Economic reforms began during the "Boluan Fanzheng" period, especially after Deng Xiaoping and his reformist allies rose to power with Deng replacing Hua Guofeng as the paramount leader of China in December 1978. By the time Deng took power, there was widespread support among the elite for economic reforms.
- reform and opening-up
Jan 30, 2020 · Chinese Economic Reform - Timeline of Key Events by Matt Slater 30 January 2020 Launched by Deng Xiaoping in 1978, the decades long process of Chinese economic reform has transformed China beyond recognition. This article highlights some of the most significant events during this period in the form of a year by year timeline.
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Dec 01, 2018 · Forty years ago, in December 1978, following a decade of the Cultural Revolution led by Mao Zedong that left the communist country in ruins, a series of transformative economic reforms opened China up to the international community and foreign investment.
Nov 02, 2020 · China's economic reform is a long-term plan to shift from a command economy to a mixed economy. That means its recent slowdown in economic growth is intentional. It's not a sign of a collapse. It's consistent with a long-term plan Chinese President Xi Jinping released in 2015.
China’s liberalization process also has its beginning with the Chinese economic reforms which started in the late 70’s. Given its state of development, the country had a strong focus on the primary sector and the first reforms were related to agriculture.
- The History of China's Economic Development
- Measuring The Size of China's Economy
- Foreign Direct Investment (FDI) in China
- Factors Driving China's FDI Outflow Strategy
- China's Merchandise Trade Patterns
- Major Long-Term Challenges Facing The Chinese Economy
- Challenges to U.S. Policy of China's Economic Rise
China's Economy Prior to Reforms
Prior to 1979, China, under the leadership of Chairman Mao Zedong, maintained a centrally planned, or command, economy. A large share of the country's economic output was directed and controlled by the state, which set production goals, controlled prices, and allocated resources throughout most of the economy. During the 1950s, all of China's individual household farms were collectivized into large communes. To support rapid industrialization, the central government undertook large-scale inve...
The Introduction of Economic Reforms
Beginning in 1979, China launched several economic reforms. The central government initiated price and ownership incentives for farmers, which enabled them to sell a portion of their crops on the free market. In addition, the government established four special economic zones along the coast for the purpose of attracting foreign investment, boosting exports, and importing high technology products into China. Additional reforms, which followed in stages, sought to decentralize economic policym...
China's Economic Growth and Reforms: 1979-the Present
Since the introduction of economic reforms, China's economy has grown substantially faster than during the pre-reform period, and, for the most part, has avoided major economic disruptions.10 From 1979 to 2018, China's annual real GDP averaged 9.5% (see Figure 3). This has meant that on average China has been able to double the size of its economy in real terms every eight years. The global economic slowdown, which began in 2008, had a significant impact on the Chinese economy. China's media...
The rapid growth of the Chinese economy has led many analysts to speculate if and when China will overtake the United States as the "world's largest economic power." The "actual" size of China's economy has been a subject of extensive debate among economists. Measured in U.S. dollars using nominal exchange rates, China's GDP in 2018 in nominal U.S. dollars was $13.4 trillion, which was 65.3% of the size of the U.S. economy, according to estimates made by the IMF. China's 2018 per capita GDP in nominal dollars was $9,608, which was 15.3% of the U.S. per capita level. Many economists contend that using nominal exchange rates to convert Chinese data (or those of other countries) into U.S. dollars fails to reflect the true size of China's economy and living standards relative to the United States. Nominal exchange rates simply reflect the prices of foreign currencies vis-à-vis the U.S. dollar, and such measurements exclude differences in the prices for goods and services across countrie...
China's trade and investment reforms and incentives led to a surge in FDI beginning in the early 1990s. Such flows have been a major source of China's productivity gains and rapid economic and trade growth. There were reportedly 445,244 foreign-invested enterprises (FIEs) registered in China in 2010, employing 55.2 million workers or 15.9% of the urban workforce.27 As indicated in Figure 11, FIEs account for a significant share of China's industrial output. That level rose from 2.3% in 1990 to a high of 35.9% in 2003, but fell to 25.9% in 2011.28 In addition, FIEs are responsible for a significant level of China's foreign trade. At their peak, FIEs accounted for 58.3% of Chinese exports in 2005 and 59.7% of imports, but these levels have subsequently fallen, reaching 41.7% and 43.7%, respectively, in 2018 (see Figure 12). The United Nations Conference on Trade and Development (UNCTAD) reports that China has become a both a major recipient of global FDI as well as a major provider of...
