History of China/ How China Became an Economic Superpower?

The People's Republic of China has grown to become one of the world's largest economies. But can you imagine that only 40 years ago, the poverty rate in this country was over 90%? The country was suffering from poverty and hunger. But in the next 30 years, we saw such a huge transformation that the poor, starving country reached thus far. In 1978, China's contribution to the global GDP was only 2%. Today, China contributes more than 18% to the global GDP. Their poverty rate is less than 1% and China is the second-largest economy in the world. It's pretty much like a superpower in a lot of ways.

How did one of the world's poorest countries become a global superpower in just 4 decades?

"Since then, China has made enormous strides in various fields." "So China is based on the Chinese word "qin". It's pronounced "chin" instead of "q-i-n". Qin was the name of an old dynasty that ruled China 2000 years ago and unified China.

 What is meant by Zhongguo?

Zhongguo, Middle Kingdom
Zhongguo, Middle Kingdom

Another interesting thing about Chinese people is that they don't call their country "China". They use the name Zhongguo, For their country. It means the Middle Kingdom. It symbolizes China's 4000 years old history. How China used to be the center of the world. It was in the middle.

 The largest Country in the world:

To 20 Largest Countries in the World

China is the world's 4th largest country. It borders India. However, the vast majority of China’s population lives on the country’s east coast, far away from India. This is largely due to the fact that most of the arable land on which China’s agriculture relies is located in this region. In the west, the country is dominated by the Himalayas and deserts.

 Colonialism in China:

China used to be a very successful and powerful kingdom till the 19th century.

Colonialism in China
Colonialism in China

And then, after that, it became a victim of colonialism. Although the British could not fully occupy China, as they did on the Indian subcontinent, but still, China was looted in different ways. This is the reason why the period from 1839 to 1949 is remembered as the Century of Humiliation by the Chinese.

 Why British use opium on Chinese people?

use opium on Chinese
Opium history in China

It all began in 1839 when the British East India Company started shipping opium to China. Opium is a drug to which many Chinese people got heavily addicted and the entire Chinese society was destroyed. After this, many treaties were forced upon China, per which, China had to hand over significant portions of land and its ports to the British.

 War in China:

Then, in the year 1850, the Chinese started a civil war known as the "Taiping Rebellion," which resulted in the death of millions of people. Fast forward to the present day, 40 years after the start of the war between China and Japan, in 1894, China and Japan declared war on each other over territory the Qing Dynasty was ruling China at that time.

 Q-I-N Dynasty:

 It's not the same, as the Qin dynasty, which is the origin of the Chinese name. The Qin dynasty is 2,000 years old. This was the Q-I-N-G dynasty. The other was the Q-I-N dynasty. Same pronunciation. From 1937 to 1945 Chinese people had to endure even more terrible torture.

This time, by the hands of Japanese colonizers. China was a part of the Allied Powers. It was fighting against Japan. About 30 million Chinese died in World War 2. In the midst of all this, a ray of hope was seen when China and the Allied Forces finally won World War II.

 Civil War:


Civil War, in China

Following the surrender of Japan, shortly after the conclusion of World War II, a civil war erupted in China between the Communist Party of China and the ruling Communist Party of China, the Kuomintang (KMT).

It started in 1927, but when Japan invaded during World War II, they stopped fighting temporarily. The Chinese Communist Party's victory in 1949 marked the end of the civil war. The people of the Nationalist Party fled to a nearby island, which is now called Taiwan.

 Mao Zedong:


Mao Zedong
Mao Zedong

The mainland of China was governed, by the Communist Party of China leader, Mao Zedong. On October 1st, 1949, the Chinese People's Republic was established marking the beginning, of the formation of the nation as we know it today. The leader of the Communists and the protagonist of the revolution, Mao Zedong, initiated the Great Leap Forward in 1958, with the goal of bringing, economic and social modernization to the nation.

