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China has experienced great socio-political changes in its history. Major changes took place from 1949 when People’s Republic was established, a time when China experienced serious social, political and economic transformations. Private enterprises were replaced by larger enterprises, private businesses owned by the government while all parcels of privately owned land were all repossessed by the government under one holding. Inheritance of ancestral land in China became a thing of the past. The caste system was equally rendered null and acquisition of higher education became the only legitimate avenue for the attainment of an upward social mobility across the board. Military grew to offer Chinese with the best employment opportunity at the time. The devolved system of power structure was integrated into bureaucratic national government structure. The government got power to enforce policies including economic policies (Wang 2003).
The historic period preceding 1950s marked the peak of major transformation in China. Series of campaigns were carried out by the party to ensure that citizens who posessed vast tracks of land gave some portions to those lacking it. Support organizations developed into larger long term mutual aid teams, voluntary and compulsory agricultural cooperatives and vibrant people's communes. Bureaucracy enlarged with the expansion of the party. Job opportunities largely increased, so that even young people with scarce secondary or college education were able to secure white-collar jobs in the newly emerged organizations. All local associations including clans, farmers’ cooperatives, and guild system were closed and replaced by government-sponsored associations. New institutions were run by party members.
By the beginning of 1960, about 90 million family farms had been replaced by 74,000 communes. Local government took over and began to control shops, commerce, markets and private traders. All the large industries and small crafts were organized into large-scale cooperatives and formed local government branches. It is 1960 that formed the basis of the contemporary China. Any other changes and reforms including 1982 reforms are just modifications and adjustments to the pattern. Cultural Revolution Period (1966-1976) was the most chaotic in the history of China due to the robust in both economic development and political reforms. This has always won support from within and outside China. Despite an imminent dissatisfaction expressed by some quarters, China’s economy was steadily and rapidly growing.
China’s Gross Domestic Product (GDP) has always been higher compared to the neighboring countries like India and Pakistan (Wang 2003). China’s economic development changes began in 1978 when economic reforms as prompted by the decollectivization of agriculture opened way for the foreign investments and entrepreneurs though most industries were still owned by the government. Between1980 and 1990, privatization and contraction were part of the reforms of that time. Other included lifting of economic regulations, protectionist policies and price controls. Despite the State monopolies in the banking and petroleum sectors, private sector grew outstandingly, accounting for 70% of China GDP by 2005. China achieved an extraordinary economic growth of 9.5% in 2010. Averagely, from 1978 to 2010, China was experiencing an exceptional economic growth of 9.5% per annum. At the moment, its economy is the second largest in the world after U.S.
Economic policies of China made it experience lots of changes, including poverty reduction, income increase and income inequality increase. The number of the state owned enterprises reduced by 48% between 2001 and 2004. At the same time, tariffs, trade barrier, and regulations also reduced. Banking system was reformed and old welfare system dismantled. In 2005 the domestic private sector exceeded 50% of the GDP and continued increasing. It is during this time that Hu-Wen reversed some old reforms (Garnaut & Song 2006).
The most current economic data of China is of the first quarter of the year 2012 under which the total value added of the industrial enterprise increased by 11.6%. Additionally, the value added growth of the state-owned and the state holding enterprises went up by 7.2%. Collective and share-holding enterprises recorded 9.7% and 13.8% respectively with 6.4% funding from foreign investors. The total retail sales of consumer goods were calculated to stand at 4.9 trillion Yuan, an increase of 14.8%.The total values of imports and exports in the first quarter of the Financial Year 2012 hit $ 859.37 billion with a growth of 7.3% (Garnaut & Song 2006).