Explain the factors responsible for the rise of the Chinese economy.
China represents the third main alternative centre of power and is the fastest growing economy. China at some time had its basis in the Soviet model which at that time disconnected all the links with the capitalist world. Factors responsible for its rising economy are as follows:
(i) Use of Soviet Model:
China accepted the Soviet model and depended on its resources. China decided to substitute imports via domestic goods and form state-owned heavy industries from capital that was produced by agriculture.
(ii) Development of Industrial Economy:
China employed all its resources for developing an industrial economy. All citizens are given education as well as health programmes.
(iii) Relation with the United States of America:
China established a relation with the United States of America in the year of 1972.
(iv) Modernisation:
Modernisations within the field of military, industry, science, agriculture as well as technology were proposed.
(v) Major Policies Announced:
Open door policy was announced by Deng Xiapong in the year of 1978 whose aim was at a generation of higher productivity via investments in technology as well as capital from abroad.
(vi) Privatisation Era:
The privatisation of agriculture in the year of 1982 and that of industry in the year of 1998 was done.
(vii) Establishment of Special Economic Zones:
Special Economic Zones were set up with the state having a centralised role in setting up China’s economy.
