade), HHPYK NOe 16,1957. pe 93s

2Die Wirtschaftliche Verflectun der Volksre ublik
China mit am urg: nst utrt uer s1en-
pp .Jorld Economic Re (UnitedA
Nations, 1957), p. 222, Ta e , note 3 . rtC. Li,
Valuation of China's Foreign Trade," Far Eastern Economic
Review, Oct. 1, 1959, p. 552; Choh-ming Ci, 2p, cii., pp.
3.

 
  

     

3The Bank of China is a specialized bank under the
People's Bank as the sole agent in all foreign exchange
transactions.

M0
solve the whole problem.
The following table is a compilation of these offié
cial quotations since May 1950.

TABLE II-B.--Official foreign exchange quotations of Commun-
ist China (yuans of Mar. 1, 1955 per unit of exchange)

 

 

Date 5 1. Ruble
May 11, 1959‘ 3.75 ~ 9.3 1.925

29, ' 3.75 9.99
June 9, 7 3.75 9.99 9.99b
July 3, " 3.55 9.323

9, . 3.50 9.32 1.025

25, ” 3.50 9.199 unchanged
Aug. 7, ' 3.22 n.a. unchanged
Sept. 6, " 3.1 7.821 unchanged
Jan. 5, 1951 2.99 5.937

29, - 2.299 9.235
June 7, " 2.227 6.235
Dec. 5, 1952° 2.227 9.959

 

- aPrior to May 1950, official quotations were not
unifiede

bFor inward remittances (esp. buying government
bonds) only. ~

cOfficial quotations remained unchanged hereafter,
except for 0.8. notes, the buying rate for which was later
pegged at 82.3“.

Sources: Compiled from information in the Financial
Market section in respective issues of the Far Eastern '
Iconomic Review. '

“1

Here there are actually a few quotations for the

ruble, which was later either quoted as unchanged or not

. quoted at all.

If we apply the rate Rbl.l.00 t 81.025

to convert the Sino-Conmunist-bloc trade figures in the

united Nations' statistics

into yuans,

l

and compare the

results with the figures given by Communist China, we get
the following table.

TABLE 11-7.--Sino-Communist-bloc trade‘ (in million yuans)

 

 

Year Total Bloc U.S.S.R. Rest Bloc

O O O O O O O O O O O O
(l) (2) (3) (u) (5) (6) (7)
1950 1390.3 2911.2 1282.9 2375.9 107.9 35.3
1951 3766.9 3708.5 2897.7 3319.8 868.7 388.7
1952 5085.3 9907.9 3701.6 3968.9 1393.7 939.5
1953 6108.0 6299.7 9562.8 9806.9 1595.2 1888.3
195“ 6776.0 721“.“ fleas 53816.2 neae 1730e2
1955 878u.0 7622.3 6797.0 5706.8 1987.0 1915.5
1956 8152.5 8196.1 5869.1 6139.7 2282.7 2056.8
1957 7837.5 7553.8 5225.0 5257.0 2612.5 2296.9
1958 9037.0 9082.3 6165.5 6209.8 2871.5 2872.5

 

*Since ruble is used in foreign trade pricing and
settlement in the Communist bloc, the conversion rate men-
tioned is used here not only for trade with Russia, but

also with the entire bloc.

Sources:

Columns (2), (u) and (6) are from Table

11-5; Columns (5) 6 (7) are calculated by converting Columns
(7)6 (9) into yuans at the rate 81. 00 a 39.10; Column
(3) is sum of columns (5) 5 (7).

 

» lThat is, 951.1. 00 . v1. 925, and as u. s. 51. oo .
351.9. 99, 0.3. 91. oo 2 99.10.

#2

When comparison is made on such a basis, there is a
remarkable degree of similarity between these two sets of
figures, especially in the more recent years.1

In Sine-Soviet trade (Columns 9 6 5), the U.N.
figures are in general slightly higher than the Communist
Chinese figures. Relatively large differences are found in
figures for 1950, 1951, and 1955. Differences in 1950-
1951,period of the Korean war, may be due to Russian mili-
tary equipment supplies which were not recorded as foreign
trade by Communist China, thus making.the Communist Chinese
figures considerably below the 0.". figures. In 1955,
when the Russian shares of the four Joint Stock Companies
were transferred to Communist China and were to be repaid
by Communist Chinese exports,2 it is probable that these
transfers were recorded by Communist China as trade, but not
by Russia, and so making the Communist ChineSe figures
higher than the U.N. figures. It is also very probable that
when Russian investments were made in these companies
(mainly in form of equipment) prior to 1955, Russia recorded
these as trade, but Communist China did not. Rhen in 1955
Communist China took over these shares, she recorded them
as trade, but this time Russia did not.

In comparing Columns (6) 6 (7), the Communist

 

1For comparison, also see Figure 11-2 below.

2These Joint Stock Companies are the Non-Ferrous
and Rare Metals Company, The Petroleum Company, The Civil
Aviation Company and The Dairen Dockyard.

“3
Chinese figures are in general higher, especially in they
earlier years. One explanation can be found in the statis-
tics themselves. The coverage of the U.N. statistics are
far from complete. Some of the trade figures of the Eastern
European countries are not available for the earlier years,
and little of the trade figures of the Asian Communist
countries are accessible th.oughout these years.1 'It is
also possible that in the earlier years part of the Sino-
Eastern-European trade was transacted via Russia, with the
result of aggravating the Russian trade figures and under-

stating the Eastern European trade figures.

Overall Comparison of Statistics

We can now put the separate comparisons together
for an overall comparison, which is shown in Table 11-8
and Figure 11-2. Here a marked similarity between these
two sets of figures can be seen. It is therefore by under-
standing the Communist Chinese manipulation of exchange
rates and her special way of reporting foreign trade figures
that her foreign trade statistics can be reconciled with
those reported by her trading partners. Also by the same
understanding, her foreign trade turnover in 1959 and 1960

can be estimated.

 

1See Appendix B.

I!“

TABLE ll-8.--Turnover and regional distribution of foreign

 

trade of Communist China (in million yuans)

 

 

 

Year -Total Communist Bloc Rest world
(1) . . . . . - . . . . .
1950 9150.0 5399.1 1390.3 2911.2 2759.7 2975.9
1951 5950.0 5771.0 3755.9 3709.5 2193.5 2052.5
1952 5950.0 5599.1 5095.3 9907.9 1919.7 1291.2
1953 9090.0 9099.9 5109.0 5299.7 1992.0 1759.2
1959'A 9970.0 5979.9 5775.0 7219.9 1599.0 1555.0
1955 10990.0 9577.5 9799.0 7522.3 2195.0 1955.3
1955 10970.0 10925.9 9152.5 9195.1 2717.5 2529.9
1957 10950.0 10915.2 7937.5 7553.9 2512.5 2952.9
1959 12970.0 12972.2 9037.0 9092.3 3933.0 3799.9
1959 (19532.5) (11172.9) (3959.5)
1950 (13002.5) (9909.2). (3599.3)
Sources: Column (2): Table'II-2; Columns (9) 6

(5): Table 11-8; Columns (6) 6 (7): Table 11-5; Column
(3): sum of Columns (5) 6 (7); Figures in parentheses are
estimates_by_converting U.N. figures in Table 11-9 into
yuans at exchange rates: for Communist bloc trade, $1.00 8
89.10, and for Rest of world trade, 61.00 a 82.95.

95

 

 

FIGURE II-2
Reconciliation of Forei Trade Fi ures
'- (IE {Sousana zillion yuans}
7
""" " total trade '1'
_ ——- Communist bloc trade ,'
12 rest of world trade I;
6.6. p
ll~L 9..-.-- .0
0 .i‘.§..... ~
2" 1"“ N. t '9
.4 0 I 0 e

 

J 1 I I 1

J l

 

 

l

"O".

 

I I l T l I l

1950 1951 1952 1953 1959

Source) Table II-8.

1

1955' 1955 1957 1959

 

98
It is also possible to make a comparison of statis-
tics from the standpoint of trade balance. In so doing, we
have to content ourselves with a simpler form of comparison.
Because of lack of detailed statistics, only a comparison.
of an overall balance can be made. i

TABLE II-9.--Balance of’foreign trade of Communist China
(in million yuans)

Year Import Export . Balance
0 O O O O 0 ECU. U u

(1) (2) (3) (9). (5) (5) ~ (7).

 

 

1950 2115.5 2951.9 2033.5 2935.3 - 9.3 - 515.5
1951 3510.5 3115.9 2939.5 2559.2 -1071.0 - 952.5
1952 3795.9 2995.9 2713.2 2712.1 -1033.5 - 279.9
1953 9511.3 9350.9 3979.7 3599.5 -1132.5 - 551.9
1959 9909.9 9792.3 9055.5 9095.1 - 339.9 - 595.2~
1955 5039.0 9755.9 9991.0 9733.9 .1099.0 - 32.0
1955 5297.0 5055.5 5559.0 5535.9 + 271.0 + 570.3
1957 5002.0 9595.7 5997.0 5577.5 + 995.0 + 990.9
1959 5137.9 5150.9 5710.5 5711.5 + 572.7 + 550.7

__'_

Sources: Columns (2) 6 (9): Table II-l; Columns
(3) 6 (5): calculated by converting trade figures in Table
II-9 each at their respective exchange rates; Columns (8)
6 (7): differences between Columns (2) 6 (9), (3) 6 (5)
respectively.

Three observations can be made from the table
above. First, concerning imports, the Communist Chinese
figures are higher than the U.N. figures. Second, for ex-

ports the 0.9. figures are higher than the Communist

. 97
Chinese figures. -And third, differences in the import
figures are greater than differences in the export figures.
Since the effects of Communist Chinese manipulation of foreign
exchange rates are already taken into account in the cal-
culation of the table, explanations must be sought in other
aspects. It is here that the c.i.f. and f.o.b. valuation
practice of various countries comes into picture.

In the import columns, Communist Chinese figures are
in general higher than the U.N. figures. This suggests
that, while all her trading partners report their exports
f.o.b., Communist China reports her imports c.i.f. The
result is that the Communist Chinese figures are substan-
tially higher.

In the export columns, the U.fl. figures are higher.
This suggests that while Communist China reports her export
f.o.b., part of her trading partners (i.e., countries in
the Free World)1 report their imports c.i.f., with the re-
sult that the U.N. figures are slightly higher.

The combined effects are shown in the balance
columns. In general, the 0.x. figures understate Communist
Chinese deficits when she has an unfavorable balance, and

overstate her surplus when she has a favorable balance.

 

1As a rule, Communist countries report both their
imports and exports f.o.b. country of origin.

“8
PIGURB 11-3
Forei Trade Balance of Communist China
' I (In 65535.3 million yuans,

united Nations' figures

 

012

 

10.1 ._ ..__.. ...A Communist Chinese figures

/
/

51+ 5 5 i f #.
19’0 1951 1952 1953 195‘ 1 55 955 1957 1'50

7.. /

 

10
1*

10.

 

 

~12

 

Source: Table II-9.

99

The Actual Re ional Distribution and Balance of the Forei n
Trade of Communisf China

After all these comparisons ending in the final
reconciliation of the Communist Chinese and the United
Nations' statistics, we come to the question: Which one set
of figures should be used in order to arrive at the actual
regional distribution and balance of the foreign trade of
Communist China? On the one hand, there are Communist
Chinese figures which are sums of two separate parts, each
converted into yuans at its own rate of exchange: on the
other hand, there are United Nations' figures with incom-
plete statistical coverage and the need for adjustments in
their c.i.f. and f.o.b. valuations.

Two aspects of the same problem should be considered.
From the financial point of view, the manipulation of ex-
change rates by Communist China, divorced from their inter-
national parities, affects only internal conversion within
the country. Or to be more specific, it affects payments
made or received by the Ministry of Foreign Trade in its
transactions with the Bank of China in buying or selling
foreign exchanges. Whether or not it affects decision on
'trade directions, we do not know. It is probable that it
does. Definitely her pattern of exchange rates would over-
state the proportion of Sino-Communist bloc trade in the
total if they are given in yuan figures. For instance, a
trade value of one million rubles would be recorded as

1.025 million yuans. But a trade value of a quarter million

50
dollars, which is equivalent to one million rubles, would
be recorded as only 250,000 x 2.95 = 512,500 yuans. When
it comes to international clearance, it is the accounts of
the Bank of China, in terms of rubles, dollars and pound
sterlings etc., that matter. All settlements must observe
international parity. Therefore, it is the United Nations'
statistics that are meaningful.

From the commodity point of view, it is known that
the pricing of commodities in intra-Communist-bloc trade is
based on world market prices.1 This is also true in Com-
munist Chinese trade with all countries.2 Then, the United
Nations' trade figures are also representative of commodity
movements. For example, when prices are more or less the
same, the amount of commodities valued at one million
dollars would be equal to that valued at four million rubles.
On the contrary, the amount of commodities valued at one
million yuans would be different if purchased from, or sold
to different sides of the Iron Curtain. Therefore, the
United Nations' statistics are again more appropriate.

It is difficult to assess the incompleteness of the
United Nations' figures. However, compared to the statis-
tics that are already available the errors are small. Ad-
justments can be made for c.i.f. and f.o.b. valuations.

Because countries in the Free World report their

 

1?. Bystrov’ 1°C. Cite, pe 57.

2Yeh Chi-chuang, ”Tan tui-wei mac-i," (On Foreign
Trade), HHPYK, No. 18, 1957, pp. 92-93.

51
trade statistics f.o.b. exports and c.i.f. imports, and
Communist China depends heavily on foreign transportation
in her foreign trade, United Nations' figures necessarily
overstate her exports and understate her imports. An
arbitrary 56 adjustment is made here, i.e., Communist
Chinese exports are scaled down by 53, and imports raised
59. Since trade figures reported by the Communist countries
are f.o.b. both imports and exports, an upward adjustment
of 53 in her imports alone is necessary. Furthermore, no
adjustments are necessary for Sino-Soviet trade, because
these two countries are neighboring and deliveries are
made mainly by railway hauling. Table II-lO shows the
results of these adjustments and the final balance. The
actual turnover and regional distribution of the foreign

trade of Communist China is shown in Table II-ll.

 

on!” ”no.” “’3‘ ”£34 ’na‘u Ahmad. MUaanH‘ huh-9.1” :63”. Kahuna.“ omfiufiu

 

 

 

 

 

 

 

 

 

52

 

 

 

 

 

3.000 0.03+ 0.00+ 0.05+ 0.00+ 0.05+ 0.030+ 5.000+ 5.00+ 3.00! 0.006 0.56 NHMMR
same
0 0.30 0.00 0.30+ 0.000 0.00I 0.30! 0.000 0.33! 0.000I 0.0+ 3.536 P000
5.00+ 0.000: 0.530: 0.0300 0.000) 0.000: 0.3000 0.00+ 0.300+ 0.030+ 0.030+ 0.00+ 000:
5.00+ 0.0006 0.030! 0.0006 0.030: 0.030) 0.000I 0.06 3.030+ 0.500+ 0.000+ 3.000 0000
0.00+ 0.0000 0.000! 0.00! 3.000! 5.000) 0.00+ 3.000+ 0.000+ 0.03+ 0.030+ 0.30: 0du08
eeoceaem
0.000 0.003 0.003 0.030 0.000 0.000 0.000 3.033 0.030 3.000 0.005 0.005 Swmmm
0 0.0 0.03 5.53 0.500 0.030 0.030 0.000 0.050 0.003 0.030 0.530 #000
0.030 0.000 3.053 0.300 0.500 0.005 3.035 0.005 0.330 0.300 0.000 0.000 0003
0.030 0.300 0.000 0.000 0.300 3.5000 5.000 0.000 0.000 0.3000 3.3000 0.0000 0000
0.000 0.000 0.000 0.000 0.0000 3.5000 0.0000 0.0330 0.0000 0.0500 3.3000 0.0000 00908
scam whoa

5.000 0.053 0.003 0.300 0.003 0.050 0.003 0.300 0.000 0.035 0.000 0.005 fimmmw 7
0 0.0 0.53 0.00 0.050 0.000 3.500 3.300 0.300 0.000 5.530 0.000 “a.“
0.000 0.000 0.000 5.003 5.353 0.050 0.030 0.305 0.005 0.000 0.0000 0.530 0003
0.000 0.000 0.050 5.053 0.030 0.005 0.000 0.000 0.050 0.0500 0.0330 0.0300 0000
0.503 0.000 0.530 0.000 0.0000 5.5000 0.5000 5.0000 0.0000 0.0000 0.0300 5.0500 00008
g

0300 0000 0000 0000 0000 3000 0000 0000 5000 0000 0000 0000

b

Ama600ov .0.D 6000005 :00 madcu unaudesoo 00 even» meuhou no eocedemII.OHlHH u4m<a

53

TABLE II-11.--Turnover and regional distribution of foreign
trade of Communist China (in million U.S. dollars)

 

 

Year Total Communist Bloc U.S.S.R. Free World
1999 798.9 392.1 392.1 956.0
(100.0) (92.8) (92.8) (57.2)
1950 1999.3 588.9 579.5 910.9
(100.0) (39.2) (38.6) (60.8)
1951 1828.7 906.3 809.5 921.8
(100.0) (99.5) (99.2) (50.5)
1952 1651.9 1077.6 967.9 573.8
(100.0 (65.2) (58.6) (39.8)
1953 2259.2 1599.6 1172.3 709.6
(100.0) (68.5) (52.0) (31.5)
1959 2995.1 1771.3 1337.6 673.8
(100.0) (72.9) (59.6) (27.6)
1355 2690.9 1851.6 1391.9 788.8
(100.0) (70.1) (52.7) (29.9)
1956 3095.0 1982.5 1997.5 1062.5
(100.0) (61.8) (99.1) (38.2)
1957 2959.7 1796.6 1282.2 1162.1
(100.0) (60.7) (93.3) (39.3)
1958 3782.1 2235.7 1519.6 1596.9
(100.0) (59.1) (90.0) (90.9)
1959 9150.1 2791.3 2052.8 1909.1
(100.0) (66.0) (99.9) (39.0)
1960 3775.6 2310.2 1663.6 1965.9
(100.0) (60.9) (99.0) (39.1)

 

Sources: Absolute figures are based on Table II-10.
Figures in parentheses are percentages of total.

CHAPTER III
THE IHPORTS 0F COMMUNIST CKINA

In the study of international trade and economic
development, countries are very often classified as industrial
and primary producing countries, which usually are the
developed and underdeveloped countries respectively. There
is, of course, no necessary correlation between industrialisa-
tion and development, primary production and underdevelopment.
For instance, Japan has a highly developed sector of
industries but low per-capita income, whereas Australia is
a primary producing country with high per-capita income.

These are only notable exceptions; in general such a corre-
lation prevails. In international trade, commodity move-
ments between these two groups of countries are primarily
the exchange of manufactured goods for primary products.
Therefore, the examination of the commodity pattern of a
country's foreign trade, as well as its commodity trade re-
lation with different types of economies, will give us some
perceptions of its stage of development. And the change of
its commodity structure through time will reflect the direc-
tion and speed of the development of various sectors in its

economy, as well as its changing position in the world.

55

It is the purpose of this chapter, and the two chapters that
follow, to investigate the commodity structure and its change
through time in the foreign trade of Communist China, so as
to ascertain her position in the international flow of
commodities, and the stage of her economic development com-

pared to other countries.

To develop such an analysis, I shall use data derived-‘

from Appendices D and E. For convenience, commodities are
classified into four major groups--machinery and equipment,
manufactured goods, raw materials, and foodstuffs, each with
several sub-groups.1 The trading partners of Communist China
are divided into three groups: Russia representing the
Communist bloc,2 the developed countries,3 and the underde-
veloped countries.“
Simple regression analysis is used to show the
changes in the percentage shares of different commodity and
country groups through time. In doing so, the years 1955-

1980, assuming the values from 1 to 8, are used as the values

 

1. 1

1For the composition of these groups and their sub-
groups, see Appendix E.

2It will be pointed out in Chapter VI and Appendix C
that, in spite of the absence of statistics, data used here
are fairly representative of Communist Chinese commodity
trade. The commodity pattern of Sino-Eastern-European trade
is similar to that of Sino-Soviet trade.

3This group consists of all non-Communist European
countries, Australia, New Zealand and Canada. Some of these
countries do have low per-capita income, such as Portugal
and Greece. However, their trade with Communist China is
very small.

I.This group consists of the Asian, African and Latin
American countries, the commodity trade statistics of which
are available. For coverage of countries, see Appendix C.

58
of the independent variable x, while the actual percentages
are used as the values of the dependent variable Y. Here we
have:

Y1 3 a T b X (1'lgeee6)

i
The simple regression coefficient b is calculated by using
the formula:

new:1 - (2 x,)( 221)

 

be

92x2 - (22(1)2 (9-5)

to show the trend in every case. 'It is defined here that a
share increases if its regression coefficient is between 1.0
and 2.0, and increases significantly if its regression co-
efficient is above 2.0. Percentagewise, an increase means a
total increase of 5-106 and a significant increase means a
total increase of more than 106 in six years. The same
definitions are used for decrease and sigpificant decrease of

shares except, of course, that the regression coefficients

are negative in value.

General Picture of Communist Chinese Commodity Imports
As detailed analyses will be presented separately

under each group, a few remarks are sufficient in passing.

In the years under study, Communist China imported only very
small amounts of foodstuffs, and even these were far exceeded
by her foodstuffs exports.1 Machinery and equipment took up
about some 908 of her total imports. A closer examination of
statistics indicates that it would be about 506 if we include

#

 

1See Chapter IV and Chapter V below.

57

TABLE III-l.--General Commodity Imports of Communist China
‘1“ 311110“ UeSe dollars)

 

_—

1955 1955 1957 1959 1959 1950 Regr.
’ Coeff.
POOdBEUffI 20.5 15.3 19.5 29.1 5.0 90.9

' (3.1) (1.9) (2.3) (2.9) (0.57 (3.1) -0.117

 

 

Raw
materials 100.5 125.5 191.1 209.5 216.0 299.3
(15.5) (15.9) (22.9) (17.5) (15.5) (18.8) 00.390

"fiflUfac- 303e3 3‘7e5 325.1 591.9 507e5 $07.3
tures goods (97.0) (92.7) (39.1) (99.9, (37.2) (33.1) ~1.920

Hachinery 6 222.8 '326.7 318.0 367.2 636.2 533.8
equipment (39.9) (90.0) (37.2) (30.7) (96.8) (90.0) +1.197

Tota1 697.1 815.0 853.0 1197.2 1360.3 1331.3
(100.0)(100.07(100.0) (100.0)(100.0)(100.0)

 

Source: Appendix D. Figures in parentheses are per-
centages of total.
machinery and equipment that were primarily not for economic
uses.1 In her total imports, the share of machinery and
equipment had increased while that of manufactured goods

decreased.

Impprts of Machinery and Equipment
Of all these imports Russia was the predominant

supplier. Except for the fact that no complete industrial
undertakings had yet been imported, Communist China has re-
sumed purchasing such commodities from.the developed countries
of the Free World. The increase was especially marked in 1957

when the Embargo was relaxed by many countries. In a few

 

1See explanatory note in Appendix C.

. 58

cases, such imports were comparable to those imported from

Russia.

TABLE III-2.--Hachinery ard equipment imports of Communist

 

 

China (in million 0.8. dollars)
1955 1956 1957 1958 1959 1960
m ”
Complete Industrial .
undertakings. 190.5 216.9 209.0 166.2 399.8 373.8
Russia 190.5 216.9 209.0 166.2 399.8 373.8
Power, electrical 6
metal-working ”acne 23e6 2500 27.5 90.2 51.6 53.5
Russia 21.1 18.6 13.9 23.6 35.6 28.7
Developed countries 1.8 9.2 11.7 19.9 19.3 29.9
Transportation 6
Agricultural mach. 27.9 95.1 18.2 95.0 127.6 69.9
Russia 27.2 29.6 10.7 79.3 122.9 53.9
Developed countries 0.3 10.9 5.7 8.5 9.5 19.9
Other machineries. 30.8 39.7 63.3 69.8 57.2 37.1
Ruasia 25e7 30.5 25.6 29.9 26e3 26e6
Developed countries 3.8 9.9 32.5 31.9 30.9 8.3
Total 222.8 326.7 318.0 367.2 636.2 533.8
Russia 219.5 295.6 259.2 293.5 589.1 983.0
Developed countries 5.9 20.0 99.9 59.3 99.2 97.1
Underdev. countries 2.9 11.1 8.9 19.9 2.9 3.7

 

__:-

Source:

Appendix D.

Another comparison would be more illustrative.

TABLE III-3.--Hachinery 5 equipment imports of Communist China
in percentages)

 

1955 1950 1957 1958 1959 1900 Regr.
. COCIfe

 

Imports from developed countries as 5 of:
(1 Total imports of

madhe ‘ CQUipe 2.0 Bel 15o, 19.8 7e? 8.0 91.007
(2) Total imports from

developed countries 6.8 12.7 29.1 11.7 12.1 11.3 60.265

In rts from Russia as 8 of:
(3 Total imports of

machinery and equip. 96.3 90.5 81.5 80.0 91.8 90.5 -0.l92
(9) Total imports from

Russia 51.5 59.9 62.0 59.2 75.3 69.3 93.890

 

Source: Calculated from statistics in Appendix 0.

Line (1) shows that imports of machinery and equip-
ment from.the developed countries into Communist China in-
creased not only absolutely, but also relatively to those
from Russie. However, compared to Communist Chinese imports
of all commodities from these countries, these imports
showed no change (Line 2). That is to say, Communist China
also increased her other imports from these countries as
well. 6

Despite the fact that Russia's share remained
stable (Line 3), such imports took up increasing shares in
total imports from Russia (Line 9). In other words, Com-
munist China was concentrating her imports on machinery

and equipment in Sine-Soviet trede, and substituting other

60
imports from Russia either by domestic production or im-
ports from.the Free world. Furthermore, as the increase of
Communist Chinese imports of’machinery and equipment from
the Free World, excluding complete industrial undertakings,
was faster than those from Russia (Table III-2), Communist
China was trying gradually to substitute Russian machinery
and equipment with those she could get from the Free World,
and concentrete her imports from Russia on complete industrial
undertakings.

More should be said about Communist Chinese imports
of complete industrial undertakings, as they amounted to
more than 505 of her imports of machinery equipment, for
which Russia was the main supplier.1 These complete indus-

trial undertakings were first known as the 156 ”above-norm":

__I:

 

1The other Communist countries also supplied Com-
munist China with some complete industrial undertakings.
Not much is known about them. (See Appendix F.)

2To facilitate management and supervision, Com-
munist China had set "investment norms" for capital con-
structions. Projects were classified as above or below norm
according to whether their investments were above or below
the normal figures. The norm for iron and steel, motor
vehicle tractor, shipbuilding and rolling stock manufac-
turing industries was ten million yuans: for non-ferrous
metals, chemical and cement industries, six million yuans:
for power stations, power transmission lines, coal-mining,
oil-extracting, oil-refining and.machine-bui1ding indus-
tries, motor vehicle and ship maintenance works and tex-
tiles, five million yuans: for rubber, paper-manufacturing,
sugar-refining, cigarette-making and pharmaceutical indus-
tries, four million yuans; for ceramics, food processing
and other light industries, three million yuans. First
P1VQ'YQQ!‘ Plan. 92s 22's. pp. 21-22e

61

construction projects designed and supplied by Russia in
the First Five-Year Plan.1 The number of these projects
increased to 211 in 1956,2 and they were later integrated
into 166.3 In 1958 and 1959, another 125 projects were
agreed upon,“ which, in view of the current rift, probably
existed on papers only. A

It was mentioned in the First Five-Year Plan that
within its duration 29,850 mdllion yuans were to be spent
on all industrial capital constructions, which included 699
above-norm projects. Among these, 195 were to be designed
and supplied by Russia. However, these Russian projects
were to cost 11,000 million yuans out of the total, and 193
of the other above-norm projects were supplementary to the

Russian ones.5

In other words, these imported projects
formed the backbone of Communist China's first step towards
industrialization.

