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Approved for Release: 2020/08/11 C02000172 CONFIDENTIAL # Communist China Said to Have Revised Economic Plans ## Communist China realizes that the pace of its industrialization program has been "too fast." [blank] the pace of industrial expansion, stepped up greatly in 1958, has overburdened technicians and administrators "beyond the limits of endurance" and led to inadequate planning and coordination. The resulting difficulties have forced the regime to revise downward its economic development plans. In the railroad industry, for example, development plans are said to have been revised downward "considerably," with one important improvement postponed from 1961 to mid-1963. This information is in line with other indications that China's economy has been having trouble sustaining the rapid pace of development exacted since 1958. In 1960, agriculture, still the most important single sector in the economy, had its second poor year in a row; light industry, which depends heavily on agriculture for raw materials, did not meet its production targets; and heavy industry had more than its usual share of problems. Shortages of industrial raw materials have probably affected current output, lags in capital construction have affected the rate at which new industrial capacity is being added, and continued denial to CPR of Soviet technicians who were withdrawn during the summer would necessitate a fundamental revision of existing plans for industrial development. In 1960, the appellation "leap forward" was applied only to those increases scheduled for heavy industry; goals for agriculture and light industry were not said to fit under this definition. If Peiping's future plans for heavy industry envisage significantly smaller increases in output, the economic development plan known as the "leap forward" will have lost its last vestige of reality. CONFIDENTIAL 11 Jan 61 CENTRAL INTELLIGENCE BULLETIN Page 3 Approved for Release: 2020/08/11 C02000172

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