Planned economy resurrected next month to force the pilot “supply and marketing agency”

China under Xi Jinping is gradually turning back the clock, with many old political systems and social policies that have been changed or optimized reincarnating themselves. The planned economy has recently been resurrected by the government, and the “supply and marketing cooperatives,” which have been described as the last vestiges of the planned economy, will be tested under official leadership starting next month. Some members of the media and the legal profession are deeply concerned about this historical regression, but they dare not say much because of public opinion control. Some Maoists also said that the measures are the official preparations for the lack of materials in the closed country.

Earlier this month, four departments – the China General Chamber of Commerce for Supply and Marketing, the Central Agricultural Office, the People’s Bank of China and the Banking and Insurance Regulatory Commission – jointly issued the “Guidance on the Launching of the “Three-in-One” Integrated Cooperation of Production, Supply and Marketing, and Credit”. The document specifies that the official pilot economic model of “production, supply and marketing, and credit, ‘trinity'” will begin in July and is expected to be completed within two years.

Our reporter called the China General Chamber of Commerce for Supply and Marketing to find out, but the agency refused to respond. We turned to the Sichuan Provincial Supply and Marketing Cooperative to inquire, and the person in charge surnamed Wang confirmed that the government is indeed fully restoring the supply and marketing cooperatives at the township level. It’s just that the name of the institution, the legal entity, and the jurisdictional licensing authority are different from those of the supply and marketing cooperatives during the planned economy.

Director Wang: the original old system, in fact, only a small part of the reservation, now to be in accordance with the market economy of this organization to frame. Because this year, this supply and marketing cooperative regulations should come out soon, it should be said that our grassroots supply and marketing agency it has a legal identity, and then his registration ah, that may be a separate grassroots supply and marketing organization, these are all around the management, are connected through the economy, through the equity connection, its people, property, things are independent, there is no such vertical management of this statement.

Our reporter found that the “opinion” has been quietly issued in the middle of this month in the form of a red-headed document to the supply and marketing cooperatives around the world, the notice requires them to “implement and solidly promote” in accordance with the “opinion”.

Ms. Zheng, a media professional within the system, told us that this is a manifestation of Xi Jinping’s own will and another resurrection of the planned economy that had been officially abandoned after the official announcement of the regulations on supply and marketing cooperatives in 2019. But because of its sensitive nature, no media outlets are willing to discuss it, except for intellectuals who have expressed concern.

Ms. Zheng said: it should be a very sure thing, who knows? He’s just getting more and more that way, and it has nothing to do with the market economy. The media will say whatever the top says, and will not make any interpretation.

The incident has also caused controversy in the Chinese legal profession, with a number of lawyers expressing concern. A lawyer in Shandong pointed out that the incident reflected the future political direction of the country. He said that the planned economy has historically proven to be a complete failure, and this regressive approach is worrying.

But some Maoists in China welcomed the re-emergence of the “supply and marketing agency. Mr. Chen, a Maoist media figure, sees it as a precautionary measure. He said the supply and marketing agency system could be useful in the event that Chinese society becomes untethered from the outside world or falls into a shortage of goods that requires a high degree of official deployment.

Mr. Chen said: economic measures, a kind of precautionary measures, for example, the supply of food and other materials, may be a problem. This he is a product of the planned economy, when the reform and opening up, they threw it away, when the economic downturn, he will use this system of unified deployment ah, to supply this society.

He said the private sector does not yet know how far this possible decoupling will go, while the scale and determination of the officials to rebuild the system remains to be seen.

After Xi Jinping came to power in 2012, the co-ops, which existed in name only, have been mentioned again and given increasing attention by officials. In October 2019, the All-China Federation of Supply and Marketing Cooperatives drafted the “Regulations on Supply and Marketing Cooperatives (Draft for Comments)” for public consultation. However, it has been widely criticized and even ridiculed as a zombie resurrection of the planned economy, and local governments have been taking a wait-and-see attitude towards it.

The planned economy, also known as a command economy, is an economy in which the allocation of resources, including what and how much to produce, is determined by government plans, and was first introduced after the establishment of the Chinese Communist Party in 1949. In 1993, the Third Plenary Session of the 14th Central Committee adopted the Decision on Several Issues Concerning the Establishment of a Socialist Market Economy System, outlining the basic framework of the “socialist market economy” system.