Livelihood first: guidelines and policies concerning ethnic trade in the early days of the People’s Republic of China

Abstract

Since its founding, the People’s Republic of China has been committed to promoting the development of ethnic minorities in all aspects, including officials training, governance building, economy and trade, culture, education and health care. Among them, ethnic trade, as an important component of economic work, was elevated to be as important as political work, which embodies the people-centered governance philosophy and the livelihood-oriented development philosophy of the Communist Party of China and the People’s Government of China. The four national ethnic trade conferences held in the 1950s formulated guidelines and policies that secured remarkable results in ethnic trade, which, to a large extent, guaranteed the production and supplies of consumption goods in ethnic areas, increased the income of ethnic minority people, and supported the national construction. It played an active role in eliminating ethnic estrangement and promoting ethnic unity, and effectively improved the identification of the ethnic minority people with the new country.

Introduction

“Ethnic Trade” referred to in this paper is a trade activity in ethnic minority areas or targeting ethnic minorities in China. “The Work on Ethnic Trade” is a special form of business organized by the Communist Party of China (CPC) and the People’s Government in ethnic minority areas or targeting ethnic minorities. After the founding of the People’s Republic of China (PRC), construction projects of ethnic minority areas were incorporated into the national plan, among which livelihood services such as health care, economy and trade were highlighted as important as political work. From 1951 to 1956, four national ethnic trade conferences were held successively, which discussed the economic and social conditions of ethnic areas, established guidelines and policies for ethnic trade, exchanged experiences and lessons of ethnic trade in each ethnic minority region. In the spirit of these conferences and their guidelines and policies, the Work on Ethnic Trade had been gradually carried out, and had reaped remarkable results in just a few years. It played a very important role in supporting the democratic construction and relieving the economic hardship and poverty of ethnic areas in the early days of the PRC. It embodies the people-centered governance philosophy and the livelihood-oriented development philosophy of the CPC and the People’s Government of China. Up to now, the Work on Ethnic Trade is one of the important contents that constitute the correct way to solving ethnic problems with Chinese characteristics. It has played a very important role in the economic and social development of ethnic minorities and ethnic areas in different periods.

At present, research on ethnic trade and the Work on Ethnic Trade in the new China after 1949 is mainly conducted from three perspectives: (1) discussing and defining the concepts, research objects, and theoretical methods of ethnic trade from the perspective of discipline construction; (2) reviewing and summarizing the Work on Ethnic Trade in the PRC from the perspective of ethnic policy formulation; and (3) analyzing ethnic trade in a certain area from ancient China to the PRC from a historical and regional perspective. Relevant findings can be found in Introduction to Ethnic Trade authored by Wang Wenchang, Ethnic Trade authored by Yang Qingzhen, Ethnic Work in Contemporary China compiled by Huang Guangxue, Research on the Ethnic Work of the Communist Party of China in the Early Days of the People’s Republic of China authored by Wu Xiaotao, Two Decades of Ethnic Trade in Inner Mongolia (1946–1965) authored by Lin Weiran, Draft History of Ethnic Trade in Gansu compiled by Dang Cheng’en and Chen Baosheng, and Ethnic Trade in Xinjiang authored by Mu Xianglin. Relatively speaking, research on ethnic trade in the early days of the PRC is inadequate, either focusing on regional scale, or discussing the relevant discourses of national leaders, or incorporated in the works on livelihood in ethnic areas. Examples include A Study of Trade in Ethnic Areas in the Early Days of the People’s Republic of China: An Example from Guizhou Province (1949–1956) (Wu Xiaotao), A Brief Discussion on the Work on Ethnic Trade in Qinghai in the Early Days of the People’s Republic of China (Li Jianning), Caravans with Ring––A Review of Ethnic Trade in Lijiang Prefecture in the Early Years of the People’s Republic of China (Zhao Yan), Chen Yun’s Contribution to Ethnic Trade in the Early Days of the PRC (Wang Lei), and A Study of Livelihood Construction in Ethnic Areas Led by the Communist Party of China since the Founding of the PRC (Qu Xiaolin). As an important part of ethnic work in the early days of the new China after 1949, the Work on Ethnic Trade was not only an economic task, but also a political task. Under those historical conditions, how did the CPC and the government consider ethnic trade in nature? How were the guidelines and policies for ethnic trade formulated? What were the characteristics and experiences of ethnic trade in the early days of the PRC? To answer these questions, this paper analyzes the guidelines and policies for ethnic trade in the early days of the PRC, with focus on the four national ethnic trade conferences held in the 1950s, and further examines and clarifies the formation process and essential characteristics of the correct path with Chinese characteristics to solving ethnic issues. The early days of the PRC herein refer to the period from the founding of the PRC to 1958.

The initial development and background of the work on ethnic trade in the early days of the PRC

Ever since its founding, CPC has paid close attention to the economic and social development of ethnic areas in the process of exploring the correct path to solving China’s ethnic issues. The Chinese People’s Political Consultative Conference (CPPCC) held on the eve of the founding of the PRC demanded that “the people’s government should support the people of all ethnic minorities in political, economic, cultural, and educational development” (The Common Program of the Chinese People's Political Consultative Conference (中国人民政治协商会议共同纲领) 1949). It has since then been the consistent position of the CPC and the government to emphasize assistance in various services of ethnic minorities. The 1954 Constitution of the People’s Republic of China and the 1956 Constitution of the Communist Party of China adopted at the 8th CPC National Congress clearly stipulated “assistance to various ethnic minorities in their political, economic and cultural development” (The Constitution of the People's Republic of China (中华人民共和国宪法) 1955), to “achieve complete equality and consolidate unity and friendship among all ethnic groups” (The Constitution of the Communist Party of China 1957). These provisions fully demonstrate the state nature of the new China after 1949, that is, a state of new democracy and people’s democracy, where all ethnic groups enjoy equal rights and bear the same obligations. These are principle provisions formulated based on the economic and social conditions of ethnic areas.