There is no complete list of these projects. It
was claimed that by 1959, 113 of these Russian projects

were either entirely or partially completed and put into

 

11818., p. as.

2Kao Ching-sheng, 'Chung-shu liang-kuo ti ching-
chi ho-tso,” (Sino-Soviet Economic Cooperation), TKP,
April 19, 1957.

aLi Fu-chun, 'Kuan-yfi 1959 nien kuo-min ching-chi
chi-hue tsao-an ti pae-kao," (Report on the 1959 Draft
National Economic Plan), HHPYK, No. 9, 1959, p. 15.

“Ibide. p. lse

sFirst Five-Year Plan, 22. cit., p. 39.

62 .
production.1 The following should give some idea about the
extent and nature of some of these projects.2

Power 16 Textiles 10

Iron and steel 19 Elec. instruments 9

Coal 12 Machine tools 2
Pneumatic in-

struments 1 Motor Vehicles 1
Steam turbines 1 Boilers 1
Mining equip-

ment 1 Tractors l
Petroleum Aluminum 6

refining 1 alloys 2
Chemicals 2 Measuring 6 Cutting

instruments 1

Sugar 2 Paper 2
Food processing 2 Starch 1
Glass 1

From experience, Communist China has been very eager
to publicize the completion of‘her'above-norm projects.
However, the completion of the first few domestically de-
signed projects, including a machine-building plant, one
hydro-electric power station and one reconstructed synthetic

fibre plant, were not announced until early 1958. Thus we

can see how important these imported projects have been to

 

1
2

3?. I-po, "Kuan ya 1958 nien kuo-min ching-chi chi-
hua tsao-an ti pao-kao,” (Report on the 1958 Draft National
Economic Plan), HHPYKI Mo. 5, 1958, p. 18.

Li Fu-chun, loc. cit., p. 15.

For identification of projects, see Appendix F.

63
her industrial expansion.

Imports of Manufactured Goods
This group consists of three sub-groups, namely,.

chemicals, manufactured minerals, and other’manufactured
goods.

TABLE III-9.--Manufactured goods imports of Communist China
(in million 0.5. dollars)

 

 

 

ROE!“
1955 1955 1957 1958 1959 1950 C002.

-:

matcals 95e7 97e6 106.0 129e, like). 80e1
(19.9)(12.0)(12.9)(10.82(3.") (5.0) -1.525

(29.3)(21.3)(l8.6)(39.3)(25.9)(28.9) 01.386

Other. 50.5 76.9 60.3 51.2 96.7 98.6
(7.8) (9.9) (7.1) (9.3) (3.9) (3.7) -l.180
Total 303.3 397.5 325.1 591.9 507.5 507.3

(97.0)(92.7)(38.1)(99.9)(37.2)(38.1) -1.920

 

Source: Appendix D. Figures in parentheses are
percentages of total imports.

In absolute value, Communist China increased her
imports of'manufactured goods. This was due to some in-
crease in chemicals and tremendous increase in manufactured
minerals, which overwhelmed decreases in other manufactured
goods.

Percentage-wise, both imports of chemicals and other
manufactured goods decreased, whereas that of manufactured

minerals increased. As a result, the imports of manufactured

69
goods in the total imports of'Ccmmunist China decreased.

TABLE III-5.--Chemicals imports of Communist China (value in
million U.S. dollars)

 

 

 

Regr.

1955 1955 1957 1958 1953 1900 C002.
VC1UC3 tatal 95.7 91.6 106.0 129e, ll‘el 80.1
(1) Russia 5.6 9.7 9.3 8.9 8.6 9.7

(2) Dev. countries 99.5 63.2 72.1 90.8 101.6 66.7
(3) Underdeveloped
countries 90.6 29.7 29.6 30.0 3.9 3.7

Percentage shares
(9) Russia 5. 9 9. 8 9.0 7.1 7.5 12.1 +1.206

(5) Dev. countries 51.7 69. 8 68.0 69.8 89.1 83.9 +6.663
(6) Underdeveloped

countries 92.9 30.9 28.0 23.1 3.9 9.5 -7.868
As 6 of total Communist Chinese imports
(7) Ru3315 0.9 0.6 0.5 0.8 0.6 0.7 -0.020
(8) Develo ed

countr es 7.7 7.8 8.9 7.5 7.5 5.0 -0.937
(9) underdeveloped

countri.' 0.3 3.6 3.5 2.5 0.3 0.3 -1.159

 

I I J

Source: Appendix D. Percentages are calculated.

Compared to the Free world, Russia had exported to
Communist China very small amounts of chemicals. Notwith-
standing the increase of her share of the market (Line 9),
such exports only maintained the same percentage in total
Communist Chinese imports (Line 7), because of the decreas-
ing importance of chemicals in Communist Chinese imports.
The developed countries had also captured increasing shares

of the market significantly but still remained stable compared

65
to total Communist Chinese imports (Lines 5 6 8). As for
the underdeveloped countries, their exports to Communist
China decreased absolutely. As a result, their share of
the market decreased significantly (Line 6).

TABLE III-6.--Manufactured minerals imports of Communist China
(value in million U.S. dollars)

 

’

 

8.8,.

1955 1956 1957 1958 1959 1960 c..:.
Value: total 157.1 113.5 158.8 910.5 396.7 378.6
(1) Russia 153.2 199.2 111.9 153.8 198.2 168.6

(2) Dev. countries 2.5 19.5 22.9 239.6 183.1 199.3
(3) underdeveloped
countries 1.9 9.7 18.0 22.1 15.9 10.7

Percentage shares
(9) Russia 97.5 86.1 79.2 37.5 92.7 99.5 -12.390

(6) Dev. countries 1.6 8.9 19.5 57.2 52.8 52.6 012.311
(6) underdeveloped

count’1C. 0.9 5.5 11.3 5.3 9.5 2.9 § 0.02.
As 6 of total Communist Chinese imports
(7) Russia 23.7 18.3 13.8 12.9 10.9 12.6 - 2.296

(0) DOV. countries 0.9 1.0 2.7 19.5 13.9 15.0 9 3.553
(9) underdeveloped
c0untr1.. 0.2 1.2 2.1 1.8 1.1 0.8 2 0.069

 

Source: Appendix D. Percentages are calculated.

Communist Chinese imports of manufactured minerals
increased both absolutely in value and relatively to
total imports. However, such imports from Russia only main-
tained their absolute level. Among those commodities supplied

by Russia, only petroleum products showed an increasing

.trend,1

while all others, including iron and steel, de-
creased. As a result, the Russian share of the market de-
creased significantly (Line 9). On the other hand, the
developed countries made the most remarkable advances in
the Communist Chinese market. Especially since 1958,
these countries poured into her market with such metals as
iron and steel, copper. aluminum and nickel, and finally
outstripped Russia to become the main supplier to Communist
China (Lines 2 6 5). Their exports had even increased
significantly faster than the increase of Communist China's
total imports (Line 8). Compared to the others, the under-
developed countries exported only very small amounts of
manufactured minerals to Communist China.

As Communist China's imports of other manufactured
goods decreased relatively to her total imports as well
as in absolute values, suppliers had to compete with one
another as well as with her own domestic production.
Only the developed countries had increased their exports
in absolute terms. Their supplies of textiles (predomin-
antly yarns)2 enabled them to capture a significantly in-
creased share of the market (Line 5), and stand still in
total Communist Chinese imports in face of a shrinking

._-

1See Appendix D. All Communist Chinese petroleum
products import figures are Russian export figures.
Virtually no country in the Free world had supplied Com-
munist China with such commodities.

 

 

2See Appendix D. Most of these Communist Chinese
imports were from the developed countries.

 

IA!

P1:
(9}
(5)
(6)
A: 1
(7)

(8)
(9)

mar)
fat:

“M1

to]

can

had .
und

 

67

TABLE III-7.--Other'manufactured goods imports of Communist
China (value in.mdllion U.S. dollars)

 

 

 

 

 

 

Regr.
1955 1956 1957 1958 1959 1960 Coef.
Value: total 50.5 76.9 60.3 51.2 96.7 98.6
(1) R0301C 20.0 25.1 19.7 20.3 11.1 15.0
(2) Dev. countries 8.5 21.9 21.1 20.6 22.8 25.7
(3) underdeveloped
countries 17.9 31.3 19.5 10.3 6.8 6.9 '
Percentage shares
(9) Russia 98.7 31.0 32.2 39.7 36.6 32.9 -1.563
(5) DsV. countries 16.9 28.1 35.1 90.2 98.8 52.9 97.063
(6) Underdeveloped
countries 39.9 90.9 32.6 20.1 19.6 19.2 -5.997

As 9 of total Communist Chinese imports

(7) R0001“ 3.0 2.0 2.3 1.1 1.2 1.2 -0e53“
(0) DCVe countr1C. 1.5 2.0 2.5 1.7 1.7 2.0 0
(9) Underdeveloped

countr100 2., 3.0 2.3 0.0 0.5 0.5 -0.696

 

-___ ' 1

Source: Appendix D. Percentages are calculated.

market for all other manufactured goods (Line 8). Russia
faced a decreased share of the market (Line 9), while the
underdeveloped countries even suffered a more significant
decrease (Line 6). With Communist China's growing capacity
to produce or even to export many commodities under this

category,1 only in scientific instruments that other countries

 

1In Chapter 7, it will be seen that Communist China
had finally become a great and net exporter of commodities
under this category.

I;

68
could expect a sustained demand.1 In fact, Communist China
had become more interested in obtaining commodities other
than what these various groups of countries had provided.

Impggss of Raw Materials
This group consists of two sub-groups: animal and

vegetable raw materials and crude minerals.

TABLE III-8.--Raw'materials imports of Communist China (in
million U.S. Dollars)

 

 

 

R08”.
1955 1055 1957 1950 1959 1950 COOf.

 

 

Animal 6 Veg. 89.5 107.7 175.8 192.5 199.8 235.2
materials (13.0) (13.2) (20.6) (16.1) (19.3) (17.7) 10.637

Crud. miner- 16.0 17.8 15.3 17.0 15.8 19.1
.16 (2.5) (2.2) (1.8) (1.9) (1.2) (1.1) -0.297

Tbtal 100.5 125.5 191.1 209.5 210.6 299.3
(15.5) (15.9) (22.9) (17.5) (15.5) (18.8) 00.390

Source: Appendix D. Figures in parentheses are per-
centages of total Communist Chinese imports.

 

In general, imports of raw materials into Communist
China increased at about the same rate as her total imports.
In absolute values, imports of crude minerals (predominantly
crude petroleum) only maintained a stable level, while that
of animal and vegetable raw materials (mostly rubber, wool

and cotton) increased tremendously. These will be discussed

 

1From both Russia and the develo ed countries,
Communist China's imports of scientific nstruments continued
to increase. (See Appendix D.) ‘

separately.

TABLE III-9.--Animal 6 vegetable raw materials imports of
Communist China (value in million U.S. dollars)

 

ROS”.
1955 1955 1957 1950 1959 1950 00.2.

 

Value: total 89.5 107.7 175.8 192.5 199.8 235.2

(1) Russia 0.6 0.6 0.9 1.6 2.3 2.0
(2) DOV. countr103 21.9 32.0 30.1 50.9 “7.5 09.7
(3) underdeveloped

countries 62.0 79.3 136.7 190.0 195.0 163.5

Percentage shares
(0) Ru901a 0.7 0.5 0.2 0.9 1.2 0.9 *0.109
(5) Dev. countries 25.9 30.5 22.0 26.9 29.9 29.6 +0.13l
(6) underdeveloped

countries 73.9 69.0 77.8 72.7 79.9 69.5 -0.290

As 9 of total Communist Chinese imports

(7) Russia 0.1 0.1 0.1 0.1 0.2 0.2 00.023
(0’ Dev. count’13’ 3.“ “.0 “.5 “.3 3.5 5.2 20.209
(9) Underdeveloped

countr1e. 9.5 9.1 10.0 11.1 10.0 12.3 2'0.000

 

Source: Appendix D. Percentages are calculated.

Countries in the Free world were the main suppliers
of animal and vegetable raw materials to Communist China.
The developed countries supplied her with wool and hair,
while the underdeveloped countries supplied her with rubber
and cotton. In general, their exports increased at approxi-
mately the same rate, and also at about the same rate as
the increase of total Communist China's imports. There-

fore, there was no change in relative shares.

70

TABLE III-10.--Crude minerals imports of Communist China
(value in million 0.6. dollars)

r

 

 

 

308’.
1955 1950 1957 1050 1959 1950 00.2.

 

va1uC3 tatal 10.0 17.0 15.0 11.0 15.0 10.1
(1’ Ru0Q1C 10.0 17.1 15.2 10.5 15.3 10.0
‘2) DOV. countr100 0 0.1 0 0.5 0.5 0.1
(3) Underdeveloped

countries 0 0 0.1 0.2 0.2 0.2

Percentage shares

(9) Russia 100.0 99.9 99.3 97.1 96.8 97.9 -O.586
As 6 of total Communist Chinese imports
(5) Russia 2.5 2.2 1.8 1.9 1.2 1.1 -0.297

 

Source: Appendix D. Percentages are calculated.

The bulk of Communist Chinese imports of crude
minerals was crude petroleum, for’which Russia was virtually
the sole supplier. In absolute values, such imports were
rather stable throughout the years under study.

Communist China.imported only very small amounts of
foodstuffs, and even these imports were by far exceeded by
her foodstuffs exports. In fact, her imports were mainly
for the purpose of re-exports. The underdoveloped countries
were the main suppliers of her foodstuffs imports, and
there was no change in relative shares throughout the years.

The abrupt increase in 1960 was due to a purchase of some

jb/02
30 million dollars of sugar from Cuba, the reason for
which must have been mainly political.

TABLE III-ll.--Foodstuffs Imports of Communist China

 

 

308’.
1055 1055 1057 1050 1050 1050 C002.
V3100! 20681 20.5 15.3 10.5 20.1 5.0 90.0
(1) Ru001l 1.0 0.0 1.0 1.1 0.5 0
(2’ DOV. countr100 0.3 2.0 0.0 10.2 0.0 2.1
(3) Underdeveloped
ccuntr108 10.2 12.0 10.5 17.0 0.0 00.0

Percentage shares

(0) Ru0018 “.0 “.0 5.1 0.0 0.0 0 -0.010
(5) Dev. countries 1.9 17.0 20.5 35.0 10.0 5.1 00.392
(6) Underdeveloped

countr100 93.7 70.0 70.0 01.2 01.7 00.0 00.077

 

Source: Appendix D. Percentages are calculated.

Impgrts of Communist China from Various Countries

It is shown above that, compared to total Communist
Chinese imports, the imports of machinery and equipment and
manufactured minerals of Communist China increased, while
that of chemicals and other manufactured goods decreased.
Different country groups had varying shares in the Communist
Chinese market. For Russia, the emphasis was on complete
industrial undertakings, crude petroleum and petroleum
products, and her share in chemicals also increased. The
developed countries increased their share in most commodity
groups, and especially in manufactured minerals, while th.

underbdeveloped countries had a decreasing share in most

W I/72
30 million dollars of sugar from Cuba, the reason for
which must have been mainly political.

TABLE III-11.--Foodstuffs Imports of Communist China

 

 

 

 

008?.
1055 1055 1057 1050 1050 1050 C002.
Value: tOtC1 20.5 15.0 10.5 20.1 0.0 00.9
(1’ R0001C 1.0 0.0 1.0. 1.1 0.5 0
(2) Dev. countrios 0.3 2.6 9.0 10.2 0.6 2.1
(3) Underdeveloped
countr100 10.2 12.0 10.5 17.0 0.0 00.0

Percentage shares

(0) R00018 0.0 0.0 5.1 0.0 0.0 0 -0.010
(5) Dev. countries 1.9 17.0 20.5 35.0 10.0 5.1 90.392
(6) Underdeveloped

countries 93.7 78.9 79.9 61.2 81.7 99.9 00.077

 

Source: Appendix D. Percentages are calculatod.

Impgrts of Communist China from Various Countries

It is shown above that, compared to total Communist
Chinese imports, the imports of machinery and equipment and
manufactured minerals of Communist China increased, while
that of chemicals and other manufactured goods decreased.
Different country groups had varying shares in the Communist
Chinese market. For Russia, the emphasis was on complete
industrial undertakings, crude petroleum and petroleum
products, and her share in chemicals also increased. The
developed countries increased their share in most commodity
groups, and especially in manufactured minerals, while the

underudeveloped countries had a decreasing share in most

73
commodity groups except in foodstuffs and animal and veget-
able materials. These changing shares were due to the fact
that different country groups had increased their'exports
to Communist China to different degrees. An investigation
from another standpoint would be more revealing.

TABLE III-12.-~Exports of Russia to Communist China (in
percentages)

 

R08”.
1055 1055 1057 1050 1050 1050 Coef.

 

"adhe 0 Equip. 51.5 59.9 62.0 59.2 75.0 09.0 00.000

Chemicals 1.9 1.0 1.0 1.9 1.1 1.9 10.039
Mfg. minerals 36.9 30.3 28.2 31.0 19.1 29.2 -2.699
Other mfg. 5.9 9.8 9.7 9.1 2.1 2.3 -0.763

An. 6 Veg. mat, 0.1 0.2 0.2 0.2 0.3 0.9 +0.051
Crude minerals 3.9 3.6 3.7 3.9 2.1 2.2 -O.380
Foodstuffs 0.2 0.2 0.2 0.2 0 0 -0.060
Total 100.0 100.0 100.0 100.0 100.0 100.0

 

Source: Calculated from statistics given in
Appendix D.

Here it can be seen that in all her»imports from
Russia, Communist China increased her purchases of machinery
and equipment significantly at the expense of manufactured
minerals. Except for petroleum products, she shifted her
demand to the developed countries in the Free World. In
otherpwords, Communist China had singled out Russia as the

79
supplier of machinery and equipment, crude petroleum and
petroleum products, meet of'which she still could not get
from the Free World. This trend, no doubt, was the mani-
festation of Communist China's efforts to adjust her position
in face of the easing Embargo.

TABLE III-l3.--Exports of developed countries to Communist
China (in percentages)

 

 

 

1955 1956 1661 1663 1666 1960 3:52:

Mach. 6 Equip. 6.6 12.1 29.1 11.1 12.1 11.3 00.265
Chemicals 56.2 91.3 39.3 19.6 26.2 16.2 -7.519
Mfg. minerals 2.9 9.5 11.0 61.0 96.0 98.5 +10.100
Other’mfg. 9.5 13.7 10.2 9.9 5.7 6.5 o1.280
An. 6 1.3. mat., 29.3 21.2 13.9 11.2 11.1 16.8 -2.163
Crude minerals O 0 0 0 0 0 0
Foodstuffs O 1.6 2.0 2.1 0.3 0.7 -0.026
262.1 100.0 100.0 100.0 100.0 100.0 100.0

 

Source: Calculated from statistics given in
Appendix D.

In the case of the developed countries, a significant
increase was found in manufactured minerals. Decreases were
found in chemicals, animal and vegetable raw materials, and
other manufactured goods, in the order of importance. Yet,
it should be remembered that in absolute values these exports

75

to Communist China still went up considerably.1 As far.
as Communist China still could not purchase certain em-
bargoed commodities from these countries, she categorised
them.into suppliers of iron and steel, copper, aluminum

and nickel. The increase was abrupt in 1958 when a further
I relaxation of the Embargo was .xecuted. As a result, about
one half of Communist China's imports from these countries
were manufactured minerals. In absolute terms, these
suppliers .xceeded those from Russia.2

TABLE III-19.--Exports of underdeveloped countries to Com-
munist China (in percentages)

 

Regr.
1055 1055 1057 1050 1050 1050 C00f.

I

Mach. 6 Equip. 1.8 6.8 3.7 8.0 1.5 1.7 -O.9l2
Chmmicals 28.6 17.9 13.2 12.5 2.3 1.8 -5.193
Mfg. minerals 0.9 5.8 7.9 9.0 8.9 9.7 +0.797
Other’mfg. 12.3 18.8 8.6 9.5 3.8 2.9 -2.796
An. 6 Veg. mat. 93.2 99.0 60.2 58.5 80.9 71.9 97.219
Crude minerals 0 0 0 0 O O 0
Foodstuffs 13.2 7.2 6.9 7.5 3.1 17.0 00.223
Total 100.0 100.0 100.0 100.0 100.0 100.0

 

Source: Calculated from statistics given in
Appendix D.

 

 

16.. Tables III-5, 111-1, and III-9 above.

26.. Table 111-6 above.

76
.As for the underdeveloped countries, trends were

quite in the opposite direction. Compared to their total
exports to Communist China, the shares of both chemicals.
and othertmanufactured goods decreased significantly. In-
creasingly, Communist China had specializ.d these countries
into suppliers of raw materials. This can be seen more

clearly in the ”triangular percentage-distribution chart"1

below, in which commodities are regrouped into three large
categories,2 (Figure III-l).

Conclusion

In the totality Communist China's imports, machin-
ery and equipment, and manufactured goods were the main
components, and the trend had been to shift from the latter
to the former. Russia started out as the chief supplier of

machinery and equipment, crude and manufactured mineral.

 

1This chart is devised to show the change in the
three-way percentage-distribution of components, which can
be three commodity or country groups. One component is
designated at each vertex and at that point the percentage
share of that component is 100. Between the vertex and its
opposite side, parallel lines are drawn each designating a
certain percentage which decreases to 0 on the opposite side.
Points on the same line are of the same percentage. Then,
any point within this triangle represents a unique combina-
tion of three percentages as measured from three vertices,
the total of which will be exactly 100. For each year, the
percentage-distribution of the three components will be
plotted on the chart and is represented by a point. Thus,
a polygonal line joining a number of points will indicate
the relative percentage change of components throughout the
corresponding years.

2Here raw materials include both animal and veget-
able raw materials and crude minerals, while manufactured
goods include machinery and equipment.

[M

77

Figure III-1

Ex orts of Underdevelo d Countries to Communist China
n percen ages

 

Manufactured Goods

 

 

 

 

”A
°AAZV MAY VVA

Foodstuffs Raw Materials

 

Source: Table III-13.

78
As a result of the relaxation of the Embargo, she became
mainly a supplier of complete industrial undertakings, crud.
petroleum and petroleum products, when her supplies of some
machinery and equipment and many manufactured minerals
were substituted by those of the developed countries in the
Free World. The developed countries were also chief
suppliers of chemicals. The underdevelOped countries, on
the other’hand, were reduced into mainly suppliers of animal

and vegetable raw materials such as rubber and cotton.

CHAPTER IV
THE EXPORTS OP COMMUNIST CHINA

China used to be an exporter of'mainly foodstuffs
and raw materials, and remained very much the same during
the first few years after th. Communist takeover. Towards
the end of the first decade under the Communist regime, the
pattern of her exports changed drastically. Manufactured
goods had finally become the main source of her external
finance. This new pattern reflects the speedy development
of her industrial sector as well as thelagging of her agri-
cultural sector. Th. present chapter is devoted to a de-
tailed analysis of the commodity composition of Communist
China's exports and their geographic distribution.

General Picture of Communist Chinese Commodity Exports
In absolute value, Communist Chinese exports had

been increasing. This was mainly due to a.persistent increase
of the exports of her’manufactured goods. Exports of other
commodities fluctuated with no definite trends of change.
As a result, the percentage share of manufactured goods
in her total exports increased incessantly at the expense
of all others. By the end of the period under study,

79

80
manufactured goods had replaced raw materials to become the
most important commodities that Communist China was eiporting.

TABLE IV-l.-—General commodity exports of Communist China
(in million 0.6. dollars)

 

 

Regr.
1955 1956 1957 1958 1959 1960 Coef.

_-

Foodstuffs 355.6 919.7 371.7 537.0 970.7 370.3
(33.9)(32.8)(28.7)(35.3)(28.0)(29.3) -1.523

3‘“ materials 950.1 505.2 905.5 923.7 907.7 923.0
(93.1)(90.1)(30.3)(27.2)(20.5)(27.7) -3.917

"f8. 800d. 209.1 331.0 017.0 551.0 090.0 725.2
(22.9)(25.3)(32.3)(35.0)(91.3)(97.5) 95.019

9.66. 6 Equip. 11.5 10.9 8.9 10.9 13.2 5.9
(1.1) (0.3) (0.1) (0.1) (1.1) (0.9) -0.019

Total 1065.91263.0 1299.91522.11681.21523.9
(100.0)(100.0(100.(0(100.0000.0(100.0)

 

 

 

 

Source: Appendix E. Percentages are calculated.

Exports of Foodstuffs

TABLE IV-2.--Foodstuffs exports of Communist China (in
million U.S. dollars)

 

1955 1956 1957 1958 1959 1960

 

Heat 119.5 115.5 91.7 159.9 109.7 79.3
"Grain 92.6 132.5 66.1 135.0 173.0 130.5
Others 193.5 166.7 213.9 297.6 193.0 160.5
Total 355.6 919.7 371.7 537.0 970.7 370.3

 

Source: Appendix E.

 

 

 

A»

 

AV
AV V.

, a 2%“
ETW

EAL\~ .r ""0. °

Raw Ma Manufactured Goods

 

 

Source: a e -

 

 

 

 

 

 

 

 

 

 

82

In absolute value, the exports of Communist China's
foodstuffs demonstrated no definite trend. This was also
true in the sub-items. In general these exports were at
their'maxima in 1958 and 1959, for which two bumper harvests
were c1aimed.1 However, since there was no trend of in-
crease in total exports, the agricultural production of
Communist China must have only made meagre progress. In
view of her policy of exporting to the utmost of her toler-
ance, the stagnation of her foodstuffs exports reflects the
fact that her foodstuffs production could barely keep up
with her population increase.

TABLE IV-3.--Poodstuffs exports of Communist China (value
in million U.S. dollars)

 

Regr.
1955 1955 1957 1958 1959 1950 COBf.

 

Va1ue: total 355.6 919.7 371.7 537.0 970.7 370.3

(1) Russia 175.8 213.7 163.8 299.5 226.9 130.7
(2) Dev. coun-
tries 29.9 37.9 37.9 59.7 99.1 91.7

(3, Underdev.
countries 150.9 163.6 170.5 237.8 199.7 198.5

Percentage shares

(9) Russia 99.9 51.5 99.1 95.5 98.2 35.3 -2.257
(5) Dev. coun-
trie. 8.3 9.1 10.0 10.2 10.“ llel 90.517

(6) Underdev.
countries 92.3 39.5 95.9 99.3 91.9 53.6 01.731

 

Source: Appendix E. Percentages are calculated.

1The general relationship between exports and agri-
cultural production of Communist China is discussed in
Chapter I.

83

Russia and the underdeveloped countries were the
chief importers of Communist Chinese foodstuffs. In general,
exports to various countries also varied according to agri-
cultural conditions in Communist China. After making allow-
ances for these conditions, Communist China exported to
them approximately the same amount of foodstuffs year in
and year out. In other’words, these exports functioned
always like a cushion to her total exports, despite its
waning importance relative to manufactured goods.1

Percentage-wise, the share of the Russia decreased
significantly while the share of the underdeveloped coun-

tries increased. The share of the developed countries was

kept at about 109 constantly.
Exports of*§aw_flategiglg

TABLE IV—9.--Raw materials exports of Communist China (in
million U.S. dollars)

 

Regr.
1955 1956 1957 1958 1959 1960 Coef.