Mao Zedong make policies:

  1. Land redistribution
  2. Industrialization

  • There were two main policies in this. First, to take the land from the landowners and distribute it among the farmers. Land redistribution. Thereafter, collectivizing agriculture. The formation of agricultural, cooperatives was intended to facilitate the work of multiple farmers on the same piece of land. However, in the end, the land became the property of the government.
  • Second, industrialization. On the one hand, large industrial plants were built for steel production. And on the other hand, telling people to make small-scale steel furnaces in their backyards to produce steel at a local level. The intention was good. To develop the country economically. But the result was very bad. The small-scale steel furnaces that people had built in their gardens were producing low-quality steel. This led to the resources being wasted.
  • In addition, the farmers had no incentive to increase their, Output due to the absence of profit sharing and private ownership of the land. Consequently, the ownership of the land ultimately resided with the government. Consequently, any crop cultivated by the farmers had to be transferred to the government. Therefore, any crop produced by the farmers was required to be surrendered to the government. This led to a huge decline in productivity.
  • Between 1958 and 1961, the grain production fell by 15%. In just a few short years, because of bad weather and other ‘masterstroke’ policies of the communist regime, the famine became so severe that the entire country went hungry. The famine killed an estimated, 20 to 40 million people. It is considered to be one, of the worst famines in human history. 

Mao made China worse:

Mao was a dictator, And because there is no checks and balances system for dictators, as there is in a democracy, dictators often have a habit of imposing their wills without thinking or testing. Several such decisions by Mao made China worse.

 Sparrow Extermination:


Sparrow Extermination
Sparrow Extermination

Another example of such a decision was the Sparrow Extermination. Mao's intention was to increase food production. So, it was decided to kill all sparrows and all birds because sparrows ate the grain. Sparrows eat some of the crop grains from the field. So, crops are affected by crops. So, all birds in the country should be killed. 

When this campaign, was launched and the sparrows were culled, a couple of years later, people noticed that these insects and pests were reproducing, at such a high rate that they were causing more harm to the crops. This worsened the food shortage. 

A scientist later discovered that if all birds were killed, then there would be no one left to eat these insects. Birds used to consume the insects which kept the insects in check. The whole ecological balance was destroyed. The situation deteriorated to the point of famine.

Chinese people criticize Mao:

Mao faced criticism, from the Chinese people and from the Communist Party. But he was unwilling to admit his error. So, another campaign was launched.

Cultural Revolution:

The Cultural Revolution was launched in 1966. It was supposed, to bring about a Cultural Revolution in the country. But the real goal was to give power to Mao and crush opposition. Propaganda and PR machinery were used extensively here. To show off his power, Mao swam in the Yangtze River.

Red Guards Force:


Red Guards Organization
Red Guards Force

  • The Red Guards were a student-organized militia. The Red Guards were Mao's devoted soldiers who carried a little red book and had red Armbands on. Their goal was to eliminate, anyone who opposed him. Anyone who disagreed with Mao's philosophy was targeted, humiliated, and frequently subject to violence, including Intellectuals, Party Officials, and Ordinary Citizens. The Communist Party members who criticized Mao, and the Cultural Revolution were also persecuted Liu Shaoqi and Deng Xiaoping were some of the high-ranking party officials, targeted by the Red Guards.
  •  In the name of that revolution, the entire country was created in a state of fear. In order to track down Traitors, people were required, to spy on neighbors and family members. A Traitor was someone who opposed Mao's rule, and they were required to report on them. Schools and universities were shut down. Students were sent to the farms, to get an idea of how the farmers were doing. They wanted, to see what life was like in the countryside. Red Guards started fighting among themselves. Historical sites and cultural artifacts were destroyed. People's lives were turned upside down. This was at a time when they were torturing Tibetans too.
  •  Finally, Mao realized the Cultural Revolution created a crisis in the country. It was dividing the country. So, in 1968, to regain control, the Red Guards system was abolished. The estimates vary a lot depending upon the source, but it is said that hundreds of thousands to 2 million people lost their lives because of the Cultural Revolution. The death toll in China is believed to have been as high as 50 million due to the policies of Mao.

 Positive points of Mao Zedong:

  1. Mao Zedong died in 1976 due to ill health. Up until then, there hadn't been any major changes in China. But that's not to say, his reign was all bad. There were some positive achievements too.
  2. Especially in terms of women's equality and education. A nationwide public education system was launched during Mao's rule.
  3. Campaigns were run by the government to end illiteracy. Under Mao's leadership, the rate of literacy in China increased significantly.
  4. In 1978, the number of primary and secondary schools in China increased by three times compared to 1949.
  5. Furthermore, a solid foundation was established, which enabled China to lift millions, of people out of poverty. As will be seen in the narrative, his Government invested heavily in education, particularly in the areas of Science, Technology, Engineering, Mathematics, commonly referred to as STEM fields. With the help of this, a talent pool was created in the country, which led the country's technological progress.