At the beginning of the PRC, the national economic situation was very grim. In 1949, industrial output was halved and agricultural output dropped by over 20% compared with those of 1937, while the inflation of currency multiplied by more than 140 billion times from 1937 to 1949, that is, from the full outbreak year of the War of Resistance against Japanese Aggression to the founding year of the PRC (Luo and Gao 2009). Most areas inhabited by ethnic minorities were located in borders, plateaus, and mountains with harsh natural conditions. As they were socially backward and economically destitute, people generally lived in poverty. In terms of trade, commercial depression, goods shortage, market manipulation by government and business, and unequal exchanges were common. For example, most areas in the southwest experienced food shortage and had to export native products in exchange for daily necessities. Due to impeded transportation and underdeveloped commerce, low market concentration and trade mobility, barter was still used in some areas, and there was no unified currency system, which severely hindered the exchange of materials (Chen 1951). Another example is Sanjiang County of Guangxi Province in South-central China. “Due to inadequate materials, fraternal ethnic groups lived an industrious and simple life. As harvest fell short of the need, they were forced to sell labor to maintain their lives over the years. Since the Japanese imperialist aggression and the Chinese Civil War launched by the Kuomintang (KMT) reactionaries, farmers were unable to work and ate away the reserves as a result of blocked traffic, interrupted trade, idle ships, and low-price purchase by bureaucratic capital” (The People's Government of Sanjiang County 1951). In places that had not yet been fully liberated, such as Southwest China, South China, Tibet and Hainan, KMT remnants and bandits were rampant, and foreign forces frequently caused chaos, openly or secretly. It can be said that the complex and backward economic and social conditions in the frontier ethnic areas affected greatly national unity and social stability. “The PRC was founded, but whether the New China can stand up or not remains in doubt” (Deng and Liu 2014).

Promoting various services to ethnic minorities was not only necessary for the realization of ethnic equality and unity, but also crucial for the transition from national construction to socialism in the PRC. Due to various factors, the population of ethnic minorities was small, the economic and cultural development was lagged behind and there were extreme shortages of workers, cadres, intellectuals and technical professionals. Without the help of the state and the majorities of the population, leapfrog development would be difficult (Wang 1959). Party and state leaders understood this very clearly. Mao Zedong, Liu Shaoqi, and Zhou Enlai repeatedly emphasized the need to help ethnic minorities develop political, economic, and cultural services. From a comprehensive, holistic perspective, helping ethnic minorities develop their economies is also of great significance to national construction. Ethnic minority settlements are vast and rich in natural resources. “Our national economy would not develop without the engagement of ethnic minorities” (Mao 1977), said Mao Zedong. Practice proved that the natural resources of ethnic areas have played a huge role in the development of the national economy. “It should be considered this way. In the past few years, ethnic minority areas have made contributions that cannot be underestimated to national construction. In my opinion, wool, cowhide, cotton, grain, as well as other supplies purchased from ethnic minority areas provide great support for national construction. For instance, machines and grain exchanged from foreign trade exports such as wool are an important force for national construction and overcoming difficulties in the last two years. Full recognition of such contribution will be conducive to work” (Yao and the then Minister of Commerce 1984), said the then Minister of Commerce Yao Yilin at the 5th National Ethnic Trade Conference held in 1962.

Based on the above-mentioned guidelines, various services in ethnic areas were rapidly developed with the liberation of the whole country. In terms of economic construction, the major measures taken at the beginning of the PRC included: first, allocating relief foods (funds) to help ethnic minority people relieve disaster, famine and resume production; second, developing trade in ethnic minority areas to ensure the supply of means of production and life and the purchase of local products. “Trade is very important for assistance in economic development of ethnic minorities, so it should be placed at the center of economic work,” upheld Deng Xiaoping, who led the Southwest Bureau of the CPC Central Committee. “Layers of intermediate exploitation in trade should be avoided so that they will suffer little losses. In this way, their economy will prosper and their lives will improve” (Deng 1994). Xi Zhongxun, who led the Northwest Bureau of the CPC Central Committee, pointed out that health and trade were currently the most important mass work and political task in ethnic areas, so it was necessary to “pool all possible forces to develop trade in fraternal ethnic areas” (Xi 2013).

In view of the complex situation and economic state of frontier ethnic areas, “trade had been developed before political power was established” in many places in the southwest and northwest. Yunnan Province announced its liberation on February 24, 1950. The next month, Yunnan State-run Trading Corporation was founded and dispatched delegations to the unliberated frontier ethnic areas along with the Chinese People’s Liberation Army (PLA) and ethnic work teams. “Daily necessities such as salt, cotton and yarn, cloth, matches, and kerosene were scarce when the PLA entered the frontier areas. Amid the heavy task of suppressing bandits, army horses were used to transport materials and resources that ensured the needs of the frontier masses. Wherever the army arrived, trade teams would immediately set up stalls” (CPC History Research Office of the Yunnan Provincial Committee of the Communist Party of China 1996). With the liberation of various parts of Yunnan and the establishment of people’s power, trade branches and trade divisions were created in major cities and towns to provide purchase and sale services to the general public. When PLA marched into Qinghai Province in September 1949, a group of cadres were transferred to set up a provincial trading company in Xi’ning, which soon officially opened for business. At that time, Golog was the most socially complicated area and the last unliberated area in the province. In February 1952, the Golog CPC Working Committee and the Golog Working Group of the Northwest Military Political Committee were formally established, and started to work with the support from the teams of Qinghai Provincial Trading Company. In August, Golog was peacefully liberated. In 1952 and 1953, the main tasks of the Golog Working Group were to publicize policies, unite the upper echelons, mediate disputes, eliminate bandits, maintain order, and train cadres, so as to pave the foundation for regional ethnic autonomy (Zhang 1992). In March 1953, the Golog Branch of the Qinghai Provincial Trading Company was created. That summer, a trade team visited 210 of the 290 tribes in Golog along with the five sub groups of the Golog Working Group. In a fanfare of publicity of the CPC’s policies on ethnic equality and unity, they were active in supporting the masses to resume and develop production. A large stream of aid, covering barley, calico, tea, production tools, and clothing, was offered to 3175 households with 11,145 poor herders, creating favorable conditions for the implementation of regional ethnic autonomy (Fang 2017).