An. 8 Veg. 373.3 399.9 366.9 320.6 399.6 335.9
materials (35.0) (31.2) (28.3) (21.1) (23.8) (22.0) o2.697

 

Crude 85.8 111.8 129.6 103.1 98.1 87.6
minerals (8.1) (8.9) (10.0) (6.l) (5.8) (5.7) -0.720
Total 959.1 506.2 996.2 923.7 997.7 923.0

(93.1) (90.1) (38.3) (27.2) (29.6) (27.7) -3.917

 

Source: Appendix E. Figures in parentheses are per-
centages of total exports.

 

11n the next Chapter, it will be shown that Communist
China was a constant net exporter of foodstuffs to all country
groups. But this was not so for the exports of her other
commOdit10..

89

Like the exports of her foodstuffs, there was no
obvious trend of change in absolute values in the exports
of Communist China's raw'materials. Such exports had been
fluctuating roughly about the same level, with the result
that their importance decreased significantly relative
to total exports. Two reasons may be advanced for such a
phenomenon. On the one hand, since the bulk of such ex-
ports were animal and vegetable materials, which were pri-
marily generated from the agricultural sector, the perfor-
mance of the agricultural sector determined the capacity of
their exports. The retarded development of the agricultural
sector of Communist China was thus reflected in the stagna-
tion of exports of such raw materials. On the other hand,
her own requirements for raw materials must have also in-
creased as a result of the development of her industries,1
thus putting further restraints on their exports.

The animal and vegetable raw materials that Com-
munist China exported were composed mainly of oil seeds,
fats, bristles, silk and cotton. Russia was the chief
market, which absorbed about one half of these exports.
Still, her share decreased when compared to Communist
China's total exports and her exports of these raw mater-
ials (Lines 9 s 7). On the other hand, the developed

countries started from a relatively low level and made rapid

 

1In the next Chapter we shall see that Communist
China had become a heavy net importer of raw materials from
the underdeveloped countries.

85
advances (Lines 2.6 5). Probably this was due to Communist
China's efforts to redirect her traditional exports back
to these countries in face of more normal trade relations
in more recent years. As a result, their purchases had
roughly kept in pace with total Communist China's exports,
despite stagnation in her exports of animal and vegetable
materials (Line 8). Exports to the underdeveloped coun-
tries decreased even in absolute values, so that their’share

decreased significantly.

TABLE IV-5.--Anima1 6 vegetable raw materials exports of
Communist China (value in million U.S. dollars)

 

Regr.
1955 1956 1957 1958 1959 1960 COOf.

I -:-: H

 

Value: total 373.3 399.9 366.9 320.6 399.6 335.9
(1) Russia ‘ 222.0 222.5 209.9 173.2 293.9 138.2
(2) Develo ed '

countr es 70.0 88.5 71.2 88.9 121.2 151.7
(3) Underdev.

countries 81.3 83.9 86.3 59.0 39.5 95.5

Percentages shares

(9) Russia 59.5 56.9 57.1 59.1 61.0 99.1 -1.892
(5) Develo d

countr es 18.7 22.9 19.9 27.6 30.3 95.2 t9.697
(6) Underdev.

countries 21.8 21.2 23.5 18.3 . 8.7 10.7 -2.805

As 8 of total Communist Chinese exports

(7) Russia 20.8 17.6 16.2 11.9 19.5 9.7 -l.988
(8) Developed

countries 6.6 7.0 5.5 5.8 7.2 9.9 00.997
(9’ Underdev.

countries 7.6 <6.6 6.6 3.9 2.1 2.3 -l.212

 

 

Source: Appendix E. Percentages are calculated.

TABLE IV-6.--Crude minerals exports of Communist China (value
in million 0.5. dollars)

 

R38”.
1955 1956 1957 1958 1959 1960 Coef.

 

 

Value: total 85.8 111.8 129.6 103.1 98.1 87.6

(1) Russia 73.1 87.8 102.9 88.7 86.0 69.1
(2) Dev. countries 0.3 0.9 0.3 1.9 2.9 3.7
(3) Underdeveloped

countries 12.“ 23.6 26.“ 13.0 9.2 19.8

Percentage shares
(8) Russia 85.2 78.5 79.9 86.0 87.7 78.9 +0.01?
(5) DOV. countriefi 0.3 0.9 0.3 1.9 2.9 9.2 t0.803
(6) Underdeveloped

countries 19.5 21.1 20.3 12.6 9.9 16.9 -0.880

As 9 of total Communist Chinese exports

(7) Russia 6.9 7.0 8.0 5.2 5.1 9.5 -0.586
(8) Dev. countries 0 0 0 0.1 0.2 0.2 00.099
(9) Underdeveloped

countries 1.2 1.9 2.0 0.8 0.5 1.0 -0.183

 

Source: Appendix E. Percentages are calculated.

The exports of Communist China's crude minerals
were composed mainly of coal and non-ferrous base metal ores,
most of which went to Russia. The underdeveloped countries
also purchased certain amounts of coal from her. In general,
there were no changes in relative shares among the various

countries.

Exports of Manufactured Goods

The exports of Communist China's manufactured goods

87
registered the most rapid increase of all her exports. Not
all manufactured goods, however, had shared the increase.
Probably because of her own requirements, the exports of
chemicals and manufactured minerals were kept approximately
at the same absolute 1evels.1

TABLE IV-7.--Hanufactured goods exports of Communist China
(in million U.S. dollars)

 

 

 

Regr.
1955 1956 1957 1958 1959 1960 Coef.

 

 

Chemica1s 29.7 92.7 37.9 99.7 29.6 28.3
(2.3) (3.9) (2.9) (3.3) (1.8) (1.9) -0.183

Hfg. ninerals 88.8 85.5 72.6 93.7 86.2 98.8
(8.3) (6.8) (5.6) 95.7) (5.1) (6.5) -0.371

Other mfg. 126.2 203.2 307.8 907.6 578.8 598.1
goods. (11.8) (16.1) (23.8) (26.8) (39.9)(39.2) 05.569

Tota1 239.7 331.9 917.8 551.0 699.6 725.2
(22.9) (26.3) (32.3) (36.8) (91.3)(97.6) t5.019

 

Source: Appendix E. Figures in parentheses are per-
centages of total exports.

As shown in the table above, it was in the exports
of other manufactured goods that Communist China made the
most advances. Commodities of this category were mostly
consumption goods such as textiles, fur clothes and foot-
wears, in which Communist China could hold down domestic

consumption and make the most provisionsfor exports. As

 

11n the next Chapter, we shall see that Communist
China was still a net importer of these commodities.

a result, such exports increased almost five times in

value within a period of six years.

TABLE IV-8.--Chemicals exports of Communist China (in
million 0.8. dollars)

 

 

Regr.
1955 1956 1957 1958 1959 1960 Coef.
Value: total 29.7 92.7 37.9 99.7 29.6 28.3
(1) Russia 9.9 23.0 17.2 22.3 13.8 16.3
(2) DOV. Countries 9.5 11.9 10.8 13.6 8.9 5.7
(3) Underdeveloped
countries 5.3 8.3 9.9 13.8 6.9 6.3
Percentage shares
(9) Russia 90.0 53.9 96.0 99.8 96.6 57.5 01.890
(5) Dev. countries 38.5 26.7 28.9 27.9 30.1 20.1 -2.380
(6) Underdeveloped
countries 21.5 19.9 25.1 27.8 23.3 22.9 +0.590
Source: Appendix E. Percentages are calculated.

The exports of Communist China's chemicals were

only about 2-38 of her total exports, of which Russia purb

chased about one half, with the tendency of getting an

increasing share.

significantly.

The deve1oped countries' share decreased

In fact, as we shall see in the next chap-

ter, Russia was a net importer, while the developed coun-

tries were net exporters of chemicals to Communist China.

The bulk of Communist China's exports of manufac-

tured minerals were iron, steel, tin, tungsten and other

non-ferrous base metals.

way to Russia.

However, the Russian share decreased

Most of these exports found their

89
significantly, because Communist China had redirected part
of her exports of tin and non-ferrous metals into markets
of the developed countries of the Free World since 1957.
The abrupt increase in 1960 was due to a sale of some 819
million of silver, probably for financing purposes. Even
if we exclude this, the share of the developed countries
still increased significantly. At its minimum, the Russian
share still exceeded well above one ha1f of such Communist
China's exports.

TABLE IV-9.--Manufacturing minerals exports of Communist
China (value in Hillion U.S. dollars)

 

Re gr.
1955 1956 1957 1958 1959 1960 Coef.

 

Value: total 88.8 85.5 72.6 93.7 86.2 98.8
(1) Russia 83.1 78.8 61.5 79.6 70.7 69.6
(2) Dev. countries 0.9 1.1 9.1 5.1 8.3 25.9
(3) Underdeveloped

countries 9.8 5.6 7.0 19.0 7.2 8.3

Percentage shares

(9) Russia 93.5 92.2 89.7 79.0 82.0 65.9 -5.051
(5) Dev. countries 1.0 1.2 5.6 5.9 '9.6 26.2 #9.319
(6) Underdeveloped

countries 5.5 6.6 9.7 15.0 8.9 8.9 +0.720

 

Source: Appendix E. Percentages were calculated.

TABLE IV-10.--0ther manufacturing goods exports of Communist
China (value in million U.S. dol1ars)

j:

 

R08”.
1955 1956 1957 1958 1959 1960 COCf.

 

 

 

Value: total 126.2 203.2 309.8 907.8 578.8 598.1

(1) Ru..1‘ 71.8 119.7 189.3 279.3 “27.5 900.5
(2) Dev. countries 6.3 10.8 18.7 26.0 31.0 33.3
(3) Underdeveloped

countries 98.1 72.7 109.8 102.3 120.3 169.3

Percentage share

(9) Russia 56.9 58.9 59.9 68.5 73.9 67.0 +3.060
(5) Dev. countries 5.0 5.3 6.1 6.9 5.3 5.5 00.080
(6) Underdeveloped

countries 38.1 35.8 39.0 25.1 20.8 27.5 -3.150

 

Source: Appendix E. Percentages are calculated.

The increase in exports of Communist Chinese "other
manufactured goods" was phenomenal. In a few years its
value had increased by several times and sales had increased
in all markets. Host of these goods were consumption
goods, such as various types of textiles, fur clothes and
footwears, which required less capital investment and
allowed faster capital turnover. Also, domestic consump-
tion of these goods could be held down without directly
straining developmental efforts. It was due to these
reasons that Communist China could make the most for these
exports. Towards the end of the period under study, these
commodities constituted more than one third of total Comp

munist Chinese exports, and became the leading component

[m

91

in her external financing.

The greatest customer of these commodities was
Russia, which absorbed fros.cne half to three fourths of
these experts. Her share even continued to increase sig-
nificantly. The underdeveloped countries constituted the
second largest market for such goods. In spite of the fact
that their share decreased significantly, their~imports
in absolute value still increased by more than twice. There-
fore, their decreasing share was mainly due to a slower in-
crease of such imports relative to other countries. The
share of the developed countries was rather stable. In
other words, in absolute value their imports increased at
about the same rate as the increase of total Communist
China's exports of such commodities.

Exports of Machinery and Equipment
' The experts of machinery and equipment of Communist

China only amounted to about 18 of her total exports.

TABLE IV-11.-Haehinery and equipment exports of Communist
China (value in million 0.8. dollars)

 

 

 

582‘.
1955 1956 1957 1958 1959 1960 Coef.
Value: total 11.5 10.9 8.9 10.9 18.2 5.9
(1) Russia 10.: 0.2 6.9 1.3 15.8 2.0
(2) Dev. countries 0 0 0 0 0 0
(3) Undev. countries 1.2 1.7 2.0 3.1 2.9 3.0
As 8 of total.Communist Chinese exports
(9’ Ru..iC 1.0 0.7 0.5 0.5 1.0 0.2 -0.086
(5) Dev. countries 0 0 0 0 0 0 0

(6) Underdev. countries 0.1 0.1 0.2 0.2 0.1 0.2 00.019

 

Source: Appendix E. Percentages are calculated.

92
In general,-most of these-exports went to Russia.
Probably such exports to the underdeveloped countries were
actually higher than the figures shown in the table above,
as some of these countries might have reported such imports
as manufactured goods. Even so, such of Communist China's
exports were essentially on a trial basis, and had more

political implications than economic significance.

Exports of Communist China to Various Countries

In summary of the previous findings, two major
points should be mentioned. firstly in Communist China's
total exports, “other’manufactured goods“ were of sig-
nificantly increasing importance, while foodstuffs and
animal and vegetable raw materials were of decreasing im-
portance. Secondly, Communist China had redirected in-
creasing amounts of her traditional exports to the markets
of the developed countries of the Free World, while Russia
had an increasing share of her chemicals and ”other*manu-
factured goods.” In addition, the underdeveloped countries
also had an increasing share of her foodstuffs. Since
these countries increased their imports from Communist China
to different extents in absolute terms, an analysis of these
increases and/or decreases each within their baskets of
Communist Chinese goods would be of interest.

In her trade with Russia, Communist China exported
significantly increasing amounts of ”other manufactured
goods” at the expense of all other commodities, especially

foodstuffs, raw materials and manufactured minerals. Towards

93
the end of-the'period under study, such exports amounted
to approximately one-third or one half of her total exports

to Russia.

TABLE IV-12.--Exports of Communist China to Russia (in per-
centages)

 

3.8,.
1955 1955 1957 1958 1959 1850 C002.

 

foodstuffs 21.2 20.2‘ 21.1 21.0 20.0 15.: -2.100
An. : v.3. Hat. 30.3 29.9 20.1 19.5 22.5 11.0 -a.217
Crude minerals 11.0 11.1 13.0 0.9 1.0 0.2 -0.011
Chemicals 1.5 3.1 2.3 2.6 1.2 1.9 -0.097
Hfg. minerals 12.0 10.5 8.3 9.1 0.5 7.9 -1.030
Other mfg. 11.1 15.9 29.8 31.5 39.9 98.1 t7.532
Mach. : Equip. 1.0 1.2 0.9 0.0 1.0 0.3 .0.103
Total . 100.0 100.0 100.0 100.0 100.0 100.0

 

Source: Calculated from statistics given in
Appendix E.

To the developed countries, Communist China exported
mostly animal and vegetable raw'materials, and this situation
persisted throughout the years. In addition, exports of
both her “other’manufactured goods" and manufactured minerals
had increased,1 while exports of her foodstuffs and chemicals

had decreased. Compared to Communist China's exports to

 

1These exports were mostly textiles, tin, other
non-ferrous base metals and silver.

99

PIGURE IV-2
Ex rts of Communist China to Russia
rcen a as

    

 

 

 

 

 

 

 

AA MAGAAA"

:- V VW‘WAVNA
Wm " "A“
aAAA A AVAVA.

Raw Hat mi 1s Hanu fa fit ured
Goods

 

 

.Source: Table IV-l2.

 

t:

803

95
Russia, the pattern of her exports to these countries had
changed far less. This can be seen in the 'triangular’per-
centage distribution chart” below, (Pig. IV-3).

TABLE IV-13.--Exports of Communist China to developed countries
(in percentages)

I .I:

 

 

 

 

 

1055 1050 10s: 1050 1959 1000 355;:
Foodstuff. 25.5 29.8 26.9 28.8 22.0 15.9 c1.593
An. 6 V08. material 60.0 59.8 50.0 96.9 59.6 58.2 ~0.806
Crude minerals 0 0 0 0.8 1.5 1.2 60.323
Chemicals 8.2 7.7 8.2 7.2 9.5 2.9 -l.l3l
Mfg. minerals 0.9 0.9 2.7 3.2 3.8 10.0 t1.563
Other mfg. 5.9 6.8 12.7 13.6 13.6 12.3 61.599
Mach. 6 equip. 0 0 0 0 0 0 0

Total ‘ 100.0 100.0 100.0 100.0 100.0 100.0

 

 

 

 

Source: Calculated from statistics given in
Appendix E. *

The main exports of Communist China to the under-
developed countries were foodstuffs. Besides these, her
exports of ”other'manufactured goods” increased significantly,
while that of animal and vegetable raw materials decreased
significantly. Towards the end of the period under study,
about one-third of Communist Chinese exports to these coun-
tries‘were in the category of"other’manufactured goods,“

most of which consisted of various types of textiles.

FIGURE IV-3.

 

 

 

 

 

/\/\ / VXA

.. A AVE. '7' ngé‘fAV
AVV‘V VVAA
° AV VAVA

Raw Materials oManu fac gred Goods

Source: Table IV-l3.

97

TABLE IV-19.-Exports of Communist China to Underdeveloped
countries (in percentages)

 

 

R08”.
1855 1955 1957 1958 1959 1950 Coef.

‘

POOdIEUTTO 98.5 95.5 92.2 53.5 52.0 95.1 00.379
An. 8 V03. mat. 25.8 23.1 21.1 13.9 9.9 8.2 o9.051
Crude 31“.”.1. 9.2 6.7 6.9 2.1 2.2 3.9 -0.606

 

 

 

Chemicals 1.8 2.5 2.2 3.1 1.8 1.5 -0.077
Mfg. minerals 1.9 1.9 1.6 3.9 1.8 1.9 00.157
Other’mfg. 15.8 20.9 25.9 23.1 32.3 38.1 09.126
Mach. 8 equip. 0.0 0.0 0.0 0.1 0.5 0.8 00.01:
Total 100.0 100.0 100.0 100.0 100.0 100.0

 

n

Source: Calculated from statistics given in
Appendix E.

 

Conclusion

The commodity pattern of Communist China's exports
had undergone drastic changes. The most spectacular change
lay in the increased exports of manufactured consumption
goods to all countries. Decreases were mainly in food-
stuffs and animal and vegetable raw materials. However, if
we exclude these manufactured consumption goods, her basic
exports to Russia and the developed countries of the Free
world were still raw materials, while to the underdeveloped

countries mostly foodstuffs.

FIGURE IV-9

Ex ort of Communist China to Underdevelo ed Countries
I: —"—"""""_ "('17: per'cent'ag'e's'T' ""9 L"

Foodstuffs
o Ito

A

 

 

  

 

 

,1 o
4" 0‘
Raw Materials . Manufactured Goods

Source: Table IV-19.

1:

of

11

99
As for’how all these are related to her industrial-
isation and her changing position in the international flow
of commodities, further analyses on her'net commodity trade
position with various groups of countries will b. more

illustrative. To this purpose the next chapter is devoted.

CHAPTER V
THE NET POSITION OF COMMODITY TRADE OF COMMUNIST CHIMA

Under the classification used in the previous two
chapters, Communist China imported as well as exported
commodities in all categories. This is true not only in
her foreign trade in general, but also in her trade with
the various groups of countries. Thus, there is no way to
know her real position in the international flow of commodi-
ties unless we put her imports and exports together. Also,
there is the question of re-exports,1 which would distort
the real picture if imports and exports are considered
separately. what is more, trends in imports and exports
may balance each other, so that it might be misleading to
draw conclusions based on imports or exports alone. It is
the purpose of this chapter to tie the two ends together,
and pin down the net position of Communist China in commodity
trade in general as well as with various groups of countries.
This will not only add to our'knowledge of the pattern and
trend of her foreign trade, but will also threw some more
light on the problems of her economic development.

Mere, Communist China's net position in a certain

‘—

 

 

 

1For Communist China, some examples were: re-exports

of Burmese rice to Ceylon, and South-East Asian rubber to
Russia.
100

101
commodity group is determined by the difference between
her imports and exports of that group of commodities. For
example, Communist China would be a net exporter of food-
stuffs if her exports of foodstuffs were larger than such
imports. It should be pointed out that her>net position
in a certain commodity has no relation with the importance
of that commodity in her total foreign trade, because of
balancing effects. That is, large imports may be balanced
by large exports. All we know is which deficit commodity
groups were paid for by which other surplus groups.1

Met Commodity Trade Position of Communist China in General

TABLE V-l.--Net commodity trade position of Communist China*
(in million U.S. dollars)

 

1955 1956 1957 1958 1959 1960

 

Foodstuffs 0355.1 +399.9 +352.2 t507.9 +969.7 t329.9
An. Veg. Mater. t288.8 +286.7 0191.1 t128.l +209.8 .0100.2
Crude minerals + 69.8 + 99.0 tll9.3 9 86.1 + 82.3 0 73.5
Chemicals - 71.0 - 59.9 - 68.6 - 80.0 - 89.5 - 51.8
Mfg. minerals - 68.3 - 88.0 - 86.2 -329.2 -260.5 -279.8
Other‘mfg. goods 0 70.7 0126.8 0297.5 4356.9 0532.1 +599.5
Mach. 6 Equipment -211.3 ~315.8 -309.1 -356.8 -588.0 -528.9

 

*A plus sign denotes a net exporter and a minus
sign denotes a net importer position.
Source: Appendices D and E.

 

1Trade figures for'net positions need not balance
because of imbalance of trade.

'53)

'0'?

w-
n.

Isa
Ur

1M

.09

L—l 1“

'9'

i A
I

102

FIGURE V-l

Overall Net Commodit Trade Position of Communist China
5 ' "'"'""'-'('I""n mIIIIon' U.S. ao'II'ar"T—"'—s ' " """'"""

 

 

 

 

 

 

 

 

  
 
  

 

 

    
   
    

 

 

+600
500. other mf. .
r goods
900p I
3°°J
foods uffs
208-»-
.n. 5 .8.
'-ter als
100‘
crude miner ls
0 L I 1 I
1055 1050 1052 1050 1350 15.0
b—‘A .4 A ‘/
100+ chemicals
20g-
mineraLs
9010
500'” mach. 5
equipment
-600

Source: Table V-l.

103

The overall picture shows that Communist China was
a net exporter of foodstuffs, raw materials and other’manu-
factured goods, while a net importer of chemicals, manu-
factured minerals, machinery and equipment. This basic
pattern remained throughout the period under study. How-
ever, there had been certain trends in some commodity groups.

Communist China was an increasing net importer of
machinery and equipment. Such net imports were largest.1
Her'net imports of manufactured minerals also had an increas-
ing trend. Her net exports of manufactured consumption
goods showed a.most spectacular increase, and finally re-
placed foodstuffs as the major net export commodity. In
foodstuffs, her net exports fluctuated with no definite
sign of change; but net exports of animal and vegetable raw
materials decreased. In other words, in financing her net
imports, her net exports of foodstuffs remained substantial,
while that of animal and vegetable raw materials were rapidly
substituted by manufactured consumption goods.

with various country groups, the net position of
Communist China in commodity trade was slightly at variance
with this general pattern. Separate discussions with some
'more detailed information are given in the following

sections.

 

I

1It was pointed out in Chapter III that substantial
amounts of military supplies were excluded from these
statistics. Including these will add to the predominance
of net imports ofmachinery and equipment.

109

Net Commodity Trade Position of Communist China with Russia

TABLE V-2.-JSIno-Soviet net commodity trade position (in
million U.S. dollars)

T I :—

 

 

 

1955 1956 1957 1958 1959 1960
Foodstuffs 0179.8 6213.0 t162.8 +293.9 +226.9 0130.7
An. 5 Veg. matr. 0213.9 +22l.9 0209.0 +171.6 0291.6 0196.2
Crude minerals t 57.1 9 70.1 + 87.7 + 72.2 + 70.2 0 55.3
metal ores t 71.2 t 89.9 +101.9 0 87.2 t 83.9 t 67.9
crude petrol. - 19.1 - 19.8 - 19.2 - 15.0 - 13.7 - 12.1
Chemicals 0 9.3 + 18.3 t 12.9 0 13.9 + 5.2 t 6.6
Mfg. minerals - 70.1 - 70.5 - 55.9 - 79.2 - 77.5 -109.0
iron 6 steel etc-'99.7 - 35.6 - 25.7 - 36.9 - 23.2 - 93.1
petr. products - 69.9 - 71.1 - 76.2 - 77.9 ~109.0 ~101.0
non-ferrous base
metals 0 99.5 + 36.2 + 95.5 + 39.6 0 99.7 4 90.1
Other mfg. goods + 97.2 + 96.0 +169.6 +259.0 +910.8 4389.5
Mach. 5 equip. -209.2 -286.9 -252.3 -286.2 -568.3 ~980.6

 

Source:

Appendices D 5

E.

Under a broad classification Communist China was a

net importer of machinery and equipment, and manufactured

minerals, and a net exporter of foodstuffs, raw materials,

chemicals and other*manufactured goods.

More detailed in-

formation shows that of crude minerals, she was a net im-

porter of crude petroleum, while of manufactured

105
mineralsl she was a net exporter of non-ferrous metals.

It was pointed out in an earlier chapter that Com-
munist China tended to depend on Russia only for the supply
of commodities that she could not obtain from the Free
world. Evidence here also supports this thesis. From Russia,
Communist China was a net importer of mainly machinery and
equipment, and petroleum products. In spite of the fact
that she was also a net importer of Russian iron and steel,
such net imports were by far exceeded by those from the
developed countries of the Free world since the relaxation
of the Embargo in 1957.2 Crude petroleum was also her net
import from Russia. It can be seen in Figure V-2 below
that not only was Communist China a heavy net importer of
Russian machinery and equipment, she had continued such
imports increasingly.

In all commodity groups in which Communist China
had a net exporter's position with Russia, the values of
net exports had not changed except that of manufactured
consumption goods. The increase in net exports of these
manufactured consumption goods was phenomenal. In the period
from 1958 to 1960, the net exports of these goods were enough
to finance almost 809 of her’net imports of machinery and
equipment.-

In general, the net commodity trade relation between

Russia and Communist China was essentially one between a

 

1Tin was the main export within this category.

2Compare Figure V-3 below.

p.
I.

1'.

OI

..

106
FIGURE V-2

Sino-Soviet Net Commodity Trade Position
:1 on e e O ”3

 

 

 

 

 

 

 

 

 

 

 

 

 

  

 

 

    

 

 

+600 6
Jr-
500
000 ‘*
other mf-.
30° goods
A an. 5 V3.
200 7' //,z -w m- erials
100 4. foodst ffs
. ‘ ‘ meta ores
-ferro
1955 1956 1957 8 1959 ‘960
l I I L I
4— W. p 1.
J - 1 iron 6 stee etc.
100 petroleum products
200 "
300 '
900 “
machinery 6
500‘__ equipment
-600

Source: Based on Table V-2.

101
developed country and an underdeveloped but rapidly in-
dustrialising country.

Net Commodit Trade Position of Communist China.with
DEGeIdpeH Countriesm' " ""”"' ‘

TABLE V-3.--Sino-developed-countries net commodity trade
position (in million U.S. dollars)

 

 

1355 1956 , 1957 1958 1959 1960
Foodstuffs +29.1 039.8 +33.9 +99.5 +98.5 039.0

An. 6 Veg. mater. 098.1 +55.7 032.5 +37.5 +73.7 082.0

Crude minerals + 0.3 4 0.3 0 0.3 t 1.1 t 2.6 t 3.6
Chamcal. -90.0 “-81.8 -61.3 ~77.2 “92.7 -6l.0
Mfg. minerals - 1.6 -13.9 —l8.8 -229.5 -l79.8 -173.9

iron 0 steel .2..- 2.5 -10.2 -10.0 .105.5 -111.7 -120.5

non-ferrous base
metals + 0.7 o 0.8 + 1.1 -99.0 -63.1 -52.9

Other mfg. goods - 2.3 -10.6 - 2.9 + 5.9 + 8.2 + 7.6
Mach. 6 Equip. - 5.9 -20.0 -99.9 -59.3 -99.2 -97.l

L

 

Source: Appendices D and E.

