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WEEKLY NEWSLETTER
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China
Index
In late 1978 China initiated a policy of integrating civilian
and military industry more closely in order to promote overall
civilian economic development. This policy entailed civilianizing
the machine-building ministries to make the defense industry more
responsive to civilian control and needs; increasing defense
industry production of civilian goods, particularly consumer goods;
and transferring technology from the more advanced defense sector
to the civilian sector of the economy. Production of civilian goods
totaled 6.9 percent of total defense industry output in 1975. In
1980 it rose to 18 percent, and by 1985 it had jumped to 41.8
percent of total output. Chinese officials predicted that by 1990
about 80 percent of defense industry output would be civilian
goods. The large excess capacity of the defense industry, resulting
from declining orders from the PLA, made possible the rapid growth
in civilian output. The defense industry manufactured a wide
variety of goods for civilian use, including motor vehicles,
optical equipment, television sets, electrical appliances,
pharmaceuticals, and medical instruments and prostheses. Many of
these products were consumer goods in high demand. For example, in
1985 the Ministry of Ordnance Industry manufactured 500,000
motorcycles, representing two-thirds of total motorcycle output, as
well as 250,000 cameras, 450,000 bicycles, and 100,000
refrigerators.
Following the formulation of regulations and mechanisms for
such transfers, defense industries began transferring technology to
civilian industries on a large scale in the mid-1980s. Technology
transfers provided defense enterprises with additional, lucrative
sources of income and furnished civilian enterprises with a wide
range of useful, advanced technology to modernize production. For
example, the Ministry of Astronautics disseminated aerospace
technology to light industry and to the petroleum, chemical
engineering, machine-building, textile, communications, medical,
and electronics industries.
Data as of July 1987
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