Hostname: page-component-586b7cd67f-2brh9 Total loading time: 0 Render date: 2024-11-22T08:39:32.976Z Has data issue: false hasContentIssue false
  • English
  • Français

‘Energizing’ Relations: Western European industrialists and China's dream of self-reliance. The case of Ente Nazionale Idrocarburi (1956–1965)*

Published online by Cambridge University Press:  21 December 2016

VALERIA ZANIER
VALERIA ZANIER*
Affiliation:
Department of International History, London School of Economics and Political Science, United Kingdom Email: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

This article explores the relationship between Chinese officials and Western European industrialists, revealing that in the second half of the 1950s, there already was a specific Western European interest in China's market potential, and that this was met with favour on the Chinese side. In order to become a strong and independent country, the People's Republic of China was especially interested in evaluating a wide range of offers in the chemical and energy sectors. By looking at the early achievements of the Italian company, National Hydrocarbon Holding (Ente Nazionale Idrocarburi, ENI), this article will show how its offer in terms of technology and engineering met with the favour of the Chinese at the beginning of the 1960s. This was just when the local petroleum industry was moving towards self-reliance, which China ultimately achieved, albeit for a short time. Sources show that, despite economic and political constraints, PRC decision-makers were perfectly aware of prices and commercial strategies, as well as of the state-of-the-art technology of the time. Furthermore, China's commercial cooperation with Western European companies in the 1950s–1960s meant that early on Chinese leaders had an opportunity to evaluate market alternatives to their tightly constraining alliance with the Socialist bloc.

Type
Research Article
Information
Modern Asian Studies , Volume 51 , Special Issue 1: Circumventing the Cold War: The parallel diplomacy of economic and cultural exchanges between Western Europe and Socialist China in the 1950s and 1960s , January 2017 , pp. 133 - 169
Copyright
Copyright © Cambridge University Press 2017 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

*

The research for this article was initially financed by Ca’ Foscari University of Venice and has proceeded thanks to a generous grant from the European Union 7th Framework Programme (FP7/2007-2013). I wish to thank all colleagues who offered their valuable comments on earlier versions of this article. In particular, I am grateful to Odd Arne Westad, Anna Soulsby, Jari Elorantaa, and one anonymous reviewer of this journal.

References

1 China's incorporation into the system of command economies, based on the Soviet model, started at several levels in the early months of 1949. Kirby, W. (2006). ‘China's Internationalization in the Early People's Republic: Dreams of a Socialist World Economy’, The China Quarterly, Vol. 188, pp. 870–890 CrossRefGoogle Scholar.

2 Shen, Zhihua and Xia, Yafeng (2015). Mao and the Sino-Soviet Partnership, 1945–1959. A New History, Lexington Books, Lanham, pp. 88–91 Google Scholar.

3 Naughton, B. (2006). The Chinese Economy. Transitions and Growth, MIT Press, Cambridge, Massachusetts Google Scholar.

4 One of the few books about this topic is: Lim, Tai-Wei (2008). China's Quest for Self-reliance in Oil: The Story of Fushun, Yumen, and Daqing, Edwin Mellen Press, Lewiston, New York Google Scholar.

5 Wen, Houwen et al. (2002). Bainian shiyou [100 Years of Petroleum] 1878–2000, Dangdai Zhongguo Chubanshe, Beijing, p. 156 Google Scholar.

6 It is interesting to note that in the early 1970s China even started to export oil products on a small scale. See: Chow Chuen-ho, L. (1992). ‘The Changing Role of Oil in Chinese Exports, 1974–89’, The China Quarterly, Vol. 131, pp. 750–756 CrossRefGoogle Scholar.

7 Bramall makes this point, quoting Eckstein, A. (1966). Communist China's Economic Growth and Foreign Trade, McGraw-Hill, London, p. 137 Google Scholar. See: Bramall, C. (2009). Chinese Economic Development, Routledge, London, p. 100 Google Scholar.

8 Eckstein, Communist China's Economic Growth, pp. 218–219.

9 The ratio of imports to the gross national product was about 4 per cent. The ratio varies according to the exchange used when making the calculation. Eckstein, Communist China's Economic Growth, pp. 120–122.

