Tuesday, December 11, 2012

First draft of final paper



Bingzhe Xu
12/11/2012
Draft 1
Policy “Reform and Opening up” in China
       China can be divided in two parts; one part that is Mao ruled from 1949 to 1976, another part is from 1976 until now. China has a great change when a Policy was implemented called “Reform and Opening up” in 1978. This paper will introduce the background of this policy, what this policy process is, and what advantage and disadvantage.
       The background of Policy
       The Culture Revolution was launched by Mao in 1966, which want to exterminate capitalism in China. Mao thinks it is still exists struggle classes in China and some people want to walk in the “capitalist road”. This movement barely destroyed Chinese economy and culture. China never made a little improvement during this Culture Revolution. At that time, Mao’s personality cult is very serious; some important nation leaders like Deng Xiaoping, Liu Shaoqi were defeated because of against Mao.[1]
After Mao dead in 1976, Deng Xiaoping took power of China again. In 1978, China still had bad economy and Chinese had low living standard level. Planning economy exists in everywhere. Deng Xiaoping wanted to reform Chinese economy that market decides everything. Although Mao’s death two years later, China still has strongly struggle classes and market economy is a symbol of capitalism, people were worried about if reforming is a good decision. After a national conference, National leader made a common that we need to stop this struggle classes and personality cult. Developing economy and let people had a good living standard important than other things. Then, Chinese government made a policy called Reform and Opening up and this policy is used until now.
Reform
       The first step reforming is agriculture. In 1981, government made a policy called household-responsibility system, which means every farmer be responsibility to some farm, farmers need to hand in a set number of crops and others can be decided free by themselves, all profit and loss belong to farmers, but the land still belong to nation. Before government made this policy, in 1979 similar experiments began in Sichuan and Anhui provinces, both seeing dramatic increases in agricultural productivity. Deng Xiaoping openly praised these experiments in 1980, and the system has been adopted nationwide since 1981. [2] This policy encourages farmers plant some crops with high profit that let farmers have high income and better lives.
       Government also reform urban industry. In 1979, government set up four special economy zones: ShenZhen, ZhuHai, ShangTou, and Xiamen. Deng created a series of special economic zones for foreign investment that were relatively free of the bureaucratic regulations and interventions that hampered economic growth. These regions became engines of growth for the national economy. [3] During planning economy, nation only permit state-owned industries exist. Deng Xiaoping break it, he permit private business to operate. In special economy zones, government gave local private business some benefit policy and made they had high competitiveness. In addition, special economy zones government use some policy to attract foreign investments. According to this way, foreign enterprises use technology to switch market. In most areas, it succeeds. In 1991, Shanghai was finally permitted to initiate economy. Now, shanghai is a famous city in the world.
Opening
       Government though agriculture and industry to reform the domestic economy. Government has another way to increase economy. Foreign investment was also liberalized upon Deng's ascension. Special Economic Zones (SEZs) were created in the early 1980s to attract foreign capital by exempting them from taxes and regulations. This experiment was successful and SEZs were expanded to cover the whole Chinese coast. When this experience has a good result, government tried to implement it in whole nation. The government reduced tariffs and trade barriers like tariff rate falling from 56% to 15%. When China joined the WTO, it agreed to considerably harsher conditions than other developing countries. Trade has increased from under 10% of GDP to 64% of GDP over the same period. China is considered the most open large country; By 2005, China’s average statutory tariff on industrial products was 8.9 percent. [4]
Get and Lose
In 1990, China’s average per capita national income was around $350. Within a decade, there was a threefold increase, taking the figure to $1,000. At the end of 2008, the figure tripled yet again and China’s average per capita national income reached another high of $3,000. From this data, we can find Chinese have a better life. In 1970s, people get married had three big things, bicycle, sewing machine, and watch; in 1980s, television, washing machine, and radio instead of them. Today, car, house, and travelling are to be new three things. During these years we can people living standard become better and better.
China develops economy with high speed during 30 years, which make Chinese environment damage seriously. In the past, government want to more GDP, they choose ignore the environment issues. But now, pollution is a big problem in China. Air and water pollution can be found in most cities. In the west, local government get income from deforestation that let land desertificational. Depending on environmental damage to get low-efficiency economy is become a big problem in China. Although government is aware of seriousness of problems and try to adjust and improve the economy development model, but these problem still exist.
When China opens the door, technology, job opportunity, and competitiveness are brought by foreign enterprises. Foreign cultures also come in China. Teenage accept all the foreign cultures because of curiousness. They seldom distinguish which is good or bad. Social has a little fickleness, people always like using money to measure one thing. Some Chinese traditional culture and value were ignored gradually by people.
Due to this policy “Reform and Opening up” China becomes an important part in the world. Every Chinese is benefit from this policy. This policy let China catch up the step of world. However, China still faces some problem and challenge that cannot be ignored.
Reference
1.      http://en.wikipedia.org/wiki/Cultural_Revolution [1]
2.      http://en.wikipedia.org/wiki/Chinese_economic_reform   [2] [3] [4]

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