UP AND OUT OF POVERTY is a compilation of Xi Jinping's major works from 1988 to 1990 when he was Secretary of the CPC Ningde Prefectural Committee, Fujian Province.The book on poverty relief comprises 29 speeches and articles. The following is an excerpt from UP AND OUT OF POVERTY, published by FOREIGN LANGUAGES PRESS in 2016.
February 1989
Many factors have contributed to poverty in Ningde Prefecture, and it is our main duty to bring the region out of poverty toward prosperity. The coastal geographic environment, easing of cross-Strait relations, and adopting of the opening-up policy have brought new challenges to Ningde in implementing a coastal development strategy. The dual task of poverty alleviation and coastal development strategy has made the work in Ningde more significant and more difficult.
Since the Third Plenary Session of the 11th CPC Central Committee, there have been huge changes in Ningde's economy. Such changes are not dazzling short-term changes, but rather changes that have taken place gradually and accumulatively thanks to the determined efforts of all the people in the region. Such changes are a transition from quantity to quality and have the effect of water droplets drilling through rock. Future development in Ningde not only requires the spirit of arduous struggle, but also requires finding the path of economic development that most suits Ningde. I call the guiding thoughts behind this "methods that suit the location, categorized guidance, acting within our means, sparing no effort, and focusing on the benefits." To follow these guidelines we must properly manage six relationships in the economic development of Ningde.
1. The relationship between long-term objectives and short-term planning
Economic development requires a combination of long-term objectives and short-term planning. But while managing this relationship, it is tempting to seek quick results in economically under-developed regions. If we only pay our attention to projects whose conditions for accomplishment are not available in the short term and overlook the importance of timing and proper steps, then we will lose all short-, medium-, and long-term objectives. When I started working in Ningde last year, I frequently heard three topics of discussion: develop Sandu'ao, construct the Fuzhou-Wenzhou railway, and build a central city. The fact that people all over this region were discussing these topics shows, in my opinion, their strong desire for change and increased ability to recognize the issues. I have tried to lower people's expectations toward these three things because I want to emphasize the relationship between long-term objectives and short-term planning entailed in them. In the "Preface to A Contribution to the Critique of Political Economy," Karl Marx said, "Mankind thus inevitably sets itself only such tasks as it is able to solve, since closer examination will always show that the problem itself arises only when the material conditions for its solution are already present or at least in the course of formation."[1 Source of English translation: Karl Marx, "A Contribution to the Critique of Political Economy, Part One," in Karl Marx, Fredrick Engels: Collected Works, vol. 29 (New York: International Publishers, 1987), 263.- Tr.]Major development projects such as port and railway construction that can easily involve hundreds of millions of yuan in investments rely on macro policies at the national level. The formation of central cities is the result of long-term economic development. Ningde runs a large deficit, which makes it difficult for us to undertake such projects that require enormous investment on our own. This year and next, the country will be focusing on rectification, which means credit and money will be fight, and large-scale investment in Ningde will be impossible. Therefore, the fight attitude should be to recognize the three main objectives and actively publicize and make preparations for them. We must study future development strategies, but they should be based on a profound understanding of the situation at the prefectural, provincial, and national levels, and we should use this understanding to formulate an "ambitious overall strategy." We should only look to carry out work that is feasible, and our long-term objectives must be gradually realized in concrete steps. We must both avoid pushing for unrealistic early achievement of long-term objectives and prevent oversimplification of short-term planning.