10 Holzman, F. D. (1976). International Trade under Communism: Politics and Economics, Basic Books, New York Google Scholar.

11 Kornai, J. (1992). The Socialist System. The Political Economy of Communism, Clarendon Press, Oxford CrossRefGoogle Scholar.

12 Ibid.

13 Apre oggi i suoi lavori a Mosca la Conferenza economica internazionale, in l'Unità, 3 Aprile 1952. On the Moscow Conference see: Robin, T. (2007). ‘Les relations commerciales de la France et de la Grande-Bretagne avec la République populaire de Chine, à la lumière de la Conférence économique internationale de Moscou d'avril 1952’, Revue d'Histoire Diplomatique, no. 1, pp. 55–72 Google Scholar.

14 Zhai, Qiang (1992). ‘China and the Geneva Conference of 1954’, The China Quarterly, Vol. 129, pp. 103–122 Google Scholar.

15 The analysis of China's economic institutions under Mao is based on the following sources: Central Archives of the Chinese Academy of Social Sciences (eds) (1991). Zhonghua renmin gongheguo jingji dang'an ziliao xuanbian (duiwaimaoyi zhuan) [Collected PRC Economic Archive Materials (Foreign Trade)], Shehui kexue wenxuan chubanshe, Beijing, and Donnithorne, A. (1967). China's Economic System, George Allen and Unwin, London Google Scholar.

16 Instituto nazionale per la storia del movimento di liberazione in Italia (INSMLI), Fondo Dino Gentili, Letter Comet Beijing to Comet Rome, 22 March 1955. According to information gathered by Spartaco Muratori in Beijing, the China National Import–Export Corporation ended its coordinating role in early 1955. Nevertheless, the company maintained its offices in East Berlin in order to facilitate contacts with Western Europe.

17 Hongse (jituan) youxian gongsi Hongse huarun bianweihui [China Resources (Group) Ltd. Editorial Committee] (2010). Hongse huarun [The Story of ‘Red’ China Resources], Beijing, p. 260.

18 Donnithorne, China's Economic System.

19 Chen and Xie played a vital role in providing grain imports from the West in the early 1960s. See: Mitcham, C. J. (2005). China's Economic Relations with the West and Japan, 1949–79. Grain, Trade and Diplomacy, Routledge, London Google Scholar.

20 I would like to take this opportunity to thank Lucia Nardi, the managing director of the ENI Historical Archives, who welcomed my project and facilitated my research. Special thanks are due to Anna Landolfi, Daniela Scamuzzi, and all the personnel working in Pomezia for the kind and professional help they provided during my visits.

21 Many books on China's economic growth agree that the years of the Socialist planned economy brought a generalized improvement. However, little analysis is offered of the integration of pre-1978 elements in post-1978 China. Some exceptions are in: Justin, Yifu Lin (1996). China's Economic Miracle: Development Strategy and Economic Reform, The Chinese University of Hong Kong University Press, Hong Kong Google Scholar; Naughton, The Chinese Economy; Lardy, N. (1994). China in the World Economy, Institute for International Economics, Washington DC Google Scholar.

22 As pointed out in the first study dedicated to this subject, in many cases the strategic nature of these committees was liable to doubt and was indeed often contested. Adler-Karlsson, G. (1968). Western Economic Warfare. A Case Study in Foreign Economic Policy, Almqvist and Wiksell, Stockholm Google Scholar. On Cocom and Chincom, see also: Cui, Pi (2000). Meiguo de lengzhan zhanlve he Bali tongchou weiyuanhui, Zhongguo weiyuanhui 1945–1994 [US Cold War Strategy, Cocom and Chincom], Dongbei Shifan Daxue Chubanshe, Changchun; 2nd ed. Google Scholar: Zhonghua Shuju, Beijing, 2005; Zhang, Shuguang (1999). Economic Cold War: America's Embargo Against China and the Sino-Soviet Alliance, 1949–1963, Woodrow Wilson Center Press, Washington, DC. Google Scholar

23 In May 1957, the British Board of Trade spoke of 207 items on the embargo list for China but not controlled for the Soviet bloc: among these were ‘some machine tools, electric motors and generators, rubber working machinery, most motor vehicles and tractors, most railway locomotives, rolling stock and other railroad equipment, most internal combustion engines, some scientific instruments, rubber and most tires, and various chemicals’. Such items matched most of the main interests that European companies had with China before the war and some of the new interests which China's fast industrialization seemed ready to import. Cf. ‘Easing of Controls on China Trade’, The Times, 31 May 1957.