To the developed countries, Communist China was
mainly a net exporter of foodstuffs and raw materials, and
a net importer of machinery and equipment, chemicals, iron
and steel, and non-ferrous base metals. This basic pattern
remained the same throughout the years. Also, she gradually
emerged as a net exporter of manufactured consumption goods.

But in absolute values, these net exports were very small

 

108

compared to those of foodstuffs and raw materials.

In commodity groups in which Communist China was a
net importer, the relaxation of the Embargo in 1957 and 1958
clearly showed its effects. Her net imports of machinery
and equipment experienced a jump and had maintained the new
level: meanwhile her net imports of iron and steel, and
non-ferrous base metals also showed tremendous increases.
Probably this reflects the inelastic supply on the part of
Russia for these commodities, of which Communist China was
in urgent need in the process of her industrialization.1
Therefore the relaxation of the Embargo immediately led to
rapid increases of her purchases from the Free World.

The net exports of her raw materials also increased.
This shows that Communist China had redirected her tradi-
tional exports to markets of these countries. Unlike her
trade relation with all other countries, net exports of her
manufactured consumption goods to these countries had in-
creased only slightly.

In general, the commodity trade position of Com-
munist China to the developed countries is typical of an
underdeveloped country to the developed countries. This

can clearly be seen in Figure V-3 below.

 

1Since the relaxation of the Embargo, net imports
of iron and steel from the developed countries exceeded by ,
far those from Russia, while Russia was continuously a net
importer of Communist Chinese manufactured non-ferrous base
metals. (cf. Table V-2 and Figure V—2.)

109

FIGURE V-3

 

Sino-Develo ed-Countries Wet Commodit Trade Position
Value (I5 EIIIIon 0.5. a.!1.».1" ' ,

t150

+100 3

 

50

l

50 d

100"

150‘

95 s . othggmfg. good

an. 6 veg. raw
materials

 

 

 

1956 1351 1350*

.on-ferrous base metals
:\‘\\\\\\\\¥ mach. 6 e.ui-
chemicals

iron 6 steel

 

~200

 

 

Source: Table V-3.

60

110

Net Commodit Trade Position of Communist China with Under-
HEVEIbpéU Countries

TABLE V49.--Sino-underdeveloped-countries net commodity trade
position (in million 0.8. dollars)

 

1955 1956 1957 1958 1959 1960

 

Foodstuffs 0101.2 +151.5 +150.0 +220.0 +100.5 +150.1
An. 0 v.3. mater. 0 10.0 + 0.1 - 50.0 - 01.0 -110.5 -120.0
Crude minerals + 12.0 . 23.0 + 25.0 . 12.8 + 0.0 + 10.0
Chemicals - 35.3 - 21.9 - 20.2 - 16.2 t 3.0 t 2.7
Mfg. minerals t 3.9 - 9.1 - 11.0 - 8.1 - 8.2 - 2.9
Other mfg. goods. + 00.1 . 01.0 + 05.3 0 02.0 4113.5 +151.»

16.3 - 0.5 - 0.1

Mach. 5. Equip. ' 1.2 - 9.“ - 6.9

 

Source: Appendices D and E.

The net commodity trade position of Communist China
with the underdeveloped countries gives a marked contrast
to those discussed in the previous sections. In a few
years, it had changed considerably in some manner. Though
still a heavy net exporter of foodstuffs, Communist China
had shifted into the position of a heavy net importer of
animal and vegetable raw materials. Mer net exports of
manufactured consumption goods also increased tremendously,
and finally became as important as her net exports of food-
stuffs. Towards the end of the period under study, Communist

China had also reversed her position in chemicals. But

111

with respect to machinery, equipment, and manufactured
minerals, she was still a net importer. Quantitatively
these were of little significance, however. She had also
net exports of crude minerals.1

It is interesting to note that the net commodity
trade position of communist China with the underdeveloped
countries differed considerably from that with other
countries. Firstly, her net exports of foodstuffs remained
dominant. Secondly, she became a heavy net importer of
raw materials. And, if we exclude foodstuffs, the basic
relation became the exchange of her manufactured consump-
tion goods for animal and vegetable raw materials. This
pattern, curiously enough, is typical of the trade relation
between an industrial country and the underdeveloped coun-
tries. Furthermore, her net exports of these manufactured
goods had increased to an extent that they alone could
finance all net imports from these countries, so that her
net exports of foodstuffs could be used for financing
through other channels. These relations are shown in the

figure below, (Fig. V-9).

Conclusion

By putting together previous findings, we can once
more construct a complete picture of the commodity trade
pattern of Communist China. From this we can gain further

insight into problems related to her economic development.

 

1The bulk of such commodities was coal.

‘4

69-

1e"

+250

112
FIGURE V-9

aino-Underdeveloped-Countries Met
OMMO 1 ra e 05 1; 1011
(in miIII U S 'a II

ion . . o are)

 

200-

150‘

100-

SQ.

foodstuffs

 

  

OthBI‘ mfg q
goods

   

 

>< \ cm“ “199“131
I I ' i,§:*

 

 

50"

100

l
I T I r

1055 1050\ 1951 10 1050 1060
‘ ‘ chemicals

 

an. 6 veg.
materials

 

 

 

-150

Source: Table V-9.

113
In her trade with Russia and the developed countries, the
relation was the exchange of net exports of foodstuffs,
raw materials and light industrial goods for net imports
of manufactured minerals, machinery and equipment: while
with the underdeveloped countries the relation became the
exchange of net exports of foodstuffs and light industrial
goods for net imports of raw materials. One fact stands
out clearly. To all countries she was a net exporter of
foodstuffs and light industrial goods. These commodities
were mainly consumption goods, and her capacity for their
exports depended on how effectively she could hold down
domestic consumption. Yet, as her net exports of light
industrial goods increased tremendously, her net exports
of foodstuffs remained more or less stagnant. Once more
this reflects the low performance of her agricultural
sector, in sharp contrast with progresses made in her pro-
duction of light industrial goods.'

Here we can visualize the dualistic nature of the
economy of Communist China. On the one hand, there was her
large but slowly improving agricultural sector, which, be-
sides providing for domestic consumption of her teeming
millions, constituted the final resort for external financ-
ing. On the other hand, it was on this basis that she was
able to build up her industrial sector, which soon
gathered strength and helped further financing by exporting
part of its products. Yet, in the vast hinterland, the

agricultural sector remained almost as backward as it ever

119
was: and only enough improvements could be made to keep
in pace with her population growth. As a result, her
agricultural surplus that could be spared was more or less
constant.

In case of foodstuffs, this duality created no
problem, as domestic consumption could be arrested at a low
level to leave a surplus for export. Therefore, the net
exports of Communist China's foodstuffs always constituted
a cushion for her external financing. However, this is not
so in the case of raw materials. Domestic consumption had
to be increased if the production and growth of her in-
dustries were to be sustained. In face of limited domestic
supplies, certain agricultural raw materials had to be im-
ported increasingly. Consequently, in spite of the fact
that her exports of agricultural raw materials remained at
the same absolute level, her net exports decreased because
of increasing imports. It is in her trade relation with
the underdeveloped countries that her economic duality was
most pronounced. While having considerable net exports in
foodstuffs, Communist China stood as an industrial country
to the underdevelOped countries in her other sector.

To Russia and the developed countries, Communist
China was still an underdeveloped but developing country.
However, the picture was distorted by the Embargo. In
earlier years, she was limited to have considerable net
imports of only chemicals (mostly fertilizers) from the
developed countries of the Free World, while her not imports

lls
of-machinery and equipment,'manufactured minerals and crude
petroleumrwere predominantly from Russia. Freer trade in
more recent years tended to spread her net imports of some
once-embargoed commodities more evenly among these countries.
She was able to acquire huge quantities of manufactured
metals from the developed countries of the Free world.
Yet, Russia remained unchallenged in her position as a
dominant net supplier of most machinery and equipment, crude
petroleum and petroleum products, most of which were still
on the Embargo list. In other'words, the Embargo had
affected the direction of Communist Chinese commodity
imports from various developed countries. Yet, Embargo or
not, she remained an underdeveloped country in her commodity

trade relation with these developed countries.

CHAPTER VI
THE CONCENTRATION OF FOREIGN TRADE OF COMMUNIST CHINA

So far in this study, the investigation of the
foreign trade of Communist China is largely confined within
the context of her economy and economic development. In
spite of the fact that we have assessed her overall import,
export and net positions in commodity trade, as well as
her positions towards various groups of countries, we are
still left with the question about her actual standing
among all countries. we know that her imports and exports
were concentrated on certain groups of commodities, and her
foreign trade in general was heavily oriented towards the
Communist bloc; and yet we have no accurate measure of
the degree of this commodity and geographic concentration
that can be compared with those of other countries. An
international comparison of this kind will not only add to
our knowledge of her standing in international economic
relations, but also give us further insights into her
economic potentials and the path of her economic develOp-
ment. To make such a comparison, the ”concentration in-

dices” are used.1

A

1For discussions on the “concentration indices,"
see Appendix G.

116

ll?

The work on-the concentration of foreign trade was
pioneered by.Albert O. Hirschman, who first developed the
"indices of concentration of trade" and calculated the geo-
graphic concentration indices of imports and exports of
forty-four countries in lOl3 and several interbwar years.1
This work was furthered by Hichael Hichasly, who, in addi-
tion to the geographic concentration indices, calculated
the commodity concentration indices of imports and exports

2 Later these indices were

of forty-four countries in lQSB.
calculated by Joseph D. Coppock for the exports of some
eighty countries in 1957.3 The commodity concentration
of exports of Communist China was included. However, his
calculation was based on about act of Communist Chinese
commodity trade statistics, thus raising the question as
to whether its result can be appropriately compared with
those based on complete statistics of other countries."
By making use of more complete statistics, both the

geographic and commodity concentration indices of imports

1Albert 0. Hirschman, National Power and the Struc-
ture of Forei Trade (Berkeley and E5e AfigeIes: University
of CaIIIornia gross, 195%).

2Michael Hichaely, Contribution to Economic Anal sis
Vol. 26: Concentration in InternafidnHI Trade (IfisterEZE:
NoFffi-RoIIana PuSIIsfiing Company, 1952}.

3Joseph D. Coppock, International Economic In-
stabilit : The Experience after Worra War II iNew York:
Hcfiraw RIII Rook Company, IQSI’.

“Statistics given in the United Nations' Yearbook

of International Trade Statistics, which Coppock use ,
echude infra-SIoc Trade stati§fics.

118
and exports of Communist China have been calculated. They
will be presented in the following sections and compared
with Michaely's findings for forty-four countries.

Needless to say, for Communist China political con-
siderations precede economic decisions. Therefore her
special case may very well be at variance with the general
pattern. Yet, her behavior is not unique. The Embargo
itself is its counterpart. Furthermore, extra-economic
considerations are not free from the confines of economic
potentials. Therefore, economic factors remain to be the
underlying basis for the comparison. Deviation from the
general rule will give us a clue to what extent extra-

economic factors can affect the economic ones.

Geographic Concentration of Foreign Trade of Communist China

The investigation of the geographic concentration
of the foreign trade of Communist China here is based
essentially on statistics given in the united Nations'
Yearbook of International Trade Statistics, from.which
indices are calculated and presented below.

Before comparing these indices with those presented
in Hichaely's study, it is of interest first to look into
these indices themselves. One striking fact that stands
out is the rapid decrease of the import concentration in-
dices. That is to say, Communist China had been diversifying
her imports more evenly among her trading partners. This
"as probably the result of‘ two factors. First, it was the

110

TABLE VI-1.--Geographic concentration indices of the foreign
trade of Communist China?‘

:-

 

 

Year Exports Imports Exports/Imports
105! 50.0 60.0 0.05
1055 50.0 50.1 0.05
1050 50.0 52.0 0.02
1057 h7.0 02.0 1.13
1050 05.0 37.0 1.25
1050 51.0 50.0 1.00
1060 05.0 05.0 1.02
Average

1050-1050 00.1 00.7 0.00.
1057-1060 00.0 “3.0 1.10.

 

*Because of rounding off, this differs slightly
from the average of the Exports/Imports column.

**Calculated from statistics given in Appendix A.
A higher index means a higher degree of concentration.

gradual resumption of ”normal" trade between Communist China
and countries of the Free World. Vigorous trade-promoting
efforts on the part of Communist China were responded to by
the relaxation of the Embargo. In 1951, all countries of

the Free‘World, except the United States, resolved to reduce
the Embargo list for Communist China to that for all other
Communist countries. A further reduction of the joint list
was resolved in the following year. As a result, the increase

of trade between Communist China and the Free world exceeded

120

by farxthat between Communist China and the Communist bloc.
When 1055 is used as a basis, Sino-Communist-bloc trade
registered a 305 increase in 1050, while in the same period
Sino-Free-Horld trade was more than doubled. The increase
was especially noticeable in her trade with the non-
Communist European countries, which were the chief suppliers
of the once-embargoed goods. Trade with these countries
was more than tripled. The effects on Communist Chin-
089 inPorts were even more revealing. within the same period,
Communist China's imports from the Communist bloc increased
only by 155, while those from the Free world increased by
1555, and more specifically, those from the non-Communist
European countries were quadrupled.1 The second reason
is essentially economic in nature. As a country develops,
it diversifies its economy. It begins to demand commodities
that it did not demand previously, and that its old trading
partners might not be able to supply. As a result it makes
new trade connections with an increasing number of countries
and increases its demand on commodities supplied by this
group of new trading partners. In the case of Communist
China this is manifested in her'increasing imports of raw
materials from the underdeveloped countries, such as natural
rubber, cotton and jute.

In fact, these factors must also have effects on

the geographic diversification of her export, as her

 

1All these percentages are calculated from figures
in Appendix B.

121

geographic concentration indices of exports show a slight
trend of decrease. This retarded decrease compared to that
of imports was probably due to the fact that she was bound
to repay her previous debts to countries of the Communist
bloc.1

If we take the geographic concentration indices of
Communist China in 1055 and compare themuwith those calculated
by Hichaely for forty-fourmcountries in the same year, we
find that Communist China ranked eleventh in export concen-
tration and eighth in import concentration.2 That is to
say, she was among the first quarter of countries whose
foreign trade was geographically concentrated. No doubt,
this concentration was partly due to the fact that being a
Communist country, she tended to have more trade with
countries within the bloc. But evidence suggests that this
is far from the decisive factor. In Coppock's calculation
of the geographic concentration indices of exports of eighty

countries, six Communist countries were included. None of

 

1Since 1057 Communist China had a favorable balance
of payments with the Communist bloc, from which she accumu-
lated a huge deficit in transactions during previous years.
The retarded diversification of her exports geographically
might also due to the sluggish increase of the Free World's
demand for her exports. However, Communist Chinese exports
to the Free World amounted to only 0.5-0.65 of total world
(excluding intra-bloc) exports. In view of her low commodity
concentration in exports, which will be discussed later,
the Free World could have absorbed more of her exports.

2Hichaely's indices range from 18.7 to 05.5 with a
median of 35.0 for exports, and from 10.5 to 81.2 with a
median of 31.2 for imports. op, cit.. PP. 19-20. Table 3.

122
them.was among the first quarter>of countries whose exports
were concentrated, and two of them.came very close to being
among the first quarter«of countries of diversified exports.1
Thus, the high concentration of exports of Communist China
should be due to other reasons also.

.0ns reason is the strict Embargo that was imposed
upon her. The fact that she had to turn to Russia and the
other Communist countries for>most commodities needed for
basic constructions was responsible for the concentration
of her exports to these countries. Even when the Embargo
was gradually relaxed, repayments for'previous debts still
had to be made. From the standpoint of Russia this pattern
might not be economically desirable. It depends on whether
Russia was really in need of these exports from Communist
China. If it was not, Russia could finance her imports by
means of her favorable balance of payments with Communist
China;2 otherwise, she could find some other compensations.
Or if it was, then Communist China would trade with Russia
heavily regardless of the Embargo. Therefore, it is imp
portant for us to look further if there were underlying

economic reasons other than the political ones. The

 

1Among eighty countries, the ranks of these Comp
munist countries were: Russia, 21‘ Hungary, 25; Czecho-
slovakia, 33; Poland, 51g East Germany, 55; and Bulgaria,
58, in order of from low to high concentration. Coppock,
op. cit., Appendix Table A92, Column X23.

2That is, by acquiring the Pound Sterlings which
Communist China had accumulated from trading with the
Sterling Area.

123
investigation of the commodity concentration of her foreign
trade wili help to disentangle the effects of various

factors s

Commodity Concentration of Foreign Trade of Communist China
Based on bread commodity classification, Coppock

. calculated the commodity concentration index of exports of
Communist China in 1051. Numerically the result was 55.5,
which ranked fourteenth (from low to high concentration)

among seventy-eight countries.1

This is to say, Communist
China was among the first one-fifth of countries whose
exports were diversified. As it was already pointed out,
the statistics which Coppock used excluded intra-bloc trade
statistics, which accounted for 605 of Communist China's
exports in that particular year. To what extent his result
was representative of Communist China's commodity trade con-
centration, therefore, requires further investigation.

On this account, one experiment is performed. It
is to estimate the commodity concentration index of exports
of Communist China by including Sino-Soviet trade statistics,
thus making the coverage of statistics up to 805 of Com-

.munist Chinese exports.2 Using also the broad Standard

 

1Coppock's indices range from 51.6 to 06.5 with a
median of 67.5 Coppock, 22, cit., Appendix Table A-2,
column X26.

2What is absent in the statistics is that of the
other Communist countries, which accounted for another 155
of Communist China's exports. The commodity components of
such exports were similar to those of her exports to Russia,
especially when these countries were taken together. (see
also explanation in Appendix C.)

125
International.Trade Classification, which Coppock used, the
calculated-result is 55.5.

It is striking to notice that numerically this index
is almost identical with that which.was calculated by Coppock.
This suggests that in exports Communist China was equally
diversified in commodities in her trade with the Free World,
and in her trade with the Free World and Russia combined.

It also reaffirms Coppock's result that Communist China
was a country of diversified exports in commodities.

In order to compare the commodity concentration of
the foreign trade of Communist China with those of other
countries in Hichaely's study, it is necessary to recalculate
her commodity concentration indices by using the 150-group
Standard International Trade Classification which Michaely
used. Here, 1051 is used as the basis for calculation.1
Such a choice is dictated by the fact that it was a year
for’which commodity trade statistics of Communist China
are most complete. In addition, it has the advantages
that this was the year Coppock used and the year in which
"freer" trade was resumed. For Communist China it was the
concluding year of her First Five-Year Plan. Horeover,
despite unfavorable agricultural conditions, her economy
was stable for being free from the disruptive effects of

her ”Great Leap Forward" and the introduction of the commune

 

1It should be remembered that Michaely's study was
based on 1055 statistics. For’most countries, it seems
reasonable to follow Michaely's belief that using statistics
of immediately neighboring years would call forth only
minor changes in the indices.

125
systemrin latter-years.

The outcome of the calculation is most interesting.
Communist China had a commodity concentration index of 18.8
for exports, and 35.1 for imports.1 .Compared to Hichaely's
calculation for forty-four countries, she ranked the third
in export diversification (tied with the United States),
and the second in import concentration.2 For exports the
result of this calculation reaffirms the conclusion of both
Coppock's study and the aforementioned experiment.

The high commodity concentration of Communist China's
imports is easily understandable. The monopoly of foreign
trade by the state made it easy to concentrate her imports
on commodities suitable for her developmental purposes. In
1051 more than 005 of her imports were within the category
of "producers' goods,” the bulk of which consisted of
machinery and equipment, manufactured metals, petroleum

3 It is mainly due to this reason

products and natural rubber.
that Communist China departs from the general rule in which
import indices in commodity concentration are substantially

lower than export indices.”

 

1For statistics and explanations, see Appendix C.

2Hichaely's indices range from 16.0 to 00.6 with
a median of 30.0 for exports, and from 15.5 to 83.0 with a
median of 20.6 for imports. Michaely, 22, cit., pp. 11-12,
Tab1e 1 e

3See Chapter III above.

“Michaely, op, cit., pp. 12-13.

126

Hichaely suggested several possible causes for the
variation in commodity concentration in exports. One of
these is the stage of economic development, and the other
is the level of industrialisation. In general, the more
developed (as measured by higher per-capita income) and the
more industrialized (as measured by lower share of primary
production in national product) is a country, the more
diversified would be its experts.1 To explain the highly
diversified commodity exports of Communist China, the first
reason is out of the question. Yet, by the end of her
Firm Five-Year Plan she did have an industrial sector which
could turn out substantial amounts of such goods as tex-
tiles, manufactured metals, clothings, chemicals and some
other manufactured goods for exports. This reason alone,
however, seems still insufficient to rank her high in ex-
port diversification, for in 1051, she still had 505 of her
national product generated from her agricultural sector,2
compared to that of 13.05 for Netherlands (1051-1055), 11.15
for France (1051-1050), 1.25 for the United States (1051-

1055), and 5.65 for the United Kingdom (1058-1055), the four

 

1Hichaely, 22. cit., pp. 13-15.

2This percentage is calculated from estimates of
Ta-chung Liu and Kung-chia Yeh, "Preliminary Estimates
'of the National Income of the Chinese Mainland 1052-1050,“
American Economic Review, Vol. LI, No. 2., (May 1061), p.
W”

127‘
other*most diversified exporters.1
One simple-minded explanation would ascribe it to
her export-drive policy. Yet, diversification itself could
not have been achieved had it not been supported by economic
potentials. Here the sise of her economy becomes important.
Even when we compare two underdeveloped countries of differ-
ent sises as Simon Kusnets pointed out, we would expect
a wider range of economic activities to exist in the larger
one, ' . . . particularly if our observation penetrates
' below the broad economic sectors and distinguish divisions
within agricultural, mining and so on."2 Communist China
is an excellent example to illustrate this point. The vast-
ness of her territories enables her to command varied
natural resources. within the broad categories of food-
stuffs and crude materials, she was far from a country ex-
porting only a few staple or extractive commodities, as
many an underdeveloped country tended to be. Her exports
ranged from grains, tea, sugar, dairy products to tobacco
in foodstuffs, and from non-ferrous metal ores, oil seeds

and fats, bristles,silk, fur skins to natural rubber in crude

MtCE'iCl. e

A“

1These percentages are calculated from estimates
of Simon Kusnets, ”Quantitative Aspects of the Economic
Growth of Nations -- II: Industrial Distribution of National

Product and Labor Force,” Economic Develo ment and Cultural
Change, Vol. V, No. 5 (SuppIemenE, 3uIy 1557), pp. 52-::.
2Simon Kusnets, ”Economic Growth of Small Nations,”

Economic Conse uences of the Size of Nations ed. E.A.G.
RESIEEbfi'TREW'TSrE: SE. HSFTIfi's'Press;'I§FU), p. 16.

121(a)

No doubt, the commodity diversification of the ex-
ports of Communist China was fostered by her deliberate efforts,
as it was her pronounced policy to export whatever it was
available over and above her own requirements. Under such a
policy direction, all sectors of her economy were exploited.
It is exceedingly difficult to assess to what extent her
pattern of exports reflected her comparative cost in produc-
ing these commodities. Many of her exports were those China
exported traditionally during the pro-Communist era, while
some others were mainly the products of her recent industrial
development. To say nothing of the inavailability of her de-
tailed price statistics, her manipulation of the internal
price structure also poses a problem. Several attempts had
been made to close the price differentials between industrial
and agricultural products; but there is no way to tell whether
this reflected the ”real" or the ”desired" cost-price re-
lationship. In any event, this probably did not affect her
determined drive for exports. It was clearly admitted that
in exporting to countries in the Free World, her foreign
trade concerns were actually sustaining losses.1 In other
words, to her the marginal utility per unit of foreign ex-
change by far exceeded that of the equivalent value of local
resources at internal prices.

Even so, this does not mean that the low commodity
concentration index of exports of Communist China was mainly

the result of her export-drive policy. This follows by the

 

1Yeh Chi-chuang, ”Tan tui-wai mac-i,” (0n Foreign

de°). HHPYK. NO. 16’ 1957’ p. 910

121(b)
very nature of the index itself. A.low index depends not on
the gambgg.of kinds of commodities that a country can export,
which can be easily stipulated, but primarily on the 3322.
distribution of the value of its exports, which must be
supported by certain economic potentials. Because the index
is calculated on the basis of the percentage shares of the
exports of individual commodities in total exports, an ex-
port-drive which results in increases in the exports of all
or most of the individual commodities will also increase total
exports. The percentage shares of these individual exports
in the total, and consequently the index itself, would not
be different significantly from that in the case had the
export-drive not been undertaken. Therefore, the basic
determinants are still the underlying economic conditions,
which in the case of Communist China were her size and the

development of her industries.

128
In his investigation in commodity concentration of ’

exports with respect to the stage of economic development
and the size of the economy, Michaely inferred that among
developed countries exports are more concentrated in the
small countries, and that among underdeveloped countries
the effect of size is relatively unimportant. Among large
countries, the developed countries had an average index of
21.1, compared to an average of 51.0 of the underdeveloped

countries.1

Curiously enough if we compare the numerical
magnitudes of indices Communist China ranked with the large
and developed countries. Then, contrary to the general
pattern, the effect of size was overwhelming in her case.
Underdeveloped as she was as measured by per-capita income,
the diversification of her exports was fostered by her size
and the very existence of her industrial sector which she

could exploit for the purpose of exports. In fact, we can

find another similar example in Hichaely's study. According

1Hichaely, 22. cit., p. 16. His calculation of the
average commodity concefifFation indices of exports is repro-
duced below.

 

Developed Underdeveloped Total
countries countries
Large countries 7 21.1 51.0 50.6
Small countries 30.1 52.0 53.5
Total 31.1 55.8 51.0

 

Here, a large country is defined as one whose population

numbered more than ten million, and a deve10ped country is

one whose per-capita income exceeded $300, for the period
052-1055.

120
to the same-criteria, Japan was also a large and under-
developed country. Yet, her industrial capacity ranked her
the tenth in export diversification among forty-four
countries.

Another factor that contributed to the diversifica-
tion of Communist China's exports is her location. For one
reason or another she traded heavily with Russia; the geo-
graphic vicinity of these two countries must have also in-
creased the variety of commodities that they could exchange

with each other.

