A CONVERSATION WITH AMERICAN AUTHOR HARRISON SALISBURY1
JUNE 14, 1988
ZRJ: Secretary Jiang Zemin isn’t in Shanghai, so I’m meeting with you. I’ve read your book—it was the Chinese translation. I welcome you on your visit to Shanghai.
Over the past several decades, Shanghai has made a great contribution to building China. It turned over 80% of its fiscal revenues to the central government. While this was helpful for the development of other provinces and cities, its own construction was affected to a certain extent. Currently, Shanghai’s urban construction is highly indebted, traffic is congested, housing is in short supply, and many urban facilities are in need of renovation.
I’ve been working in Shanghai for several months now, and its population of over 12 million creates great pressure on me. This is because Shanghai is primarily a city of processing industries. Its raw materials, especially agricultural raw materials, all come from other provinces and cities. When prices of these raw materials increase, it causes production costs in Shanghai to go up and its fiscal revenues to go down, putting it in a very difficult position. A while back, prices rose quite a bit, so our people weren’t very satisfied with our work. University students in particular were critical of us.
Salisbury: They’re hoping you’ll do better.
ZRJ: We indeed weren’t doing very well, but since this year, there has been a turnaround in Shanghai because the central government has given us a considerable amount of autonomy and implemented a policy of fiscal contracting. That is to say, whereas in the past Shanghai turned over 80% of its revenues to the central government, it now turns over 70%, and if we do well in the future and create even more revenue, the percentage turned over can be a bit lower still. This way, we have greater autonomy to work on our own construction and on our people’s livelihoods.
Right now there’s a sort of pride in Shanghai, a hope of recovering its place as number one in the country. As a result, the morale of the people of Shanghai is gradually rising and we are gradually overcoming some significant difficulties. For example, this year almost 300,000 people came down with hepatitis,2 but this difficulty has passed. Shanghai used to be the place where implementation of the planned economy was most highly concentrated, but now the concept of a commodity economy is gradually taking root.
I think this May was a turning point in Shanghai’s history. Beginning in May, industrial production in Shanghai began to rise. The industrial growth rate over the last few years was about 4–5%. It was 8.5% this May, and this trend will not weaken. That’s why I’m very confident about the future growth of Shanghai.
Of course a very important condition for the development of Shanghai is that it implement the economic development strategy drawn up by the central authorities for the coastal areas. I should say that the situation in this regard is very good. Shanghai is working very hard to improve the investment environment; foreign entrepreneurs are more interested in Shanghai than they used to be, and investments in Shanghai are also increasing quite rapidly. We plan to build a “New Shanghai” on the eastern side of the Huangpu River. That way we will be able to move industries from the west side of the river to the east side, so traffic congestion and other problems on the west side will be easier to solve. There’s already one tunnel under the Huangpu River; a second tunnel will be opened to traffic by the end of this year. Construction will begin on the Huangpu Bridge by the end of this year, and we’ll start building a second bridge by the end of next year. We’ll also build corresponding ports and airports and develop communications and digital telephone systems. At present we’re using US$3.2 billion in loans made to Shanghai by the World Bank and the International Monetary Fund (IMF). Although quite a few difficulties still lie ahead of us, I’m confident that we will do a good job of building Shanghai.
Salisbury: Mayor Zhu, you’ve described a plan that is both bold and realistic. As I understand it, Shanghai also plans to build a subway.
ZRJ: Work on the subway will start this year. We’ll first use foreign capital for Phase 1; after about four to five years, an underground subway network will take shape.
Salisbury: This should have been done several years ago. Do you agree with me?
ZRJ: In the past, the conditions weren’t there, and we didn’t have the money.
Salisbury: Now you have the power and the money to do it. I’m very glad to hear that. Many years ago I heard that you were talking about building a subway system—this is good for Shanghai’s development. Just now I heard that you’re going to build an airport, and I’m very interested in this. Shanghai’s airport really does need rebuilding. On the one hand, there aren’t enough parking aprons; on the other hand, there aren’t enough baggage-handling facilities. These need to be improved.
ZRJ: [The authority for] civil aviation construction does not lie with the Shanghai local government—jurisdiction lies with the central government. I only make suggestions as a passenger.
Salisbury: I sympathize with you. Over the past two or three months, I’ve constantly flown on CAAC. Each time I have a complaint and want to make suggestions.
ZRJ: Since I started working in Shanghai, I no longer fly, I take the train.
Salisbury: I have another suggestion that you may have already thought of. There are shuttle flights in the United States such as those from New York to Washington or New York to Boston, with one flight every hour or two. The distance from Beijing to Shanghai is almost the same and the traffic is almost as heavy. After Shanghai starts an airline, you could have one flight every hour or two. Also, simplify the procedures so that taking the plane is like taking a car. This would be convenient for passengers while making a lot of money. Businessmen who travel between Beijing and Shanghai would especially need this.
