A few of the most visionary leaders in China’s history set China on a trajectory allowing it to grow from a Third-World Economy to economic powerhouse on pace towards becoming the World’s largest Global Economic Super-Power by the year 2025(Netflix, 2020). The United States and China were allies during World War II fighting Imperial Japan. After the Allies declared victory, China was internally split between the US supported Nationalist and The Communist Army led by Mao Zedong. Mao and his army claimed victory in 1949 and established The People’s Republic of China. Moa believed in socialism and a collective community that shared in the wealth and were represented by The State. Under Mao’s leadership China would withdrawal from economic and diplomatic relationships in the West, close the Chinese stock exchange and allow China to become completely self-reliant in terms of finances, food, and goods. Over the course of the next two decades China suffers from widespread famine, a corrupt infrastructure and a busted economy. By 1960 China’s economy was roughly $59 Billion versus the United States in 1960 which was roughly $ 543 Billion.
In 1976 after Mao’s passing Deng Xiaoping becomes the leader of China and becomes the first leader of China to ever visit the United States signaling to the world that Communist China is open for business. Xiaoping announces a new plan to establish ‘special economic zones’ (SEZ’s), these zones would be unrestricted and have a different set of operating rules. Factories would be able to export goods to the West and importers able to trade with capitalist countries (Netflix, 2020). The ideal to entice foreign investment by not taxing profits, providing low rent, and a seemingly endless supply of cheap labor works, and investments began to poor into China. China public declares they remain committed to their ideals of Communism while incorporating a capitalist economy.
The first SEZ was established in Shenzhen in 1980. The population in Shenzhen in 1980 was 59,000 by 2016 the population has grown to a whopping 12 Million people and the Gross Domestic Product (GDP) per capita increased by 24,569%. By 2005 China was constructing neighborhoods the size of Rome every two-weeks (Netflix, 2020). Between 2011-2013 China used more cement than the United States used in the previous 100-year period (Netflix,2020).
China would call their new policy ‘Socialism with Chinese Characteristics’. Between 1980 and 1990 China’s economy almost doubled from $191 Billion to $ 360Billion, respectively the United States was roughly 6 Trillion in 1990 (Netflix, 2020). In 1989 the economic policy success inspired students to protest for Democracy, free-speech, and freedom of the press. Although China may have embraced economic freedom, they reacted violently against political freedom and the Socialist Military murdered countless protestors in an event which is known as ‘Beijing’s, Tienanmen Square Massacre’ (Netflix, 2020).
In a reaction to the negative publicity of the massacre, in December 1990 China opened The Shanghai Stock Exchange in an attempt to allow Chinese to make money. By the end of the decade China’s economic strategy success was visible everywhere, Chinese workers saw increases in wages and the quality of life economically. China received the ultimate recognition they sought and were accepted into the World Trade Organization, agreeing to improve their social justice and treatment of their people (Netflix, 2020).
Access to luxury foreign brands such as Rolex, Rolls-Royce, Bentley, Polo, Luis Vuitton, Coach and others become status symbols and are heavily desired. The average laborer in China cannot afford the luxury brands and a new counterfeit market is created by Chinese factories to meet the demand. By t998 China’s economy passed the $1 Trillion dollar mark, still lagging the United States at $ 9 Trillion.
The Global financial crisis in 2008 crippled many factories in China as global import demand dried up. The new leader of The State, Hu Jintao did not hesitate to allow the State to step in and provide a $586 Billion dollar bail out of the Chinese economy. Factories pivoted and began making goods for the booming population in China versus exporting. Countries including the United States, saw the Chinese consumer market demand and were eager to try and access the Chinese market with the population of China surpassing 1.4 Billion people.
Hu Jintao continued the success of his predecessor’s economic leadership and saw a new opportunity with China’s new economic leverage. China begins to heavily invest in developing Nations such as Africa and Western Europe. In 2015 one of the most ambitious policies was announced ‘The Belt and Road Initiative’ which would expand China’s infrastructure connecting coastal China to London via railway. A massive network of highways connecting Eastern China to Pakistan’s deep-water ports, a massive pipeline would pipe natural gas from Turkmenistan to Eastern China (Netflix, 2020). China continued to expand SEZ’s throughout China and invested over $ 1 Trillion dollars across dozens of countries.
China’s newest leader Xi Jinping has overseen many of the latest investments into Africa and many other developing Nations. By the end of 2018 China had closed the gap between their economy and the United States, with China being at $13 Trillion and The US at $ 20 Trillion. The question is no longer if, but when for China to surpass the United States as the largest economic super-power. At the current rate many expect China to have an economy worth $ 22 Trillion by 2025, passing the United States which is estimated to be at $ 21 Trillion in 2025 (Netflix, 2020).
Economic success and power alone do not build Nations, given the lack of political freedoms it is difficult to predict the future of China and its people; However, the leadership and economic strategies conducted by Deng Xiaoping and Hu Jintao helped develop China from a third-world economy to what may soon become the World’s Largest Economic Super-Power by the year 2025.
Reference:
[1]Moran, R. T., Abramson, N. R., & Moran, S. V. (2014). Managing cultural differences (9th ed.). NY: Routledge.
[2]Netflix (2020). History 101. Episode 3 The Rise of China. Retrieved from