Hundreds of intellectuals and retired state officials have signed a petition urging China’s National People’s Congress (NPC), which convenes in a two weeks’ time, to halt the privatisation of state companies. The target of the petitioners’ protests is a draft law on private property that was withdrawn a year ago.
By Vincent Kolo, CWI

The debate is the latest sign of growing popular discontent that is beginning to unnerve sections of the ruling ”communist” apparatus. In 2005, China reported 87,000 ”mass incidents”, including riots, demonstrations and industrial stoppages, a fifty percent rise on the 2003 figure (58,000 ”mass incidents”). No official figures have so far been released for last year, possibly a sign of official sensitivity on the subject. The petition, which has attracted considerable international attention, criticises the country’s decade-long privatisation programme, saying it had allowed hundreds of millions of dollars in assets to fall into private and foreign hands. Such privatisation, it said, needs to be stopped to curb social unrest, which it described as “a rising wave upon wave of voices opposed to privatisation.”

Anti-privatisation websites blocked

The petition, which has reportedly attracted 3,000 online signatures, warns that, “with the unceasing advance of privatisation, our country already has a serious gap between rich and poor, which is polarizing into two extremes,”

Coming in the run-up to the annual session of the NPC, the latest privatisation debate is extremely unwelcome for China’s top leadership of President Hu Jintao and Premier Wen Jiabao, and sits uneasily with their mantra about a “harmonious society”. It is a reminder of the explosive strains building up in China as a result of the process of capitalist restoration, which has seen nearly 60 million jobs destroyed in the state-owned industrial sector.

The authorities have responded by blocking web sites that spread the anti-privatisation petition including ‘Mao Zedong’s Banner’, a forum for left criticism of government policies, where the petition is believed to have originated two months ago.

The signatories, who are urging the NPC to reject the new private property bill, include a former head of the National Statistics Bureau and several prominent academics from the Central Party School in Beijing. Rather than advocating a return to Maoist ‘central planning’ these critics advocate a mixed economy with a continued strong role for the state – in some respects similar to old-style social democrats in the West. They characterise the economic policies of the last decade as heavily influenced by ‘neo-liberalism’.

Privatisation ”on a truly massive scale”

Opposition to government policies has undoubtedly been stiffened by the move last year to withdraw the proposed law on private property ‘for further amendments’. The aim of the latest petition is to repeat this feat. Since then, however, the congress’s executive body has revised the bill, with backers calling for its inclusion on the agenda for the upcoming session, which opens on 5th March.

The scale of privatisation in China is hard to gauge accurately, because it is commonly carried out illegally by local governments in alliance with former managers of state companies. While the central government has acted from time to time to try to control this process, they are also reluctant to publicise the phenomena or publish up-to-date statistics, fearing this will further inflame public opposition.

As Hong Kong professor X. L. Ding explained, “the diversion of the assets and profits of state firms into the private hands of the managers and officials in charge of them has been occurring on a truly massive scale – far more massive than most observers of China have realised.”
Ding’s research, shows that in the early 1990s illicit transfers of state assets totalled 50-100 billion yuan (US$6 to 12 billion) each year, and has accelerated since then. (Ding, The illicit asset stripping of Chinese state firms, The China Journal, No. 43, January 2000).

Bill ”legalises ill-gotten gains”

“The property law basically takes all the illegally gotten income and legalises it,” said Han Deqiang, one of the petition’s signatories, an economist at Beijing University of Aeronautics and Astronautics.

Whatever the outcome at the largely rubber-stamp NPC meeting, this debate, following the furore caused by last year’s part-privatisation and foreign-listing of China’s biggest banks, is a sure sign of splits opening within the seemingly monolithic edifice of the ruling party. These splits, in turn, reflect a growing alarm as workers and peasants – the big losers from the process of capitalist restoration – begin to stir.

Originally published on chinaworker.info

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