In order to better guide the development of ethnic trade, the central and local governments successively issued relevant regulations and measures shortly after the founding of the PRC. Following the establishment of the People’s Government of Qinghai Province on January 1, 1950, the Fellowship Association of All Ethnic Groups in Qinghai Province was immediately convened. The meeting focused on the development of ethnic trade in pastoral areas and adopted the Resolution on the Development of Trade in Pastoral Areas (Zhang and Yao 1984). On November 1, 1950, Xikang Province held its first trade conference to discuss and set down the work concerning local trade and the policy for developing trade in ethnic minority areas (People's Daily 1950). On December 2, the Government Administration Council of the Central People’s Government issued a circular: in consideration of ethnic habits, the cattle and sheep that Muslims eat during the three major festivals shall be exempted from slaughter tax. On December 10, the Ministry of Trade convened a joint meeting of regional trade ministers of the six greater administrative areas and professional company managers and decided to establish a package of trading companies in remote border areas where possible. On December 16, the Trade Department of Guangxi Province introduced preferential measures for purchases by fraternal ethnic groups as follows: (1) in areas close to ethnic minorities, trading agencies should recommend to government agencies outstanding members of local fraternal ethnic groups as salespersons for fraternal ethnic trade communication to facilitate direct trade and reduce intermediate exploitation; (2) in areas where ethnic minorities are concentrated, sales offices should be set up to sell major daily necessities and purchase native products at appropriate prices that make neither losses nor profits. If this is not possible, cooperatives will be organized instead to sell at preferential prices; (3) trade agencies that approach fraternal ethnic groups should give appropriate preferential treatment to fraternal ethnic groups via hawkers. Fraternal ethnic groups can enjoy such preferential treatment for purchases if there is a general certificate issued by the villages; (4) fraternal ethnic groups refer to the Miao, Yao, Zhuang, Ling, Luo and other ethnic groups in concentrated and remote areas. Those who are the same as the Han ethnic group will be treated as ordinary people (Trade 1998). On July 29, 1951, the Ministry of Trade of the central government set up the Ethnic Trade Section under the Division of Local Trade of the Department of Domestic Trade. From August 5 to 9, the Northwest Bureau of Trade held the Ethnic Minority Trade Conference of the five northwestern provinces, in which Xi Zhongxun gave instructions on the development of ethnic minority trade (Yang et al. 1990).

As of August 1951, trade in ethnic minority areas across the country, especially state-run trade, had made preliminary progress. “According to incomplete statistics, state-run trade agencies have successively set up 750 enterprises and a large number of mobile trade divisions in ethnic minority areas, including state-run trade enterprises, retail outlets, purchase stations, outlet stores, and processing plants, which absorbed over 1,700 cadres engaged in ethnic trade. Under the fair and reasonable price policy of state-run trade, the price parity of commodities in ethnic minority areas has undergone major change. The purchase prices of native products have risen, while the sales prices of daily necessities from other regions have been reduced” (Editorial 1951). Through commodity exchanges, the purchasing power of ethnic minority people was significantly increased. This contributed to resuming production and improving lives, as a result, ethnic minorities showed active support for the CPC and the government. For example, in 1951, the trading company in Wuzhou District of Guangxi Province set up many purchase and sales offices and task forces in close operation with the military to eliminate bandits. They transported over 30,000 kg of peanut oil, 1014 m of cloth, 42 pieces of yarn, and large quantities of salt and daily necessities to the Yao ethnic minority settlements. The Yao people there generally suffered from ancylostomiasis due to lack of salt, so they were very happy to walk out of mountains for access to salt. At the same time, two purchase and sales teams of the trading company that accompanied the military sold oil, salt, and cloth at low prices to meet the needs of the Yao people; and purchased live pigs worth more than 45 million yuan and dried mushroom and winter mushrooms worth more than 9 million yuan at appropriate prices, which avoided the losses and difficulties of the Yao people arising from the slow sales and low prices of native products. In addition, people of the trading company went deep into mountainous areas to purchase native products directly from farmers at a reasonable price. Local farmers all expressed that: “In the past, native products were cheap, but now, native products sell so high to improve our lives, owning to the favor of the CPC. In the future, we must work harder in production “ (Ethnic Affairs Committee of Guangxi Zhuang Autonomous Region and Archives of Guangxi Zhuang Autonomous Region 1998b).

In short, in more than a year since the founding of the PRC, trade was integrated with other ethnic work in the vast frontier ethnic areas to play an active role in promoting the CPC’s ethnic policy, facilitating exchanges among all ethnic groups, and seeking support from ethnic minorities.

