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Small Town Gets Rich by Making Socks

We all wear socks. But, how many pairs do we go through in a year? This little question never occurs to most of us, but for the people in Datang, a small town in Zhuji in east China's Zhejiang Province, it is of the utmost importance.

Situated in the center of Zhejiang, Datang has a population of 23,000 and 20,700 of them are farmers. But one out of every two households there earns money by making socks, with 90 percent of the farmers' income coming from making socks.

Local statistics indicate the average consumer in the United States goes through about 30 pairs of socks a year, Hong Kong residents, about 10 pairs, Chinese who live on the east coast of the mainland of China, four to six pairs, while those who live in the country's western regions manage on one pair of socks a year.

This simple answer to that simple question is well known to the people of Datang, and it has given them great confidence.

Every year, Datang manufactures about 8 billion pairs of socks of all kinds, more than enough to provide the whole world with one pair for every person.

Last year, the town realized 12 billion yuan (US$1.45 billion) in output, turning itself from a tiny unknown roadside village to a now nationally famous town, and all of this has happened within a single decade.

Now, an ordinary Datang farmer enjoys an annual income of 10,580 yuan (US$1,275), which is almost 5 times the national average -- 2,200 yuan (US$265).

"The legendary story of Datang's economic boom can perhaps give us some ideas to help deal with the problems faced by farmers, which the Chinese government must give immediate attention to," said Wang Guowei, Party secretary of the Zhuji.

Statistics from the Ministry of Civil Affairs show the rural poor still make up the bulk of the poverty stricken in the nation as a whole. Although around 2 million poverty-stricken households every year have been lucky enough to rise above the nation's poverty line with the help of the government, there are still 6-to-7 million waiting to be lifted out of poverty each year.

"From my experience, I have seen that one way of solving the problem is to reduce the number of farmers," said Wang.

Datang's sock industry is an example of how creating a one-product industry in a particular place through the efforts of all the residents can enable the surplus rural labor force to leave their fields and find a way to get rich. This, in economic jargon, is called a "lump economy."

In Zhuji, there are nine other "lump economies" like that of Datang. The town of Diankou has succeeded in creating its own special hardware manufacturing industry, which reached a total output value of 10 billion yuan (US$1.2 billion) in 2001. Fengqiao, another township in Zhuji, benefits from its shirt industry, and realized a total output value of 6 billion yuan (US$720 million) last year. The town of Sandu has always been linked with its silk shawls, and the town of Xiasanhu with its freshwater pearls.

All these "lump economies" combined helped Zhuji achieve an industrial output value of 55.9 billion yuan (US$6.7 billion), and a gross domestic product (GDP) of 17.4 billion yuan (US$2.1 billion) last year.

According to a recent survey in 2001, covering all the county-level cities in China, Zhuji ranked 66th. Certainly, this was no easy feat for a city with a population of 1.07 million, of which 80 percent are rural residents.

While providing a way for the surplus rural labor force, "lump economies" have also contributed to the quick expansion of the towns, their tertiary industry and social undertakings.

(China Daily March 26, 2002)


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