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China: An International Journal 4.1 (2006) 151-164


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Corporatism and Agricultural Reform in China:

A Comparison with Hong Kong

Wong Cham Li

Corporatism and Agricultural Reform in China

Reforming the agricultural sector began immediately after Deng Xiaoping assumed leadership of China in 1979. A massive de-collectivisation programme in the early 1980s freed peasants to engage in independent household farming through the so-called "family joint-working contracting system" (jiating lianchan chengbaozhi). Under this system, arable land owned by the state was distributed or contracted out to every peasant household which could support itself and earn extra income from farming. This system worked well in the beginning. Agricultural production increased drastically in comparison with the collectivisation period from 1949. By 1990, China had changed from a food-deficient country to a food-surplus one.

However, the hard fact was that peasant income did not, by and large, increase with the rise in production. State planners found that as society adapted from central planning to a market economy under Deng's reform programme, the small producers and farming households could not cope with the ever-changing conditions of the big market. Chinese peasants lagged far behind in terms of economies of scale, usage of technology, marketing methods and integration of production processes as found in modern agricultural sectors elsewhere. The peasants also fell prey to the big businesses and enterprises that dominated the market. As a consequence, both the transaction and production costs for their produce were high, causing their final income to not amount to much. [End Page 151]

Therefore, some peasants believed it would be to their advantage to join hands and form associations and co-operatives to help organise their agricultural production, and thereby increase economies of scale. The local officials also applauded this idea, seeing it as one means to promote the integration of agriculture (nongye chanyehua), i.e., to integrate the "family joint-working contracting system", which the Chinese authorities vowed would remain unchanged, with modern agricultural practices.

Corporatist organisations had formed in various industrial sectors soon after the launch of the economic reforms in 1978.1 However, it was not until the mid-1990s that agricultural associations and co-operatives were established. According to statistics released by the Ministry of Agriculture, there were over 1.4 million peasant co-operative organisations by 2003. The number of peasant households joining these organisations accounted for about four per cent of the total number of peasants nationwide.

In Beijing, the percentage of agricultural produce sold through the specialist co-operative associations continues to increase. In 2003, 80 per cent of the milk came from the cooperatives, as well as 46 per cent of the vegetables and 40 per cent of the fruit. Assuming identical conditions and scales of farming, the income of the peasants in the crop growing sector who joined the associations was 35 per cent higher than those who did not join. In the animal husbandry sector, the income was 40 per cent higher. There is an increasingly strong call, voiced from within and without the Government for the enactment of a Co-operatives Law to guide formation of the co-ops.2 In corporatist parlance, these organisations are variants of corporatism operating at the meso- or sectoral level.

Philippe C. Schmitter, defines the corporatism concept, or more correctly, state- or authoritarian-corporatism, as a system of interest representation "in which the constituent units are organised into a limited number of singular, compulsory, non-competitive, hierarchically ordered and functionally differentiated categories, recognised or licensed (if not created) by the state and granted a deliberate representational monopoly within their respective categories in exchange for [End Page 152] observing certain controls on their selection of leaders and articulation of demands and supports".3

Alan Cawson, a prominent corporatist writer, presents a more societal or liberal definition: "Corporatism is a specific socio-political process in which organisations representing monopolistic functional interests engage in political exchange with state agencies over public policy outputs which combine interest representation and policy implementation through delegated self-enforcement...

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