National ethnic trade conference and its guidelines and policies

The Work on Ethnic Trade as a brand-new component of ethnic work and economic work of the new China after 1949 met considerable difficulties and problems in preliminary practice. Southwest China representatives summarized three deficiencies in the Work on Ethnic Trade: (1) general work instead of specific work well adapted to local specific conditions; (2) unclear understanding of the role of ethnic trade in economic development; and (3) inadequate cooperation between ethnic trade and other work (Chen 1951). Representatives from South-central China suggested that the work on ethnic trade should pay attention to five aspects: (1) taking into account the overall regional economic development in promoting trade in ethnic minority areas… (2) arranging appropriate funds for trade services in ethnic minority areas, and adopting “professional management” according to specific needs… (3) correcting the bias against Han merchants, and strengthening the administration of industry and commerce to strictly stop deception and excessive exploitation… (4) restoring and establishing primary markets such as fairs, assemblies, and rallies, and strengthening the integration with nearby cities and towns… and (5) developing transportation in ethnic minority areas, in order to enhance ties, exchange culture, and reduce transportation costs (People's Daily 1951b). Representatives from Northwest China raised nine issues with suggested solutions, including prices and sales of fur and native products, public-private relations, market management and weights & measures, supply and demand adjustment, transportation, improvement of operating methods of state-run companies, training of ethnic minority cadres, circulation of silver coins, and encouraged management of cooperatives by ethnic groups (Fang 1951). Feedbacks from various places covered not only guidance and principled issues such as guidelines and policies on ethnic trade, but also specific matters related to transportation, prices, varieties, supply and demand, personnel, and management.

The CPC attached great importance to proceeding from reality in all work, that is, work ranging from governance to livelihood should be carried out in accordance with the specific conditions of each region and each ethnic group. With the gradual development of political and other services in ethnic areas, the CPC and the government learned more deeply about the economic and social conditions in ethnic areas, and gained a more comprehensive understanding of the wishes and needs of ethnic minorities, especially in the process of organizing ethnic minority people to participate in nation-building activities, such as organizing ethnic minority delegations to the capital city of Beijing to participate in grand celebrations and to visit other cities, and sending Central Delegations to Ethnic Groups to visit and greet the ethnic people, and to carry out investigations. The Government Administration Council issued the Several Decisions on Ethnic Affairs on February 5, 1951, based on the report of Li Weihan, Chairman of the Central Ethnic Affairs Commission, on the participation of representatives of ethnic groups in the National Day Celebration, the summary report of Shen Junru, head of the Central Delegation to Ethnic Groups, on visits to ethnic minorities in the northwest, and the report of Liu Geping, head of the Central Delegation to Ethnic Groups, on visits to ethnic minorities in the southwest. According to the decisions, three professional conferences on health, education and trade related to ethnic minorities would be held at an appropriate time in the second half of the year (Ethnic Affairs Committee of the People's Government of Yunnan Province 1951).

From August 17 to 31, 1951, the First National Ethnic Trade Conference was held in Beijing. Totally 149 people attended the meeting, who represented major administrative regions, Inner Mongolia Autonomous Region, provinces and municipalities in North China directly under the Central Government, and relevant departments of the Central Government. Among them, 42 representatives were ethnic minorities, including Mongolian, Hui, Tibetan, Uygur, Miao, Yao, Zhuang, Li, and Dong (People's Daily 1951a). In his opening speech, Sha Qianli, Vice Minister of Trade, said that the meeting was held to discuss the guidelines and policies for ethnic trade, exchange experiences and lessons, and analyze cadres and business issues (Sha 1951). Liu Geping, Deputy Director of the Central Ethnic Affairs Commission, delivered a report on ethnic policy, and Yao Yilin, Vice Minister of Trade, gave a report on state-run trade across the country in 1951. Following the reports of regional representatives on the trade situation and requirements of ethnic minority areas, departments concerned (such as forest reclamation, agriculture, transportation, post and telecommunications, banking, and taxation) discussed these issues and provided written answers. The meeting also exhibited native products from ethnic minority areas, and introduced via forum their production, sales, specifications and quality (Zhou 1984). Vice Premier Chen Yun attended the meeting on behalf of the Government Administration Council. “Work on trade in ethnic minority areas has been fruitful and well welcomed by fraternal ethnic groups” (Chen 2005), he emphasized in his speech, noting that problems in ethnic trade must be solved step by step according to local conditions. Through more than ten days of exchanges, learning, and discussions, the meeting clarified the guidelines and policies of state-run trade in ethnic minority areas, and reached consensus on several important issues. Yao Yilin wrapped up the meeting and presented the report to the Government Administration Council.

At the meeting, the guidelines for ethnic trade were clarified, enhancing the understanding of ethnic trade. Sha Qianli pointed out that policies for ethnic trade were not consistently recognized due to the different conditions of ethnic areas in the vast country. With sufficient experiences in this new realm, there were inevitably deviations in the implementation of policies in various areas, which affected the Work on Ethnic Trade (Sha 1951). Through study, discussion and exchanges, the delegates reached unified understanding and realized that the Work on Ethnic Trade was not only an economic task, but also “an important political task as a concrete manifestation of ethnic policy.” “Trade workers in ethnic minority areas should be good at political work as well. They should work hard to well serve the people wholeheartedly. Their task is to unite national ethnic minorities more intimately through economic and trade activities to consolidate national defense and defend the great motherland” (Editorial 1951). The general policy of ethnic trade established after discussions was “to enhance ethnic unity and facilitate production and life improvement of ethnic minorities through material exchanges according to the characteristics and needs of various ethnic regions” (General review, 1984).

In addition, several important issues in the Work on Ethnic Trade were discussed. Corresponding measures and methods were brought forward: (1) establishing a state-run commercial network based on regional and ethnic characteristics, which comprises of comprehensive companies, professional companies, mobile squads and outlet stores, and creating cooperatives in areas where conditions permit to drive the production and life of ethnic minorities; (2) introducing policies to unite legitimate private businesses and restore and establish regular markets, and adopting a market management system to ensure that various commercial institutions and individuals can conduct fair and reasonable exchanges in the market; (3) implementing a fair and reasonable price policy that takes into account both public and private businesses, resolutely opposing the deception and plunder of any ethnic minority, and proposing some specific methods for the supply of daily necessities and the acquisition of native products to ensure the reasonable profits of production, transportation and sales; (4) actively training and cultivating ethnic minority trade officials by such means as holding special training classes and teaching and learning by doing; (5) giving preferential treatment in trade to ethnic minorities living in areas with special difficulties. If necessary, state-run trade companies should bear some losses in business operations. (6) Integrating ethnic trade with relevant work under the unified leadership of the local Party and government, and relying on the masses to better implement policies. The trade ministries of the major administrative regions and the commerce departments of all provinces should set up specialized agencies for ethnic minority trade or designate officials to be responsible for specific research and guidance on the work (Zhou 1984).