2. The relationship between the rate of economic development and economic benefits
Speed and benefits are opposing goals that are difficult to reconcile, and it is hard to find the right midpoint between the two. I believe that we should try to coordinate speed of development and economic benefit in order to gain greater benefits. "Try to hurry, and you accomplish nothing.” (2 Source of English translation: Confucius, "Book Thirteen," in The Analects of Confucius, trans. Burton Watson (New York: Columbia University Press, 2007), 91. -Tr. ) We should see that pursuit of high speed often excessively squeezes resources, giving the overall economy no room to breathe, and excessive speed has a destructive effect on the development of the productive forces. We stress putting economic benefits first for two reasons: to check inappropriate speed of economic development, and to take into consideration the realities of Ningde. This region has weak foundations and cannot take excessive strain, and we must make sure projects of hundreds of thousands of yuan and above will be successful. Ningde has limited investment channels, so we must pay attention to steering investment toward projects that deliver benefits. Ningde has low levels of management skills, and its product profit margin and contribution to tax revenue are below provincial averages. Currently one-third of its production capacity is not up to full speed. Therefore, there is still ample room for greater benefits through increasing production quality and efficiency and tapping new potential. On the other hand, we should see that even though Ningde has made great achievements these past few years, its main economic indicators are still falling proportionally when we look at the entire province. Therefore, suitable development speed is still necessary. This can keep us from falling further behind in the entire province and the country at large, and prevent inaction and failure to pursue development.
3. The relationship between resource development and adjustment of industrial structure
There are two prerequisites to properly managing this relationship: first, Ningde is rich in resources, but the development and use of these resources are determined by having reasonable industrial policies; second, adjustment of the industrial structure in Ningde should be made primarily in light of the current state of local resources. The resources of Ningde are distributed unevenly, but the distribution of industries in the region is more or less even. In other words, the industrial structure does not match the resources, and there are no clearly dominant industries. Leaders at all levels should pay close attention to the mismatch between resource distribution and industrial structure.
For regional economic development in both developed countries and developing countries, if the appropriate industrial policies are not in place, structural productive forces cannot be fully released, and economic growth will not have the speed and benefits that it should realize. Therefore, Ningde should formulate regional industrial policies to determine the optimal structure, priority, and timing of industrial development.
Ningde has excellent potential for its agricultural, forestry, and hydropower resources. I believe that this kind of regional situation should be the basis for adjusting industrial structure in Ningde. Agriculture is an advantage of the region. In the past, development relied on agriculture. Going forward, we still will rely on comprehensive development of agriculture. But we must go beyond traditional farming under the constraints of the natural economy, and step up to "big agriculture" in the comprehensive commodity economy.
Although Ningde has many mountains, the foundation for the forestry industry is poor. Our forest cover and reserves are low. We should adopt positive guiding principles and formulate policies that recognize the strategic role of forestry in poverty alleviation in the region. It is worth stressing that the edible mushroom industry has facilitated economic development in Ningde, but we must properly manage the relationship between this and other industries, in particular the forestry industry. Areas with rapid development in the edible mushroom industry can link forestry to mushrooms.
The all-round development and use of Ningde's sea-based resources are still in the initial stages. We should pay close attention to building pelagic sea fishing fleets. The depth and breadth of shallow sea and tidal land aquaculture should be increased. For shrimp farming, which has already seen some development, we should focus on increasing per-unit yield. For high-end fish, shellfish, and algae farming, we should expand the farming area. The hydropower industry is also a major resource advantage of Ningde. I advocate actively developing hydropower resources in Ningde according to our abilities. Hydropower is a basic industry and also one with good benefits, therefore "as soon as we have money, build power stations." We can raise funds for small power stations and seek to build medium-sized stations with foreign capital or through joint ventures. Gradually, we will form an electric power system in Ningde with hydropower as the dominant source, integrated with the provincial power grid to accommodate peak usage. We can also integrate factories into the power system to develop the metallurgy industry in Ningde.
I must emphasize that one of the most basic principles of industrial development in Ningde is that development should be compatible to the capacity for self-balancing. The adjustment of industrial structure in each county of Ningde can identify a leading industry or industry groups based on local resources and productive forces. Investment policies targeting leading industries can be formulated and implemented to expedite their development. In mm, growth in the leading industries will drive the development of upstream and down- stream industries. For example, Gutian has the deep processing of mushrooms; Zherong has pharmaceuticals; Xiapu has massage tools and processing of seaweed, nori, and mustard root; and Fu'an has electrical machinery and ferroalloys. These are all promising industries. For these industries that have sufficient supplies of raw materials and ready markets, we should adopt powerful measures to grow them to achieve mass production and pursue the benefits of economies of scale.