24 The contributions of Dobson, Cain, Førland, and Jackson have shown a more multi-faceted relationship between the United States and Western European allies, highlighting how will to power and economic questions played a crucial part in a conflict traditionally described as ideologically driven. Cf. Cain, F. (2007). Economic Statecraft During the Cold War: European Responses to the US Embargo, Routledge, London Google Scholar; Dobson, A. P. (2012). US Economic Statecraft for Survival 1933–1991: Of Embargoes, Strategic Embargoes, and Economic Warfare, Routledge, London Google Scholar; Førland, T. E. (1991). ‘“Selling Firearms to the Indians”: Eisenhower's Export Control Policy, 1953–1954’, Diplomatic History, Vol. 15, No. 2, pp. 221–249 Google Scholar; Jackson, I. (2001). The Economic Cold War: America, Britain, and East-West Trade, 1948–1963, Palgrave, New York CrossRefGoogle Scholar.

25 On the impact of such economic and technological exchanges on Eastern European transition, see, among others: Autio-Sarasmo, S. and Miklossy, K. (eds) (2011). Reassessing Cold War Europe, Routledge, London Google Scholar. On trade and technology exchanges, see also: Eloranta, J. and Ojala, J. (eds) (2005). East–West Trade and the Cold War, University of Jyvaskala, Jyvaskala Google Scholar. On the increasing interaction between East and West in the framework of détente, see: Romano, R. and Romero, F. (2014). ‘Special Issue: European Socialist Regimes Facing Globalization and European Co-operation: Dilemmas and Responses’, European Review of History, Vol. 21, Issue 2 CrossRefGoogle Scholar.

26 See: Eckstein, Communist China's Economic Growth.

27 ‘[. . .] in 1957 there was a significant drop in Soviet export to China, as reported in “Vneshnyaya torgovlya” n. 10 (October 1958)’. The National Archives (TNA), FC 1121/14. Despatch of the British Embassy in Moscow to the Northern Department, Foreign Office, 6 November 1958.

28 East-West trade discussion in Washington, 4 March 1962, T 312/612, PRO. Quoted in Cain, F. (2005).‘Computers and the Cold War: United States Restrictions on the Export of Computers to the Soviet Union and Communist China’, Journal of Contemporary History, Vol. 40, No. 1, pp. 131–147 CrossRefGoogle Scholar.

29 The most exemplary case is the Center for the Development of Cultural and Economic Relations with China (Centro Cina), founded in 1953 and directed by the anti-fascist intellectual, Ferruccio Parri. For a description of the activities of the Center, see: Samarani, G. (2014). ‘Roma e Pechino negli anni della Guerra Fredda: il ruolo del Centro Studi per le relazioni culturali ed economiche con la Cina’, in Meneguzzi, G. and Samarani, G. (eds), La Cina di Mao, l'Italia e l'Europa negli anni della Guerra fredda, Il Mulino, Bologna, pp. 93–118 Google Scholar.

30 In 1952, Chinese and Japanese signed their first private commercial agreement of the post-Second World War era. During the Cold War, economic relations were always at risk because of politics. For an informed analysis, see: Soeya, Y. (1998). Japan's Economic Diplomacy with China, 1945–1978, Oxford, Oxford University Press Google Scholar.

31 Until now the most exhaustive study on the chemical fertilizer sector and on the commerce between China and North Atlantic countries is: Liu, Jung-Chao (1971). China's Fertilizer Economy, Aldine Publishing, Chicago Google Scholar.

32 On the British case, see also: Boardman, R. (1976). Britain and the People's Republic of China, 1949–1974, MacMillan, London Google Scholar; Tuck-Hong Tang, J. (1992). Britain's Encounter with Revolutionary China, 1949–1954, Palgrave Macmillan, Basingstoke CrossRefGoogle Scholar; Timberlake, P. P. (1994). The Story of the Icebreakers in China, The 48 Group Club, London Google Scholar.

