Agriculture

In 1949, China's grain output was 113.18 million tons, and that of cotton 444,000 tons; the agricultural foundation was fragile. Between 1950 and 1953, the Chinese government carried out a wide-ranging land reform in the rural areas. Peasants with little or no land were given land of their own, greatly arousing their enthusiasm for production. During the period of the First Five-Year Plan (1953-57), the yearly gross output of agriculture increased by 4.5 percent, on average. This period was the first golden time” for China's agricultural development.

From 1958 to 1978, China's agriculture developed slowly. During this period, China practiced the cooperative and people's commune systems in rural areas successively, which emphasized the effectiveness of centralized and unified management, but reduced the efficiency of resource utilization and allocation. As a result, the peasants’ enthusiasm for production was greatly dampened. In this period, the gross agricultural output value increased by only 2.3 percent, on average, every year.

The rise of township enterprises has promoted the all-round development of the agricultural economy. In 1987, the gross output value of township enterprises exceeded that of farming; in 1990, the township enterprises earned 13 billion US dollars from exports, about 23.8 percent of the national gross value of foreign exchange earned from exports. Thousands of towns are playing an important role in eliminating the differences between urban and rural areas, and promoting the integration of urban and rural areas. The per capita net income of farmers increased from 134 yuan in 1978 to 2,210 yuan in 1999.