Since the founding of the People’s Republic of China in 1949. China has been pursuing a modernist vision of rapid economic development by implementing several policy variants.
From the 1950s up to the 1970s, China followed the Soviet model of development. Which meant that industrial production was solely in the hands of the central government whilst agricultural production was controlled by a network of rural collectives.
It was only in 1978 that China started to abandon the planned system and gradually returned to a more market-oriented economy. 1978 marked the beginning of a suite of economic reform policies known as Reform and Opening 改革开放 (gǎigé kāifàng).
Before the reforms, the Chinese economy was dominated by state ownership and central planning. From the 1950s up to the 1970s, Chinese real GDP per capita grew at a rate of only 2.9% per year on average and worse still Starting in 1970, the economy entered into a period of stagnation.
It was then after the death of Mao Zedong that the Communist Party leadership turned to market-oriented reforms to salvage the failing economy.
At this point let me introduce a very important figure Deng Xiaoping who served as the paramount leader of the People’s Republic of China from 1978 to 1989.
Deng Xiaoping was very instrumental in the successful launching of the reforms and he is often credited as the “General Architect”. The Chinese Communist Party launched the reforms on December 18th, 1978
Now, four decades of gradual reform have brought sweeping social and economic changes, which include the return of smallholder agriculture under the Household Responsibility System, the privatization of industrial production, greater integration into the world economy, and the rise of a consumer class.
The success of China’s economic policies and the manner of their implementation resulted in immense changes in China. Economic Development in the Chinese context aimed to improve living standards for the Chinese citizenry by increasing agricultural and industrial outputs, generating employment opportunities, and increasing household incomes
Success in China’s economic reforms can also be measured partly by its rapid economic growth in GDP per capita. By 2010 China was the second largest economy in the world.
Perhaps you might ask yourself “Why were economic reforms successful?”
The basic elements of a market economy were successfully introduced and adopted by the Chinese government in the initial stage of reform. It is also worth considering that China has a huge amount of human capital plus the competence of Chinese leaders in carrying out economic reforms, all contributed to the success and development of the Chinese contemporary economy
Are there any Shortcomings?
So, is everything perfect? No!
There are still a number of institutional shortcomings in the form of state control, lack of competition, and bureaucratic interference in the market economy
But! It is important to note that Even in the face of these shortcomings The Chinese people were able to get rich through hard work and entrepreneurship.
Final Thoughts about modern China economic development
Here are my final thoughts. The Chinese government shows great determination to continue reforming in the future and those who will participate in this economy as it is developing may as well be heavily rewarded in the future even though they have to endure the bureaucracy, legal challenges and sometimes corruption. Well, those are just opinions.
This is why we should consciously consider China in the East and not only narrow our attention to the west developed nations. The numerous economic reforms that have been stimulating growth and development in China over the past four decades is evidence enough that China shouldn’t be ignored. So therefore, this just a snapshot of what has been happening in the contemporary China a period from 1978 to the present day.