33 Grabicki, M. (2015). Breaking New Ground. The History of BASF in China from 1885 to Today, Hoffmann und Kampe Verlag, Hamburg Google Scholar.

34 On the German case, see Bernardini's article in this special issue.

35 On the French case, see Romano's article in this special issue.

36 For a detailed analysis of Gentili's endeavours with China, cf.: Capisani, L. (2013). ‘Dino Gentili, la Comet e il dialogo commerciale fra Italia e Cina (1952–58)’, Studi Storici, no. 2, pp. 419–447 Google Scholar.

37 Mitcham, China's Economic Relations with the West, p. 122.

38 Ibid.

39 Goods appearing on the consolidated list of goods embargoed for China by England in June 1951. Cf. Board of Trade Journal, 8 November 1957.

40 See: Cain, Economic Statecraft During the Cold War.

41 ENI was created by law no. 136 passed on 10 February 1953, which became operational on 11 April of the same year. Enrico Mattei became chairman on 4 March 1953. Cf. www.eni.com, [accessed 13 July 2016].

42 Carnevali, F. (2000). ‘State Enterprise and Italy's “Economic Miracle”: The Ente Nazionale Idrocarburi, 1945–1962’, Enterprise and Society, Vol. 1, Issue 2, June 2000, pp. 249–278 CrossRefGoogle Scholar.

43 Regarding the lack of vertical integration, see: Pozzi, D. (2010). Dai gatti selvaggi al cane a sei zampe’, Enterprise and Society, Vol. 11, Issue 2, pp. 414–416 Google Scholar; Carnevali, ‘State Enterprise and Italy's “Economic Miracle”’.

44 Pozzi, ‘Dai gatti selvaggi al cane a sei zampe’; Venanzi, F. and Faggiani, M. (eds) (1994). ENI: un'autobiografia, Sperling and Kupfer editori, Milano Google Scholar.

45 According to Pozzi, it was the National Iranian Oil Corporation, not ENI, who invented the formula. See: Pozzi, ‘Dai gatti selvaggi al cane a sei zampe’, p. 412.

46 Cf. Venanzi and Faggiani (eds), ENI: un'autobiografia, p. 33.

47 The circumstances of Mattei's death have given rise to very popular conspiracy theories. Though such theories are not rooted in any source, after more than 50 years, they still exert influence, even on valuable scholars. Cf. Buccianti, G. (2005). Enrico Mattei. Assalto al potere petrolifero mondiale, Giuffré, Milano; Galli, G. (2005). Enrico Mattei: petrolio e complotto italiano, Baldini Castoldi Dalai editore, Milano. A balanced analysis of the existing literature is found in Pozzi, ‘Dai gatti selvaggi al cane a sei zampe.’

48 Central Intelligence Agency Bulletin, 20 December 1958, in CIA CREST Database.

49 RG 59 General Records of the Department of State, Research and Analysis Branch (OSS) and Bureau of Intelligence Research, Intelligence Reports, October 1951–August 1961, 7631–7674, Box 319, Folder: Report N. 7912, 31 December 1958.

50 The episode is narrated in Pini, M. F. (2013). Italia e Cina. 60 anni tra passato e futuro, L'Asino d'oro, Roma Google Scholar.

51 National Security Council (NSC) 5411/2 ‘US Policy towards Italy’, RG 59 General Records of the Department of State, Executive Secretariat, Records Relating to National Security Council Policy Papers, 1947–1979, Lot 63D351 and 66D95, Entry A1 1586E, From: NSC 5410 Memoranda to: 5417 Memoranda Box 32.

52 INSMLI, Fondo Dino Gentili, Letter n. 175, Comet Rome to Comet Beijing, 7 February 1955.

53 Archivio Storico ENI (hereafter: ASE), Fondo ENI, Relazioni Esterne, b. 56.

54 Ibid.

55 Ratti's memories of the 1958 China trip are reported in: Venanzi and Faggiani (eds), ENI: un'autobiografia.

56 Cf. Samarani, G. (2007). ‘Enrico Mattei e la Cina’, in Guarnieri, D. (ed.), Enrico Mattei. Il comandante partigiano, l'uomo politico, il manager di stato, Istituto di Storia Contemporanea, Ferrara, pp. 91–98 Google Scholar.