Mao passed a law of marriage:

Mao's opinion about women was that "Women hold up half the sky." In 1950, a new marriage law was passed according to which arranged marriages and forced marriages were made illegal across the country. Women were given the right to divorce and in many other aspects, women were brought on equal footing.

Deng Xiaoping:


Deng Xiaoping
Deng Xiaoping

In 1976, after the death of Mao in China, a new Chinese Communist Party leader named Deng Xiaoping came to power. Deng is also known as the father of China because it was under his leadership that China's true transformation began. Deng was one of the leaders who spoke out against Mao during his time. Deng was forced to step down from all his posts during China's Cultural Revolution. It was obvious that Deng Xiaoping's ideology was very different from Mao's ideology.

Deng believed that the government had extremely tight control over the Chinese economy. This was the reason for the downfall of China in the previous half-century.

 Liberalization policies:

He wanted to liberate the economy. This is why he introduced his economic liberalization policies. There are many reasons for this which we will go over one by one but his overall ideology is now known as socialism with Chinese characteristics.

Policy change in the agriculture system:

  1. First, to bring transformation to the agriculture system, Deng introduced a household responsibility system. By the time of Mao's Great Leap Forward, private agriculture had been completely eliminated.
  2. No individual was allowed to own land. All ownership was in the hands of the government at the local level. Deng did not change this ownership structure. The ownership of the land remained with the village government.
  3. However, individual farmers and their family members were allotted the land on long-term leases. These farmers would have the right to choose which crops to cultivate, how to run their business, and from where to generate profit. Thus, the farmers were given more freedom to cultivate the crops of their choice.
  4. Deng also said that all farmers would have to sell a quota of their crops to the government. However, once the quota was met, the excess produce could be sold anywhere in the country and generate extra profit. This encouraged farmers to innovate. Thus, their productivity increased. Some of the land reforms introduced in India after Independence were in Kerala and West Bengal. These reforms are said, to be one of the key reasons for the rapid development, of states like Kerala.

 Policies change in factories:

  1. Deng Xiaoping used the same idea in factories. Factory Manager Responsibility System was introduced. Before this, during Mao's leadership, the responsibility to manage the industrial factories in China was given to the members of the Communist Party. 
  2. There was a lot of political interference. However, under Deng's leadership, the responsibility was shifted to the workers and managers working in the factories. 
  3. They gave them more flexibility in terms of what they wanted to produce, what their production target was, what price they would sell the products at, and what salary they would draw. Again, the workers in the factory were encouraged to work more.


Suppose there is a factory which produces shoes. Now, the factory workers and managers have the power to decide how many shoes to produce, what materials to use, how much to sell the shoes at, and how much to pay them. The workers have developed a sense of responsibility and ownership. It is their factory and they can turn it into a successful factory if they want to. Centralized planning during Mao's leadership a person sitting on top dictating everything. How everything should be running. The government decided everything. Everything that happened or did not happen. V More freedom was given in the economic sense. Because of all these policy measures, millions of people started coming out of poverty and people's lives started changing.

Between 1978 and 1984 on average, agriculture output in China increased at the rate of 7.4%. From the late 1970s to the mid-1980s, the grain production in China more than doubled.

 Revolutionize education:

Revolutionize education
Revolutionize Education

The next step was to revolutionize education. To focus on educating people. For this reason, the government introduced a compulsory education law in 1986. For 9 years, every child in China received free and compulsory education. Moreover, there was no halt in China after the passage of the law. The government began to put more money into education on a regular basis. In 1980, the money spent by the government on education was approximately 2% of GDP in China. And it kept increasing. By 2010, it reached 4.1% of GDP.

Not only that, China has also focused on technical and vocational education. People were taught the skills that are actually needed in jobs. All the developed countries have focused heavily on education. And they are developing because education was so high on the agenda. As a result of all these efforts, we have seen a tremendous increase in literacy rates in China.

 In 1982, it was at 65%, and in 2012, it crossed 95%.  Another important indicator is spending on health care. In 2021, the Chinese government spent 5.59 % of GDP on health care.