On October 5, 1951, Premier Zhou Enlai issued an instruction on approving the report of the Ministry of Trade on the National Ethnic Trade Conference and notifying its implementation. The document required the people’s governments (military and political committees) of the major administrative regions and Inner Mongolia Autonomous Region and the five provinces and two cities of North China to urge their financial and economic committees and related provincial people’s governments to earnestly handle trade affairs in ethnic minority areas and formulate appropriate plans according to local conditions (Zhou 1984).

This national ethnic trade conference was of great significance in the history of ethnic work in the new China after 1949. “The national ethnic trade conference brought together fraternal ethnic groups from all over the country to discuss trade related to their own interests. Such an ethnic policy is truly groundbreaking and unprecedented” (Ministry of Trade of the Central People's Government 1951), said Cai Gai, the Tibetan representative to the meeting. Guidelines and policies established at the meeting charted the way for the further development of the Work on Ethnic Trade. To a certain extent, they drove the improvement of production in ethnic areas and the improvement of the lives of ethnic minorities, making positive contributions to regime building and social stability of ethnic areas.

In 1952, 1955 and 1956, the second to fourth national ethnic trade conferences took place successively. In 1956 and 1957, the forum on special needed commodities for ethnic groups and the working conference of heads of ethnic trade divisions (sections) were held respectively. Based on changes since the 1951 National Ethnic Trade Conference, these meetings carefully discussed and summarized ethnic trade development and related specific issues, and set down important principles and systems.

First, on the establishment of ethnic trading agencies, the meetings emphasized again that trade agencies must be set up according to the characteristics and specific conditions of each ethnic region; ethnic policies and ethnic trade policies must be earnestly implemented in all commercial sectors, and shall not be understood as merely policies developed by ethnic trade bureaus (divisions, sections) or ethnic trade companies. In the spirit of subdividing state-run commercial institutions across the country, the Fourth National Ethnic Trade Conference divided institutions in ethnic areas into three types, namely general areas, pastoral areas, and remote mountainous areas. For general areas, state-run commercial institutions were responsible for ethnic trade at or above the county level, and supply and marketing cooperatives for ethnic trade below the county level. For pastoral areas, a package of stationary and mobile ethnic trade institutions was set up, without the reach of professional companies. For remote mountainous areas, some stationary small stores were added to mobile trade squads (traveling salesmen), to address the difficulties of local farmers in buying and selling things.

Second, on the preferential treatment in trade to ethnic minorities living in areas with special difficulties, the state adopted preferential measures in terms of capital profits, in order to stimulate the economic development and life improvement of ethnic minorities. More specifically, 80% of the funds of ethnic trading companies shall be invested by the state and 20% shall be financed by bank loans. Ethnic trading companies were allowed to not deliver the profits temporarily, so that ethnic trade could accumulate funds for continued development and growth. It was also stipulated that “loss-making subsidies” and “neither loss-making nor profit-making trade” could only be used as a temporary measure in specific regions, specific periods, and special circumstances.

Third, fair and reasonable price policies were upheld based on the classification of ethnic areas. For areas in the first category, the principles set by the Fifth National Price Conference should be observed. For areas in the second and third categories, specific implementation plans should be proposed by province based on local actual situation in line with the spirit of the Fifth National Price Conference, and submitted to the Ministry of Commerce for approval and implementation. It was highlighted that national purchase prices shall be conscientiously implemented, including the policy of high price for high grades, and practices that violated the policies, such as forcing grades or prices up or down, shall be firmly opposed.

Fourth, on the issue of acquisition and supply, the meetings iterated that the guiding principle for ethnic trade was to actively organize and guide the sales and production of native products and organize the supply of means of production and subsistence in large quantities, so as to promote the improvement of ethnic minorities in production and life. The Third and Fourth National Ethnic Trade Conferences further called for solution to special needed commodities of ethnic minorities, and the National Symposium on Special Needed Commodities of Ethnic Minorities held in March 1956 drew up a catalogue of special needed commodities of ethnic minorities and the method for supply.

Fifth, on the issue of ethnic trade officials, the meetings regarded the cultivation and training of ethnic minority officials as an important task, which could be conducted by means of practices while teaching and learning, commercial cadre schools, and short-term training courses. They added that it was necessary to give positions and powers to ethnic officials, strengthen the unity of officials of all ethnic groups, and overcome Han chauvinism and local national chauvinism. The National Working Conference of Heads of Ethnic Trade Divisions (Sections) held in February 1957 formulated a plan for training ethnic officials. In the second five-year plan period, ethnic officials should represent 70–80% of the officials in moderate areas with a large proportion of ethnic minority populations and 40–50% in poor areas with a small proportion of ethnic minority populations. In addition, within 5 years, basically every company run by autonomous region, prefecture and county must have at least one ethnic deputy or chief at manager, section, unit, and team levels, or of the sales department.

From 1951 to 1956, four national ethnic trade conferences were held, as well as ethnic trade meetings at different levels in various ethnic areas, which fully demonstrated the important status of ethnic trade in ethnic work and economic work in the early days of the PRC. Among them, the second to fourth national ethnic trade conferences supplemented and improved the guidelines and policies formulated by the first conference based on the actual development of ethnic trade over the past few years. After 1957, due to changes in the national situation, the Work on Ethnic Trade was greatly affected, and the national ethnic trade conference came to a standstill. It was not until October 20, 1962 that the Fifth National Ethnic Trade Work Conference was reconvened (Yao and the then Minister of Commerce 1984).