57 Cf. Perrone, N. (2001). Enrico Mattei, Il Mulino, Bologna, p. 109 Google Scholar. Perrone's text is based on the recollections of Alvise Savorgnan di Brazzà, ENI's chief public relations officer. The fact that the mission had such a political content could explain why it is not documented in the ENI Archives.

58 This description was made by Aldo Moro, Italian statesman and one of the most influential figures among the left-wing Christian Democrats. Cf. Venanzi and Faggiani (eds), ENI: un'autobiografia, p. 196.

59 Liu, China's Fertilizer Economy.

60 After the discovery and exploitation of a big natural gas field in Ravenna, ENI started its adventure in the chemical industry. As the productive capacity of the Ravenna field far exceeded heating needs for northern Italy, the company diverted them for industrial use. Cf. Colitti, M. (2008). ENI. Cronache dall'interno di un'azienda, EGEA, Milano, pp. 168–169.Google Scholar

61 ASE, Fondo ENI, Relazioni Esterne, b. 56.

62 INSMLI, Fondo Dino Gentili, Nota di Spartaco Muratori a Dino Gentili, 9 Aprile 1956. Although it is not possible to find such an agreement, this document confirms that in Beijing, Spartaco was waiting for his son's arrival alongside ENI's mission.

63 ENI Archives have not preserved anything other than Giovanni Muratori's report of the exploratory mission. Giovanni Muratori only worked at the Società Nazionale Metanodotti for a short period, after which he was employed in the long term by CERN in Geneva.

64 The Yumen oilfield was already known to the Chinese before the founding of the PRC: ‘In October 1939 Sun Jianchu finished his first report on Yumen titled Gansu Yumen Youtian Dizhi Baogao (Geological Report on the Oilfields of Gansu Yumen), completing one of the earliest comprehensive indigenously-generated geological reports of China's oil resources in modern times.’ Cf. Shen, Zhongguo Shiyou Gongye Fazhan Shi [A History of the World Oil Industry], p. 33, quoted in Lim, China's Quest for Self-reliance in Oil.

65 Cf. Cheng, Chu-yuan (1976). China's Petroleum Industry. Output and Growth, Praeger, New York Google Scholar.

66 Lim, China's Quest for Self-reliance in Oil, p. 144.

67 Chu-yuan, Cheng (1984). The Demand and Supply of Primary Energy in Mainland China, Chung-Hua Institution for Economic Research, Taipei Google Scholar; distributed by University of Washington Press, Seattle, p. 160.

68 Cf. Lieberthal, K. and Oksenberg, M. (1986). Bureaucratic Policy and Chinese Energy Development, University of Michigan Press, Ann Arbor, p. 66 Google Scholar.

69 Other leading characters in the petroleum industry were: Gu Mu, Sun Jingwen, and Lin Hujia. Some of them went on to become principal economic specialists in the mid-1970s (Yu, Kang, and Gu), while others led key ministries and became the links between the top leaders and the bureaucracy (Tang, Song, and Sun). Cf. Lieberthal and Oksenberg, Bureaucratic Policy.

70 ASE, Fondo ENI, Presidenza, b. 72.

71 ASE, Fondo ENI, Presidenza, b. 72. Relazione della missione ENI a Pechino, 27 Settembre–6 Ottobre 1959.

72 Ibid.

73 ASE, Fondo ENI, Presidenza, b. 56. Memorandum senza firma, 8 Settembre 1960.

74 The CIA acknowledged the famine in China only in February 1961. Cf. Zhang Shuguang, Economic Cold War, p. 244.

75 In December 1958 Mao stepped down as head of state. He was replaced by Liu Shaoqi in the spring of 1959.

76 Under the new policy of ‘readjustment’ (of the pace of development), ‘consolidation’ (of existing plants), ‘reinforcement’ (of the weak links), and ‘improvement’ (of quality of products), by 1965, most of the industrial output had attained 1958–59 levels. Cf. Cheng Chu-yuan (1971). The Economy of Communist China 1949–1969, University of Michigan, Center for Chinese Studies, Ann Arbor. pp. 4–5.