ZRJ: If I were in charge, that’s what I’d do.
Salisbury: On this matter, people’s opinion is what matters most.
ZRJ: There are too many problems right now and they have to be dealt with one by one. Let me give you another example. Quite a number of Shanghai’s water mains were built in the 1930s—they’re over 50 years old. The pipes are old—they often burst and water gushes over the roads. There were four or five such episodes recently, which gave me a lot of headaches. Water has to be shut off whenever something like this happens, and if it’s not handled properly, people might even be hurt or killed.
Inspecting a burst water main at the intersection of Xizang Road and Beijing Road, June 8, 1988.
Salisbury: This sort of thing happens in New York too—I fully understand. If you want to discuss this with someone, you should look up the mayor of New York. Some of New York’s water mains weren’t built in the 1930s but in 1860. They’re over 100 years old and also burst frequently, sometimes even flooding an area. There’s no way other than to upgrade them section by section.
ZRJ: Shanghai also has over 20,000 factories. Most of their equipment is out of date and there’s a danger of fires and explosions. I feel as if I’m sitting on a volcano, not knowing which day it will erupt.
Salisbury: Mayors always have that feeling.
ZRJ: I think the mayor of New York may have an easier time than I do. Over 90% of the industrial enterprises in Shanghai are state-owned and I have to be in charge of them.
Salisbury: The mayor of New York doesn’t have to be in charge of industrial production, but he has to be in charge of many things, such as how to attract enterprises to come to New York. Two-thirds of the mayor’s time is used for meeting businessmen and foreign entrepreneurs. He also is in charge of maintaining New York’s labor force. It’s hard to be a mayor—you have to solve all types of problems.
ZRJ: Every person has his own difficult sutra to recite.
Salisbury: Mayor Zhu, you said the people have complaints. What do they complain about?
ZRJ: First, prices. For several decades, Chinese people have been accustomed to unchanging prices. Now, although wage increases have surpassed price increases, people still complain. Prices in Guangdong are higher than those in Shanghai, and wages there have also increased more than they have in Shanghai. The people there are already quite used to price increases.
Second, traffic. There are 76,000 people working in Shanghai’s public transit companies, but their work still isn’t enough to satisfy the demands of the people, who swear while they’re riding crowded public transit. I’ve already received many letters from the people asking me to ride the crowded public transit instead of traveling by car.
Third, housing. Shanghai only recently resolved the problems of the households in greatest difficulty, those with 2 square meters of living space per capita. However, it’s very hard to solve the housing issue in Shanghai because people don’t want to leave the central urban area. Because of constraints on commerce, transportation, and education, even when housing is built in the suburbs they’re unwilling to move there. When we develop Pudong, we will have to build beautiful housing complete with all the necessary facilities; otherwise the people won’t be willing to move. They’d rather have just enough space for a bed in central Shanghai than a house in Pudong.
Salisbury: That’s only natural, but it can be resolved once the subway is built.
ZRJ: It’ll be hard to resolve just with one subway line. We must build a subway network.
Fourth, environmental pollution. Industry is developing very quickly now, but pollution management hasn’t kept up.
Salisbury: The pace of pollution management is never as fast as that of industrial development.
ZRJ: I don’t know how long it will take to solve these problems—perhaps 20 years. But at present I must solve the problem of supplying non-staple foods to the people of Shanghai—this is more important than the other issues. I think we have to make it possible for the people to eat well and to eat inexpensively, and I’m making this a breakthrough point for all my work in Shanghai. These past few months, there’s been a great improvement in the supply of non-staples—perhaps heaven is helping us. This year the summer harvest was reduced nationally, but it increased 10% in Shanghai; vegetable production in Shanghai also increased from last year, and prices have been lower than in Beijing and the areas around Shanghai. Of course we can’t be overly optimistic, as production in the rural areas is determined by weather to a large extent. However, Shanghai has strong capacities in industry, science, and technology. It’s possible for us to build an intensive and modernized non-staple production system in Shanghai within two to three years, and to thereby build a stable non-staple production base.
Recently, we also proposed a five-year plan for improving traffic in Shanghai. For now, we can’t immediately develop Pudong and can only use existing facilities. We’ll first implement separate lanes for motorized and nonmotorized vehicles, build some elevated highways, and widen some roads, and then employ some management measures. This way, after five years of effort, Shanghai’s traffic will look very different.
1. This is the main part of a conversation between Zhu Rongji and American author Harrison Salisbury. The Chinese edition of Salisbury’s book The Long March–The Untold Story was published by the People’s Liberation Army Press in May 1986.
2. A hepatitis A epidemic broke out in Shanghai in January 1988 and spread explosively, with the numbers affected reaching 292,000. It was caused by the consumption of infected clams and was eventually brought under control by mid-March.