The Relationshi Between Geo ra hic and Commodit Concentra-
fT—on of'Tfie"To're'i Li"'gg_i""'l"ra'3e' "'o' 1' Comm'un' Is' E'Cfiin'a ' " ' 2' ""' ""'"
Both Hirschman and Michaely pointed out, as a rule,
there is a positive correlation between geographic and
commodity concentration of exports.1 Then Communist China
was an exception--as we have already seen she ranked high
in geographic concentration and low in commodity concentra-
tion. To explain the general rule, Hirschman suggests that
as a country becomes more industrialized, which in general
means more capable of exporting a greater variety of goods,

2 It is true

it makes trade connections with more countries.
that the industrialization of Communist China, together with
the size of economy, enabled her to rank among countries of

high commodity diversification in exports. But effects of

 

1Hirschman, 22. 933., pp. 106-101; Hichaely, 22.
Eli-Ea. pp. 22-23.

zaimcm. Ole .cl-Le. pa 1°70

130

these factors‘on"her geographic diversification were out-
weighted by her political alliance with Russia. However,
it would seem appropriate to reason that her high geographic
concentration in exports based on political alliance alone
would not have been economically feasible, had it not been
supported by underlying economic factors. It is pointed
out in an earlier section that being a Communist country
alone was far from the decisive factor for high geographic
concentration in exports.1

To interpret the general rule of positive correla-
tion between geographic and commodity concentrations of ex-
ports, Michaely also suggests that ' . . . for a country
which for one reason or other»maintains trade connections
with only one or a very few countries abroad, exports are
limited to those which are in demand in the partner country.'2
This does not preclude the possibility of a negative corre-
lation. It depends on the variety of commodities that are
in demand in the partner country. A negative correlation
can still exist if a country exports to its predominant
trading partner a great variety of commodities. It is
indicated in an earlier section that in exports Communist
China was equally diversified in the variety of commodities
in her trade with the Free World, and in her trade with the
Free World and Russia combined.3 In other words, her exports

 

1399 P- 122 above.

zfiichaely, 22s Cite. pe 23a

388° 9. 125 above.

131
to Russia—was:as-diversified as that to the entire Free
World. As we find in the Free World countries of various
types at various stages of economic development, their
demands for Communist Chinese exports must have been
varied. Then the Russia demand for Communist Chinese
exports must have also been varied to the same extent.1
Probably this was also fostered by the political alliance
itself. It is doubtful, however, that the political alli-
ance was the dominant factor, because Russia could have
financed her desirable imports by her favorable balance
with Communist China.

It is, therefore, this economic factor together with
her geographic proximity and political alliance with Russia
that contributed to the negative correlation between her
geographic and commodity concentrations of her exports.

Yet, Communist China was not a unique case. There
was another country whose pattern of concentration of ex-
ports bore a remarkable resemblance with here. This country
was Canada which ranked high in geographic concentration
and low in commodity concentration of exports.2 Different
as these two countries might be when measured by per-capita

income, there were factors in common that caused their

 

1A perusal on the Sino-Soviet section of Communist
Chinese commodity trade statistics will help to bring this
out more clearly. (Appendix E.) '

2Among the forty-four countries Canada ranked
eleventh in commodity diversification and eighth in geo-
graphic concentration of exports. Hichaely, 22, 233., p.
12, Table 1.

132 _
defection from.the general rule. 0n the one hand, the sises
of their economies and their’industrialisation contributed
to the commodity diversification of their exports. 0n the
other hand, they both found their largest customers in their
immediate neighborhood absorbing about one-half of their
total exports, which in turn constituted about one-fifth of
the total imports of their largest customers. In other
words, Communist China stood in relation to Russia very
much the same as Canada stood in relation to the United
States in exports. .

Prospectively, the high commodity concentration of
the imports of Communist China is very likely to last for
quite a long time. Her sustained efforts towards economic
development will necessitate her purchase list to remain
highly selective for that purpose, regardless of interna-
tional political situations. But her high geographic con-
centration of imports will depend very much on such situa-
tions, as it is already pointed out that the gradual re-
laxation of the Embargo already had its effects.

0n the export side, as Communist China was already
diversified in commodity varieties, she was potentially in
a position to diversify geographically. This is especially
so because her exports constituted a very small proportion
of total international trade. As her exports assumed the
role of a necessary payoff, the future pattern will depend
on that of imports. In the foreseeable future, it would seem
unlikely that Communist China will be among those countries

133
whose foreign trade are highly diversified geographically.
Despite the recent rift between her and Russia, the exist-
ing Embargo will oblige her to depend heavily on Russia,
unless she is willing to go without those urgently needed
commodities. Yet, given no worsening in the international
relations between Communist China and countries of the Free
World, there is still a long way she can go in this direc-
tion.

CHAPTER VII
SUHHARY AND CONCLUSIONS

The present study investigates the foreign trade
of Comunist China within both the context of not- domestic
v economy and the international economy. In reflection, the
pattern of her foreign trade gives us a static view of her
economy and a dynamic view of’her economic development.
By first summarising the previous findings, this chapter
will focus on these economic problems of hers, and draw
further conclusions with respect to the prospects of her
foreign trade in the future.

0n Communist China's Forei Trade Statistics Exchan e
REESE-353'?EE'TEFEE'ET'TFaEL' '

Usually the first question posed on Communist
China's economic statistics is their reliability. This
naturally includes her foreign trade statistics as well.
A careful comparison of foreign trade statistics released
by Communist Chinese sources and those by her trading
partners shows that by and large there is no evidence of
deliberate falsification.. These two sets of statistics can
be reconciled with due understanding of two factors, namely,
the Communist Chinese manipulation of her foreign exchange

135

135
rates and her special way in reporting foreign trade
figures. For detailed analysis, however, the Communist
Chinese statistics are too crude and fragmentary to be use-
ful. Furthermore, because of her foreign exchange manipula-
tion and her special way in making foreign trade reports,
her foreign trade figures are not found to be very meaningful
from the point of view of international finance as well as
commodity movements. As the yuan-ruble rate was set at
ll.025, the yuan-dollar rate should have been 55.10.1
instead, it was set at s2.35. This depreciation of the

set,

dollar (and also of the other‘Western currencies) would
necessarily exaggerate the proportion of the trade between
Communist China and the Communist bloc in her total trade
in statistics given by Communist China. Even when her foreign
trade was constant in real terms, a shift in its direction
_ would still affect Communist China's statistics.2 Given
the pattern of her foreign exchange rates, it would seem
that the planning and controlling purposes would be better
served if the books of the Foreign Trade Ministry were kept
in terms of rubles, dollars etc. Figures given in yuans
can only distort the real picture.

 

 

1This refers to the 5 to 1 rate of the old ruble to
th. dollar. 1

- 2See also: Rang Chao, "Yuan-dollar Price Ratios

* in Communist China and the united States,“ Occasional Pa ers
No. 2, ed. J. I. Crump, Jr. (Ann Arbor: Center for Cfiifiese “

Stunt... 1963), p. 21.

136

Then come the questions concerning the exchange
rates themselves. Admittedly the yuan was overvalued against
the Western currencies; yet, evidence shows that it was
undervalued against the ruble.1 Then the normal result for
Communist China should have been an import surplus with the
Free World and an export surplus with the Communist bloc.
However, the actual result was the very opposite. One
reason for this is, of course, that part of her imports
were financed by Russian credits. But her export surplus
with the Free World was largely the effect of the Embargo.
If both markets were freely accessible to her, she should
have imported far'more from countries of the Free World,
assuming that the terms of trade were the same in all
markets. This may very well explain why the relaxations of
the Embargo in 1051 and in 1058 resulted in rapid increases
of her imports from the Free World.2 In fact, it is very
probable that the overvaluation of the yuan itself (against
the Western currencies) was a counter-measure against the
Embargo.

It should be noted here that as the Embargo forced
the Ministry of Foreign Trade to pay higher prices for im-
ports, these prices were paid in the local currency to the
People's Bank for acquiring foreign exchanges. The Ministry

__*

1mung Chao, 23. 233.. p. 19.
2

Since 1058, Communist China had a deficit with
countries in the Free World. Previously, it was a constant
surplus. See Table II-10 above.

131
also received higher prices in selling her foreign exchange .
proceeds from exports.1 For the Communist Chinese economy
as a whole, whethar'she was trading in the best markets
depended on the pricing of commodities in terms of foreign
exchanges. This leads us to the question of her terms of
trade. More specifically, one would ask whether Communist
China had suffered from a worse terms of trade in trading
heavily with the Co-aunist bloc.

. The Minister of Foreign Trade of Communist China
stated once that pricing in Sino-Soviet trade was reason-
able and fair, because in negotiation prices in the capital-
ist world-market were used as references.2 If so, Com-
munist China.was not taken advantage of by the monopolistic
position of Russia as a result of the Embargo. A few in-
.quiries have been made by economists to test this state-
ment. Due to limited information these inquiries are all
based on the comparison of the prices of only a few sample

oommodities.3 .Mo attempt is made here to duplicate such

 

1For the practice of these internal transactions,
3.. pp. 32¢33e

2See discussion on p.50.

3See: R. F. Dernberger, "International Trade of
Communist China," Three Essa s on the International Economics
of Communist Mummy
of HIhfiIgan'Press, 1058) pp. 153-150; Feng-hua Ma, ”Price
Problems in Communist Ch na's Foreign Trade" Journal of
Asian Studies, Vol. xxx, Mo. 5 (August, 1062 ,Wz,
(Kbstracfaqof Papers Presented at the Fourteenth Annual
Meeting); Y. L. Wu, F. P. Moeber and M. M. Rockwell, o .
cit., pp. 321-328; and A. Yoshio, "Terms of Trade o ins

and Underdeveloped Countries in Relation to Their’Trade with
the Soviet Union,” JPRS:0505, 28 June, 1061.

138

efforts. Bowever, two points deserve our~attention. First,
as these inquiries are based on a lflmited sample of
commodities, it is doubtful whether they are representative
of the whole picture. Second, price negotiation in Sino-
Soviet trade was not made on the basis of individual commo-
dities. Using the world prices as a reference, prices
were first fixed in the Sino-Soviet Trade Agreement in 1050.
Adjustments were made in later years so that concessions of
one party on some commodities were met by concessions of
the other party on some other commodities.1 Therefore,
it was essentially a deal of packages of commodities. Short
of detailed statistics and complete information on commodity
specifications, results of these inquiries may not bring out
the real picture. In fact, it is not surprising that these
attempted inquiries do yield quite different results.2

As the Embargo created a potential position for
Russia to exercise monopolistic power, it was up to Russia
to decide whether to exploit it or not, especially when

Communist China was most anxious to trade. Even if Communist

China was paying and getting reasonable and fair prices,

__:-___

1Yeh Chi-chuang, "Tan tui-wai mac-i” (On Foreign
Trade) MMPYK Mo. 16, 1051, pp. 00-03.

 

2Both Ma and Yoshio show that Communist China was
paid lower rices in about one half of the sample commodi-
ties and pa d higher prices in most sample commodities in
her trade with Russia, compared with the trade between
Russia and other countries. Yet, on the other hand, the
other two studies show that Communist China aid and was
paid about world prices in trading with Russ a.

130
her terms of trade could still be bettered as alternatives
were open. Perhaps the test of the pie is still in its
eating. The rapid resumption of trade between Communist
China and countries of the Free World may be taken at least
partly as some indication that previously she was not trad-
ing in the best of all markets.

The Forei Trade of Communist China in 'Domestic
EE3E3if"I2""""""E"""""'"-"'JunL"'“""'

. As the regional direction of the foreign trade of
a certain country may be affected by non-economic factors,
its capacity is largely a reflection of its economic poten-
tials. Communist China had pushed her foreign trade vigor- ‘
ously. In ten years the turnover increased by 1505. For
the period 1058-1060 she was about as great a trading country
as Australia, Switzerland and East Germany, and was super-
ceded by only the established trading countries.1 She was
second only to Russia in the Communist bloc.

Yet, compared to national product, her foreign

trade turnover was a meagre 125, which was a relatively low

percentage.2

Two reasons may be advanced for such a phenome-
non. The first reason 1ies in the size'of her economy. For
Communist China'size” clearly refers to both population and

geographic area. In general, the variety of natural resources

 

1They are: United States, Canada, Belgium-Luxem- .
burg, France, West Germany, Italy, Netherlands, United King-
dom, Sweden, Japan and Russia.

2

See comparison with Simon Kuznets' findings for
other countries on p. 25 above. (Simon Kuznets, Six Lectures
on Economic Growth, 22. cit.)

150
and economic activities are positively correlated with the
size of the economy. The larger the size of the economy,
. given the stage of economic development, the greater variety
of commodities can be domestically produced, and the less is
the necessity to participate in international trade; and
vice versa. This is well substantiated by the study of
Simon Kuznets, who shows that for the world at large the
foreign trade ratio (imports t exports/national product)
and the size of the economy (population in his case) are

1 The same rule also holds in countries

negatively correlated.
of low per-capita income.2 For Communist China the effects
of her size on the nature of her economy was well reflected
in her varied exports.

The second reason for her low foreign trade ratio
is closely related with the first one. It is the low level
of her economic development. In fact, the level of economic
development itself has no general relation with the foreign
trade ratio. A low level of economic development can also
be compatible with a high foreign trade ratio. But, as
the Communist Chinese economy was varied to start with, it
had also a varied domestic demand to cater for. Then,

the level of exports depended on the surplus of domestic

production over consumption of the same commodities. In

 

1Simon Kuznets, op. cit., pp. 05-06, esp. Table 10.

2Simon Kuznets, “Economic Growth of Small Wations,‘
Economic Conse uences of the Size of Nations, ed. E. A. G.
REEinson {New Tori: St. Martin's Press Inc., 1060), p. 20,

Table 1 (B).

151
other words; given minimum requirements for domestic con-
sumption, the level of domestic production determined the
level of her exports and consequently the level of her foreign
trade. Therefore, the low level of her foreign trade was
a combined result of the size of her economy and her low
level of.economic development.

0! the three basic paths towards economic growth,
namely, through expanding primary production for exports,
expanding light industrial goods for exports, and producing
industrial goods for domestic markets, the choice of Com-
munist China was essentially the last one. In spite of the
fact that she exported light industrial goods to other
underdeveloped countries in exchange for raw materials, her
overall exports were diversified. Circumscribed by the
underlying nature of her economy and further dictated by
her policy of ”balanced growth,” only 5-15 of her'national
product was exported. This pattern of economic growth by
definition involves necessary improvements in the agricul-
tural sector, which not only provides foodstuffs and raw’
materials for the entire economy, but also absorbs the
products of the growing industries. The economic develop-
ment of Communist China did begin with some improvements
on the agricultural front, and also with import-substitution
of the domestic light industrial products.1 This does not

 

1In the pro-Communist era, China was a net importer
of both grains and manufactured goods including textiles.

152
mean the end of foreign trade, because as Ragnar'Wurkse
pointed out:1 I
in; .uii‘.‘ 23$13.“:§‘§3§i33;.§32.3‘23.33‘firing...
goods, but also (b) the substitution of capital
goods imports for consumer goods imports.

For Communist China it meant both. Through strict
regimentation of domestic consumption, she was soon able to
capitalize on the development of her import-substituting
industries by exporting their products. In other-words,
such industries were not only able to substitute imports,
but also able to accompany her traditional exports in financ-
ing her'capital goods imports. In fact, if these industries
continued to develop at a high speed, and external markets
were easily accessible, she could shift into a position
of exporting light industrial goods in exchange for food-
stuffs and raw materials. This was what Japan did in the
turn of the century. As Communist China was reluctant to
adopt this pattern, a judicious balance must be struck
‘between various sectors internally in order to warrant
stable growth.

This can be seen more clearly when presented for-
mally. Take the case of an economy with three sectors: A
being the agricultural sector, L being the light industrial
sector, and B being the heavy industrial sector. A supplies

foodstuffs to both L and R, also raw materials to L. L

1Ragnar Wurkse, Pattern of Trade and Develo ment
(Oxford: Basil Blackwell, 1531), p. 55.

 

p 153
supplies consumer goods to both A and M. Assume further
that this is an underdeveloped economy, so that A depends
very little on the products of M. Probably L depends on
the products of M to a greater extent; but most products
of M will be further invested.

Then, in a closed economy, a drag in the W sector
will mainly affect itself. Its repercussions on the other
sectors will not be far-reaching and immediate. The effects
of a drag of L on the economy will be more severe, as con-
sumers in all sectors will be hit. Yet, the most far-
reaching and imediate will be the adverse effects of a drag
in A. Besides consumers, the smooth-running of L will be
affected by shortages in the supply of raw materials. Part
or some branches of it will have to come to a standstill,
which in return will have adverse effects on the entire
economy.

An open economy provides escapages through imports
in case of need. Given a marketable surplus, a drag in any
sector can be salvaged by imports without creating balance
of payments problems. Yet, for an underdeveloped country,
this surplus primarily comes from the A sector. Even when
the L sector has developed to a stage of providing a surplus
for export, it still depends on A heavily for material in-
puts. Of course in. the long run a country can develop its
L sector on imported materials, if it is willing to do so
and if it can get free access to foreign markets. But it is

the short-run adjustment that is most painful. A drag in

155
the A sector not- only creates shortages of foodstuffs and
' materials, but also cuts its means of financing. Reper-
cussions willicause a situation more than a problem of
balance of payments. As resources cannot be shifted from
sector to sector over-night, a considerable proportion of
the economy will come to a standstill. And before adjust-
ments are made, the economy will have suffered tremendously.

Therefore, when a country takes the path of balanced
growth, the key to smooth development is still the agricul-
tural sector. In fact, more leeway should be given, for,
by its very nature, it does not only drag, but sometimes it
also strikes. Its adverse effects will be immediate and
. repercussions far-reaching. Even foreign trade will have
to go through quantitative as well as qualitative readjust-
ments. '

In such a type of economic growth, foreign trade is
not an engine of growth itself. Despite its importance in
financing capital goods imports, it is a servant or a victim.
The abrupt decrease of the foreign trade and imports of
grains of Communist China during her recent economic crisis

furnishes a very good example. A

The Forei Trade of Comnunist China and the International
Economy 'l "' ' " "

The analysis of the commodity structure and the net
comodity position of the foreign trade of Communist China
leads to' the following conclusions. '

Firstly, Communist China was a net exporter of

155
foodstuffs to all groups of countries. Despite its waning
importance relative to light industrial goods, such net
export remained quite stable in absolute values, and con-
tinued to be a basic source for external financing.

Secondly, she was becoming an increasingly great
net importer of machinery and equipment and also manufac-
tured minerals, while an increasingly great net exporter of
other manufactured goods. War net exports of raw materials
decreased on the other hand.

Thirdly, in her commodity trade relation with the
developed countries, including those of the Free World and
Russia, Communist China still stood as an underdeveloped
but rapidly developing country. Foodstuffs, raw materials
and light industrial goods were exported in exchange for
chemicals, manufactured minerals, and machinery and equip-
ment. The tendency was that more and more light industrial
goods were exported. .

Fourthly, to adjust herself to the Embargo, Com-
munist China-depended on Russia for the supply of the em-
bargoed goods. Other than machinery and equipment, crude
petroleum and petroleum products, she was a net exporter
in all other commodities to Russia. From the developed
countries of the Free World, she had increasing net imports.
of manufactured minerals, chemicals, and some machinery and
equipment.

'Lastly, if we exclude foodstuffs exports, Communist

China stood in relation to the underdeveloped countries as

1na

an industrial country. She exported light industrial goods
in exchange for’animal and.vegetable raw materials. These
experts alone were about enough to finance all her’net
imports from these countries. Therefore, her foodstuffs
exports to these countries, which constituted about one half_
of their total imports from her, were essentially a surplus
for financing through other channels.

In spite of the fact that this study is limited to
I a very short period of time, the above conclusions indicate
that Communist China was developing at a fast rate. The
impression is especially clear in the changing pattern of
her exports. Eventually she had emerged into a position ex-
porting almost one.half of her total exports in manufactured
_goods. One might ask, what the stage of her industrialisa-
tion is. '

’ In the study of the development of exports of menu-
factured goods, from 1999 to 1953, A. K. Csirncross pointed
out that for ten industrial countries:1

1min.”.33“.§3§2.§“32§2n2§:.2;‘2.3.32i5? $3.3?“
chemicals have shown a slight upward trend since 1899,
although the change between 1937 and 1950 was the other
way. The miscellaneous group of manufactures has shown

a pronounced downward trend, especially since 1929.

That is to say, the path of further economic development is

 

l
A. K. Cairncross, ”World Trade in Hanufactures since

1900,“ factors In Economic Develo ment (London: George
Allen rum ,""'p._2'9'§2_‘lfiese ten countries are:
United Kingdom, United States, France, Germany, Belgium,
Italy, Sweden, Switzerland, Canada and Japan.

IQ?
to go from exporting consumers' goods to exporting pro-
ducers' goods. Indeed, as late as 1899, all industrial
countries still exported mainly textiles and/or other con-
sumers manufactures, except the United States.1 As new-
comers started to export manufactures, usually textiles,
old-timers shifted to export mainly capital goods. The
following table shows that Communist China is just another

DUUOGOIOPs

TABLE VII-l.--Hanufactures exports of Communist China (in

 

 

 

percentages)
Year Engineering Textiles Chemicals Hiscel-
Products 8 Hetals laneous
1951 ‘ 2.1 50.5 25.3 21.5
1958 1.9 31.0 25.5 21.5
1959 2.5 h9.3 16.2 31.9
1980 0.6 50.5 17.8 31.5
Source: Calculated from statistics given in

Appendix E according to Cairncross' classification.

 

1Cairncross' calculation is reproduced as follows.
‘22, Cit., 9. 2‘6. TCbIQ XI).

- Pro rtion of Main Cate ories to
Tote! Egports of Manufactures 195! I 1953

 

Engineering Textiles Hctals 8 All Other
Products Chemicals Items

UK 17.5 99.9 87.0 15.5 17.9 17.8 18.1 21.8
USA 21.9 59.2 7.9 6.6 39.3 20.2 29.8 19.0
France 5.1 25.7 35.8 18.6 13.6 32.5 99.8 23.2
Germany 8.9 U5.7 20.6 5.9 20.7 25.5 99.8 22.9
Belg Italy
Sued: Swit::} a. 9 25.3 92.6 15.3 19.3 29.1 29.3 29.1
Canada 30. 2 18.5 7.5 Deg gs, 36.0 52.6 “3.6
Japan 0.2 13.1 580‘ 36.1 21.5 21.0 19.8 2‘98

 

1&8

In these years, textiles and miscellaneous manufac-
tures were predominant in Communist China's exports.
It is interesting to note that in 1951, the concluding year
of her Pirst Five-Year Plan, the commodity structure of her
exports of manufactures was very similar to that of Japan
in 1399.1

This of course does not mean that Communist China
would follow the footsteps of Japan in her pattern of develop-
ment. Nor does it mean that it would take her another
sixty years to develop to a stage comparable to the present
day Japan. In economic development every case is unique,
because of unique underlying economic factors and historical
incidences. However, it gives us some indication of the
approximate stage of her economic develOpment as reflected
in the commodity structure of her exports of manufactures
at the end of her First Five-Year Plan.

The Prospects of the Foreign Trade of Communist China
Although in economics everything depends on every-

thing else, something is bound to depend on something else
more. In Communist China the foreign trade sector was small
compared to her entire economy. Important as it was in
transplanting the modern tricks of technology directly

from the advanced countries, its stable development depended

mainly on the stable develOpment of the domestic economy

 

V—v—

1According to W. W. Rostow, this was the time (1878-
1900) of‘the Japanese takeoff. See his The Sta es of Econo-
mic Growth (Cambridge: Harvard University v53... 1551’.

1ll9

itself, which in turn depended largely on the performance
of the agricultural sector. This was especially so when
she was determined to adopt a ”balanced growth” policy.
As a result foreign trade only played a passive role in the
entire economy.

no doubt, the long-term goal of Communist China is
to become economically independent. Yet, we do not know how
independent is truly independent. On the one hand, it can .
mean complete isolation so that foreign trade will one day
die an unknown soldier; or self-sufficiency in basic require-
ments so that foreign trade will become only a balancing
item. On the otherrhand, it may be contended that a low
foreign trade ratio among countries, together with an inde-
pendent industrial sector, would be independent enough so
as not to forego certain advantages derived from foreign
trade. It is very probable and only reasonable that it is
this that the Communist Chinese leaders hays in mind. Even
so, it is far too early for Communist China to be able to
attain this stage. Her immediate task still is to build up
her own industrial sector, and in doing so foreign trade
has been a powerful leverage. Therefore under normal condi-
tions we should expect her foreign trade to grow continuously.
It is also likely that even her foreign trade ratio will in-
crease for some years to come.

As for the commodity structure of her foreign
trade, trends discussed previously will continue as she

further develops. That is to say, she will continue to

150 '
increase her exports of light industrial goods in exchange
for heavy industrial goods from the developed countries,
and for raw materials from the underdeveloped countries.

These expected projections, however, were brought to
a pause by her recent economic crisis, in which foreign
trade was an immediate victim. Total turnover in 1962 was
about one half of its peak level in 1959, and substantial
amounts of grains were for the first time imported. This
was further aggravated by her "rift" with Russia, which re-
sulted in a more than 50% decrease in Sine-Soviet trade.

Her imports from Russia decreased by about 759, with complete
industrial undertakings coming close to the vanishing point.
Of course, this does not mean that the previous develop-
ments of her foreign trade will be washed away for good.
Rather they are waiting in retrenchment tor her to resume
normal economic conditions, for which she is probably new
setting aside a few years before she would launch another
Five-Year Plan. We should therefore expect her foreign

trade to follow the projected pattern, upon the normaliza-
tion of her economy based on improvements in her agricultural
sector.

Further developments in the geographic distribution
of her foreign trade is hard to predict for political rea-
sons. As successive relaxations of the Embargo has brought
her nearer to the Free World, there is no way to determine
how far she can and is willing to go in that direction.

The main prospect still lies in the possibility for her to

151
acquire heavy machinery and equipment from the Free World,
and her political relation with Russia. It is here where
the “economic man' goes out and the ”political animal”
steps in.

BIBLIOGRAPHY

Books

Adler, Solomon. The Chinese Economy. New York: Monthly
Review Press, . '
Barnett, A. Dock. Communist Economic Strate : The Rise
of Hainland China. Washingion, 5.5.: haiionai
ann ng soc a ion, 1959.

Boorman, B. L. et. al. Hoseow-Pekin Axis. New York:
Council on Foreign e a one, .

Cairncross, A. X. Factor in Economic Development. London:
George Allen nw ., .

Cheng Che-yuan. The China Hainland Market Under Communist
Control. Hong‘xbng: The Union Research insiiiuie,

Coppock, J. B. International Economic Instability: The
Exgirience or or ar . ew or : c raw

00 ompmy , e
Crump, James 1. (ed.) Occasional Pa are No. 2. Center
{gr Chinese Studies: The Uhiversiiy of Hichigan,
63.

 

Die Wirtschaftliche Verflechtun der Volksreaublik China
gifiger gowjezunion. Hamhurg: insiiiui fuer hiien-
' me, 0
First Five-Year Plan for Develo ment of the National
Econom of ihe Fee Té's Re uhiic of China in 1953-
1957. Pehing: Foreign hanguages Press, i§5§.

Hirschman, Albert 0. National Power and The Structure of
Forei Trade. Berheiey and Che hhgeies: UdiVBrsity
oi Ehiiiornia Press, 1959.

Hsin Ying. The Forei Trade of Communist China. Hong
Kong: The Union Research insiiiuie, 1955.

152

153

Kuznets, Simon. Six Lectures on Economic Growth. The
Free Press o encoe, .

Li, Che-ling. Economic Develo ment of Communist China.
Berke ley—an"Th3"s' figeiezs":"Un'i've' 'rs'iiy 'o"i"'EhIiiornia
Press, 1959.

Liu, T. C. and Yeh, K. C. The Econom of The Chinese
Ma nland: National Income ana iconomic Bhveio ment
TESS—1959. 2 vois. Sania Monica: The R553
Corporaiion, 1963.

Nichaely, Michael. Contributions to Economic Anal sis,
Vol. 26: Conceniraiion in Tniernaiionai Trade.

s e am: 0 c an s ng ouse, 62.

Nurkse, Ragnar. Patterns of Trade and Development. Oxford:
Basil Bla e , .

