How Did China Become So Economically Succesful?
China is now known to be the superpower that rules trade. They are not only manufacturing household items but have successfully made some of the most advanced things to exist. Trade is easily their biggest asset, and online sites such as Alibaba and Aliexpress only give the world a glimpse into what China is capable of manufacturing.
The ability to manufacture quality products also brings the factor of trading those products for profit. China is one of the biggest traders to exist in the 21st century, with $660 million in trade with the USA alone. But how did they get to this point? How did China get to a point where they are nearly as stable as a world superpower where they were previously in a stagnant economy making no progress?
Political Changes
The economy of China was at a stagnant point before 1978. They were not moving, and almost all properties that existed in the state were nationalized. Many rich property owners lost their properties and could not regain control of things. This was majorly due to the reforms made by General Mao. The Maoist ideology majorly consisted of eliminating the thought of a bourgeois China. He feared that China would follow the path of the Soviet decline and fall into the same state. He made reforms and encouraged the youths to fall into the “Red Guard” notion which would criticize anything which seemed bourgeois. This only made them extremely enthusiastic about working toward them that. Many elitists were not only verbally abused but also physically assaulted. The army was stopped and told not to intervene in matters revolving around the red guards.
The economy hit a serious decline, and industrial production declined by 12% in 1968 compared to 1966. Many people who were living in China made a lot of them migrate from the country to others in hopes of finding a better living. General Mao’s reign finally ended in 1976, and that is where an economic uprise was seen. After years of being stagnant and making no progress in the financial world, the changes that came after this was what helped stabilize the economy.
The leader who came next made it possible for China to trade again. They joined the World Trade Organization, and the political party eased their rules and gave their country trade liberalization. Not only did this affect the economy positively, but it also made it possible for industries to grow.
Social Change
China was quick to realize its potential in the industrial world and made reforms that would socially support the people of its country. The government not only made education a major factor in the development of their country but also ensured they had a highly skilled workforce.
Many small businesses were supported, and people were encouraged to work towards a better future. With the government’s ease in control of certain prices and better incentives to those who made a greater profit encouraged industries to produce better products and yield a higher productivity rate.
The government also invested in better infrastructure and more in giving the country a better industry. This meant that industries were given better machinery, better workforces, and more people willing to towards better goals.
The government also encouraged people to move out of the agricultural sector into the industrial sector. Where 4/5 people were involved in the agriculture sector, with time came the point where only one out two people were willing to work in the agricultural industry. The government made sure to focus on rural areas just as much as urban development. This helped them avoid urban migrations and helped workers get off from farms into the industrial sector for a better chance at living.
Not only were the country’s people encouraged to do better for themselves. The government also opened doors for international investments. With foreign trade and investment, more people were encouraged to start businesses and make profits. Better profit policies and incentives made people work more towards a better future, and the economy rose to an excellent point of 9% per year.
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Conclusion
With such major changes China has risen to become an excellent ration which has persisted in growing further but has mainted the growth spurt that started the economic growth. Economists do still argue if China will be able to continue the growth spurt or be left behind with time.
Since China continues to show signs of consistent growth, many have also stated that they will be able to surpass other supreme powers and become a superpower country themselves in the next 20 years.