Achievements and experiences of ethnic trade in the early days of the PRC

At the beginning of the PRC, frontier ethnic areas where ethnic minorities lived had relatively slow economic development and very complicated social situation due to historical conditions. While barriers between ethnic groups were not yet eliminated, ethnic minorities still did not understand the policies of the CPC and the State. Despite such hardships and dangers, ethnic trade pioneers went deep into frontier ethnic areas after PLA. Through ethnic trade activities, they vigorously publicized the CPC’s ethnic policies, and helped the people of ethnic minorities solve their difficulties in production and life, creating favorable conditions for various tasks in ethnic minority areas. This played a very important role in promoting ethnic unity, stabilizing social order, and supporting national construction (Planning Department of the Ministry of Commerce 1984a).

First of all, state-run commercial networks were generally built in the vast ethnic areas, while completing the transformation of private businesses. According to incomplete statistics, state-run commercial institutions in ethnic areas grew from 841 in 1951 to 3609 in 1955, an increase of 3.3 times, with supply and marketing cooperatives established in areas where conditions permitted (Wang 1984). For example, after the establishment of the Guixi Zhuang Autonomous Region (civil administration level) of Guangxi Province in 1953, its three prefectures of Nanning, Baise, and Liuzhou (Yishan) and the Longsheng County of Guilin prefecture were designated as ethnic trade areas involving 43 counties and cities. The trading company system of Guixi Zhuang Autonomous Region was formed, including trading companies at the county level and ethnic trade offices or purchase and sales units below the county level. Commercial institutions and business operations in ethnic areas developed considerably in a progressive manner. By the end of 1956, there were more than 2800 ethnic trade institutions in the region (Ethnic Affairs Committee of Guangxi Zhuang Autonomous Region and Archives of Guangxi Zhuang Autonomous Region 1998a). Economic centers in ethnic regions took shape gradually. Not only a large number of mobile trade squads and traveling salesmen from state-run trading agencies went to vast pastoral areas and mountainous areas, many primary markets and economic centers were fostered and developed, which significantly facilitated the purchase and sales activities of ethnic minorities. For example, the state-run commerce and cooperative commerce in the pastoral region of Xinjiang successively organized more than 1300 mobile trade squads over 6 years, and Xiangxi Miao Autonomous Prefecture dispatched 840 traveling salesmen in the fourth quarter of 1955 for procurement and supply purpose in ethnic areas. The Beizi Temple area in Xilin Gol League of Inner Mongolia and the town of Shuajinsi in the Aba Tibetan Autonomous Prefecture both became grassland economic centers with a population of six to seven thousand. In addition, the areas along the newly built roads, some new cities and market towns sprang up every year, which increasingly changed the economic outlook of ethnic minority areas (Wang 1984). While developing state-run trade, full play was given to the active role of private businesses. The socialist transformation of private businesses began in 1956 and was basically completed in 1958 (1962 in Tibet). For example, there were 12,006 private businesses with 16,704 employees and 1,842,116 yuan of (fixed and mobile) funds in 44 ethnic counties in Guangxi Province. Through direct transition, public-private partnership, cooperative stores (groups) and concentrated agencies, 9882 private businesses were mobilized for socialist transformation at the end of March 1956, accounting for about 82% of the total. They had 13,820 employees and 1,772,334 yuan of funds, representing 82% and 96.21% of the total respectively. The rest 2124 private businesses with 2884 employees and 69,782 yuan of funds were not yet transformed (Ethnic Affairs Committee of Guangxi Zhuang Autonomous Region and Archives of Guangxi Zhuang Autonomous Region 1998d).

Second, with the establishment and development of state-run trading institutions, the ranks of ethnic trade officials kept expanding, growing from about 10,000 in 1951 to 60,563 in 1955. Among them, ethnic minority officials increased from 1700 to 12,098, taking up 20% of the total (Wang 1984). For example, according to statistics at the end of 1956, there were more than 8500 ethnic trade officials in 31 ethnic inhabited counties and cities in the western region of Guangxi Province, accounting for about 50.5% of the total officials. Leading officials also accounted for a considerable proportion. In Baise Special Area, for example, 750 or 41% of the officials at the unit level were ethnic minorities, according to the 1956 data (Report 1998). In addition, the political, professional, and cultural levels of ethnic minority officials were greatly improved. In particular, many leading officials of ethnic minorities were trained to hold important positions such as department directors, managers, section chiefs, and unit chiefs. Many honorably joined the CPC and the Youth League (Li 1984). These maturing ethnic officials played a huge role in carrying out commercial work in ethnic areas, better meeting the needs of people of all ethnic groups, strengthening ethnic unity through closer ties with people of all ethnic groups, and implementing the CPC’s ethnic policies. At the same time, Han officials made extensive contacts and exchanges with people of various ethnic groups by studying and publicizing the CPC’s ethnic policies. They not only made great progress in thought and work, but also forged friendly ties with local ethnic groups that promoted the unity and development of all ethnic groups.

