Deng Xiaoping and his economic reforms

2024 Author: Henry Conors | [email protected]. Last modified: 2024-02-12 02:43

Deng Xiaoping is one of the prominent politicians of communist China. It was he who had to deal with the disastrous consequences of Mao Zedong's policy and the "cultural revolution" carried out by the famous "gang of four" (these are his associates). For ten years (from 1966 to 1976) it became obvious that the country did not make the expected "great leap", therefore pragmatists came to replace the supporters of revolutionary methods. Deng Xiaoping, whose policy is marked by consistency and a desire to modernize China, to preserve its ideological foundations and originality, considered himself one of them. In this article, I would like to reveal the essence of the transformations carried out under the leadership of this person, as well as to understand their meaning and significance.

Rise to power

Deng Xiaoping overcame a thorny career path before becoming the unofficial leader of the CCP. Already by 1956, he was appointed to the post of General Secretary of the Central Committee of the Communist Party of China. However, he was removed from his post after ten years of service in connection with the beginning of the "cultural revolution", which provides for a large-scale purge of both personnel andpopulation. After the death of Mao Zedong and the arrest of his close associates, the pragmatists are rehabilitated, and already during the 3rd plenum of the eleventh convocation, the reforms of Deng Xiaoping in China begin to be developed and implemented.

Policy Features

It is important to understand that in no case did he renounce socialism, only the methods of its construction changed, and a desire arose to give the political system in the country a uniqueness, Chinese specificity. By the way, personal mistakes and atrocities of Mao Zedong were not advertised - the fault fell mainly on the mentioned "gang of four".

The well-known Chinese reforms of Deng Xiaoping were based on the "policy of four modernizations": in industry, army, agriculture and science. Its end result was to be the restoration and improvement of the country's economy. A specific feature of the course of this political leader was the willingness to contact the world, as a result of which foreign investors and businessmen began to show interest in the Celestial Empire. It was attractive that the country had a huge cheap labor force: the rural population prevailing there was ready to work for a minimum, but with maximum productivity, in order to feed their families. China also had a rich resource base, so there was an immediate demand for government resources.

Agriculture

First of all, Deng Xiaoping needed to carry out reforms in the Chinese countryside, because the support of the masses was vital for him to consolidate his figure in power. If aunder Mao Zedong, the emphasis was on the development of heavy industry and the military-industrial complex, the new leader, on the contrary, announced the conversion, the expansion of the production of consumer goods in order to restore domestic demand in the country.

People's communes were also abolished, in which people were equal, did not have the opportunity to improve their situation. They were replaced by brigades and households - the so-called family contracts. The advantage of such forms of labor organization was that the new peasant collectives were allowed to keep surplus products, that is, the excess crop could be sold on the emerging market in China and make a profit from it. In addition, freedom was granted in setting prices for agricultural goods. As for the land that the peasants cultivated, it was leased to them, but over time it was declared their property.

Consequences of reforms in agriculture

These innovations contributed to a significant increase in the standard of living in the village. In addition, an impetus was given to the development of the market, and the authorities were convinced in practice that personal initiative and material incentives to work are much more productive than the plan. The results of the reforms proved this: in a few years, the amount of grain grown by peasants almost doubled, by 1990 China became the first in the procurement of meat and cotton, and labor productivity indicators increased.

End of international lockdown

If you reveal the concept of "openness", you should understand that Deng Xiaoping was against a sharptransition to active foreign trade. It was planned to smoothly build economic ties with the world, the gradual penetration of the market into the unchanging command and administrative economy of the country. Another feature was that all transformations were first tested in a small region, and if they were successful, they were already introduced at the national level.

So, for example, already in 1978-1979. in the coastal regions of Fujian and Guangdong, SEZs were opened - special economic zones, which are some markets for the sale of products by the local population, business ties were established with investors from abroad. They began to be called "capitalist islands", and their number grew rather slowly, despite the favorable state budget. It was the gradual formation of such zones when building foreign trade that did not allow China to lose the lion's share of raw materials, which could be instantly sold out for a very high price by Chinese standards. Nor was domestic production affected, risking being overwhelmed by imported and cheaper goods. Favorable ties with various countries led to the acquaintance and implementation of modern technologies, machines, factory equipment in production. Many Chinese went to study abroad to gain experience from Western colleagues. There is a certain economic exchange between China and other countries that satisfies the interests of both sides.

Changes in governanceindustry

As you know, before Deng Xiaoping, whose economic reforms made China a powerful power, was chosen as the unofficial leader of the CPC of China, all enterprises were subject to a plan, strict control by the state. The new political leader of the country recognized the inefficiency of such a system and expressed the need to update it. To do this, a method of gradual price liberalization was proposed. Over time, it was supposed to abandon the planned approach and the possibility of creating a mixed type of management of the country's economy with the predominant participation of the state. As a result, in 1993 plans were reduced to a minimum, state control was reduced, and market relations were gaining momentum. Thus, a "two-track" system of economic management of the country was formed, which takes place in China to this day.

Affirmation of diversity of forms of ownership

Deng Xiaoping faced the issue of ownership as he implemented one reform after another to transform China. The fact is that the change in the organization of housekeeping in the Chinese village allowed newly-made households to earn money, capital grew to start their own business. In addition, foreign businessmen also sought to open branches of their enterprises in China. These factors have led to the formation of collective, municipal, individual, foreign and other forms of ownership.

Interestingly, the authorities did not plan to introduce such diversity. The reason for its appearance lies in the personal initiativethe local population, which has its own savings, to open and expand self-created enterprises. People were not interested in privatizing state property, they wanted to run their own business from the very beginning. The reformers, seeing their potential, decided to formally secure the right of citizens to have private property, to conduct individual entrepreneurship. Nevertheless, foreign capital received the greatest support "from above": foreign investors were provided with a range of various benefits when opening their own business in the territory of the Republic of China. And as for state-owned enterprises, in order not to let them go bankrupt in the face of such high competition, the plan for them was maintained, but reduced over the years, and they were also guaranteed various kinds of tax deductions, subsidies, and profitable loans.

Meaning

It is impossible to deny that Deng Xiaoping, together with like-minded people, did a great job of leading the country out of a deep economic crisis. Thanks to their reforms, China has a significant weight in the global economy and, as a result, in politics. The country has developed a unique "concept of two-track economic development," competently combining command and control levers and elements of the market. The new communist leaders steadily continue the ideas of Deng Xiaoping. For example, now the state has put forward the goal of building a "society of moderate prosperity" by 2050 and eliminating inequality.