Township and Village Enterprises:

Deng Xiaoping’s next development initiative was the Township and Village Enterprises (TVEs). Cooperatives are usually owned by the workers who work in the cooperatives, whereas in China, TVEs are owned by the townships and villages both have the same purpose to bring economic growth in rural areas and to improve people's living standards. Such as Amul, whereas TVEs are found in nearly every industry in China. Textiles, electronics, manufacturing, services.

In fact, one of the most prominent TVEs is Huawei Technologies. The company began as a TVE based in Shenzhen. But today, it has become a global leader in telecommunications equipment. Wenzhou, China is a case in point. Initially, some local entrepreneurs set up small factories to manufacture footwear. Over time, this venture has grown to become, a major Export Industry in China.

By the end of the 1990s, television broadcasting company TVE employed approximately 100 million individuals in China. People's living standards started to increase. Usually, there is an income gap in rural and urban areas. Here, however, the disparity in income was narrowed due to the presence of TVE’s.

About 20% of China's total industrial output was from TVE's in the 1990s. This led to the creation of millions of jobs. However, this could only be achieved, if the workforce was already well-educated and well-trained. However, this could only be achieved if the necessary skills and qualifications were already in place.

 Special Economic Zones:

Special Economic Zones

Deng established special economic zones (SEZs) in China in 1980, which provided tax incentives, simplified administrative procedures, and reduced regulations to facilitate foreign investment.

 China Development:


China Development

When people talk about China’s development, this is often the first thing that comes to mind. However, there are many other factors of China has to consider, in order to successfully attract foreign investment. When foreign companies invest in the country, they need skilled people. If people are not educated and skilled, no one will invest money. Here, the labor was cheap, people were skilled, only a little bureaucracy, and people already had the experience required because of TVEs.

Shenzhen was the first special economic zone in China. The city was originally a fishing village but within a few years it became an international city. In 1980 Shenzhen had a GDP of $0.3 billion. By 2020, it reached 420 billion dollars.

Foreign Companies established in china:

To encourage foreign companies to come to the country, an open-door policy was made. China's economy was open to the world. This is called economic liberalization. It was done in China in 1978.

Foreign Companies established in china
Foreign Companies  in China

This is why many multinational companies such as Nike, Apple, and Louis vuitton established their manufacturing plants in China. In 1980, China's FDI was $0.06 billion. In 2021, it exceeded $333 billion.

Railway lines, in China
Railway lines 

Railway lines were built, good public transport in cities. Priority areas were made. Areas of priority were identified, such as energy production, computer science, optical engineering, space engineering, physical science, and genetics, which were heavily subsidized by the government.

 Beijing Science Park:


Beijing Science Park
Beijing Science Park

The money spent on research and development was gradually increased by the government and in 2020, it crossed $500 billion.  The Beijing Science Park, established in 1988, is a prominent example of a technological and innovation center. It is home to a large number of high-tech enterprises, research institutes, and universities.

 GDP China:



GDP (in Trillions USD)











 In the year 1990, India had a GDP per capita of approximately the same level as China, whereas in the same year, India had an economy with a GDP per capita greater than that of China. $1,202 vs. $983 for China. But their change was so remarkable that today, China's GDP per capita is more than three times that of India's.  With regard to these revolutionary policies, Deng Xiaoping said that he took the approach of "crossing the river by feeling the stones". We traverse the river by examining every single stone.

What effect did it have on the ecology?

The continued authoritarianism of Deng Xiaoping has led to the current circumstances under the rule of Xi Jinping. If Deng had wished, he could have turned China into a democracy. But he didn't. For this reason, today, a dictator emerged who again runs his own will and imposes decisions without thinking twice. This is why, during the 2020 pandemic, China experienced a number of distressing lockdowns. As a result, restrictions on individuals' liberty are being reintroduced.


  •  Every decision made was made with pragmatism and practicality. It is not because a dictator suddenly had an idea of how to reform the country and imposed his decision without any further deliberation or consultation with advisors.
  • From Deng Xiaoping, we learn that the process of introducing reforms is a gradual one that must be conducted through rigorous evaluation. It must be tested at every stage and the policies must be adapted as necessary.
  • This is not to say that Deng Xiaoping is an ideal hero in our narrative. Or that he did not do anything wrong. Economically, his ideology did favor freedom but politically, he was still a dictator.
  • The Tiananmen Square Massacre of 1989 occurred during his administration. One thing that was ignored in all these police was the environment.

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