Third, the acquisition and supply of commodities was expanded according to the needs of ethnic minorities, thus opening up and invigorating the market. Ethnic areas rendered few agricultural products, but relatively abundant local specialties that completely relied on market for sales. In other words, the sales of such native products affected the supply of materials and furthered the production and life of ethnic minorities. However, due to inconvenient transportation in most of the ethnic areas, the acquisition of native products in the past was limited to very low prices or very few varieties, which failed to bring appropriate benefits to the people of ethnic minorities. After 1949, the government regarded the acquisition of native products as an important task of ethnic trade. In addition to expanding the acquisition of major native products, markets were created for many native products that were unsalable over the years, and new products were explored to scale up acquisitions. This played an important role in domestic supply, ensuring exports, supporting industrial construction, and promoting the development of production and life in ethnic minority areas. In terms of supply, there was a noticeable increase in the variety, color, and quantity of commodities. Commodities in special needs by ethnic minorities were added into supply after the Third National Ethnic Trade Conference. According to incomplete statistics, the acquisition and supply in ethnic minority areas nationwide were worth 1130.71 million yuan, and 1604.39 million yuan in 1955 respectively, both up by more than 7 times compared with 1951. For example, wool purchased by Qinghai in 1954 multiplied by 5.5 times compared with 1950; the native products purchased by Guixi Zhuang Autonomous Prefecture in the first half of 1955 doubled in value over the same period of 1954; and the native products provided by Luodian Buyi Autonomous County in Guizhou Province increased from 3 in 1951 to 115 in 1955 (Wang 1984). In Kaili region of Guizhou Province, ethnic trade stores invested more than 3.1 billion yuan in purchasing various native products from May 1952 to August 1954, which created an average household income of more than 356,000 yuan (Liu 1954). Commodities in special needs by ethnic minorities provided in Qinghai Province quadrupled in 1955 as compared with 1952, while such commodities provided in Yunnan Province grew from 1000 varieties in 1953 to 5000 varieties in 1955. The allocation of some under-supply commodities, such as tea and silk, also took account of the needs of ethnic regions. Yunnan, Qinghai, and Sichuan set up sales divisions for commodities in special needs by ethnic minorities in early 1956 (Wang 1984). Guangxi adopted many preferential measures with respect to the daily necessities of ethnic minorities and commodities in special needs. For example, cotton cloth was generally and urgently needed by ethnic minorities. Before 1958, cotton cloth was supplied in ethnic mountainous areas through stamps of uncertain amount, and cotton yarn for self-woven and self-use was provided as alternative to cloth to meet their needs. Priority was also given to ethnic minorities in the supply of salt, sugar, tobacco, alcohol, kelp, and salted fish. As to commodities in special needs such as laces, silk threads, silver jewelry, musical instruments, beads, gun powder, and hunting equipment, no matter the value or the place of origin, people were assigned to organize purchases and special counters were set up for supply. These practices effectively stimulated the economic development of fraternal ethnic areas, driving the continuous improvement of production and life. At the same time, the purchase and sale of ethnic trade expanded year by year. According to the statistics of 31 counties and cities inhabited by ethnic groups in Guangxi at the end of 1956, the total value of purchase and supply for the whole year increased 5.5 times and 3.2 times compared with 1952 respectively (Ethnic Affairs Committee of Guangxi Zhuang Autonomous Region and Archives of Guangxi Zhuang Autonomous Region 1998a). Besides, the long-term dominance of foreign products in frontier ethnic areas such as Yunnan, Xinjiang, and Tibet was undermined as domestic products were increasingly diversified and welcomed by virtue of high quality and low price, boosting patriotism among people of all ethnic groups (Planning Department of the Ministry of Commerce 1984b).

Last but not least, fair and reasonable price policies ensured to a certain extent reasonable and stable prices in ethnic areas. Historically, exchanges in frontier ethnic areas had been seriously unequal in value, which greatly weakened the purchasing power of ethnic minorities and impaired the improvement of production and life in these areas. In the early years of the PRC, the continued adjustment of the purchase prices of native products and the implementation of freight subsidies to remote mountainous areas gradually brought down the price ratio of industrial and agricultural products and thereby enhanced the purchasing power of ethnic minorities. For example, in Xining city, 50 kg of wool could be exchanged for only 4 pieces of Fu Tea in 1946, but 25 pieces of Fu Tea in 1955. In Taijiang Miao Autonomous County of Guizhou Province, 25 kg of rice were previously exchanged for 0.5 kg of salt, and 50 kg of tung oil for a bolt of homespun cloth, but in 1953, 10 kg of salt or 5 bolt of homespun cloth could be obtained (Wang 1984). For the mountainous townships of Qibainong, Sanyiyang, and Bansheng more than 75 km from the county town in Du’an Yao Autonomous County of Guangxi Province, local residents went to a market town more than several kilometers away from home for transactions as there was no local market, and they were subject to heavy exploitation by Han merchants, often exchanging 0.5 kg of wood mushrooms for 0.5 kg of salt, one egg for one needle, one fat pig plus one dog for a half-old quilt. After 1952, shops and purchase and sales groups were successively set up in these mountainous areas, which greatly facilitated the transactions and increased the income of the local Yao people (0.5 kg of wood mushrooms could be exchanged for 10–15 kg of salt, and one egg for one pack of needles), and tremendously changed the local economic outlook (Ethnic Affairs Committee of Guangxi Zhuang Autonomous Region and Archives of Guangxi Zhuang Autonomous Region 1998a).

The Second National Ethnic Trade Conference also stipulated that ethnic trading companies received 80% of its funds from the State and 20% from bank loans, and there was no need to turn in profits. This not only enabled the accumulation of ethnic trade funds, but also supported the price policy implementation to a certain extent, which was conducive to production development in ethnic minority areas. Ethnic minorities showed growing recognition of the CPC and the government. “Roots of grass on the mountains and rocks (for road construction) below the water become valuable after the people’s government came here,” said the Yi people in Liangshan area, “led by the CPC, we have cloth and salt…to make veil longer than 3.3 meters.” This reflected the improvement to the vital interests of the Yi people brought by the price of state-run commercial enterprises (Office of the Ethnic Affairs Committee of the National People's Congress 1957).

