The rise and fall of China's TVE coalmines

Abstract

The ‘economic miracle’ of township and village owned enterprises (TVEs) in China has led to claims that China's success has depended on the prosperity of TVEs and also that they are expected to be the major source of growth in China's future development. Since the late 1990s, however, the Chinese government has implemented an extensive TVE closure policy. This paper, based on case studies on China's TVE coalmines in particular and the entire coal industry in general, explores underlying forces that have driven both the rise and the fall of TVE coalmines. It has found that the earlier rise of TVE coalmines was forced upon the nation to accommodate her crying need for economic development. The subsequent fall, however, became inevitable when China was forced to confront the further challenges of transition and globalisation. The struggle between pro‐ and anti‐ closure of TVE coalmines reflects the enormous difficulty for China to cope with the tangled challenges from development, transition and globalisation, and contributes to the continuing state of uncertainty governing the future of TVEs.

Keywords:

• Coal
• TVE
• development
• transition
• globalisation
• China
• policy making

Notes

Though they constitute three per thousand only of the TVEs at national level.

China's TVE coalmines are defined as ‘those coalmines collectively owned or operated by towns and villages, those privately owned, and those excluded from state owned coalmines and foreign invested coalmines’ (Ye and Zhang, 1998:16). Despite so many categories in fact, the Chinese commonly call them TVE coalmines or small coalmines.

Of more than 30 towns in Shenhmu County, the revenue of some came almost completely from TVE coalmines.

The proportion of a deposit successfully removed by the miners.

In 1995 there were 14,432 TVE coalmines extracting coal in key SOE's coalfields, of which 7,526 or 52 percent had no licenses at all (Ye and Zhang, 1998: 83).