The most notable economic history in the economic giant of China began after the Qing dynasty in 1937. China suffered a relapse and needed to have a comeback so that it could effectively compete with the west and acquire the power and resources needed for the brewing Japanese war. The civil wars and the continued Japanese attacks proved to be a challenge to the economic growth in the country that was still striving to make a statement in Asia and the West. It was then that the process of industrialization began, and China started to advance economically. The industries were made in an effort to do what the West was doing to bounce back after the economic depression of the World War (Richardson, Philip, 23). However, even then, because of the enmity caused by the civil war, most people from other countries started boycotting Chinese products and rendered their industries nearly useless. For a more strategic plan, China developed a national budget after the formation of a stable government. The national budget included areas in the country’s economy that needed to be addressed. As a result, most of the sectors that were vital for economic development were considered. Aspects such as infrastructure were addressed. China had a lot of expertise in building and used their industries to develop the necessary materials needed for the construction of a strong infrastructural base that opened the country to others. The infrastructure made it easy to develop a vast market for its products and surpass the issue of the regional boycott. By 1978, China had established a market economy and had registered significant improvement. The domestic industries in the country had numerously increased in number and provided the much-needed employment for the big population. New industries emerged on a frequent basis and gave rise to an economically powerful nation. In addition, China went through an agrarian revolution that was important in ensuring there was surplus food to cater for the high population, which immensely reduced the rate of poverty in its people. In addition, through the 21st century, the country focused on the development of its rural areas. Consequentially, it achieved a uniform economic growth that placed it on a regional and global list as one of the most economically established countries in the world.
Communism was adopted in China to ensure that the industries dwelt on the contributions made from the peasants in the name of sharing. Under the rule of Mao Zedong, the aspects of communism were centered on the industries as opposed to focusing on the people. The focus on the people was one of the reasons for the aspect of socialism (Dirlik, Arif, 10). The consumer goods were given little or no attention at all, and the people continued to perish in poverty. It was Deng Xiaoping who transformed the face of communism and led China to become economically dominant. He adopted the four aspects of modernism that were accrued to the principles of socialism. They were intended to focus on pulling the people out of the economic situation in which they were (Glassman, Ronald, 15). He adopted aspects of industrialization that valued the labor force of the people and incorporated aspects of modern technology. The products produced were not only used for commercial purposes, but were consumed by the people who contributed in terms of the labor force. However, the military established a firm control on the economy and people protested over the degree of the public ownership of land. Modern day China adopted a more relaxed approach to the principle of communism and gave people the right to the privatization of land. People have been given the freedom in a technologically advanced world that was not the case in a traditional Chinese communist economy. The constitution of China was enacted in 1982 to afford people more privacy in their economic and social endeavors. However, it has been under a strict scrutiny from the international community on the aspect of its effectiveness.
The economic transition
The economic growth in China experienced a major transition from 1978. There were a series of structural reforms that subsequently led to the many changes in the country in terms of economic growth. First, there was a registered growth in the private sector owing to the flexibility afforded on the aspect of communism. The state exercised flexible control on private businesses, which thrived and contributed to the growth of the economy. The Chinese government realized that the private sector was a good source of revenue that needed to be nurtured. As a result, the government let the private sector perform its businesses independently, and the results were satisfactory. The sector was a paramount source of revenue acquired through proper taxation systems that were flexible and gave the sector a chance to grow. Additionally, the aspect of distribution of resources was equalized in China from that year. Every sector received a fair share of the country’s resources, which ensured that they all got an opportunity to grow. Additionally, the country adopted different friendly foreign policies that fostered trade with the outside world (Naughton, Barry, 12). Before this transition, China was always considered as rigid when it came to international market forums and trading policies. However, from 1978, the country experienced an overhaul in its foreign policies that opened it to the outside world and ensured that it acquired more economic empowerment through trade. Additionally, the transition involved the exploitation of the advantages that the country had over the rest of Asia. Such was its strategic geographical position and vast population. The geography made the country accessible for trade, and the population was efficient in providing labor. The Chinese government centered on such advantages to achieve economic growth. Furthermore, the period of transition witnessed a massive development in the technology that China used. China adopted the most advanced and modern technologies that helped it to achieve economic prowess and grow its empire.
China has adopted the aspect of free trade agreements (FTAs) because such would provide a good framework that would strengthen the economy of the country ties of the country with the rest. Additionally, the government recognized such agreements to have an impact on the process of domestic reforms that were vital for further economic advancements. Free trade agreements stipulate that the country has no restrictions of trade with whomever it signs an agreement (Hu and Matthias, 250). The Chinese government has currently signed such agreements with over 20 states, 8 of which are still in progress. The countries can freely trade with China at any level. The country cited free trade agreements as a move that will open the country to further integration with the world economy, a move that is anticipated to bring good economic fortunes to China. The country intends to foster good trade corporation with a substantial part of the world because it will lead to further economic development and well-being. In addition, such trade agreements provide a vast market to the ever growing Chinese industrialization sector. Such a market will be vital for the establishment of a versatile economy that will steer China towards becoming the most economically advanced nation by 2020.
Hu, Jiaxiang, and Matthias Vanhullebusch. Regional Cooperation and Free Trade Agreements in Asia. Leiden, The Netherlands: Brill Nijhoff, 2014.
Glassman, Ronald M. China in Transition: Communism, Capitalism, and Democracy. New York: Praeger, 1991. Print.
Richardson, Philip. Economic Change in China, C. 1800-1950. Cambridge: Cambridge University Press, 1999. Print.
Naughton, Barry. The Chinese Economy: Transitions and Growth. Cambridge, Mass: MIT Press, 2007. Print.
Dirlik, Arif. The Origins of Chinese Communism. New York ea. Oxford Univ. Press, 1989. Print.