In short, under the guidance of the CPC’s ethnic policies in the spirit of the national ethnic trade conferences, ethnic trade made great progress in the early days of the PRC through various measures, including establishing, consolidating and developing state-run trading agencies and active supporting the development of supply and marketing cooperatives; uniting legitimate private businesses and the restoration and establishment of primary markets; implementing fair and reasonable price policies that took into account both public and private companies; adopting the method of combining economic leadership and administrative management; and actively training and cultivating of ethnic minority officials. A few basic experiences in ethnic trade in the early days of the PRC can be summarized as follows (Planning Department of the Ministry of Commerce 1984a):

First, by upholding the guidelines and policies formulated by the national ethnic trade conferences, the Work on Ethnic Trade has been elevated to be as important as political affairs. The Work on Ethnic Trade has been fully recognized as an important work of the CPC, as well as a long-term economic, political and ethnic work. Ethnic trade officials should uphold the basic principles and requirements of safeguarding ethnic equality and ethnic unity, serving the people wholeheartedly, and opposing Han chauvinism and bureaucratic capitalism. As Vice Premier Chen Yun said at the First National Ethnic Trade Conference, “Trade is an important part of ethnic work at this stage. Trade workers in fraternal ethnic areas are also officials of the ethnic affairs commission serving for both economic and political affairs. You must bear the political task of uniting fraternal ethnic groups and consolidating national defense on top of the economic work” (Chen 1984). For this reason, it was required to train and promote ethnic minority officials in a planned way, so as to make it easier to understand the needs of ethnic minorities and leverage ethnic trade to serve ethnic minorities. Meanwhile, the Han officials of ethnic trade organizations were required to study ethnic trade policies, familiarize themselves with ethnic languages and customs, and often investigate the needs of ethnic minorities in production and life, so that the commercial work could be closely connected with ethnic minorities.

Second, the Work on Ethnic Trade should start from reality by persisting in investigation and research, and practical and feasible methods were adopted to render ethnic and regional characteristics. For example, the purchase of native products was carried out properly according to the actual situation, ranging from the determination of varieties, quantities, specifications, and prices to the storage and transportation of commodities. It should be neither developed blindly nor treated conservatively. For another example, the supply of commodities was organized according to the needs of people of various ethnic groups, taking into account the different characteristics of the history, culture, production and life of ethnic minorities, as well as the changes of commodities in special needs by ethnic groups. The generalized practices in certain regions were corrected and improved in a timely manner based on actual conditions. These positive experiences reflect the fine conduct and tradition of the CPC.

Third, vigorous efforts were made to train trade officials of ethnic minorities. This is a key factor for the success of ethnic work and one of the core connotations of the CPC’s ethnic policies. The Work on Ethnic Trade is directly related to the production and life of ethnic minorities. On the one hand, the training of ethnic trade officials played a very important role in publicizing the CPC’s ethnic policies, building close relations with ethnic minorities, and enhancing ethnic unity. The multiple flexible methods of training ethnic officials formed in practice according to local conditions and aptitudes have positive guiding significance for a long period of time. On the other hand, the Han officials were encouraged and required to learn and implement the CPC’s ethnic policies and establish close relations with people of ethnic minorities in their Work on Ethnic Trade. This has driven the formation of the consciousness of the Chinese nation while contributing to ethnic unity.

Due to various factors, there were also many deficiencies and problems in practice in various places. Policy formulation, commodities supply, and regulatory systems in some regions were highly unspecific as they did not give due consideration to the characteristics and needs of ethnic minority regions. State-run businesses underperformed to different degrees in their business operations in terms of the understanding of serving the people, the purchase of native products, and price control of certain commodities (Planning Department of the Ministry of Commerce 1984b). For example, trade work in Guangxi failed to fully consider the economic characteristics of ethnic minority mountainous areas and the needs of ethnic minorities in terms of acquisition and supply, unified purchase and marketing, policies for private businesses, division of labor within state-run cooperatives, and establishment of specialized agencies. As a result, the Work on Ethnic Trade tended to be unspecific, and the policies for the Work on Ethnic Trade were not well implemented (Ethnic Affairs Committee of Guangxi Zhuang Autonomous Region and Archives of Guangxi Zhuang Autonomous Region 1998c). In 1958, with the rise of the Great Leap Forward, many regions removed all levels of ethnic trade administrations, and relaxed necessary assistance and preferential measures for ethnic areas, and weakened the management of commodities in special needs by ethnic minorities. Not only the production and life of ethnic minorities were greatly affected, but also the economic construction in ethnic areas was severely impaired. The Work on Ethnic Trade was not resumed until the Fifth National Ethnic Trade Conference was held in October 1962.

Conclusion

Among the various ethnic tasks carried out in the early days of the PRC, the Work on Ethnic Trade and medical and health care were highly effective in improving people’s livelihood. The Work on Ethnic Trade, combined with supply and marketing cooperatives, drove to a large extent the exchange of materials and the development of production in ethnic areas. It thus made very positive contributions to prospering the economy in ethnic areas, improving the life of ethnic minorities, supporting national industrialization, and developing foreign trade. The Work on Ethnic Trade also facilitated ethnic work, and played an important role in promoting the recognition of the CPC and the government among the masses of ethnic minorities, fostering close ties between the central government and ethnic minority areas, and consolidating and strengthening ethnic unity. Despite some deficiencies and defects in actual work, the effectiveness and significance of the Work on Ethnic Trade in the early days of the PRC is beyond doubt.

The practice of the Work on Ethnic Trade in the early days of the PRC not only embodies the CPC’s ideas of ethnic equality and ethnic unity, but also demonstrates the tremendous efforts of the CPC and the government in building a modern unified multi-ethnic country. The implications of the Work on Ethnic Trade help us deeply understand the dialectical relationship between the development of ethnic minority areas and the modernization of the country, the objective fact of the “three inseparables ties”¹ regarding ethnic groups and the pluralist unity of the Chinese nation, and the people-centered governance philosophy and the livelihood-oriented development philosophy of the CPC and the government. It is appropriate to say that the Work on Ethnic Trade in the early days of the PRC as a great practice of the CPC’s ethnic policies provides positive and useful experience for devising the right path with Chinese characteristics to resolving ethnic issues.