China's Economic Reform

中国的经济改革
Daniel Xiquan Liu 刘希全

Nov. ， 2021
 目录
CONTENTS

01 Why Reforms Happened in China?

02 H o w R e f o r m s Wo r k e d i n C h i n a ?

03 What Reforms Brought to China?

 01
Why Reforms Happened
in China?
01 Why Reforms Happened in China?

How much you know

about China?
• Population
01 Why Reforms Happened in China?

How much you know

about China?
• Population
• Size

9.59 million KM2

01 Why Reforms Happened in China?

How much you know

about China?
• Population
• Size
• CPC

Communist Party of China has more than 95 million party members in 2021
 01 Why Reforms Happened in China?

How much you know

about China?
• Population
• Size
• CPC
• Alibaba

Double 11 online shopping festival

01 Why Reforms Happened in China?

How much you know

about China?
• Population
• Size
• CPC
• Alibaba ...

5000 years' history & culture

01 Why Reforms Happened in China?

Confucius (551BC-479BC)
• Borned in Lu state of Zhou dynasty
(Now Qufu city of Shandong)

Doctrine of the Mean

• the Golden Mean

• Harmony between the heaven & human
• A balance of extremes
• compare with “Check in Balance”
01 Why Reforms Happened in China?

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zero 极简主义设计，极致简约风潮流所向，通用设计，完美兼
容，打造最实用，最具个性的演示方案，让你的演示卓越非凡。
zero 极简主义设计，极致简约风潮流所向，通用设计，完美兼
容，打造最实用，最具个性的演示方案，让你的演示卓越非凡。

Qing is the last imperial dynasty of China, also called Manchu dynasty

Population in 2010
Manchu:10,387,958≈0.74% of total
01 Why Reforms Happened in China?

The People's Republic of China

Mao era
(1949–1976)

 Early 1950s: Social revolution: the state controlled all the economy as the Soviet
Union.
 Under such a planed economic system,
 Equalism, short of competition
 Low efficient
 Closed
 Political Confilicts
 China was very poor in comparison with other East Asian countries in later 1970s
01 Why Reforms Happened in China?

10000

9000
8611.4

8000

7000

6000
1976 5171.04
5000 GDP per capita

4000

3000

2000

1159
1000

165.41
0
GDP Per Capita
Mainland China USA Japan
China Taiwan
01 Why Reforms Happened in China?

Taiwan/Mainland in GDP
50.0%

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45.0% 点击此处添加标题
43.8%
年终总结是人们对一年来的
40.0%

工作学习进行回顾和分析，
35.0%
36.3%35.7%
从中找出经验和教训，引出
规律性认识
30.0% . 29.7%
25.0% 25.2%
23.8%
20.0%
21.3%
16.7%15.6%
15.0%
13.7% 13.6%
12.2%
10.0%
9.1%
7.6% 7.2% 6.4%
5.0%
6.2% 5.7% 5.2% 5.1% 4.7%

0.0%
1970 1980 1990 1993 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Taiwan/Mainland in GDP
 02
How Reforms Worked in
China?
02 H o w R e f o r m s Wo r k e d i n C h i n a ?

Opening Up to FDI
1978-1984 China was opened to foreign investment for the first time since
People's Private the Kuomintang era. We created a series of special economic
communes household-responsibility system zones for foreign investment.
Familly
1952-1956

文字
标

Decollectivization of Agriculture
Shenzhen Hongkong
Under the new policy, farmers were able to exercise formal Macao
control of their land as long as they sold a contracted portion
Zhuhai
of their crops to the government. This move increased Oversea Chinese
Shantou
agricultural production by 25 percent between 1975 and 1985.
Xiamen Taiwan
02 H o w R e f o r m s Wo r k e d i n C h i n a ?

1978-1984

Industrial Responsibility System

Allow individuals or groups to
01 State-owned
manage
industries
the
were
enterprise by 03
contract.
A dual-price system allowed to sell any
production above the Private Business
State-owned industries were
plan quota, and Private businesses were
allowed to sell any production
commodities were allowed to operate for the first
above the plan quota, and
commodities were sold at
market prices.
02
sold at both plan and time since 1950s.

both plan and market prices.