Remer, C. F. Cad.) Three Essa s on The International
Economics of Cdmmhhiof'ihihh. hhh hrhhr: Univorsity
o c gan ress, .

Robinson, E. A. G. (ed.) Economic Conse uences of the Size
of Nations. New or : . a in s ress, .

Rostow, W. W. The Sta es of Economic Growth. Cambridge:
Harvard Universiiy Frees, ighi.
Second Session of The Second National Peo le's Con ress of
" """' ""' The"Peo"—Ie"'s'he u' hii'c oi China"'w§'c"um'e'n"'is3. Pehihg:
, Foreign CEhguages Press, 1965.
Szczepanik, E. F. (cd.) EconOmic and Social Problems of

The Far East. Nong Kong: Bong Kong Un:vers y
PPCSB. Iggze

 

Ten Glorious Years. Peking: Foreign Languages Press, 1960.
Ten Great Years. Peking: Foreign Languages Press, 1960.

Wu, Y. L. An Economic Survey of Communist China. New
Yor : c an ssoc a es, .

Wu, Y. L., Noeber, F. P.. and Rockwell, N. H. The Economic
Potential of Communist China. 2 vols. henio Parh:
an or escarc me u c, 1963.

Yin, Helen and Yi-chang. Economic Statistics of Mainland
China (1999-1951). Uhfihriage: harvaha Universiiy
0.8, s

15W

Periodical Articles
(in English)

Ames, Edward. ”Exchange Rates in Soviet-type Economy,”
Review of Economic and Statistics. Vol. XXXV,
0e OVe . pp. - e

Bystrov, F. “The Organization of International Settlements
among The Socialist Countries,” Problems of Econo-
mics. Vol. III, No. 2 (June, 1950), pp. 55-59.

Cairncross, A. R. "World Trade in Manufactures since l900,‘
in his Factors in Economic Develo ment. London:
George hiien 5 Unwin £53., I932, pp. 230-253.

Chao, Kang. "Yuan-dollar Price Ratios in Communist China
And The United States," Occasional Pa ers No. 2
(ed.) James I. Crump Jr. Cenier for Chinese
Studies, the University of Michigan, 1963, pp. 1-39.

”China's Foreign Trade Agreements and Activities.” JPRS:

3125, Communist China Digest No. 22. August Tl,
m, pp. - o

 

Dernberger R. F. ”International Trade of Communist
China,” Three Essa s on The International Economics
of Communisi'China. (.8.3 C. P. homer. hhn hrhor:
Uhiversiiy of Michigan Press, 1959, pp. 119-221.

Eckstein, Alexander. "Moscow-Peking Axis: The Economic
Pattern," Moscow-Pekin Axis. M. L. Boorman, et.
al. New Tori? Cduncii 6h'Poreign Relations, 1957,
pp. 5W-111.

Kuznets, Simon. "Economic Growth of Small Nations,”
Economic Conse uences of the Size of Nations. (ed.)

s e e neon. cw or 3 e a n 3 08.,
1960, pp. 1U-32. ‘

Kuznets, Simon. "Quantitative Aspects of The Economic
Growth of Nations -- II. Industrial Distribution of
National Product and Labor Forces," Economic

Develo ment and Cultural Chan e. VoI. V, No. B,
Ouiy, i557, Suppiement.) ' "'H"

Liu, T. C. and Yeh, K. C. ”Preliminary Estimates of the
National Income of the Chinese Mainland 1952-1959,“

American Economic Review. Vol. LI, No. 2,(May,
upp emen , pp. - 17.

155

Li, T. C. “A Valuation of China's Foreign Trade,“ Far
Eastern Economic Review. Vol. XXVII, No. lu'1bct.

: PP: -

Ma, Pong-hue. ”Price Problems in Communist China's Foreign
Trade,” Journal of Asian Studies. Vol. XXI, No. I,
(August, Mtracts of Papers
Presented at t e Fourteenth Annual Meeting.)

Mah, Feng-hwa. ”The First Five-Year Plan and Its Internap
tional Aspects,” Three Essa s on the International
Economics of Communisi'China. lea.) C. F. Rehbr.
hhn hfihor: Uhiversiiy oi Hichigan Press, 1959, pp.
33-117.

"Minister Outlines Development of Sine-Soviet Trade in
1958,” some No. 1893, pp. ui-uz.

Szczepanik, E. F. ”Balance of Payments of Mainland China,“
Economic and Social Problems of the Far East.
zczepan: We“
University Press, 1962, pp. 113-129.

 

Szczepanik, E. F. ”Foreign Trade of Mainland China,"
Contemporapz China, No. 3, 1958-1959, pp. 69-130.

”Trading Organizations on China,” Far Eastern Economic
Review. Vol. XX, No. 20,( y , , pp.

Yang, Chien-pai. "On the Internal Relationship Between
Industrial and Agricultural Production," JPRS:
5639, October 26,1960.

Yoshio, A. "Terms of Trade of China and Underdeveloped
Countries in Relation to Their Trade with the Soviet
Union," JPRS: suan, June 28,1961.

Periodical Articles
(in Chinese)

Chao, Chi-chiang. “Chi-mien lai wo-kuc tui-wai mac-i ti
chung-ta pien-hua ho fa-chan,” (Great Changes and
Developments of Our Country's Foreign Trade in the
Last Seven Years), Tui-wai mac-i luen-wen shuan.
(Selected Treatises on Foreign Traae.) (Fehihg,
1951), pp. lO-17.

'Chung-shu soong-ti pan hu-tso ho-tso ti hsin cheng-chiu, '
(New Achievements of the Sine-Soviet Fraternal Mutual
Assistance and Cooperation), JMJP, April 29, 1958,

( Edit 01.131 ) e

155

I, Yin-tang. 'Chung-shu mac-i ti fapchan,' (The Develop-
ment of Sine-Soviet Trade), JMJP, April 21, 1957.

Mac, Ching-sheng 'Chun oshu lian -kuo ti ching-chi ho-
tso ' (Sino-Sov st Econom c Cooperation), TKP,
April 19, 1351. "

Nuc-chia tung-chi chfi (State Statistical Bureau):
'Kuan-yu 1952 nien kuo-min ching-chi ho wen-hue
tsiao-yfi hui-fu yfi fa-chan ching-kuang ti kung-pao,'
(Communique on the Restoration and development of
the National Economy, Culture and Education in
1352), MMYP, No. 10, 193a, pp. 223-230.

'Kuan-yU 1953 nien-tu kuo-min ching-chi faechan ho
kuo-chia chi-hue chi-hsing chieh-kuo ti kung-
pac," (Communique on the Development of the National
Economy and the Results of the Execution of the
National Plan in 1953), MMYP, No. 10, 1953, pp.

3 ~232.

'Kuan-yfi 195Q nien-tu kuo-min ching-chi fa-chan ho
kuo-chia chi-hua chi-hsing chieh-kuo ti kung-

pac," (Communique on the Development of the National
Economy and the Results of the Execution of the
National Plan in 1959), MMYP, No. 10, 1955, pp.
166-167.

”Nuan-yfi 1955 nien-tu kuo-min ching-chi chi-hue
chi-hsing chieh-kuo ti kung-pao,” (Communique on
the Results of the Execution of the 1955 National
Economic Plan), MMPYX, No. 13, 1956, pp. 39-92.

'Kuan-yfi 1956 nien-tu kuo-min ching-chi chi-hua

chi-hsing chieh-kuo ti kung-pao.” (Communique on
the Results of the Execution of the 1956 National
Economic Plan), HMPYK, No. 17, 1957, pp. 201-205.

"Nuan-yfi fa-chan kuo-min ching-chi ti ti-i-ko wu-
nien-chi-hua (1953-1957) chi-hsing chieh-kuo ti
kung-pao." (Communique on the Results of the Execu-
tion of the First Five-Year Plan for the Development
of the National Economy 1953-1957), MMPYX, No. 8, ‘
1959, pp.'98-51.

'Nuan-yfi 1958 nien kuo-min ching-chi fa-chan ching-
kuang ti kung-pao,' (Communique on the Development
of the National Economy in 1958), MMPYK, No. 8,
1959, pp. s1-su.

157

Rue Chum-wen. 'Liang-tiao-tui chou-lu, kao-shu-tu chien-
she chin-kung-yeh ' (Walking on Two Legs, Develop-
igggLight Industr es at High Speed), CXCCY, No. 18,

Li Che-jen. "Shu-luan ho ko jen-min-min-tsu kuo-chia ti
yuan-tso shi shi-hsien wupnien-chi-hua ti joupli
tiao-chien," (The Assistance of the Soviet Union
and the People's Democratic Countries Is an ad-
vantageous Condition for Realizing the First Five-
Year Plan), HHYP, No. 9, 1955, p. 131.

Li Fu-chun. 'Kuan-yfi 1959 nien kuo-min ching-chi chi-hue
tsao-an ti pao-kao,” (Report on the 1959 Draft
Ngtlgnal Economic Plan), HHPYK, No. 9, 1959, pp.

Li Hsien-nien. 'Shu-luan shi wo—kuo chien-she she-hui-
tau-i ti pang-yang ho wei-ta ti yuan-tso chieh,“
(The Soviet Union Is a Model for Constructing
Socialism.and Great Helper of Our Country,) HHPYK,
No. 5., 1955, pp. 50-52. """

'Kuan-yfi 1955 nien kuo-chia chueh-suan ho 1956 nien
kuo-chia yU-suan ti pao-kao,‘ (Report on the 1955
National Final Accounts and the 1956 National
Budget), anyx, No. 1n, 1956, pp. 1-9.

'Kuan-yfi 1956 nien kuo-chia chueh-suan ho 1957 nien
kuo-chia yU-suan tsao-an ti pao-kao,” (Report on
the 1956 National Final Accounts and the 1957
Ngtégnal Draft Budget), HHPYKI No. 19, 1957, pp.

"’ e

Li Ming. "Wo4men shi chen-yang kuan-li tui-wai mac-i chi-
hua ti," (How We Manage Foreign Trade Planning),
CHCC, NO. 1957’ pp. 20-210

Li Po-fang. "Chi-chi chia-chiang tsu-chi tsu-kou hue-
yuan,” (Strenuously Strengthenin the Organization
of Commodity Sources for Exports , CHCC, No. 2,
1953, pp. 27-28. "“"

Liu, Chi-hang. ”Chi-pen chien-she Shih-hsien-la keng-hao
ti chuan-mien ti ta-jao-chin,’ (Basic Construction
Has Realized A Better and All-around Great Leap
Forward), CHYTC, No. 1, 1960, p. 29.

Lu Shihpkuang and Huang Juan-ting. 'Wo.kuo Chin-kou mao-
i tsai ti-i-ko wu-nien-chi-hua chi-chien ti tso-
yung,” (The Function of Our Import Trade During

_ {2;7First Five-Year Plan Period), 25:, Dec. 15,

153

Po I-po. 'Kuan-yfi 1956 nien-tu ching-chi chi-hue ti eni-
hsing chieh-kuo ho 1957 nien-tu kuo-min ching-chi
chi-hua tsao-an ti pao-kao,” (Report on the Results
of the Execution of the 1956 Economic Plan And The
1957 Draft National Economic Plan), HHPYK, No. 1!,
1957. pp. 28-39e

'Kuan-yfi 1958 nien kuo-min ching-chi chi-hue tsao-
an ti pac-kao,” (Report on the 1958 Draft National
Economic Plan), HHPYK, No. 5, 1958, pp. 12-23.

"Yoh Chi-chuang pupchang ti fa-yen,” (The Statement of
Minister Yeh Ch -chuang--Report to The Second Session
' Of The First National People's Congress of The
People's Republic of China, 1955), Jen-min shou-tse
(People's Handbook), (Peking, 1956), pp. 232-233.

Yoh Chi-chuang. ”Kai-chin wo-kuo tsu-kou kung-tso, pao-
cheng kuo-chia kung-yeh chien-she," (Improve Our
Work in Exports, Guarantee Our National Industrial
Construction), HHPYK, No. 21, 1956, p. 155.

“Wei-ta ti ho-tso, wu-shi ti yuan-tse,“ (Great
Cooperation, Selfless Assistance), JMJP, Nov. 3,
1957.

“Tan tui-wai mac-i," (On Foreign Trade), HHPYK, No.
16, 1957, pp. 90-93. ""“

'Wo-kuo tui-wai mac-i tsai ti-i-ko‘wuonien chi-
hua ti fa-chan,"(The Development of Our Foreign
Trade During the First Five-Year Plan Period),
pg, No. 23, 1957.

'Shih-nien lai wo-kuo ti tui-wai mac-i,” (The
Foreign Trade of Our Country in the Past Decade),
JMJP, Sept. 22, 1959.

APPENDICES

159

APPENDIX A
The Regional Distribution of the Foreign Trade

of Communist China

The following tables are compiled mainly from.
statistics given in various issues of the United Nations'
Yearbook of International Statistics, Direction of Inter-
national Trade, and World Economic Report. Up to 1953, some
countries reported only their ”trade with China." There is
no way to disentangle ”trade with Communist China"'figures
from these overall figures. However, in these years "trade
with Nationalist China' of these countries was relatively
insignificant. From 1959 to 1956 Pakistan reported also
only her "trade with China.” Here figures are adjusted by
deducting the Pakistan-Nationalist-China trade figures re-
ported by Nationalist China from those Ttrade with China'
figures. I

Since most figures in the following tables are de-
‘ rived from the above-mentioned sources, they are referred
to in the text as United Nations' statistics. In cases
where statistics are not available from them, the following
sources are used. A Survey of the Strategic Trade Control
Control Program 1957-60 and The Battle Act in New Times
(v.3. Department of State: 1960 and 1962); Der Ostblock:
Aussenhandel des oestlichen Wirtschaftsblockes einschliess-
ligh Ching_by Bruno Kiesewetter (Berlin, 1960): gppgp.

160

161
Statistical Yearbook 1959: Die Wirtschaftliche Verflech-
tung der Volksrepublik China mit der Sowjetunion (Hamburg:
Institut fuer Asienkunde, 1959): Vneshn a a Tor ovl a,
No. 10, 1959; and Far Eastern Economic Review, Sept. 15,
1960 (for Macau only).

182

 

NNNQDOONHONEI‘NM

3003mONOQONNM
eeeeeeeeeeee
H

N WNHHMSI'
N

ee
ON
Pie-9H

es
5")

.HH
.H
F.
m.oo
«.m«
9.5
o.H«
«.2«
«.mm
o
«.0

0800300, I090”

N

«.o
m.on
o.««
«.od
n.6md
«.«m
0.6H
m.«
m.«d

9.6H
¢.«
o.o
o.moH
«.mo
n.ad
o.H««
o.HoH
«.o:
m.m
9.0H

.emoooucum mcwomnocne

 

m.:c« H.odm m.mom «.006
«.0 «.H c.d A.

a A.H H.« c

o m. «.H .9

o «. «.o «.«
I «.hd a.nd I

o o.d I I

H. H. n. «.
o.» a I I

H. m.» 3.: H.
o.« n.0H «.2 h.
a. «.H o.d a.
n. o.o «.OH «.
0.0» :.:m m.«« o.”
3.»: a.n: c.3Hn «.mm
«.5 H.HH m.o« :.oH
n.«« m.::« o.Ho« o.o«
o.mn a.mo o.mdd «.mm
n.ad n.am o.h: «.mH
c n.m «.9 h.H
o.» o.on «.od 3.

9.20:

o.HaH

m.«om
n.d

.d

I
e
h

000
H

508’ 503003”. '00

8'

e e s

GDP.” NQID
HON

e
80
ON
HN

N00“)
e
In:
60

o.«m

O

s
O
In
H

GOIHOIIOII
e

.99
ee
8'
H

COSMOOOHI‘

e e e e e e e e

NHIDHHHDN
NMNH”

huq «NH

3
I

ewe< deuce
mashm
pdomsx
common
omen

menu
mmueacmuu<
cco<
managema
xesesem
ceuewxem
common .2
ssoc:
coach
cunecoocu
m can
ucox com
.U%QHU=
coaaeo
uncommon
venom

 

waow muons“ wmooxo chow macaw“ wmomxe Hewow whoomm wmooxe Howow whoomu wmooxo
one"

«mad

mand

coma

aaouu phone“
.0» «nooxov
newmvcmoo

 

 

<Hm<

163

 

 

 

 

.esooewcwm ucaooaocue

».oms «.Hou n.aou o.~m. «.eeu o..e« o.oo. ..ouu n.a«m n.a«o ..«aa «.mn. some deuce
o.m. o a.” o. o. a. a. a. I a. a.” o.u a. cause
' - - 5 5 5 - T - - T . ”flfigx
- - - - - - T F - 5 5 - wok"
o.~ o a." 5.. o «.o ..o o a.» o.ou .. m.on anon
- - - u - u a. o u. «.n «.H o anemones
- u , - - a u a." a «.u a." a H.« xezesew
«.a« «.o« n. a.»« u.»« o.~ u.o« ..o« a. a.- a.m~ o.o eeuuoxea
- A- - a. a. s. o. a a. a.” a m.u cannon .2
- - - - - . a.» a." o.m a.» a.” c.m soon:
«.3» “.3 a.o~ a... n.ad n.a. n.aoa m.ou .a.oo o.mm~ n.5c 5..» comes
a.“ n a." «.om o.~ ..mm o.u~ m.¢ H.ou n.a. e.HH «.om monocoean
o.». a.” a.« m.om «.u n.. a.«« a.mn «.m m.m~ a.» m.»~ emcee
o.sau a... o.omH ..aau :.¢o a.~un o.¢on ..um n.amm m.mou o.n~ «.moa men: mean
«.on a.” ...n a..m ..o m.»« 0.“. «.a «.5m a.om a.» H.na .uaumnz
a..o «.9» «.m. e.aa a... «.nm n.a. m.m« o.o~ ..uo n.an a.o~ eonsoo
- - - - - - a a a a o o coconaao
a.« ..A G.” m.n o.n m. o.o~ n.an n.« «.5» ”.ma «.«u sense
E E E E 68... 2&5
«non swam name one” .0» «soaxoo
Godiva—500

 

  

ecmsu unacmmaoo mo comma

.o.==aucoo. <Hm<

169

.enoocmcwm

O
,4
O
3

e
O
3‘
N

O
O
8
50

0
ID
gs
M

O
In
(D
N

O
M
U)
M

O
D
If)
H

.doo .Hmn

e
In
C)
H

e
(D
O
N

O
Q
8

O
50
N

O
N
N

O
N
In

0
fl
,4

O
(0

O
CO

”IIMIIIIIIOIIF

H.

MNWIII'IIIIIII.’

C.
CO H
N a)

H «.omd

H
N
«loosen-locoIIMIIIIIIIIIoI
C

If)
8
MIOmhMOOIINIIIOIIIIIO
e

e
N

O O O O C O
HIDQNQ
I‘D

e e e e e e
Rel-(BN6
(~08 N

3
(s

O
O
O
N

O O O O O O
HHMNH
RID!” N

,4
e e e e e e
N NOwFs-IQD

In
,4
IOOQFDOIOOIIIIIIIIIM
”MON

H
IDONOOOIIIOIIIUIIIOO
O

O
O

s

U)

M
NIOOFOU‘IRIIOIIII'OIOIN

O

In
3|OID088¢DIIOIIIIIIIIIN
NOOIIDMQUIOIIIIOIOII|UIIIO

M
O
O
,4
p
O
o:
In
0
8’
O
M
e
,4

mcovaflocH.

e
N
:I’
N

H

”SN
9"

UzimmMNOflIINI3IIIIIIOI-I
N 6003605040

ewe< Hausa
camam
unessx
common
dean

cesH
ceueacomu<
coo<
ocoawena
xesommm
ceuuuxom
common .2
scum:
coach
canccoocn
m can
mcox so:
commas:
coaheo
cuoooaeo
mason

 

we we m was om“ wmooxe new)» wmo on“ wmooxe Hewow mucosa wsooxo chow who am“ mucosa
«man

«sad anon Anon

 

Aaomu «mouse
.00 uncoxev

nowmucsoo

vomnwucoov (Hm<

165

 

 

 

5.555 5.55 5.55 5.555 5.55 5.55 5.555 5.55 5.55 5.555 5.55 5.55 55555< 5.505
5.5 5.5 I I I I I I I 5.5 5.5 5 55555:
5.5 5. 5. 5.5 5. 5. 5.5 5. 5.5 5. 5 5. 555.555
5.5 5.5 5. 5.5 5.5 5.5 5.5 5.5 5.5 5.55 5.5 5.5 noosm
5.. 5.5 5.5 5.55 5.5 5.5 5.55 5.55 5.5 5.5 5.5 5.5 50555< .5
5.5 I 5.5 5. I 5. 5.5 I 5.5 5.5 I 5.5 55555.5
I I I 5.5 5.5 5. 5.5 5.5 5. I I I 55.5.5552
5 555.5055
o.« I o.« 5.: I 5.: a.» 5. «.m s.« I a.« musewuz
5.55 5 5.55 5.55 5.5 5.55 5.55 5.5 5.5 5.55 5.5 5.5 oppose:
I I I I I I «.5 I «.5 I I I «soon aso>n
5. 5 5. 5. 5 5. 5.5 I 5.5 5.5 5.5 5.5 555:5
5.5 5 5.5 5.5 5 5.5 I I I I I I .sue .3 .55
5.55 5.55 5.55 5.55 5.55 5.55 5.55 5.55 5.55 5.55 5.55 5.55 55555
5.5 5.5 5 5.5 5.5 5. 5.5 5.5 5. 5.5 5.5 5. .suc .m .5555
5.5 5 5.5 5.5 5 5.5 5.5 I 5.5 5.5 5 5.5 55sou5<
Hmwow wmoomu whooxe Hmwow wmoomw wmooxo Hmwow wmooa5 umooxo Home» uncomw whooxe “moan uncoaw
5555 5555 5555 5555 .05 «noose.
.. 5553556

/

(OHkkv.

 

166

-'1953
expo per 0 a
1 10.9 11.1
.2 C 7
1.9 10.9 10.3

1953
por c a
.8 11.U 12.2
1 2
11.6 23.6

11.1
12.0

1955
OXFOI:E impori ‘65:! BXDOI‘
29.5 25.5
5. .1
19.0
.9 .9
25.3 I5.5

08

.5
.1 .1
19.6 19.0

1.3
20.2

 

1956

per
.5

29.2 35.3
1
5
7

29.0 62.0

expor
11.1
9
1
33.0

ts Be Afre

Egypt
Nyasaland

Senegal

 

 

 

AFRICA (continued)

Countries
(export to,
uport from)
Algeria

Br

Fr. W. Afr.
Ghana

Ivory Coast
Morocco
Nigeria
Rhodesia and
S. Africa
Sudan
Tunesia
Uganda
Total Africa

167

 

1

O
O
H

O
O
H

O
N
F)

O
N
,4

0
60
H

O
O

O
ID

0066006
0365000
6066006
3003365
IIIIIUI
IIIOIO"
IIIIIII"
IIIIIII
CIIIIIF
IIIIIOH
IIOIIIO
IIIIIIN

e
O
H

e
O
H

e
N
H

e
N
H

e
If)

e
00

00663036
30000630
60060606
65030060
00300006
IIIIOIFI
IIIIIIFO
3060633)
03030356
3000336006
00006663
IIBIIIIDI

cownm< 5ouoa
coco»:
cancers
cocoa
cownu< .m
5cmecem
oco5cem>z
one eueooonm
swoon“:
oooomo:
ueooo 550:5
omega
.5M< .3 .55
vohmu
.su< .u .u hm
c550 5<

 

Howey whammy wnoaxe HewOw wmoaa5 waooxe Howow wmoomu wmooxs Hewow mucus“ waooxo

55055 phonon

 

.5555 5555 5555 5555 .05 555555.
mowmucooo
Ilka-LE3 5 8.555558 «555.55

ecwco newcossoo no comma «ouch

166

L

 

 

 

5.555 5.555 5.555 5.555 5.55. 5.555 5.5.5.5.555 5.555 5.555 5.555 5.555
5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 5. 50505505
5.55 5.. 5.5 5.5 5.5 5.5 5.5 5.5 5.5 5.5 5.5 5. 0500500505
5.55 5.55 5.55 5.555 5.55 5.55 5.555 5.55 5.55 5.555 5.55 5.55 .x.5
5.55 5.5. 5.55 5.55 5.55 5.55 5.5. 5.55 5.55 5.55 5.5 5.5 55055055505
5.55 5.55 5.5 5.55 5.55 5.5 5.55 5.55 5.5 5.55 5.55 5.5 0.0.05
I I I 5. 5. I 5.5 5.5 5. 5. 5. 5. 05055
5.5 5.5 5.5 5.5 5.. 5.5 5.55 5.5 5.5 5.5 5.. 5.5 503502
5.55 5.5 5.5 5.55 5.55 5.55 5.55 5.55 5.55 5.55 5.5 5.55 5050550550:
5.55 5.55 5.5 5.55 5.55 5.55 5.55 5.55 5.55 5.55 5.55 5.55 55055
5. 5 a. 5. 5 5. 5.5 I. 5.5 5.5 I 5.5 0005055
5 5 5 5. 5. 5. 5. I 5. 5. I 5. 000055
5.55 5.55 5.55 5.555 5.555 5.55 5.555 5.555 5.55 5.555 5.55 ...55 5.5.5. 50055.5
5.55 5.55 5.55 5.55 a... 5.55 5.55 5.55 5.55 5.55 5.55 5.55 000055
5.55 5.5 5.5 5.55 5.5 5.5 5.55 5.55 5.5 5.55 5.5 5.. 0505555
5.5 5. 5. 5.5 5.5 5.5 5.55 5.5 5.55 5.55 5.5 5.55 5500505
5.55 5.55 5.5 5.55 5.55 5.5 5.5. 5.55 5.5 5.55 5..5 5.5 55050.5:5I505
5.55 5.5 5.5 5.55 5.55 5.5 5.55 5.55 5.5 5.55 5.55 5.5 0555050
ooxe HRH when.“ who?» H05ow w5oomh wmooxe Howe» whom W398 5.595% 5.5255
5555 5555 5555 5555 .05 55055..
- 53.55.5900

 

 

“woman

 

169

 

F000H

o
noun
mom“
son

a.
003
503
o

Hons
gown
20m

00nad

N.

«or:
«on»

.3
.0
C!

5... 0 0 00
Cflfil GDGDF' CN‘OI
run

IHP‘JWDIMD Iannewm

 

m.

«0oou

I00
0

.dd

0
50 In
N

00 00
CIUWH

dflfiflnflhfifiICVfiHNfl’if‘cwi
OI (”ONO

.60
0
mun

C3GN”“D°H4¢'°HDI‘C’.OHUL'

0 00 00 00 00 00

CDCD IDCNN ‘UI*F' 3’0HD
oflfifi' 04

wood”

oouu
honu

QWSFHD¢WN€D°W~UW3I‘D
0 0 0
that 1H

GI

rifi- CIFJD
PI

n.and
NO
303»

«Ind
non

Hoomm Hosmd

a.
:0”
00mm
20mm

”0
n0:
woos

0
In
G)

.0. 0
cube. «0
«nu r4

£f8WflUiOH4¢iOHtCDM’IFUM
Oi

FHHGDFWMF-

ccmod

com
don

   

c 0 051m

 

 

mmmn

omod

‘H-

500x. Hawow wwonmw wmoaxo Hdwow muonmu w50nxo «Baku «50935
.05 5500505

505555500

 

IGOR

50509
auwsuhom
05:0550maw

0x03.

