China One for the Money, One Goes Slow

Austerity-minded officials from Beijing sometimes complain that touring Guangdong province in South China is like visiting a foreign country. In contrast to much of China, Guangdong exudes abundance: successful farmers living in multistory houses, townships producing consumer goods ranging from shoes to toys to microwave ovens, thousands of privately owned businesses blossoming. Set in the humid delta of the Pearl River, Guangdong's capital, Guangzhou, better known in the West as Canton, seethes with enterprise. The Dongping Street free market is filled with stalls selling all sorts of food: fish swimming in tubs of fresh water, poultry, a greengrocer's delight of vegetables and fruits. Most important is a bountiful selection of grades and cuts of pork, which has been rationed in such huge cities as Beijing and Shanghai.

Bureaucrats from the capital are more likely to recognize the threadbare inland province of Hunan, just across Guangdong's northern border. In Hunan, Mao Zedong's birthplace, most people still regard private enterprise with condescension. While the province once benefited heavily from investment in state enterprises, some of those facilities have become a drain on resources. With local officials abiding by the directives of central planners in Beijing, state-owned stores are consistently short of both agricultural and consumer goods.

A decade ago, China appeared to be a monolith, but times have changed. After nine years of Deng Xiaoping's "Second Revolution" -- economic reform -- two Chinas have emerged. In the relatively prosperous coastal regions, millions of successful entrepreneurs are building a future in exports to the outside world. Meanwhile, most of the interior provinces lag well behind, thanks to stagnant state planning, price-controlled agriculture and millions of cadres clinging to Mao's rusty concept of the "iron rice bowl," lifelong employment guaranteed by the state. In parts of the interior, especially the large cities and Sichuan, Deng's home province and the laboratory for economic reform, some have prospered. But not many. The eleven western provinces and territories, including the huge Tibetan and Xinjiang autonomous regions, with 300 million of China's 1 billion people, produced only 17% of the 1987 GNP of $293 billion. The ten provinces and municipalities in the east, with 360 million people, account for a remarkable 53%.

This month, when the 3,000-member National People's Congress, the country's legislature, meets in Beijing to consider speeding up the pace of economic reform, the disparities between the two Chinas are likely to become even more pronounced. One item on the agenda will be the proposed transformation of Hainan Island, now part of Guangdong, into a separate province with the mandate to become a capitalistic special economic zone. Both Communist Party General Secretary Zhao Ziyang and Acting Premier Li Peng called for further development of the coastal industrial cities and special economic zones, even at the risk of letting the rest of the country languish. Said Li: "We must persevere in our policy of permitting a part of the people to become prosperous before the rest."