77 Document no. 010-002-00112 preserved in the Beijing Municipal Archives. The document, drafted by the PRC Science and Technology Committee (中华人民共和国科学技术委员会) and the Ministry of Oil Industry (中华人民共和国石油工业部), is dated December 1962. It shows plans for the development of the oil industry over the next 10 years (1963–1972), testifying to the PRC's interest in obtaining foreign cooperation.

78 ASE, ENI, Estero, b. 123. Lettera di Ratti, 15 dicembre 1961.

79 Ibid

80 ASE, ENI, Estero, b. 123. Lettera di Armani, 31 gennaio 1962.

81 ASE, ENI, Estero, b. 123. Telespresso n. 335/24 (12 marzo 1962) dal Console Italiano a Hong Kong (Piero Guadagnini) al Ministero degli Affari Esteri e al Ministero del Commercio Estero.

82 Cf. Maugeri, L. (1994). L'arma del petrolio. Questione petrolifera globale, guerra fredda e politica italiana nella vicenda di Enrico Mattei, Loggia de’ Lanzi, Firenze Google Scholar.

83 Kochavi, N. (2002). A Conflict Perpetuated: China Policy During the Kennedy Years, Praeger, Westport, Connecticut. Google Scholar

84 For an analysis of Italian diplomatic relations with the PRC, see Meneguzzi Rostagni's article in this special issue.

85 ASE, ENI, Relazioni Esterne, b. 1. Ratti, Relazione Missione E.N.I. in Cina, febbraio–marzo 1962.

86 Member firms of the cartel included: West Germany's BASF AG, Hoechst AG, Ruhr Stickstoff AG; Austria's Oesterreichische Stickstoffwerke; Italy's SEIFA; Norway's Norsk Hydro; The Netherlands’ Centraal Stickstoff-Verkoop-Kantoor n.v.; Belgium's COBELAZ Comptoir Belge de l'Azote; France's Syndicat Professional de l'Industrie des Engrais Azotes; and the Swiss LONZA AG (a non-exporting member). See: Mitcham, China's Economic Relations with the West, p. 98.

87 Liu, China's Fertilizer Economy, p. 60.

88 ASE, ENI, Relazioni Esterne, b. 1. Ufficio Commerciale ENI, Relazione sui principali contratti commerciali siglati con operatori esteri, 21–27 maggio 1962.

89 ASE, ENI, Relazioni Esterne, b. 1. Riunione preliminare con la delegazione cinese, Berna, 2 novembre 1962, Relazione di Armani.

90 ENI Historical Archives, b. 1.

91 Information from personal contacts with former Società Nazionale Metanodotti technical personnel.

92 Cf. Mitcham, China's Economic Relations with the West, p. 147.

93 ASE, ENI, Estero, b. 123. Promemoria di Tosoni per l'ingegner Girotti.

94 Li, Mingjiang (2011). ‘Ideological Dilemma: Mao's China and the Sino-Soviet Split, 1962–1963’, Cold War History, Vol. 11, No. 3, pp. 387–419 Google Scholar.

95 Cf. Martin, G. (2008). ‘Playing the China Card? Revisiting France's Recognition of Communist China, 1963–1964’, Journal of Cold War Studies, Vol. 10, No. 1, pp. 52–80 CrossRefGoogle Scholar.

96 For a detailed analysis of China's financial and trade relations with Britain, and for the role of Hong Kong, see Peruzzi's essay in this special issue.

97 TNA, BT 241/646.

98 Cf. Mitcham, China's Economic Relations with the West.

99 Cf. Badel, L. (2010). Diplomatie et grands contrats: l'Etat francais et le marchés extérieurs au XXme siècle, Publications de la Sorbonne, Paris, pp. 314–315 Google Scholar.

100 ASE, ENI, Estero, b. 40. Memorandum firmato da Ratti e Zhu Jianpai a Berna, 30 gennaio 1963.

101 See Meneguzzi Rostagni's article in this special issue.

102 ASE, ENI, Estero, b. 98. Relazione sulla missione ENI mission a Pechino, 19–26 dicembre 1964.

103 Ibid.

104 ASE, ENI, Estero, b. 98. Relazione sulla visita della delegazione ENI a Shanghai, 8–10 marzo 1965.

105 Ibid.