02 H o w R e f o r m s Wo r k e d i n C h i n a ?

1984-1993

The decentralization of Township and village Corruption and

Deng's southern tour
state control enterprises increased inflation
02 H o w R e f o r m s Wo r k e d i n C h i n a ?

1993-2001

Township and village

enterprises

Exchange Rate Reform Revise the Constitution Joined the WTO

02 W h y R e f o r m s Wo r k e d i n C h i n a ?

China became the 143rd WTO

Member on 11 December 2001

WTO Principles
 Trade without discrimination
1. Most-favored-nation (MFN): treating other people equally
2. National treatment: Treating foreigners and locals equally
 Freer trade: gradually, through negotiation
 Predictability: through binding and transparency
 Promoting fair competition
 Encouraging development and economic reform
02 H o w R e f o r m s Wo r k e d i n C h i n a ?

Revised the Law

1 Since 1999, China have revised more than 10 pieces of Law
to meet the requirement of WTO.

Open the market on service

2 FDI is allowed to enter into the field of service sector such as
retail, wholesale, banking, insurance and telecommunications.

Creat a fair and competitive market

3 The disctiminations among state-owned enterprises, FDI,
private sectors disapeard in most field.

Joined the WTO in 2001

After joined the WTO, the service sector was considerably liberalized and foreign investment was allowed;
restrictions on retail, wholesale and distribution ended. Banking, financial services, insurance and
telecommunications were also opened up to foreign investment. Furthermore, China had to deal with certain
concerns linked to transparency and intellectual property that the accession to WTO underlined.
02 H o w R e f o r m s Wo r k e d i n C h i n a ?

2001-Now
Free Trade Port
Exchange Rate Fair Competition Chinese Gvernment is
planing to creat a free
Allow more flexible Anti-Corruption Movement trade port in Shanghai.
RMB Rate

2005 2008 2013 2014 2015

Free Trade Belt & Road Initiative

Signed free trade agreement The Silk Road Economic
with more than 20 countries Belt and the 21st-century
or regions; Created free trade Maritime Silk Road
pilot zone;
 03
What Reforms Brought to
China?
03 What Reforms Brought to China?

GDP Data(1978-2021)

 GDP Growth Rate Average

about 8%;

 GDP Per Capita: $156.4 -

$10 ， 500.4
03 What Reforms Brought to China?

GDP Data(2016)

 GDP in 2021: 14.72T US$;

 GDP per capita 10,500.4 USD

 GDP growth rate 2.3%

annual
03 What Reforms Brought to China?

Foreign Exchange Reserves

Calendar Actual
2018/01 $3.140T
2021/09 $3.200T
03 What Reforms Brought to China?

The domestic private sector first exceeded 50% In 2010, China was able to surpass Japan as the
of GDP in 2011 and has further expanded since. largest economy in Asia.

VS VS
03 What Reforms Brought to China?

Urbanization

 Almost 0.6Billion population

moved into cities;

 About 1/4 of top 100 large cities of

the world will locate in China;

 Most cities enlarged more than 3-5

times;

 We are starting to be short of labor

force in some field now.
03 What Reforms Brought to China?

what will China do in the future?

Encourage Improve Global Supply Avoid Middle-

Competition Chain Position Income Trap

 Anti-Crupption Movement  Encourage Outward FDI  Innovation and entrepreneurship

in Domestic Market;  Develop E-Commerce  Transform development
 Free Trade Policies in  Belt and Road Initiative model to technology driven
Global Market.
03 What Reforms Brought to China?

Some Experiences from China's

Economic Reform

 Set Up A Clear Target for a Period (such as 5-years plan)

 Release Freedom to the Market, Encourage Competition.
 Step by step, evolution, no revolution.
 Powerful Leadership, stable society ， Peaceful
Environment.
 谢谢聆听
THANK YOU FOR LISTENING

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