Of course, the rules of economic development show us that continued industrial development will inevitably tilt the balance of local resources, and considerable raw materials from other places will be needed. However, industrial development should still be based on the processing and use of local resources.
4. The relationship between mountainous and coastal areas in the distribution of productive forces
The dual economic states of the coastal and mountainous areas constitute a special problem in the economic development of Ningde. To recognize the content and implications of this special problem we must consider it from different angles. First, from the viewpoint of historical materialism, people cannot freely choose their own forces of production, and all historical forces of production are the starting point for the productive lives of the next generation. Therefore, coastal and mountainous areas both have their own path of economic development to follow. Second, objectively, there are differences between the coastal and mountainous areas, and this makes it possible for them to engage in complementary cooperation. The economic development strategy of Ningde must consider how to coordinate such differences. Therefore, policy formulation cannot be rigidly uniform, and in implementation we should take into account the differences and cooperation between the coastal and mountainous regions.
The revitalization of the mountain economy and development of the coastal economy are both important to bringing the economy of Ningde to a new level. This does not mean, however, that we will implement a balanced strategy in handling these two types of economies as we address regional distribution of productive forces. I believe that the distribution of productive forces should be varied. That is, we should take the path of "unbalanced-balanced-unbalanced" distribution of productive forces based on the reality of unbalanced economic conditions. Taking investment as an example, we should use input-output coefficients to determine the quantity and direction of investment and implement targeted investment policies. The reasons for this are clear. First, investment is not "relief." We do not necessarily invest more in poorer areas. Second, within a certain period, returns from investment in more economically developed areas are greater and faster. Of course, this does not mean that there should be no investment in mountainous regions. I simply mean that there should be overall priorities, and the proportion of investment can be increased for specific investment projects in mountainous regions where the benefits will be good.
The coastal region, in particular the Fuzhou-Wenzhou highway belt, is where industry is more highly concentrated in Ningde. This region's industrial output accounts for more than 70% of the entire prefecture, and its fiscal revenue accounts for 64.8% of the entire prefecture. Fuding, Fu'an, and Xiapu counties each has industrial outputs of over 100 million yuan. This is a priority area in the distribution of our productive forces. We envision centering growth around Saiqi, extending growth to the inland from the Fuzhou-Wenzhou highway belt, and gradually advancing toward the mountainous regions.
5. The relationship between reform and opening up and poverty alleviation
I believe that for Ningde, the initial and ultimate purposes of opening up and poverty alleviation are both for the development of the commodity economy, so they should be aligned as they evolve, and the rules of commodity economy should apply to both. This "alignment theory" has three levels of significance. First, there is a certain difference between opening up and poverty alleviation. Specifically, they evolve in different forms and follow their own patterns, so we must have different policies and measures for the two areas of work. Second, opening up and poverty alleviation are interconnected. So we advocate approaching poverty alleviation with an open mind and leveraging opening-up policies in poverty alleviation. Third, opening up and poverty alleviation rely on each other to progress. Achievements from poverty alleviation serve as a new starting point for opening up, and opening up will bring poverty alleviation work to new levels. Therefore, we must strive to maximize overall performance and benefits. Based on the above understanding, both opening- up and poverty alleviation policies should play a role in developing the economy of Ningde, and the work in both areas should have its own characteristics.