0005505553m
500035

05055

503502
ovcdnaonuoz
55055

0:05.55
000059

5.5.55 5000500
oonuah
vanacum
3500509
«50060::5I50m
055505¢

 

 

 

50050550005 550555

170

 

 

 

  

 

o.m« u.nn n.«n «.o:n 0.0m a.uo «.muu o.nm m.uun n.ann o.mh oohm .oo
. I 0 095m «ouch
I I I o.um 9.9” c.u« o.ou o.o c.9u e.u« o.nn o.o _ .x.=
I I I u.nm c.9a moan n.an s.m« a.nn m.s« coca a.a vaunaonvwam
I I I a.» a.» v.3 h.» o’u h.o :.u a. o. covuam
- - - - - - - ' - - - - aflnam
. I. I a." a. u.« a.” a. a." o.m o.u a.» guano:
I I I n.an c. m.«u u.pa n. m.hd no: a 9.: nvnuauoguoz
u.h a.“ o.: a.» n.n h.n a.» a. a.» a.» o.» u.« I aaoun.
- - - - - - - - - - ' ' ”and 8H
o.« .. o.o o.u« n.au s.au “.mm a.. ¢.o: m.ma 9.5“ o.su ..m.». acmauou
I I. I m.c A.n :.m «.mu a.a n.5H h.o «.n m.m oocngu
o. h. a. m. a. «. m.n o. b. a.m mom a. caducwm
I I I a.« A. o.« 9.0 a. o.¢ u. a. o ghoecon
o.on o.o a. o..« :.s m.s o.s~ c.o :.ou m.m o. ».a uaaaaoxaaaaom
I I I m. a. A. o. m. a. n. n. o oaauua<
Hmwow wmoqaa wmoaxo Howmw muons“ wmoaxo Humww wmoaam whoaxu chow phoned waoaxo «scam unoaaw
. mama emu” swan «man. .0» «pagan.
Ila. nomhvcaoo

 

 

Avoscuvc00v ”moms”

171

 

«.an s.cn 0.. o.«» p..« «.o n.a. 3.5» «.a «.ma n.aa «.ua «menace ”upon
I I I 9.: .a.« «.u «.o c.p «.d o.oH a.» «.n vcuaoon .2
«.QA c.2a o.c u.o« o.nu a.» c.»» :.o~ o.o H.oa u.on o.o~ mmnwnwma<
«.mu m.» «.9 o.o« o.o« a.» >.mu a.a «.5 p.mm n.ae m.u IIIImmewMH.a

.m a .2 ”once
9.” a." o. a. a. a. a.» o.« s. a.« m.~ a. coaxoz
o." o.« o o.~ o.u o a.~ a.~ I 9.. m.. I anamuaa
H. a H. u. a. I a. I u. I I I ouoanoco>
m. o m. m. - m. o. a a. - - - scfiham
«. o u. u. o a. o. o. a. I I I onmnunowz
H. o n. a. o a. I I I .I I I uuanuua< .«o:
n. a a. I I I I I I I I I nooo>aom an
o a o o.» a.» a a. a. I a.«» u.«m I «ago
a o o I I I a. I a. a. I a. canaaaoo
o o a a.» m.p o a. I a. m. m. I ”wanna
o. a. a. a. u. I g. n. I :.u n.« o «cauaomn<
o.~ a.~ a.» p.ns o.a a.» 9.0 o.~ ~.m p.2H o.o a.» nuance
A. o a. u. I N. a. I n. u. I w. , - .m.=

 

Hmwow wmoaam whoaxo Huwbw wwoaau wmonxo Huwow muons“ wwomxu Humow phage“ wuonxo “noun whoaau

“no“ «mag mama coon .ou uuoaxo.
nownvcsoo

 

  

E2 55.80 u «Sag

ucwgo vumcafieoo no awake w0h0h

172

 

 

”.0 m.H o.» c.0H a.» a.» n.0H. H.3 No: NIHH H.o H.m Uwcuuoo HMHOB
o. o m. h. H. m. o. a o. I I I vcdHnON .2
9.. a.” «.m ».m 9.. ..: o.ou ~.m a.» «.HH a.. a.» munmmwma<
n.aa a. «.HH o.: o.« A.“ :.ou a.“ m.a o.nn 3.. 9.9 =..umuomk
.m a .z HUHOH
:. H. n. a. o a. N. m. a. o.» 3.N o. .00 x0:
I I I o o a o a o «. ~. 9 an: on:
I I I I I I I I I I I I uaoauoco>
N. o N. m. I n. m. .o m. m. o o. EdCHfiam
I I I I I .I I I I , :. N. N. oawunoowz
I I I I I I a. o u. a. o a. .o-«u:< .».2
I I I I I I H. o H. N. H. H. hovd>Hmm Hm
- ' - - - - - - - - - - ”go
I I I a. a a. I I I I I I .«nauaoo
I I I m.N a.N o 0.: m.: o H. H. o HHNflhm
H.H o H.H o o o No: O.H N.n N.o :.N o.» ”Guano
0.5 o m.a N. o N. N. o N. N. o N. .m.:

 

some“ hoax»_HMWNWImmmmmMIwmmmmw Hmwow muons“ wacaxu Hnwow muoaaa whonxo Aachm «poaaw
mama . an.” mm. mm.” .ou uuoaxo.
nowaucaoo

 

 

a@05¢«~¢00v
(H24uoo a <oumuz<

 

173

 

 

o
DID (O
8"

m. m.m .mcmmuo Human
I I unumoom .2
MMHouwmad
m m.m :.mm IIINmemeII

.m a .2 moves

. oowxoz
aoswoub
«Huanoco>
aucwham
uswaauumz
uoaawuc< .uoz
aovo>Hom .Hu
cane
unnazuoo
kumhm
ncwucumh<
avocuo

.m.=

Howow wuouam whoaxw Huwow whomfim wuoaxu Hmwow mucusa whoaxu Howow whomfim whonxu Hanan unoqaw

MN."
MO 0
05
O
8
o
H
IDFIF
.0
3‘0 (0
O
O
h
0
o
H
80.0
.0
IDID‘IIO

0.
OF 3‘
CO
C
O
0
ID

IOIII8

o
N N

.H

IBINIIIIOIOII
0
£0
,4
IIDIHIUIIOIIII
C
m
H
INIHIIIIII'II
O
M
IDOIIIOIIIIIIIla
o.
OOIOIIIIIIIUN
InGIOOIIIIIIIIN
o.
ORIIIIOIIIIIN
RQIIIIIIIIIIN
”IDIIIIOIIIIOM
ONIIIIIIIIOIO
Ofllillllllllm
00

O‘DN
.‘t
H
033
3
H
SNIIIII
00
{ON
3
0.
0H
3
.0
EN
N
FF.
N

 

 

mama mmmm Hmmm mmmm .ou uuomxuv
nouuucsou

nauvHHom .m.p coauwma ca~ Avuacwucoov

namgu ummcaasou no mucus a mayo» <z<uoo . <onmz<

17h

adco oouox :«hoz.

 

n.N:QHn.OHo

 

 

m.mmm «6.93.2.3 mémfi «.mmmmmémmm m5..." m.mmmmm.m..: m.m...: 83 ~38.

«Janis... ~62. 9.33.5. mamm m.mmomm.mmm «.33 132962 m.Sm inmhmB
”.mmm «.mmm m.:mm m.mmm m.moa m.mmm m.mmm m..mm m.m.m m.omm m.mmm m.mmm muuoa

‘Oomm - - - - - - - - - - - ”Udfipgou

HQH§§OU §Hu<

I I I m.ma m.mm m.mm ..mm m.mm m.m~ m.mm m.mm m.mm «menses
m.mm m... m.mm m.mom m.mm m.mm m.mm m.m. ”.mm m.mm m.mm :.m: ocumom_
m.mm m.mm ..mm :.mm m.mm m.mm m.mm m.mm m.m: m.mm m... m.mm mnomcam
3.:ma m.mom m.mm ”.mmm m.mmm m. mom m.mmm m.mmm m.mmm m.mmm ”.mm «.mmm 1.x.a. mauanow
«.mnm m.mm m... m.omm «.mmm e. um m.mmm “.mm m.mm m.mom :.mom :.mm .mxomomuosoouo
m.m 0.: m.: u.mm m.mm a. a m.ma m.m m.mm I I I .muummsm
m.m m. m.» m.m m. m.~ I I I I I I .mauam<
wao w mmoaaa whoaxo chow Who am“ wmoaxo Hawow who am“ wmoaxo chow who am“ whoaxo macaw «honed
mmmm .mmm mmmm ommm . .ou uuomxov
uuwhucaou

 

 

004m HmHZDzroo

17S

NHao aucvom> nuuoz c
nanomcoz and uoaox nuuoz «a

 

 

m.mmmm m.mmm m.mmm m.mmmm m.mmm m.mmm m.mmmm m.mmm m.mmm m.mmmm m.mmm m.mmm comm moaoa
m.mmmm m.mmm m.:s: m.mmmm m.mmm‘ m.m.m m.mmmm ..mmm m.m:m m.mm:H m.mmm m..mm .m.Mum.p
m.mmm m.mma m.mhm m.m". :.mmm m.mmm m.mma m.mmm :.mmm m.mmm m.m:m 3.3mm “Inca
co.N o.H o.H co.: m.H :.N o.mH I I .co.om I I uowhucaoo
unanaasoo cowm<
I I I I I I I I I I I I uwcuaom
m.mm m.mm m.mm m.m. ..mm m.mm H.om m.:m ..mm m.mm m.mm m.:m vacuum
m.mm m.mm m.mm m.mm «.mm m.mm m.mm m.mm m.mm m.mm m.mm m.mm maomnam
a.mmn ..m. m.mm m.mmm m..m a... m..mm :.mm m.mm m.mmm m..m :.mm m.m.m. mc.apom
:.mmm m.m. “.mm ..mmm 3.3m m.mm m.mmm m.mm 5.0m m.mmm m... :.mm .mxnmomaosoouu
m.m m.m m.: m.s m.: m.m m.m m.: m.: :.om m.m m.m omnummam
I I I I I I m.m m m.m m.: m. H.. nmcunm<

 

Homo» wmoamm wmonxo Hmwow .wnonmw wmoaxo Huwow mmoamm Hmonxo Huwow macaw“ wuoaxo
«man

smaH

mmOH

omaH

39C gone.“
.09 «honxvv
nouuvcsoo

 

 

H.0600v ooam hmuzbzxoo

176

 

H.mNOH :.aom «.mha OOHm HouOH
«Kmom 2.2.: m.Hmm mgmm «2.5m 53H: ..m.E
n.am N.N: m.N: N.NOH «.ma o.Nm Huuoa

mm m.m:a m.mma a.mmm m..mm
.m m.m:a m.mma m.mmm m.mmm
I. I m.m m.m

"HP.
0 o
N“

”“0

o o 0

NH”
HP.

In

0
I:
O
a.
‘0

o
m
N
I.”
OI

o
a
F
M

ovuuucaoo
vuwcaafioo cuwu<
macoaom
ocmnom
mammcsm
n.a.m. mamauou
uwxm>oauosoouu
caumwaam
nmauna<

0
Q
o 0
ma.
:3
M
0
IO
N
o 0
0"
3m
1‘
o
M
N

o o
(‘0)
NM

0
N
o
H

IIIIIOI
IIIIIII
IIIOIIO
IIIIIIDI
IIIII”.
IIIIIMI
IOOIC‘HI
lI-DIINIDO

O

O

O

N
.0000”.

m.

 

E E E EIILIII. o .395 898 39: toms
mama mmma amma mmma .ou «hoax.m
mowuucaoo

 

A.vcoov ooqm Banzaxzou

 

O

IAPPBNDIX B

_The Re ional Distribution of the Forei ' Trade
' ' ' f C ' Y CFIna -- Somme

ammunis
n m

on . . o firs

177

 

CEEEEFITF""‘
(exp. to,

1960

1959

1956

ing. from) Exporf”fmngEN'Tb{aI Exgéfif'ffigorf' ToEaI xgor mgor o a

 

 

2215.2
1510.6
700.6
1506.9
720.6
109.1
656.3
26.0
32.9
3762.1

 

 

Conn. B1cc.1106.9 1106.9 2293.7 1006.9 1276.2 2725.1 1171.5 1003.7
U.S.S.R. 907.3 616.3 1663.6 1099.2 953.6 2052.9 690.6 630.0
Reet Bloc 299.6 330.5 630.1 307.7 320.6 672.3 290.9 009.7
Reet world 767.2 701.5 1069.7 735.9 676.2 1012.1 776.9 769.0
Asia 001.5 150.9 592.0 030.7 160.7 595.0 516.1 200.5
IAfrica 03.2 90.9 120.1 55.0 69.0 113.0 59.1 50.0
Europe 260.0 376.0 600.0 229.7 011.7 601.0 166.0 067.9
America 6.9 09.9 55.7 7.3 6.0 15.7 7.1 20.9
Oceania 11.2 00.9 56.1 9.2 37.0 06.6 9.2 20.7
2225;! 1910.1 1606.3 3762.0 2162.6 1950.0 0137.2 1950.0 1611.7
Continued

un rIee
(exp. to, 1957 1956 1955

AI

ing. from) Exg'o"r"f'!m2"'or"¥-"To' Ea! Exgcrf-meg' o'r'T' To'fa! Expor? Tm'gofi't‘l'o'fai
990.6 1999.2 960.9 979.2 1959.1

733.3 1097.5 603.5 706.0 1391.9

Comm. Bloc
U.S.S.R.

Reet 61oc

Rest World 609.3
Aeia 036.6
.Africa 50.7
Europe 109.9
America 9.3
Oceania 0.9.
22321_ 1621.3

520.2 1166.5

212.3
52.0
235.3

5.3
-110“
niaao.§.

 

.suo.9
103.1
aau.2

13.1

. 19.2

*figurea do not add because

973.0 610.3 1602.3 966.6
736.1 500.1 1262.2 760.2
230.9. 266.2. 560.1* 220.09

606.0
033.9
33.6
166.0
7.6
5.1

207.0. 501.7.

027.0
192.0
29.0
190.1
5.0
6.1

1073.0
626.3
62.6
360.1
13.0
11.2

217.0. 230.6* 067.2‘

091.5
329.6
20.2
132.5
0.5
0.7

306.6
156.0
25.3
110.9
5.9
6.1

-1635.0~1007.613072.6.1352.0I1265.6

of having only total figures.

796.1
' 066.0
05.5
203.5
10.0
10.6
2657.2

_j

176

 

 

 

 

Continued

(2:3.r13: ' 1950 ' ' 1655 ‘ - 'iséz .

ing. from) WW gooa mm woe: WW goroa
Conn. Bloc. 763.9 995.7 1759.6 609.9 995.5 1535.3 .075.7 599.0 1075.1
U.S.S.R. [579.3 ‘759.3 1337.6 070.7 697.6 1172.3 013.7 550.2 967.9
Rest Bloc 195.6 236.0 022.0 175.1 167.6 363.0 62.0 05.2 107.2
Rest World 393.5 265.7 679.2 022.2 293.6 716.0 301.6 237.0 579.0
Asia 270.6 .177.2 051.9 269.6 191.1 050.7 202.1 150.9 393.0
Africa 12.0 11.6 23.6 7.9 10.0 19.3 6.2 9.9 15.1
EurOpe 100.6 69.0 169.6 129.7 100.7 230.0 57.0 76.5 132.6
Anerica 1.1 2.9 0.0 11.2 .1 11.3 29.0 1.2 30.6
Oceania 5.0 5.0 10.0 3.9 1.5 5.3 6.9 .6 7.5
223:1’ 1157.0 1261.0 2036.6 1072.0 1179.3 2251.3 917.3 636.6 1650.1
Continued

Countries

(exp. to, 1951 1950 1909

imp. from) ”W goroa Eli-WW Eoroa W20!!! gooa
Comm. Bloc. 376.9 525.6 900.5 193.6 390.5 566.1 196.9 103.2 302.1
U.S.S.R.. 331.3 076.0 909.7 191.3 366.2 579.5 196.9 103.2 302.1
Rest Bloc 07.6 07.2 90.9 2.3 6.3 9.6 - - -
Rest World 093.6 031.3 920.9 510.1 010.0 920.5 230.2 226.9 057.0
Asia 265.2 375.0 600.2 209.7 351.6 601.3 106.0 195.0 001.0
Africa 12.7 - 12.7 10.7 - 10.7 - - -
Europe 161.3 53.9 215.1 91.0 56.9 109.2 12.3 13.6 25.9
America 06.0 .6 09.0 150.6 0.6 159.0 3.3 13.6 16.9
Oceania 6.0 1.9 7.9 3.7 1.2 0.9 9.2 0.6 12.9
2232;_ 972.5 956.9 1929.0 703.7 909.9 1512.6 029.1 370.0 799.1

 

179

 

 

APPENDIX C

n m on . . o are
SITC Code Commodity Specification Import Export
001 livestock for food ‘ 29.3
011 meet fresh 0.1 20.0
012 meat dried . 2.3
013 meat canned 21.1
021 milk cream fresh
022 milk dried 0.1
023 butter
020 cheese and curd
025 eggs 30.2
026 natural honey 9.?
029 dairy products, n.a.s.** 9.0
031 fresh fish 15.5
032 fish preserved 0.1
001 wheat unmilled 1.0
002 rice 7.1 50.9
003 barley unmilled 0.3
000 maize unmilled 0.6
005 ocereals unmilled n.e.s.** 0.3
006 wheat flour, etc.
007 flour, etc., n.e.s.u 2.9
009 cereal preparations 6.1
051 " fruit nuts fresh 0.3 32.0

052 dricd fruit 0.0 7.0

190
APPENDIX C (continued)

 

053 fruit prep. 11.5
050 vegetable fresh dried 23.9
055 vegetable prep. 0.3 9.0
061 sugar 9.3 10.6
062 sugar prep. confectionery 0.9 0.1
071 coffee

072 cocoa

073 chocolate 6 pre.

070 tea 6 mate 21.9
075 spices 1.1 6.6
091 fodder n.a.s.u 1.5
091 margarine 0.2
099 food prep. n.e.s.u 0.1 1.9
111 beverages non-ale. . 9.0
112 beverages alc. 1.6
121 tobacco un.mfg. 03.9
122 tobacco mfg. 0.2
211 hide etc. crude 10.1
212 fur skin crude 0.5
221 oil seeds etc. 1.0 126.1
231 crude rubber 79.0 37.2
201 fuelwood charcoal _ 0.2 1.1
202 wood round etc. 0.2 2.2
203 wood shaped 1.0
200 cork raw waste 0.2

251 pulp waste paper 1.2

161
APPENDIX C (continued)

I

 

 

261 silk _ 30.1
262 wool 6 hair 36.9 51.0
263 cotton 51.2 3.0'
260 jute inc. waste 0.36 1.6
265 veg. fibres n.e.s.“ 0.7 6.0
266 synthetic fibres 0.2

267 textile waste

271 fertilizers crude

212 crude minerals n.O.B.“ 0.9 21.0
291 iron ore etc. 0.1
292 scrape iron steel

293 base metal ores n.a.s.** 0.2 90.0
290 scrape metal n.a.s.u

295 silver ore'

291 animal mattr. n.a.s.** 0.9 23.1
292 veg. mattr. n.a.s.u 1.9 19.2
311 coal coke etc. 12.1
312 petroleum crude 10.2

313 petroleum products 76.5

310 natural gas. mfg.

315 electric energy

011 animal oils fats 0.3

012 vegetable oils fats 1.7 05.2
013 oils fats n.a.s.** 1.1
511 inorganic chem. 7.9_ 10.9
512 organic chem. 9.7 2.5
521 tar or. coal chem. 0.1 0.1-

531
532
533
501
551
552
561
591
599

611
. 612
613
621
629
631
632
633
601
602
651
652
653
650
655
656
657
661

162

_ mm .C- 000.00».

 

coalter dyes etc.

dye tanning extr.

' paints etc.

drugs

essential oils

soap 6 cosmetics etc.
fertilisers mfg.
explosives

chem. mat. prod. n.a.s.‘*
leather

mfg. leather

furs dressed etc.
rubber semi-finished
rubber mfg. n.e.s.**
boards plywoods

wood mfg. n.e.s.u

cork mfg.

.paper paperboard

paper etc. mfg.
yarn thread
cotton fabrics
misc. fabrics
ribbon etc.
special fabrics
madeup textiles

rugs

.lime cement

7.5
0.5
1.1
13.3
0.0
0.2

0.5
11.3
0.1

0.1

1.0

0.1

3.6
10.6

.1.7.

0.7

V 1.0

0.0

0.3.
2.0
0.1
0.1
5.0
2.2

0.6
6.6
0.1

1.1

0.1
0.6
1.0.
0.2
5.0
5.5
6.2
36.3
92.1
5.6
20.0
02.2
7.3
16.0

103
I Appsustx c (continued).

 

662 bricks tiles etc. . 1.3
663 minerals mfg. n.e.s.u 0.6 3.7
660 glass 0.3 2.1
665 glass were 0.1 1.3
666 pottery ' 1.9
671 silver etc. metals 0.9 0.9
672 game, etc. . 0.2
673 worked gld. slv. gems . . 0.5
691 iron I steel 62.0 11.0
692 copper 3.1 ,

693 nickel 1.6

690 aluminum 1.9 0.2
685 lead 0.1 ' 0.2
696 zinc 0.0 A

697 tin 09.7
699 base metals n.a.s.** 5.6 7.9
691 ordnance ‘ 126.0.

699 metals mfg. n.a.s.u ‘ 7.6 2.0
711 power mach. n.e.s.** 5.6

712 ag. mach. 0.9

713 tractor non-steam 3.5

710 office mach. 0.2 0.0
715 metal-working mach. : i 7.0

716 mach. n.e.s.‘6 272.1 1.5
721 else. mach. n.e.s.u 10.5 0.5
731 railway vehicles 0.6

732 road motor vehicles 9.0

160
APPENDIX C_(conttnuedl

 

733
730
735
611
612
621
631
601
602
651
661
662
663
660
691
692

. 699

911
921
931

road vehicles n.a.s.**
aircraft

ships and boats
prefab. bldg. etc.
bldg. fixtures
furniture

handbags

clothes not fur

fur clothes n.a.s.u
footwear

instruments

photo goods

expd. movie films
watches clocks

music instruments etc.
printed matter

mfg. goods. n.a.s.**
postal pckgs n.a.s.**
live animals n.e.s.u

special shipments

2.6
0.1
1.6
0.1
0.2

0.1

16.0
2.0
1.2
2.0
0.1
3.0
0.6

0.1

2.6

6.0
0.0
0.1
1.7
1.2

19.6
7.6
0.1

0.0

.0.1
1.1
19.3
0.1
0.2
0.1

 

*6 not elsewhere specified.

Estimated; see explanation below.

165

The united Nations' Commodity Trade Statistics (1957)
' gives complete commodity trade statistics according to the
150-group Standard International Trade Classification for
the following countriesI.Austria, Belgium-Luxemburg, Den-
mark, Finland, France, Germany (P.R.), Greece, Ireland,
Italy, Netherlands, Norway, Portugal, Sweden, the United
Kingdom, Yugoslavia, Canada, El Salvador, Neth. Antilles,
New Zealand, Australia, Ghana, Trinidad and Tobago, Turkey,
Japan, Malaya and Singapore. Part of some countries' imp
portant commodity trade statistics are also given, such as
the exports of Indonesian rubber and Egyptian cotton. How-
ever, it is included here only those cases in which complete
statistics are available. Therefore, to complete the
statistics of those countries whose statistics are only
partly given, the P.A.O. Trade Yearbook for 1957 is also
referred to in a few cases. In other words, the statistics
used here represent quite a complete picture of the commod-
ity trade between Communist China and her trading partners
mentioned. ‘

Complete Sine-Soviet trade commodity stitistics in
1957 are given in the Russian book of trade statistics:
Vneschnzaza Toggovlza Soyosa SSR sa 1955-1959 Gods (Foreign
Trade of U.S.S.R. 1955-1959). These statistics are given
according to Russian trade codes. Since the Russian classi-
fication is more detailed than the SITC three-digit code,
the former can readily be converted into the latter. In

the Russian trade statistics values of detailed items do not

196

add to the given total. The difference between the given
and the aggregated total in Russian imports from Communist
China is less than 16 of the total. This can be considered
as statistical discrepancies. But in Russian exports to
Communist China, the given total exceeds the aggregated '
total by more than 209. (As a matter of fact, this phenome-
non is consistent throughout the years in which statistics
are given, not only in-l957.) This suggests that there
were some Russian exports to Communist China kept unreported .
in detail for one reason or another. A careful comparison
between the Russian and the United Nations' classifications
shows that the only item.missing in the Russian report is
Ordnance (SITC 691), and leads to the judgment that the un-
designated proportion of Russian exports were commodities of
this nature.

The commodity trade statistics between Communist
China and some of her important trading partners in Asia,
such as Hong Kong, Burma, Ceylon, Indonesia and Macau are
given in various issues of the Far Eastern Economic Review.
These reports give complete statistics, but commodities are
classified according to simpler codes. Hong Kong reports
her trade according to the Standard International Trade
Classification two-digit code (52 items). In integrating
these statistics into the more detailed three-digit code
classification, an average is ascribed to each of the sub-
items. The effects of such an arbitration are discussed in

Appendix 6 below. As for other countries, names of commodities

m
are used for the purpose of classification, such as rice,
crude rubber, cotton textiles etc., and make it easy to
integrate into the SITC three-digit code. As these coun-
tries are traders of high commodity concentration, the bias
would not be significant.

The coverage of commodity trade statistics in this
study is by no means complete. The most obvious absence of
statistics is those of the other Communist countries.
Judging from the trade agreements between Communist China.
and these countries, the pattern of commodity trade would
be very similar to that between Communist China and Russia,
especially when these countries are taken together. Even
with their absence, we have here still about 906 of both
Communist Chinese commodity exports and imports. Geo-
graphically, this study covers all important trading coun-
tries in non-Communist Europe except Switzerland; in Asia,
all important Communist Chinese trading partners are covered;
in the New Continent, we cover Canada, El Salvador, Neth.
Antilles; in Africa, we have Egypt, Uganda and Ghana; in
Oceania, both Australia and New Zealand; and for the Com-
munist bloc, Russia. Since this coverage is well repre-
sented by important trading partners of Communist China in
different continents, and of different types of economies,
we can confidently state that it is fairly representative
of the foreign trade of Communist China with respect to its

commodity structure.

