The Contributions Made by the Economy Reform and Private Sector for the Rapid Economic Development in China

Abstract

he People's Republic of China is now the world's second largest economy after the United States and the world's fastest-growing major economy, with an average annual growth rate of 10% from 1978 through 2005, according to official statistics.[1] It is also the second largest trading nation in the world and the largest exporter and second largest importer of goods. In more than 50 years since the founding of the People’s Republic of China in 1949, Chinese economy has undergone an unusual development process, passing through socialist heavy industry development strategy and economic reforming and opening-up strategy. Due to the reform and opening-up policy China has attracted foreign direct investment, increased its productivity and raised its economic efficiency by introducing profit incentives to rural collective enterprises, family farms and private businesses. There are some economic development models in China’s private sector. Among those the Wenzhou economic model is the most successful one.

Key words: Chinese Economy, Economic Reform and Opening-up Policy, Wenzhou Economic Model