“China is a sleeping giant. Let her sleep, for when she wakes, she will move the world.”
– Napolen Bonaparte (French Military & Political Leader
The western and eastern world have always had a difference in their mindset, be it the rise of their economy’s or be it their transformation into nation states. China has always selected a different path in doing things. After the World War 2, USA had adopted a new form of capitalism which helped in rebuilding Germany, Japan and even France! Nonetheless, China had opted for something else….
China, also referred to as “Middle Kingdom”, has had a rich history of various expeditions, discoveries and inventions. Paper, Gunpowder, silk, and even printing press are the gifts invented by China that today serve as a necessity. Despite of their rich trade history with their inventions, the country had gone through a phase of famine, poverty and depressed economy. The name “China” derives from Qin dynasty, which unified China 2000 years ago.
China flourished during the silk trade. But, between 1839 and 1949, China went through what the world says, “The Century of Humiliation”, in which China suffered great losses. In 1949, Mao Zedong led Chinese Communist Party (CCP) and defeated Nationalist Party (KMT) and became the country’s leader, which led to the rise of one-party rule in the country. Although, Mao Zedong’s policies were for the betterment of the drastically declining economy of China, the results were devastating and so were the consequences. Due to shortage in crops, Mao had made sparrows disappear, thinking that they were eating grain which thus, led to greater damage to crops due to the sudden disrupt in the food chain. Nonetheless, the country’s economy was in depression but the literacy and gender equality rate seemed to have surged, especially in that of the girls and women. A slogan “Woman hold up half the sky” was quite popular in Mao Zedong’s term as the president of China.
China flourished during the silk trade. But, between 1839 and 1949, China went through what the world says, “The Century of Humiliation”, in which China suffered great losses. In 1949, Mao Zedong led Chinese Communist Party (CCP) and defeated Nationalist Party (KMT) and became the country’s leader, which led to the rise of one-party rule in the country. Although, Mao Zedong’s policies were for the betterment of the drastically declining economy of China, the results were devastating and so were the consequences. Due to shortage in crops, Mao had made sparrows disappear, thinking that they were eating grain which thus, led to greater damage to crops due to the sudden disrupt in the food chain. Nonetheless, the country’s economy was in depression but the literacy and gender equality rate seemed to have surged, especially in that of the girls and women. A slogan “Woman hold up half the sky” was quite popular in Mao Zedong’s term as the president of China.
The Rise Of Deng Xiaoping
Deng Xiaoping (also known as the “Father of modern China”) became the president of the People’s Republic of China as the successor of Mao Zedong in 1976. He led the country to the very beginning of what we say the “transformation” of China from being one of the poorest countries to being the economic superpower in today’s world. He believed that the enormous involvement of the government in the economy was the reason for the depressing economy that they were facing. Some of his reforms included:
- Giving more freedom to the economy
- introducing “Consumer Education Law” in 1996
- Provided free and compulsory education for every child in China;
- Township and Village Enterprises (TVEs)
- Sole purpose was to improve: –
- Economic conditions of rural areas
- Living standards of the citizens.
- Outcomes;
- Around 100 million people got employment
- Gap reduced
- China’s total industrial output came from TVEs at a surging 20%
- Sole purpose was to improve: –
- Special Economic Zones (SZEs)
- Sole Purpose:
- Offering tax incentivesEasier bureaucratic processes
- Sole Purpose:
- Less restrictions and regulation to attract foreign investment
- Outcomes:
- Loads of foreign investment which initially improved the economy
Transformation of a fishing village into “Shenzhen”
Deng Xiaoping adopted a new version of capitalism and experimented it ina fishing village in southern China to have port access for more flourishing trade. Initially in 1980, Shenzhen being a small fishing village, had a GDP of 0.3 billion. This led to a massive improvement in the economy of the country. The average income surging from $1 to a whopping $30,000 a year!
The Growth
The sudden sparkle in Shenzhen had impressed the president. He further implemented similar zones across China which attracted companies and foreign investment due to the country’s cheap labour. The economy flourished in a manner no one had ever thought could be possible! The foreign direct investment (FDI) which was at a mere $0.06 billion in 1980 sky-rocketed to $344 billion in 2021! Meanwhile the GDP per capita which was sitting at $983 increased to about $17,312. The fruits of Deng Xiaoping’s policies made the country sprint progress, infrastructure and much more in a pace never imagined before. Deng Xiaoping also increased the communication network within the country to promote smooth transport of both cargo and passengers. Today, China has the largest railway network and railway stations as big as international airports! Not to mention companies like Nike, Volkswagen, Apple and many more invested in this country which not only benefitted their companies but also educated the labour in China.