Q.China's rapid industrial growth can be traced back to its reforms in 1978. Do you agree? Elucidate.
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Start your 14-day free trial to unlock the full solution →China's rapid industrial growth can indeed be traced to the reforms introduced in 1978. Carried out in phases, they reformed agriculture first, then industry and trade — decollectivising farms, allowing private enterprise, and opening Special Economic Zones to foreign capital and technology — which unleashed a long boom.
Agreeing with the statement
Before 1978 China had followed the Great Leap Forward and the Commune model, which did not deliver the growth hoped for. The turning point came when China introduced far-reaching economic reforms in 1978. It is fair to agree that its rapid industrial growth traces back to these reforms.
How the 1978 reforms drove industrial growth
The reforms were introduced in phases, beginning with agriculture, foreign trade and the investment sectors:
- Reform of agriculture first: Commune lands were divided into small plots and allotted to individual households. Under this system, people were allowed to keep the income from land after paying taxes. This raised farm productivity and generated a surplus.
- Private enterprise permitted: In the later phase, reforms were introduced in the industrial sector. Private firms and township and village enterprises were allowed to produce goods, and state enterprises were made to compete in the market.
- Special Economic Zones (SEZs): China set up SEZs to attract foreign investment, modern technology and management, boosting industrial output and exports. …
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