A key aspect of China's economic modernization and growth strategy during the 1980s and 1990s was to attract FDI into China to help boost the development of domestic firms. Investment by Chinese firms abroad was sharply restricted. However, in 2000, China's leaders initiated a new "go global" strategy, which sought to encourage Chinese firms (primarily SOEs) to invest overseas. One key factor driving this investment is China's massive accumulation of foreign exchange reserves. Traditionally, a significant level of those reserves has been invested in relatively safe but low-yielding assets, such as U.S. Treasury securities. On September 29, 2007, the Chinese government officially launched the China Investment Corporation (CIC) in an effort to seek more profitable returns on its foreign exchange reserves and diversify away from its U.S. dollar holdings.34 The CIC was originally funded at $200 billion, making it one of the world's largest sovereign wealth funds.35 Another factor behind...
Economic reforms and trade and investment liberalization have helped transform China into a major trading power. Chinese merchandise exports rose from $14 billion in 1979 to $2.5 trillion in 2018, while merchandise imports grew from $18 billion to $2.1 trillion (see Table 4 and Figure 15). China's rapidly growing trade flows have made it an increasingly important (and often the largest) trading partner for many countries. According to China, it was the largest trading partner for 130 countries in 2013.40 From 2000 to 2008, the annual growth of China's merchandise exports and imports averaged 25.1% and 24.2%, respectively. However, China's exports and imports fell by 15.9% and 11.2%, respectively, due to the impact of the global financial crisis. China's trade recovered in 2010 and 2011, with export growth averaging 25.8% and import growth averaging 31.9%. However, since that time, China's trade growth slowed sharply. From 2012 to 2014, China's exports and imports grew at an average...
China is currently undergoing a major restructuring of its economic model. Policies that were employed in the past to essentially produce rapid economic growth at any cost were very successful. However, such policies have entailed a number of costs (such as heavy pollution, widening income inequality, overcapacity in many industries, an inefficient financial system, rising corporate debt, and numerous imbalances in the economy) and therefore the old growth model is viewed by many economists as no longer sustainable. China has sought to develop a new growth model ("the new normal") that promotes more sustainable (and less costly) economic growth that puts greater emphasis on private consumption and innovation as the new drivers of the Chinese economy. Implementing a new growth model that sustains healthy economic growth could prove challenging unless China is able to effectively implement new economic reforms. Many analysts warn that without such reforms, China could face a period of...
China's rapid economic growth and emergence as a major economic power have given China's leadership increased confidence in its economic model. Many believe the key challenges for the United States are to convince China that (1) it has a stake in maintaining the international trading system, which is largely responsible for its economic rise, and should take a more active leadership role in maintaining that system; and (2) further economic and trade reforms are the surest way for China to grow and modernize its economy. Lowering trade and investment barriers would boost competition in China, lower costs for consumers, increase economic efficiency, and spur innovation. However, many U.S. stakeholders are concerned that China's efforts to boost the development of indigenous innovation and technology could result in greater intervention by the state (such as subsidies, trade and investment barriers, and discriminatory policies), which could negatively affect U.S. IP-intensive firms. Op...
The first two decades following the founding of the People’s Republic of China in 1949 was marked by periods of substantial growth in per capita GDP growth, the growth of output per person, followed by sharp reversals.
Dec 04, 2020 · Reform in China Long-time Chinese communist leader and founder, Mao Zedong, had repeatedly warned his comrades about 'taking the capitalist road.' Since 1949, China's social, political, and...
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(December 2017) China's Rural Reform (also called Agricultural Reform) was one of the multiple chinese reforms implemented in China in 1978. The reforms were initiated by Deng Xiaoping, the leader of the Communist Party of China at the time.
The reform movement began to sour in 1985. Financial decentralization and the two-price system combined with other factors to produce inflation and encourage corruption. China’s population, increasingly exposed to foreign ideas and standards of living, put pressure on the government to speed the rate of change within the country.