The national government has listed Xiapu and Ningde counties of the prefecture as opening-up coastal counties. The counties that are not included in this list still face the question of how to open up, and people in these counties also need to have the notion of opening up on their mind. Ningde is exploring its way forward towards opening up, but there are four points that we should be clear about. First, we should not blindly follow the methods of the special economic zones and set up isolated development zones far from old urban centers. We must rely on our current cities - that is, we must build upon what we already have. Second, the practice of opening up over the past few years in a number of places has told us that tax exemptions and deductions are not the most important considerations for foreign investors. They aren't looking just to save money. They care more about making more money and making money easily. We can make Ningde more attractive to foreign businesses by improving our soft environment. For example, we can simplify procedures, lower fees, provide one-stop service for foreign investors, and prevent multiple departments acting on their own and frequently passing the buck. Third, we must coordinate foreign trade and across-the-Strait trade. As we vigorously develop the "3+1" industries and foreign trade, we should also expand trade with Taiwan and bring in new investment from Taiwan. Fourth, we must combine resource development and opening up, and leverage resources particular to Ningde to increase our attractiveness to the outside world.
Poverty alleviation work in Ningde has already made historic achievements, and 87.3% of impoverished households have their basic needs met in food and clothing. However, as opening up progresses, poverty alleviation work must be brought up to a new level. We must further the reform in Ningde. Every thing we do must be centered on reform, and poverty alleviation work must be carried out in the spirit of reform. Poverty alleviation funds should not be scattered about like pepper. Over 90% of poverty alleviation funds must be used to support economic entities at the county, township, and village levels in order to boost their vitality. We must give priority to supporting hundred-million-yuan towns and townships, model science and technology towns and townships, the Spark Program, non-staple food supply, and commodity bases for creating foreign exchange through exports. We must work hard to build small economic development zones and coordinate poverty alleviation with regional economic development. We must properly carry out two-step rural reform, improve the two-tiered responsibility system, further promote land operations at a suitable scale, and encourage farmers to increase investment in agriculture. A specialized and market-oriented service system for agricultural production must also be improved along with the comprehensive development of agriculture. Enterprise reform must introduce a competition mechanism on the basis of improving the contract system. We must optimize the organization of labor, strive to "arrive through one continual push," and boldly advance leasing and auction reforms. Where conditions are right, enterprises can also try out stock ownership systems. On the whole, the property rights relationship between the state and enterprises must be simplified; simple, non-paternal relations must be established through taxation; and conditions must be created for enterprises to compete in the market.
6. The relationship between science, technology, education and economic development
For impoverished regions, we must emphasize the major role of science, technology and education (S&T education) in economic development. But due to the low level of economic development, S&T education faces insufficient funding, and problems have arisen. For example, should this sum be invested in education or in the factories?
Of course, an underdeveloped economy cannot be used as an excuse for not carrying out S&T education. On the contrary, it is precisely because the economy is underdeveloped that we must have all the more motivation and pressure to step up S&T education. S&T education and economic development have a mutually causal relationship, and we cannot wait until the economy has been developed to start our education. "It takes ten years to grow trees, but a hundred years to cultivate people." Delaying a few years means losing opportunities for a generation. The competing priorities of S&T education and economic development simply remind us that we must take note of three things. First, we must view S&T education from a long-term strategic perspective and see S&T education as a top-priority for economic and social development in Ningde. Second, with an underdeveloped economy, we must seek to get the most from S&T education. Third, we must convert progress in S&T education into kinetic energy that drives economic development, stressing both access and the "practical effect" of S&T education.
To every problem, there is a solution. For education, our principle is to pursue both "universal education" and "adult education." We must especially support vocational training and rural literacy work. All of society needs to do something for education, which is provided in various forms through multiple channels. We should strive to secure basic facilities [3 This refers to classrooms that are equipped with chairs and desks, and housed in safe buildings.] for elementary and higher-level schools by 1990. We should direct efforts to all types of training, such as practical rural technology training, and S&T and management training for officials and employees. S&T should be oriented toward production and rural realities, and S&T professionals should be encouraged to play a greater role in commodity production. We must also emphasize applied S&T, leverage S&T in the adjustment of urban and rural industrial structures, and promote the participation of S&T professionals in the Spark Program.
Note：
Originally published in Fujian Tribune, May 1989.