166

 

 

 

 

APPENDIX D
The Commodity Structure 9 Origin of Imports ’
o ommunist 1na -
(In miIIion U.S. Hollarsi

Specification ‘1955 1956 1957 1956! 1959 1950
Foodstuffs 20.5 15.3 19.5 29.1 6.0 00.9
Neat 0.2 0.3 0.1 0.3 0.0 0.3
Russia 0 0.1 0 0 0 0
Dev. Countries Del 0 001 0.1 Gel 0
Underdev. countries 0.1 0.2 .0 0.2 0.3 0.3
Grains 19.9 10.2 7.1 6.9 0 0.9
Russia 0 0 0 0 0 0
Dev. countries 0 0 0 7.9 0 0
UDGCPdCVe countries 16.6 10e2 7e1 1.0 0 0.9
0th.”. 1.5 “.8 12e3 lass 5.6 39s,
Russia 1.0 0.6 1.0 1.1 0.5 0
DeVs countriea 0e2 2e6 3.9 2.2 0.5 201
Underdev. countries 0.3 1.6 7.0 16.6 0.6 37.6

Animal 6 ve etable
raw maferiafis 90.5 107.7 175.9 192.5 190.9 235.2
Crude rubber 20.7 09.6 79.0 91.5 109.1 121.0
Russia 0.1 0.2 0.1 0.0 0.2 1.1
DCVe countrias 0 0 0.3 103 3.0 1602
Undorch. countriCQ 20.6 “9e‘ 18. 69.6 105s 103s?
Oil seeds 6 fats 0.0 0.2 3.1 2.1 1.9 3.9
DCVs COUDtriea .0 0 Del 001 . 0e, 2e5
Underdev. countries 0.0 0.2 3.0 2.0 1.1 1.3
Fibres 50.3 52.0 99.3 . 91.3 76.9 100.9
DQVe countries 21e3 31.2 36e8 ~6e2 “2.0 00.9
Underdev. countries 29.0 21.2 52.5 05.1 30.9 55.9
Others 5.1 5.5 0.0 7.6 7.0 9.6
Russia 0.5 0.0 0.3 1.2 2.1 0.9
Dev. countries 0.6 1.6 1.5 3.3 1.9 6.1
Underdev. countries 0.0 3.5 2.6 3.1 3.1 2.6

169

APPENDIX D (continued)

 

 

Specification. 1955 1956 1957 ' 1956 1959' I960
Crude minerals 16.0 17.6 15.3 17.0 15.9 10.1
metal ores 0.2 0.2 0.2 1.6 1.9 1.0
Ru.318 0e2 0.2 0e2 1.2 1.3 la:
DCVe countries 0 0 0 0.3 0.3 0
Underdev. countries 0 0 0 0.1 0.2 0.2
{UCII Incl 10.6 10.2 15.0 13s? 12.1
Russia 10.1 10.9 10.2 15.0 13.7 12.1
OthCrB 1e? 2.6 as, a.“ 003 0.6
Ruaaia 1e? 2e? 0.8 0.3 0.3 0.5
Dev. countries 0 0.1 0 0 0 0.1
Underdev. countries 0 0 0.1 0.1 0 0
Chemicals 95.7 97.6 106.0 129.7 110.1 90.1
arse ‘ inorganic 22e2 10.6 17.5 29.6 sec. 21a6
Russia 1.7 3.0 1.6 5.7 6.1 7.3
DCVe countries 12.2 10.3 11s 22.0 32e1 2001
Underdev. countries 9.3 1.5 0.0 1.9 0.6 0.2
fertilisers mfg. 39.5 56.1 53.6 65.6 00.3 29.9
Russia 0.6 0.1 0.5 '1.2 0.9 0.9
Dev. countries 21.2 35.6 37.9 02.5 39.5 27.5
Underdev. countries 17.7 20.0 15.3 21.9 1.0 0.5
others 30.0 26.7 30.9 30.5 35.0 23.6
Rua.ia 3.3 1.6 2.2 2.0 1a? 1.5,
Dev. countries 16.1 17.3 22.9 26.3 31.0 19.1
Underdev. countries 10.6 7.9 9.9 6.2 2.3 3.0
Ninerals mfg. 157.1 173.5 159.9 010.5 306.7 379.6
iron 6 steel 77.2 70.9 62.0 255.9 150.7 191.0
Russia 75.5 60.3 32.0 60.7 37.7 57.1
Dev. countries 1.3 11.3 17.5 176.9 102.9 120.3
Underdev. countries 0.0 3.2 12. 19.0 10.1 - 0
petroleum products 65.0 71.3 76.5 77.7 100.6 103.2
,Russia 60.9 71.1 76.2 77.0 100.0 101.0

190

APPENDIX D (continued)

 

SLOCI! 166‘ 1011

Minerals mfg. (continued)

other base metals

Russia
Dev. countries
Underdev. countries

Other metals

Russia
Dev. countries
Underdev. countries

Other mfg. goods.

textiles

Russia

Dev. countries

Underdev. countries
instruments

Russia

Dev. countries

Underdev. countries
others

Russia
Dev. countries
Underdev. countries

Machinery 9 Eguipment

complete industrial
undertakings (Russia)

transportation equip.

Russia
Dev. countries
Underdev. countries

Power, elect. 5 metal—
working mach.

Russia
Dev. countries
Underdev. countries

23.6

21.1
1.6
0.7

216.9

30.7
20.7
6.1
3.9
25.0
16.6

2.2

H
N
0

“N” :9 «3890
O (I) (”60° 8 ‘09” (D

(a)
07

61.0
10.3
00.5

2.6

15.5

N

F‘ In
‘1 PM"! N ”0'8 '0
0.. O 0..

n Q0“ 0 :cm s

166.2

71.6

59.7
5.1
6.6

00.2
23.6

10.0
2.2

60.7
5.2
70.7
0.6
10.7
1.3
9.2
0.2
06.7
19.9
15.0
0.9
16.7
12.6
3.6
0.5
10.1
0.5

0.2
1.0

636.2

399.6
117.7
110.0

3.0
0.3

51.6
35.6

10.3
1.7

53.5

29.7
20.0
0.0

191

APPENDIX D (continued)

 

§pecIfication

1955

 

Machinery 6 Eguipment (continued)

as. mach. 6 tractors

Russia
Dev. countries
Underdev. countries

others
Russia

Dev. countries
Underdev. countries

10.0

10.3
0
0.1

30.6
25.7

3.6
1.3

1955 195’ 195! I!!! 195“
10.0 0.3 20.0 9.9 9.6
6.9 1.9 19.6 6.0 6.7
0.6 1.6 3.0 1.1 0.6
0.7 0.6 1.0 0.0 0.1
39.7 63.3 60.6 57.2 37.1
30.5 25.6 20.0 26.3 26.6
0.9 32.5 31.0 30.0 6.3
0.3 5.2 9.0 0.5 2.2

 

For sources and explanations, see Appendix E below.

192

 

 

 

 

 

 

APPENDIX E
The Commodi Structure 6 Destination of E orts
o ommunist CEina l955-l960
(in million 0.3. aollars)

Specllication 1955 l955 l957 1956 l959 1960
Foodstuffs 355.6 010.7 371.7 537.0 070.7 370.3
Meat 119.5 115.5 91.7 150.0 100.7 79.3
Russia 70.7 65.5 3766 75e5 “Se, 23.1
Dev. countries 0.0 7.1 6.9 11.0 9.9 2.9
Underdev. countries 00.0 01.9, 07.2 67.9 09.1 53.3
grains 92.6 132.5 66.1 135.0 173.0' 130.5
Russia 07.7 72.0 27.2 61.1 96.3 59.9
Dev. countries 1.2 0.9 0.2 3.3 12.0 10.0
Underdev. countries 03.7 59.7 38.7 70.6 70.7 57.6
others 103.5 166.7 213.9 207.6 193.0 160.5
Russia 57.0 75.2 99.0 107.9 93.9 06.7
Dev. countries 23.9 29.5 30.3 00.0 29.2 20.2
Underdev. countries 62.3 62.0 90.6 99.3 70.9 97.6

Animal S-ve etable
raw maferials 373.3 390.0 366.9 320.6 339.6 335.0
Crude rubber 0.7 12.9 37.2 22.0 16.0 7.1
RUQSia as, 12.9 37.2 22.0 16.0 7e1
oil fats 50.9 59.3 06.3 52.0 00.1 30.9
RUBBiB 35.3 30.2 22.0 29s? 30.0 13.9
Dev. countries 7.5 13.6 9.0 11.7 9.0 15.7
Underdev. countries 9.0 11.5 10.9 '11.0 5. 5.3
fibres 100.3 101.0 92.1 72.9 139.7 107.3
Russia 70.0 61s? 56.1 06.7 1°5e6 7°03
Dev. countries 16.7 27.0 25.5 16.6 27.6 26.2
Underdev. countries 9.2 12.3 6.5 5.6 6.3 0.8
oil seeds * 160.5 153.2 126.1 110.2 136.7 113.1
Russia 98.5 99.7 79.6 61.9 79.0 03.1
Dev. countries 23.9 29.5 16.3 29.2 52.6 60.9
Underdev. countries 39.2 29.0 30.0 19.1 5.1 5.7

193
APPENDIX E (continued)

 

 

 

pec {cation I955 1955 1957 1956 l959 1960
Animal 6 Ve etable
raw malerials (continued)
others _ 61.0 63.0 65.2 63.1 61.1 12.0
Ruggia 13e1 10.0 12e3 10.9 11s: 5.6
Dev. countries 22.0 19.0 20.0 29.9 31.9 02.9
Underdev. countries 35.9 30.6 32.9 23.3 19.0 23.7
Crude Minerals 95.9 111.9 129.6 103.1 99.1 97.6
metal o... A ‘ 63.2 75.3 30.1 15.0, 90.6 63.9
Russia 62.2 75.5 99.9 70.0 73.3 61.2
Dev. countries 0.1 0.1 0 0.6 2.0 2.6
Underdev. countries 0.9 0.2 0.2 0.0 5.3 0.1
fuels as? 10.5 12e1 A as“ 5.0 1”e1
Russia 5.0 2.1 1.9 2.9 2.6 2.6
Dev. countries 0 0 0 0 0.1 0.2
Underdev. countries 1.7 9.0 10.2 5.6 2.3 11.3
Othera 15e9 25.5 27e‘ 19a? 12.5 9.6
Russia . 5.9 10.2 11.1 11.9 10.1 5.3
Dev. countries 0.2 0.3 0.3 0.9 0.9 0.9
Underdev. countries 9.8 15.0 16.0 7.0 1.6 3.0
Chemicals 20.7 02.7 37.0 09.7 29.6 28.3
org. 6 inorganic 9.9 19.2 13.0 20.2 12.9 10.9
. Russia 6.5 16.6 9.6 12.2 7a“ 10.0
Dev. countries. 1.9 1.5 1.9 3.7 3.2 1.1
Underdev. countries 0.0 1.1 2.0 0.3 2.3 3.0
others 15.9 23.5 20.0 29.5 16.7 13.0
363.1. 3.0 6.0 7.6 10.1 6.0' 5.3
Dev. countries 7.6 9.9 9.0 9.9 5.7 0.6
Underdev. countries 0.9 7.2 7.0 9.5 0.6 2.9
Manufactured minerals 66.6 95.5 72.6 93.7 96.2 96.6
iron 6 steel 27.3 29.2 11.0 23.7 11.0 16.0
Rusaia 26.8 27.6 7e? 22e3 10e3 1309
Dev. countries 0 0 0.6 0 0 0.3
Underdev. countries 0.5 1.0 3.1 1.0 1.1 2.2

190
APPENDIX E (continued)

 

 

Spgclllcafion “55"" 1956 ' 1957 "l!!!“ l9~59"""'l'96'09
Manufactured minerals (cont.)
petroleum products I 0 0 0.7 0.0 0.5 0.1
,Russia 0 0 0 0.2 Del 0
Dev. countries 0 0 0 0 0.0 0.1
Underdev. countries 0 0 0.7 0.2 0 0
other base metals 58.7 53.2 56.6 62.1 60.5 62.7
RU'sia $6e2 50.0 51.6 “Beg 50.9 06.9
Dev. countries 0.9 1.1 3.3 5.0 7.6 11.1
Underdev. countries 1.6 1.7 1.5. 9.2 2.0 2.7
other metals 2.9 3.1 3.9 7.5 9.6 19.6
RUSSia 0.1 0.6 2.0 3e2 5e“ 1.6
Dev. countries 0 0 0.2 0.1 0.3 10.0
undCrdCVe ccuntrie. 2a? 2.5 Is? 0.2 “cl 3.0
Other "fge gOOdS 126s? 203e2 307e8 007.6 576.6 596.1
textiles 91.0 139.0 215.9 230.2 351.0 369.3
Russia 60.0 92.0 139.7 ”157.1 269.2 203.6
Dev. countries 0.7 7.5 10.3 19.9 22.0 23.7
Underdev. countries 26.3 39. 61.9 53.2 61.2 101.0
instruments 0.1 0.2 0.2 0.5 0.5 0.2
Underdev. countries 0.1 0.2 0.2 0.5 0.5 0.2
others 35.1 60.0 91.7 176.9 226.9 229.6
RUSBiC 11.6 27e3 00.5 12202 159a3 156.9
Dev. countries 1.6 3.3 0.0 , 6.1 9.0 9.6
Underdev. countries 21.7 33. 02.7 09. 59.6 63.1
Machines: 6 Eguipment 11.5 10.9 9.9 10.0 19.2 5.0
transportation equip. 10.0 9.0 6.5 0.9 12.9 0.7
Russia 10.3 9.2 6.0 0.3 12.1 0
Underdev. countries 0.1 0.2 0.1 0.6 0.9 0.7
power, electrical 6 ~
metal working mach. 0.1 0.0 0.5 2.9 2.6 0.7.
Russia 0 0 0 1.6 2.0 0
underdCVe Countries 0.1 0e“ 0.5 1.3 0.5 0.7

135
APPENDIX E (continued)

 

 

Epcolflcaflon I955 l956 'l957 l956 l959 1960
Machine 6 E ui ment
(contlfiueal
0th.”. 1.0 1e1 leg 2.6 2a? 0.0
338'13 0 0 0.5 1e“ 1e? 2e.
Underdev. countries 1.0 1.1 1.0 1.2 1.0 1.6

 

 

 

_The geographic coverage of statistics here is the
same as Appendix C. Sources of statistics are also the same,
except other issues of the cited Yearbooks are also used. The
.trading partners of Communist China are divided into three
groups: Russia representing the Communist bloc; all non-Com-
munist European countries, Canada, Australia and New Zealand
'as the developed countries; and all the others as the-underde-
veloped countries. Commodities are regrouped into twenty-six
broader groups, the composition of which are shown below.
(SITC 691 and 911-931 are excluded.)

ommo s c ca on cm as on n ree- co es
Meat 001-013, 031-032.

Grains . 001-009.

Other foodstuffs - 021-029, 051-122.

Crude rubber 231.

Oil fats 011-013.

Fibres _ 261-267.

Oil seeds 221.

Other an. 6 veg. raw
materials 211-212, 201-251, 291-292.

196

APPENDIX E (continued)

omm s ec ca on
Metal ores

Fuels (crude minerals)
°Other crude minerals

Organic 6 inorganic
chemicals

Fertilisers mfg.
Other chemicals
Iron 6 steel
Petroleum products

Other (non-ferrous) base
metals

Other metals

Textiles

Instruments

Other "other mfg. goods“

Complete industrial under-
takings

Transportation equipment

Power, electric 6 metal-
working mach.

Agricultural mach. 6
tractors

Other machinery 6
equipment

cm 031 on n ree- c es
291-295.
311-312.
271-272.

511-512.

561.

521-552, 591-599.
691.

313.

662-669.

671-673, 699.

651-657.

961-962, 960-991.

611-602, 661-666, 911-951, 963, 332, 393.
no equivalent, but evidently no such
trade was transacted by those countries
which reported in SITC codes.

731-735.
111, 116, 721.
712-113.

71“ ’ 716 0

 

197
APPENDIX F

THE INPORT 0? COHPLETE INDUSTRIAL UNDERTAKINGS
OP COMMUNIST CHINA

The content of this Appendix is compiled from
scattered information in the following references:

I Yin-tang, 'Chung-shu mac-i ti fa-chan,” (The Development
of Sine-Soviet Trade), JMJP, April 27, 1957.

Kuo Chun-wen, "Liang-tiao-tui chou-lu, kao-shu-tu chien-she
chin-kung-yeh " (Walking on Two Legs, Developing
Light Industr as at High Speed), CKCKY, No. 18, 1959.

Li Che-ion, ”Shu-luan ho ko jen-min-min-tsu kuo-chia ti
yuan-tso shi shi-hsien wu-nien-chi-hua ti jou-li
tiao-chien," (The Assistance of the Soviet Union
and the People's Democratic Countries Is An Ad-
vantageous Condition for Realizing the Five-Year
Plan)’ HHYP’ NO. 9‘ 1955’ p0 1310

Li Fu-chun, ”Kuan-yfi 1959 nien kuo-chia ching-chi chi-hue
tsao-an ti pao-kao,” (Report on the 1959 Draft
National Economic Plan), MNPYX, No. 9, 1959, pp.

5-20.

Li Hsien-nien, "Kuan-yfi 1955 nien kuo-chia chueh-shuan ho
1956 nien kuo-chia yU-shuan ti pao-kao,“ (Report on
the 1955 National Final Accounts and the 1956 Na-
tional Budget), anyx, No. 10, 1956, pp. 1-9.

Liu Chi-hang, "Chi-pen chien-she shih-hsien-la keng-hao ti
chuan-mien ti ta-jao-chin,” (Basic Construction Nae
Realized A Better and All-around Great Leap Forward),
cuyrc, No. 1, 1960, p. 29.

Lu Shih-kuang and Huang Juen-ting, "No-kuo chin-kou mac-i
tsai ti-i-ko wu-nien-chi-hua chi-chien ti tso-yung,“
(The Function of Our Import Trade During the First
Five-Year Plan Period), TEE, Dec. 15, 1957.

Po I-po, 'Kuan-yfi 1959 nien kuo-min ching-chi chi-hue tsao-
an ti pao-kao ” (Report on the 1959 Draft National
Economic 91.65, MNPYX, No. 5, 1953, pp. 12-23.

Yeh Chi-chuang, ”Wei-ta ti ho-tso, wu-shi ti yuan-tee,"
(Great Cooperation, Selfless Assistance), JMJP,.
November 3, 1957. ’

' 196
APPENDIX F (continued)

'Wo-kuo tui-wai mac-i tsai ti-i-ko wu-nien-chi-
hua chi-chien ti fa-chan," (The Development of Our
Foreign Trade During the First Five-Year Plan
Period), 22, No. 23, 1957.

Xuo-chia tung-chi-chfi, (State Statistical Bureau)
"Kuan-yfi 1952 nien kuo-min ching-chi ho wen-hue
tsiao-yfi hui-fu yfi fa-chan ching-kuang ti kung-pao,‘
(Communique on the Restoration and DeveIOpment of
the National Economy, Culture and Education in 1952),
HHYP, No. 10, 1950, pp. 229-230.

"Kuan-yfi 1953 nien-tu kuo-min ching-chi fa-chan ho
kuo-chia chi-hue chi-hsing chieh-kuo ti kung-pao,' .
(Communique on the Development of the National Econ-
omy and the Results of the Execution of the National
Plan in 1953), HHYP, No. 10, 1950, pp. 231-232.

"Xuan-yfi 1950 nien-tu kuo-min ching-chi fa-chan ho

kuo-chia chi-hue chi-hsing chieh-kuo ti kung-pao,”
(Communique on the Development of the National

Economy and the Results of the Execution of the

National Plan in 1950), HHYP, No. 10, 1955, pp.
66-167. ""'

”Kuan-yu 1955 nien-tu kuo-min ching-chi chi-hue chi-
hsing chieh-kuo ti kung-pao,” (Communique on the
Results of the Execution of the 1955 National
Economic Plan), HHPYK, No. 13, 1956, pp. 39-02.

”Kuan-yfi 1956 nien-tu kuo-min ching-chi chi-hue
chi-hsing chieh-kuo ti kung-pao." (Communique on
the Results of the Execution of the 1956 National
Economic Plan), NHPYK, No. 17,1957, pp. 201-205.

”Kuan-yfi fa-chan kuo-min ching-chi ti ti-i-ko wu-
nien-chi-hua (1953-1957) chi-hsing chieh-kuo ti
kung-pao." (Communique on the Results of the Execu-
tion of the First Five-Year Plan 1953-1957 for the
Development of the National Economy), HNPYK, No. 9,
1959, pp. 09-51.

'Kuan-yfi 1959 nien kuo-min ching-chi fa-chan ching-
kuang ti pao-kao,” (Communique on the Development

of the National Economy in 1959), HHPYK, No. 9, 1959,
pp, 51-5“.

199
From year to year Communist China announced the
completion or partial completion of her above-norm projects
that were put into production. In the following list, group
A are those explicitly announced as Russian projects, and
group B are those just mentioned as ”above-norm“ projects.

1952: 3 projects

A -- Fuh-sin Power Station: Harbin Flax Mill.

 

B -- Northwestern Cotton Mill No. 1.

1953: 9 proiggtg

A -- Fuh-sin Mai-chow Open-cut Coal Mine: Fang-man Power
Station; Si-an Power Station No. 2; An-shan Steel Roll-
ing Mill: An-shan Seamless Steel-tube Plant: An-shan
Blast Furnaces No. 7 and No. 9.

B -- Fu-shun Power Station; Wu-lu-mu-chi Power Station.

1950: 6 projects

A -- Harbin Measuring and Cutting Instruments Plant: Shang-
yang Pneumatic Tools Plant: Chang-chow Power Station:
An-shan Steel Sheets Plant; An-shan Blast Furnace No.
6; Chung-King Power Station.

1955: 9 projects

A -- Sheng-yang Machine Tools Plant No. 1: Liao-yuan Chung-

 

yang Vertical Shaft Coal Mine: Bo-kang Tung-shan
Vertical Shaft Coal Mine.

B -- Dairen Power Station: Nu-la-po Power Station: Peking
State Cotton Mill No. 2; Shih—chia-chuang State Cotton
Mill No. 2: Chang-chow State Cotton Mill No. 3: wu-lu-
mu-chi July First Cotton Mill.

200

1956: 15 projects

A--

Chang-chun Motor Vehicles Plant; Harbin Electrical
Instruments And ApparItus Plant; Ho-kang Hsing—an-tai
Vertical Shaft Coal Mine; Fu-shun Aluminum Plant;
Harbin Aluminum Alloys Plant; Peking Electronic Tubes
Plant; An-shan Steel Rolling Mill No. 2.

Huai-nan Shieh-chia-shih Vertical Shaft Coal Mines

No. 2 and No. 3; Shih-chia-chuang Power Station; Xuang-
ting Power Station; Sheng-yang Electrical Cable Plant;
Northwestern State Cotton Mill No. 0; Shih-ning and

Pang-foh Food Processing Plants.

1957: 7projects
A -- Pen-ki Steel Plant; Hei-lung-kiang Steel Plant; Kirin

Fertilizer Plant; Kirin Carbide Plant; Harbin Boilers
Plant; Si-an Electrical Capacitors Plant; Tai-yuan

Power Plant No. 2.

1956: 22 projects

A -- Chia-mu-sze Paper Mill; Shih-chia-chuang Starch Plant;

Shih-chia-chuang Glass Plant; Wu-han Blast Furnace

No. 1; An-shan Open-hearth Furnaces No. 0 and No. 5;
Nu-han Heavy Machine Tools Plant; Lo-yang Mining Equip-
ment plant; Harbin Steam Turbine Plant; Shuang-ya-shan
Coal Nashery; Huai-nin Shieh-chia-shih Coal Washery;
Fuh-sin Hsin-chiu Vertical Shaft Coal Mine; Lo-yang
Power Station; Pen-ki Power Station; Len-chow Si-koo
Power Station; Lon-chow Petroleum Refinery; Hua-chiao

Sugar Refinery; Kuei-ping Sugar Refinery; Nan-ping

201

Paper Mill; Han-tan'Cotton Mills No. 2 and No. 0;
Cheng-chow State Cotton Mill No. 6.

1959: 7 projggtg

A -- Pao-tao Blast Furnace; Nu-han Open-hearth Furnace;
Lo-yang Tractors Plant.

9 -- Ping-ting-shan Vertical Shaft Coal Mine; Ma-tou and
Tai-yuan Coal Washeries; Peking Power Station.

The total list here consists of 79 projects. This
is far from complete, because by the end of 1959 it was
claimed that 113 Russian projects were completed.

It was announced that by 1950 a total of 19, by
1955 a total of 29, and by 1955 a total of 03 Russian pro-
jects were completed. If we take both the A and B projects
together, they come very close to the alleged numbers of
those completed projects. This suggests that all projects
under group B are also Russian projects.

The Eastern EurOpean Communist countries also agreed
to supply Communist China with 69 projects. Little has been
known about these projects, except by 1957 the supply of 33
projects was completed. A few of these can be identified.

From Poland -- Chiang-men Sugar Cane Chemical Plant;
Friendship Sugar Refinery; New China Sugar Refinery.

From East Germany -- Paootou Sugar Refinery; Peking
Glass Plant; Northern China Tole-communication Apparatus
Plant.

From Czechoslovakia - Pao-tou Leather Plant.

202
APPENDIX 6
CONCENTRATION INDICES OF FOREIGN TRADE

The index of geographic concentration of exports of
country j is defined as:
ij s 1096<§£l)
s X.j

where ij is the export of country j to country s, and X.j
is her total exports. And, the index of geographic concen-

tration of imports of country j is defined as:

Gjm =1oyg<§211

where Msj is the import of country j from country s, and M.j
is her total imports.

The upper limit of these indices is 100, which will
be the case if country j exports to, or imports from only
one country. The lower limit is also definite, as there is
a definite number of countries in the world.

The index of commodity concentration of exports of

country j is defined as:

ij = 100’2IXi52
1 X.j

where Xij is country j's exports of commodity i, and X .j is
her total exports. The index of commodity concentration of

imports of country j is defined as:

ij . 1oo/1IM‘32
1 9.5

203
where Mij is country j's imports of commodity i, and M.j
is her total imports.

The upper limit of these indices is also 100, which
will be the case when country j experts or imports only one
defined commodity. But the lower limit is 9891851.: 901,904-
ing on the number of commodities defined. Here a broader or
a more detailed classification of commodities will affect
this lower limit. For instance, under the 150-group classi-
fication the lower limit is 9.2, which will be the case when
country j experts (or imports) an equal amount of all 150
commodities. However, the lower limits will only be 13.9
and 37.7, if commodities are classified into 52 or 7 groups
respectively. In other words, the more detailed the classi-
fication, the wider will be the range of the commodity
concentration indices, with the common maximum of 100.

Then without mathematical proof, it can be visualized
that when the same commodity trade statistics are used, the
concentration index will always be higher when broader
classification is used. And such an index will set an upper
limit to that which is based on more detailed classification.
This limit will only be approached when both indices approach
100.

As mentioned in Appendix C, Hong Kong reported her
trade according to the 52-group Standard International Trade
Classification. In integrating these trade figures into the
more detailed lSO-group classification, arbitrary estimates

are made by attributing an average value to each of the

200
appropriate sub-groups. Needless to say indices based on
this arbitration will be different from that which are cal-
culated had the exact values been known. Its effect on the
commodity concentration index of imports can only be slight,
because only 1.50 of Communist Chinese imports was from
Hong Kong in 1957. 'However, it could cause a substantial
error in her commodity concentration index of experts, as
Hong Kong absorbed 12% of her exports in that year.

It is pointed out by Hirschman (22, 213.. pp. 160-
162) that based on the assumption of equal distribution
within the frequency classes, the index will naturally al-
ways be lower than it would have been had the exact values
of the single items been known. In other words, the index
based on that assumption sets a lower limit for the real in-
dex. Therefore, the commodity concentration index of ex-
ports of Communist China (which is 19.9) should be more
appropriately considered as a minimum.

The maximum value can also be arrested. It is
indicated earlier in this Appendix, that the concentration
index based on broader classification will set an upper
limit to that which is based on more detailed classifica-
tion. Another experiment is made by calculating for Com-
munist China the commodity concentration index of experts
based on the 52-group classification. The result is 25.0,
which is the upper limit.

Here finally we know that the commodity concentration

index of exports of Communist China falls within the range

p 205
from 18.8 to 25.” for the year 1957. This range is by no
means narrow. But, when compared to those indices calcu-
lated by Michaely, we know one fact for sure--Communist

China was among the most diversified countries in exports.