1. I was here in Guangdong in 1984.
At that time rural reform had been under way for several years,and we were just beginning to introduce urban reform and to establish special economic zones.
Eight years have passed since then.This time, during my trip here,I have found that the rapid growth in the Shenzhen and Zhuhai special economic zones and some other areas has exceeded my expectations. After what I have seen,I am even more confident.
2. Revolution means the emancipation of the productive forces,and so does reform. The overthrow of the reactionary rule of imperialism,feudalism and bureaucrat-capitalism helped release the productive forces of the Chinese people. This was revolution,so revolution means the emancipation of the productive forces. After the basic socialist system has been established,it is necessary to fundamentally change the economic structure that has hampered the development of the productive forces and to establish a vigorous socialist economic structure that will promote their development. This is reform,so reform also means the emancipation of the productive forces. In the past,we only stressed expansion of the productive forces under socialism,without mentioning the need to liberate them through reform. That concept was incomplete. Both the liberation and the expansion of the productive forces are essential. In upholding the line, principles and policies formulated since the Third Plenary Session of the Eleventh Central Committee of the CPC, it is essential to adhere to the principle of''one central task and two basic points''. If we did not adhere to socialism, implement the policies of reform and opening to the outside world, develop the economy and raise living standards,we would find ourselves in a blind alley. We should adhere to the basic line for a hundred years, with no vacillation. That is the only way to win the trust and support of the people. Any one who attempted to change the line, principles and policies adopted since the Third Plenary Session of the Eleventh Central Committee would not be countenanced by the people; he would be toppled. I have said this several times. Had it not been for the achievements of the reform and the open policy, we could not have weathered June 4th. And if we had failed that test, there would have been chaos and civil war. The "cultural revolution" was a civil war. Why was it that our country could remain stable after the June 4th Incident? It was precisely because we had carried out the reform and the open policy, which have promoted economic growth and raised living standards. The army and the government should therefore safeguardthe socialist system and these policies. In the short span of the last dozen years, the rapid development of our country has delighted our countrymen and attracted worldwide attention. This suffices to prove the correctness of the line, principles and policies ，adopted since the Third Plenary Session of the Eleventh Central Committee. No one could change them, even if he wanted to. After all that's been said, I can sum up our position in one sentence: we shall keep to this line and adhere to these principles and policies. Since we introduced the reform and the open policy, we have drawn up many rules and regulations covering all fields of endeavour. Clear-cut guidelines and policies concerning economic and political affairs, science and technology, educational, cultural, military and foreign affairs have been worked out and expressed in precise terms. The recent Eighth Plenary Session of the Thirteenth Central Committee was a success. It declared that the rural household contract responsibility system with remuneration linked to output should remain unchanged. Any change in that system would cause concern among the people, who would say that the Central Committee had altered its policy. In the initial stage of the rural reform, there emerged in Anhui Province the issue of the "Fool's Sunflower Seeds". Many people felt uncomfortable with this man who had made a profit of 1 million yuan. They called for action to be taken against him. I said that no action should be taken, because that would make people think we had changed our policies, and the loss would outweigh the gain. There are many problems like this one, and if we don't handle them properly, our policies could easily be undermined and overall reform adversely affected. The basic policies for urban and rural reform must be kept stable for a long time to come. Of course, as the reform progresses, some of these policies should be improved or amended as necessary. But we should keep firmly to our general direction. It doesn't matter much whether we can come up with new ideas.
What matters is that we should not change our policies and should not make people feel that we are changing them. Then, the prospects for China will be excellent. We should be bolder than before in conducting reform and opening to the outside world and we should have the courage to experiment. We must not act like women with bound feet. Once we are sure that something should be done, we should dare to experiment and blaze a new path. That is the important lesson to be learned from Shenzhen. If we don't have the pioneering spirit, if we're afraid to take risks, if we have no energy or drive, we cannot blaze a new path, a good path, nor can we accomplish anything new. Who dares to claim that he is 100 per-cent sure of success and that he is taking no risks? No one can ever be 100 per cent sure at the outset that what he is doing is correct.
I've never been that sure. Every year leaders should review what they have done, continuing those measures that have proved correct, acting promptly to change those that have proved wrong and tackling new problems as soon as they are identified. It will probably take another thirty years for us to develop a more mature and well-defined system in every field.
The principles and policies to be applied under each system will also be more firmly established. We are constantly accumulating more experience in building a Chinese-style socialism. Judging from the local press, the provinces have gained considerable experience, each proceeding in the light of its own particular features. That's good. Creativity is precisely what we want.
11. The reason some people hesitate to carry out the reform and the open policy and dare not break new ground is, in essence, that they're afraid it would mean introducing too many elements of capitalism and,indeed, taking the capitalist road. The crux of the matter is whether the road is capitalist or socialist.
The chief criterion for making that judgement should be whether it promotes the growth of the productive forces in a socialist society,increases the overall strength of the socialist state and raises living standards. As for building special economic zones, some people disagreed with the idea right from the start, wondering whether it would not mean introducing capitalism. The achievements in the construction of Shenzhen have given these people a definite answer: special economic zones are socialist, not capitalist. In the case of Shenzhen, the publicly owned sector is the mainstay of the economy, while the foreign-invested sector accounts for only 25 percent. And even in that sector, we benefit from taxes and employment opportunities. We should have more of the three kinds of foreign-invested ventures [joint, cooperative and foreign-owned]. There is no reason to be afraid of them. As long as we keep level-headed, there is no cause for alarm. We have our advantages: we have the large and medium-sized state-owned enterprises and the rural enterprises.
