Milk From the Butterfly Spring: State and Enterprise in the Yunnan Dairy Industry

Abstract

Founded in 1959, the Dengchuan Milk Products Factory was both an individuated enterprise and an asset in the development of western Yunnan. This article examines the six-decade transformation of Dengchuan from state-owned industry, to officially promoted dragon head, and finally as a wholly owned subsidiary of the New Hope Group. Even as the company enjoyed greater managerial independence, it has relied on the government for materials, market access, and the development of its dairy base, a relationship that only recently reversed as the company responded to demands for capital investment and productive upscaling. Albeit on a much smaller scale, this relationship is comparable to the business groups that dominate sectoral development in strategic industries.