The economic and socio-economic framework that, from the end of the 20th century, is taking shape more and more impetuously in China is clearly detached from the traditional image of a rural town. The first phase of true modernization of the economic structure corresponded to the years following the revolution, with planning policies and the establishment of heavy industries, later (in the years of the cultural revolution) scattered a little everywhere; in a couple of decades, industrial production equaled agricultural production in value, which, in turn, restructured by a series of land and management reforms, rapidly increased its size, practically reaching food self-sufficiency and definitively removing the spectrum of recurring famines. These have not occurred since the early post-revolutionary years.
In the 1970s, the new economic course focused on productive specialization in light industry, achieved within the framework of integrated regional systems. The plans implemented in the following decade, in the perspective of a ‘market socialism’, gave further impetus to modernization, especially of industry, while giving back space to private enterprise in agriculture and pushing for the formation of a private service sector, especially in the direction of foreign exchange and the creation of channels and financial instruments: many state-owned companies were privatized, private individuals were allowed to set up industrial and commercial companies, consumer prices were liberalized, public real estate assets began to be liquidated. In the 1980s, the first five Special Economic Zones (SEZs) were opened on the coast, which subsequently multiplied to cover almost the entire coast and various inland areas; SEZs are subject to particularly favorable tax regimes and are aimed at international investors, starting with Asian ones. In 1990 the Shanghai Stock Exchange was reopened; in 1997 the return of Hong Kong gave China a very efficient platform to connect with the global economy; already in 1998 the direct foreign investments destined to China were lower only than those destined to the United States.
According to Thembaprograms, China has thus decisively entered the international scene, not only thanks to foreign investments, but also by placing its productions, gradually updated, and its own investors in vigorous competition with advanced economies, while towards those backward tends to replicate (with some substantial differences) the center-periphery relationships that characterized the nineteenth-twentieth-century development of western economies: import of raw materials and export of consumer goods with low added value, infrastructure, armaments, under the aegis of privileged diplomatic relations, but with little or no interference in internal affairs. The growth rates of the Chinese economy have been extraordinarily high since the early 1990s: often over 10% per year (still in the first months of 2007, almost 12%), supported by the increase in production destined for export as well as in domestic consumption. China has now established itself in fourth place in the world for wealth produced, and average incomes per resident have also registered a considerable increase, although remaining contained; after all, the low cost of labor is one of the main attractions for foreign investors in China and the main strength of Chinese companies. Thus a class of entrepreneurs with ample economic resources and a westernized middle class are emerging in terms of expectations and, above all, in terms of consumption; speculating is the very rapid increase of the socio-economic gap (in a country that for decades has made equality its foundation) between the wealthy and non-wealthy classes, and of the regional gap, which for decades we had tried to cancel, but that the modernization of the coastal area has again emphasized, to the detriment of rural and inland areas. To these phenomena, which certainly contribute to destabilizing the stability of the social and political structure, is added a series of intrinsic repercussions to such a rapid growth process: from the growing dependence on foreign supplies to constant inflationary pressures, from the need for monetary maneuvers completely unprecedented for the country to negotiate also at international level (C. has become part of APEC, Asia-Pacific Economic Cooperation, and of the WTO, World Trade Organization) of interventions to stop economic expansion, in order to avoid worsening internal imbalances and trade imbalances with foreign countries; the latter are clearly in favor of China.
In all this, private and public entrepreneurship and government authorities seem to be able to firmly govern a decidedly positive trend in macroeconomic terms and not entirely negative in social terms. However, it is precisely on the social side that the stability of the growth process appears most at risk: the liberalization of property (implemented within certain limits) and of economic initiative has in fact put in brackets the community solidarity mechanisms which, even more their own central social policies, had in previous decades guaranteed relative prosperity to the population, the protection of the weakest groups, the minimization of social and territorial contrasts. The Chinese authorities are now confronted, like those of the capitalist countries, with the management of social security mechanisms, of union consultation, drainage and redistribution of monetary resources, aiming at the same time not to depress the strong propensity for productive investment and not to exacerbate the living conditions of the population: the reduction, in particular, of public commitment in traditional sectors of intervention such as education, work, housing and health care is in fact a heavy, hardly tolerable burden for those around 300 million Chinese who live below the poverty line. On the other hand, with an average GDP (at current prices) per resident of 2,968,789 dollars (2008), China is now among the medium-development countries, demonstrating the overall success of the economic growth policies adopted.