Article 28 of the Common Program

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Initially, the CCP expropriated the national and public enterprises of the GMD government under the guise of "liberation" from imperialism, feudalism, and bureaucratic capitalism. This policy of dispossession formed the bedrock of the CCP government and its socialist transformation efforts. The CCP's urban expropriation system was established through the expropriation efforts in Northern China, beginning with Shijiazhuang in Hebei province in 1948. This experience became a model for urban expropriation, although the process was fraught with problems.
The first issue was the lack of coordination in expropriation efforts. After the PLA occupied Shijiazhuang, various procurement troops from neighboring liberated areas dismantled and removed plant facilities and components. Each liberated area had its own policies, often prioritizing their local interests. Before the CCP gained a significant advantage in the civil war, their base was in rural areas, and the cities they occupied were relatively small and often not held for long. Consequently, their city management was short-term, viewing urban expropriation as a means of resource procurement. The CCP struggled to control the scramble for resources in Shijiazhuang due to unclear responsibility for urban expropriation and difficulties in unified protection and distribution of resources.
The second issue was the approach to urban expropriation through class struggle. Before expropriating Shijiazhuang, the CCP had implemented a "bottom-to-top" class struggle strategy in rural areas. In Shijiazhuang, CCP cadres formed Poor's Associations and Labor Unions based on class struggle theory, mobilizing them for expropriation. However, members of these associations often engaged in plundering urban goods and taking the law into their own hands under the pretext of liquidation, leading to widespread panic throughout the city. The CCP implemented a "top-down order system" for expropriation, concentrating authority in the Military Control Commission, which handled military, police, cultural, educational, and financial duties. Expropriation Groups operated under a military control lasting 3-6 months in large cities and 2-3 months in smaller ones. Upon stabilizing order, control shifted to local Party committees and governments.
To ensure unified military control, the CCP mandated reporting for cities over 50,000 people and formed the "Northeast Southward Executive Battalion" for expropriation tasks. The Central Policy Research Office was established in late 1948 to create a unified confiscation policy and conduct research. This approach was deemed effective with the peaceful "liberation" of Beijing in January 1949, aiding the CCP's southward campaign. Control methods varied by city, retaining former employees for management and quickly taking over military, police, and press functions.

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A key feature of the CCP’s approach to eliminating Western presence was its deliberate avoidance of compensation claims under international law. Instead of outright seizing or nationalizing foreign property, the CCP leveraged lawful means to persuade foreigners to abandon their property or transfer it to Chinese entities voluntarily. CCP foreign policy experts, many of whom had studied in the West, understood that such tactics would shield China from international compensation demands. As a result, foreign individuals and businesses faced mounting obstacles that ultimately compelled them to leave. By April 1952, major British firms in China had announced their intention to close down operations, a stark departure from their traditional practice of striving to expand commercial activities in the country. This decision was driven by the ongoing decline in the value of foreign investments in China, attributed to heavy taxation, enforced subscription to government loans, restrictive labor legislation, and pervasive government control. As a result, enterprises became increasingly unprofitable and unattractive. Rentals were frozen, taxation raised, demands for considerable repairs at short notice were made, and massive fines imposed. But, again, no outright confiscation as such or a legal nationalization was carried out. Besides Western companies, there were also Russian businesses. The strategy of the CCP was to buy them out. The Quilin Company, a trading entity boasting numerous department stores and warehouses in the Northeast, occupied prime locations in major northeastern cities, evoking memories of the Russian imperialist era and emerging as one of the largest foreign enterprises in the region. Adding complexity to the matter of CCP control, the Soviet government held partial ownership of the company and deployed cadres to assume management roles. Concurrently, CCP authorities assigned cadres to apprentice with Soviet managers at each Qiulin department store. The formal takeover commenced with the acquisition of relatively small-scale supply bases in remote counties and culminated in 1952 with the complete transfer of ownership from Soviet to Chinese hands. An important player on the industrialization of China is Japan. In 1931, Japan transformed Manchuria into the puppet state of Manchukuo. Leveraging its vast colonial territories, population, and resources in northeast Asia, Manchukuo became a significant industrial project for the Japanese. The empire's influence extended further into North and Central China following the outbreak of the Sino-Japanese War in 1937. Alongside the advancing army, Japanese special agents were dispatched to confiscate Chinese factories and mines. In the northern provinces of Shanxi and Hebei, military agents collaborated with the Xingzhong Company, a Mantetsu operation based in Tianjin, to seize control of local industries and businesses.
In Shanxi, numerous factories, including Baojin and most of Yan Xishan’s,(a warlord) were taken over by the Japanese and restructured into military-managed factories under Japanese authority. Their original Chinese names were replaced with serial numbers, and over 40 factories in Shanxi alone were converted to military management. To oversee these confiscated factories and integrate them into Japan’s expanding wartime economy, two new national policy corporations were established: the North China Development Corporation and the Central China Development Corporation. Modeled after the South Manchuria Railway Company, these corporations were tasked with managing industrial production in occupied China during World War II. For instance, in 1949, the New China Economic Construction Company purchased the Baoji Iron Factory, and the Shui Shang Commercial Company. Both factories became publicly owned enterprises and were renamed the New China Scientific Instruments Company. In December 1950, to improve production conditions and expand production capacity, the Beijing Supply Agency decided to merge the two factories, build a new plant, and name the combined entity New China Instrument Machinery Factory. In 1952, to meet the needs of the First Five-Year Plan, the factory was transferred to the Ministry of Heavy Industry and renamed the Beijing Scientific Instruments Factory, officially becoming part of the national enterprise system. In 1954, to better integrate instrument production with educational work, the Ministry of Heavy Industry transferred the factory to the Ministry of Education, renaming it the Beijing Teaching Instruments Factory. On December 22, 1950, the GAC promulgated the Provisional regulations on mining, which specified that the country’s mineral resources were state assets and should be managed by the central government. In April 1950, the Bureau of Petroleum Administration was set up under the Ministry of Fuel Industry. This ministry was in charge of managing and coordinating the production, transportation, and marketing of oil.

 23-11-1953 Decision of the GAC on the Implementation of the Planned Purchase and Planned Supply of Grain

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Chapter 4 of Common Program

• Road to Common Program
• Common Program
• Bibliography
• Documents