explain in brief the advantage of economic reforms done by china
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The Chinese economic reform (simplified Chinese: 改革开放; traditional Chinese: 改革開放; pinyin: Gǎigé kāifàng; lit.: 'reform and opening-up'; known in the West as the Opening of China) refers to the program of economic reforms termed "Socialism with Chinese characteristics" and "socialist market economy" in the People's Republic of China (PRC). The reforms were started by reformists within the Chinese Communist Party—led by Deng Xiaoping—on December 18, 1978, during the "Boluan Fanzheng" period.[1] They went into stagnation after the 1989 Tiananmen Square protests, but were revived after Deng Xiaoping's Southern Tour in 1992. In 2010, China overtook Japan as the world's second-largest economy.[2][3]
Before the reforms, the Chinese economy was dominated by state ownership and central planning. From 1950 to 1973, Chinese real GDP per capita grew at a rate of 2.9% per year on average,[citation needed] albeit with major fluctuations stemming from the Great Leap Forward and the Cultural Revolution. This placed it near the middle of the Asian nations during the same period,[4] with neighboring capitalist countries such as Japan, South Korea and rival Chiang Kai-shek's Republic of China outstripping the PRC's rate of growth.[5] Starting in 1970, the economy entered into a period of stagnation,[6] and after the death of Mao Zedong, the Communist Party leadership turned to market-oriented reforms to salvage the failing economy.[7]
The Communist Party authorities carried out the market reforms in two stages. The first stage, in the late 1970s and early 1980s, involved the de-collectivization of agriculture, the opening up of the country to foreign investment, and permission for entrepreneurs to start businesses. However, a large percentage of industries remained state-owned. The second stage of reform, in the late 1980s and 1990s, involved the privatization and contracting out of much state-owned industry. The 1985 lifting of price controls[8] was a major reform, and protectionist policies and regulations soon followed, although state monopolies in sectors such as banking and petroleum remained. In 2001, China joined the World Trade Organization (WTO). The private sector grew remarkably, accounting for as much as 70 percent of China's gross domestic product by 2005.[9] From 1978 until 2013, unprecedented growth occurred, with the economy increasing by 9.5% a year. The conservative Hu Jintao's administration regulated and controlled the economy more heavily after 2005, reversing some reforms.[10] On the other hand, a parallel set of political reforms were launched by Deng in 1980, but eventually ended in 1989 due to the Tiananmen Square protests.
The success of China's economic policies and the manner of their implementation resulted in immense changes in Chinese society in the last 40 years, including greatly decreased poverty while both average incomes and income inequality have increased, leading to a backlash led by the New Left. In the academic scene, scholars have debated the reason for the success of the Chinese "dual-track" economy, and have compared it to attempts to reform socialism in the Eastern Bloc and the Soviet Union; as well as to the growth of other developing economies. Additionally, these series of reforms have led to China's rise as a world power and a shift of international geopolitical interests in favour of it over Taiwan.
The reform era has been said to end during the leadership of Chinese Communist Party general secretary Xi Jinping,[11][12][13] who generally opposes the reforms and has rolled back many of the Deng-era reforms[14][15][16] as the Communist Party reasserts control over different aspects of Chinese society, including the economy.[17][18] In 2018, sinologist Minxin Pei argued that the Chinese economy is currently the least open since the reform era began in the 1980s.[19] This de-liberalization is seen by one Hong Kong commentator as part of the subject of the present US–China trade war,[18] in which the United States alleges the Chinese government is giving unfair and discriminatory competitive advantages to Chinese state-owned and private companies.