More important, political power is in our hands. Some people argue that the more foreign investment flows in and the more ventures of the three kinds are established,the more elements of capitalism will be introduced and the more capitalism will expand in China. These people lack basic knowledge. At the current stage, foreign-funded enterprises in China are allowed to make some money in accordance with existing laws and policies. But the government levies taxes on those enterprises, workers earn wages from them, and we learn technology and managerial skills. In addition, we can get information from them that will help us open more markets.
Therefore, subject to the constraints of China's overall political and economic conditions, foreign-funded enterprises are useful supplements to the socialist economy, and in the final analysis they are good for socialism. The proportion of planning to market forces is not the essential difference between socialism and capitalism. A planned economy is not equivalent to socialism, because there is planning under capitalism too; a market economy is not capitalism, because there are markets under socialism too. Planning and market forces are both means of controlling economic activity. The essence of socialism is liberation and development of the productive forces,elimination of exploitation and polarization, and the ultimate achievement of prosperity for all. This concept must be made clear to the people. Are securities and the stock market good or bad? Do they entail any dangers? Are they peculiar to capitalism? Can socialism make use of them? We allow people to reserve their judgement, but we must try these things out. If, after one or two years of experimentation, they prove feasible, we can expand them. Otherwise, we can put a stop to them and be done with it. We can stop them all at once or gradually, totally or partially. What is there to be afraid of? So long as we keep this attitude, everything will be all right, and we shall not make any major mistakes. In short, if we want socialism to achieve superiority over capitalism, we should not hesitate to draw on the achievements of all culturesand to learn from other countries,including the developed capitalist countries, all advanced methods of operation and techniques of management that reflect the laws governing modern socialized production.
12. In developing the economy, we should strive to reach a higher level every few years. Of course, this should not be interpreted as encouraging unrealistic speed. We should do solid work, stressing efficiency, so as to realize steady, coordinated progress. Guangdong, for example, should try to ascend several steps and catch up with the "four little dragons" of Asia in twenty years.
In relatively developed areas such as Jiangsu Province, growth should be faster than the national average. Shanghai is another example. It has all the necessary conditions for faster progress. It enjoys obvious advantages in skilled people, technology and management and can have an impact over a wide area. In retrospect, one of my biggest mistakes was leaving out Shanghai when we launched the four special economic zones. If Shanghai had been included, the situation with regard to reform and openingin the Yangtze Delta, the entire Yangtze River valley and, indeed, the whole country would be quite different.
13. For a big developing nation like China, it is impossible to attain faster economic growth steadily and smoothlyat all times. Attention must be paid to stable and proportionate development, but "stable" and "proportionate" are relative terms, not absolute. Development is the absolute principle.
We must be clear about this question. If we fail to analyse it properly and to understand it correctly, we shall become overcautious, not daring to emancipate our minds and act freely. Consequently, we shall lose opportunities. Like a boat sailing against the current, we must forge ahead or be swept downstream.
16. There are two tasks we have to keep working at: on the one hand, the reform and opening process, and on the other, the crackdown on crime. We must be steadfast with regard to both. In combating crime and eliminating social evils,we must not be soft. Guangdong is trying to catch up with Asia's ''four little dragons'' in 20 years, ot only in terms of economic growth, but also in terms of improved public order and general social conduct -- that is, we should surpass them in both material and ethical progress.
Only that can be considered building socialism with Chinese characteristics. Thanks to a strict administration, Singapore has good public order. We should learn from its experience and surpass it in this respect. Since China opened its doors to the outside world, decadent things have come in along with the others, and evils such as drug abuse, prostitution and economic crimes have arisen in some areas. Special attention must be paid to these evils, and resolute measures must be taken to stamp them out and prevent them from spreading. After the founding of New China, it took only three years to wipe these things out. Who in this world has ever been able to eliminate the abuse of opium and heroin? Neither the Kuomintang nor the capitalist countries. But facts have shown that the Communist Party was able to do it. Throughout the process of reform and opening, we must combat corruption. Cadres and Party members should consider it of prime importance to build a clean government. But we still have to rely on the law, which provides a firm guarantee. In short, so long as we develop our productive forces, maintain a reasonable economic growth rate, promote reform and opening and, at the same time, crack down on crime, we shall be able to build a socialist society with advanced ethical standards.
Throughout the process of reform and opening, we must also adhere to the Four Cardinal Principles.
19. The implementation of the correct political line must be ensured by a correct organizational line. In a sense, whether we can manage our domestic affairs well, whether we can keep to the socialist road and adhere to reform and the open policy, whether we can develop the economy more rapidly and whether we can maintain long-term peace and stability will all be determined by people.
31. We shall progress forwards along the road to Chinese-style socialism.
32. Capitalism has been developing for several hundred years.
How long have we been building socialism? Besides, we wasted twenty years. If we can make China a moderately developed country within a hundred years from the founding of the People's Republic, that will be an extraordinary achievement. The period from now to the middle of the next century will be crucial. We must immerse ourselves in hard work: we have difficult tasks to accomplish and we bear a heavy burden of responsibility.