chinese economy under deng xiaoping

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"It matters not whether the cat is black or white, as long as it catches mice." Deng Xiaoping

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DENG XIAOPING : The chinese reform
Elmahdi Fathi : 2014-81611

China has always been renowned for being successful in the domains of science and arts, however in previous decades, China has been ravaged by famines, civil discomfort and foreign outsourcing. China was consumed by this injustice until well after the Second World War when Mao Zedong introduced Communism adapted from the U.S.S.R, and created an autocratic socialist system which imposes firm constraints upon the Chinese social, political and economic system. It wasn't until the 1980's China's following leader Deng Xiaoping who focused focused on developing China into a market operated economy and by the 21st century the economy has improved tremendously, improving the standard of living as well as giving freedom of speech, China has now adapted to a successful socialist market economy in which the government still has a large contribution in terms of corporate decisions.

For Deng Xiaoping ,the best way to build a better China was to offer better living conditions as soon as possible, to give people the level of morale they need for further development. At that time, he realized that China’s economic need to reform; he found very effecient ways to reform the China’s economic. His goals were to open up the China’s market to the outside world, breaking down the collective farms, getting rid of

state-run enterprises and providing more jobs for people in the industry. He found that the most important thing was the modernization of agriculture because 80% of the population derived their living primarily from agricultural production. The new contract responsibility system allowed farmers to rent land for individual farming families. Farmers had to sell a certain percentage of their crops to the State with the State’s price, and they could sell the remaining for their own profits. This system had helped the rural income to be doubled. It marked a successful modernization of agriculture. Besides the modernization of agriculture, in the Deng era, there was a shift from central planning and reliance on heavy industry to consumer-oriented industries and reliance on foreign trade and investment. Some of the new factories were purchased from other countries; some of them were built with local resources. Capitalist enterprise was accepted in industry. People were allowed to invest in workshop, hire people to work for them, and earn profits from the work that was done by the employees if they had the funds to do so. Foreign investors were allowed to do the same. They built factories and used cheap Chinese labors to produce goods for export. Deng had set up a successfully solution that lowered the rate of unemployment Chinese and to improve the industrial market. These new factories and workshops not only provided a lot of jobs for unemployed Chinese, but also to have modern machines that was brought in by the foreign

investors

and

Chinese

workers had opportunities to be trained to use it.

Feeling this was not enough to boost the economic up, Deng loaned money from IMF and the World Bank to upgrade machinery and establish new manufacturing and industrial development.He opened a total of five towns and villages and allowed foreign investors to build factories and hire Chinese to work for them. It might not be the best way to reform the economic as a whole, but it played an important role because it benefited the Chinese workers, the investors, and the Chinese government. During the 1980s, Deng promoted the “open door” policy to encourage foreign investment and to trade with the world. China needed larger quantities of raw materials to fuel its industrial growth so they signed contracts for minerals, timer, and so forth. It had not only provided China with raw materials that were needed, but also improved the relations with other neighbor counties and the...
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