Country Report
China
Brief History
From archaeological findings we know that about 500,000 -1,000,000 years ago, there were primitive human beings such as Yuanmou Man, Lantian Man and Peking Man in the wide expanse known today as China. After the long period of primitive existence, the Xia Dynasty, the first in Chinese history, was established in the 21st century BC, heralding the beginning of a slave society in China. The following Shang and Western Zhou dynasties saw further development of the slave society. Then came the Spring and Autumn and Warring States periods, periods of transition from slave to feudal society.
In 221 BC, Qin Shi Huang, the First Emperor of the Qin Dynasty,ended the rivalry among the independent principalities in the Warring States Period and established the first centralized, unified, multinational state in Chinese history--the Qin Dynasty. Subsequently, one dynasty replaced another. China remained a feudal society until the Opium War in 1840.
The Opium War, which started in 1840, was a turning point in Chinese history. In the 17th and 18th centuries the major countries of Europe were looking for markets for their merchandise and colonies. To protect its opium trade, Britain launched the war of aggression against China in 1840. In 1842 the corrupt Qing court signed the humiliating Treaty of Nanking with Britain, bartering away China's national sovereignty. This reduced China to a semicolonial, semifeudal country.
The Revolution of 1911, a bourgeois democratic revolution led by Dr. Sun Yat-Sen, ended the rule of the Qing Dynasty. Thus, the monarchy that had existed in China for 2000 years came to an end, and the provisional government of the Republic of China was founded.
In 1919 the May 4th Movement against imperialism and feudalism took place. In this movement, the Chinese working class for the first time appeared on the political scene. In 1921, at its first National Congress, delegates representing Communist groups from all parts of China met in Shanghai and founded the Communist Party of China. The Chinese people led by the Communist Party participated in a bitter struggle for many years. In 1949 the Chinese people finally ended the rule of the Kuomintang headed by Chiang Kai-shek, achieving the victory of the New Democratic Revolution.
On October 1, 1949, 300,000 people gathered at Tiananmen Square in Beijing for the ceremony formally declaring the new state. Mao Zedong, chairman of the Central People's Government, solemnly proclaimed the founding of the People's Republic of China.
China experienced a period of economic recovery in the first three years (1950-1952) following the founding of the People's Republic. Then the basic socialist transformation of agriculture, the handicrafts industry, and capitalist industry and commerce between 1953 and 1956, the leading role of public ownership of the means of production had been defined, and the transition from new democracy to socialism realized. During the ten years from 1957 to 1966 China began large-scale socialist construction. Overall, great achievements were made in the national economy during this decade in spite of some serious mistakes in the economic construction. The output of essential industrial products, such as steel, coal, crude oil, electricity and machine tools increased by several or, in some cases, even a dozen times, and some new and developing industries such as electronics and petrochemicals were established. Work in science and technology, particularly in atomic energy, jet technology, computers, semi-conductors and automatic controls, progressed rapidly. The Cultural Revolution, which lasted for ten years from May 1966 to October 1976, brought great calamity to the country and the people, causing the most serious setbacks and most damaging losses to both since the founding of the People's Republic of China.
Drawing on the support of the masses of the Chinese people, the Communist Party of China smashed the Jiang Qing counter-revolutionary clique in October 1976. The end of the disastrous Cultural Revolution marked the beginning of a new era in Chinese history. Since the Third Plenary Session of the CPC Eleventh Central Committee at the end of 1978, China has instituted a policy of reform and opening to the outside world. The errors of the Cultural Revolution and earlier leftist deviations were rectified. The focus shifted to modernization centered on the economy.
Economic Profile
| Year | 1995 | 1996 | 1997 |
| GDP | US$1,110.8 billion | US$1,250.4 billion | US$1,357.6 billion |
| GDP Per Capita | US$575.00 | US$670.00 | US$738.00 |
Average GDP growth (1995 - 1997) was 7.2%
Since 1978 the Chinese government has been trying to move the economy from a sluggish, centrally-planned economy to a more market oriented one while still maintaining Communist Party control. Their policies have allowed household responsibility in agriculture instead of collectivism, increased local officials and plant managers authority, allowed some small-scale enterprises, and opened the economy to foreign trade and investment. These changes have brought about a quadrupling of GDP since 1978.
Major imports: plastics, fabrics, telecommunications equipment, electrical machinery and switches, transistors, rolled steel, motor vehicles, oil products, aircraft, and other industrial machinery.
Main partners: Japan, US, Taiwan, South Korea, Hong Kong, Germany and Russia.
Total US$138.83 billion (c.i.f., 1996)
Major exports: clothing, miscellaneous consumer goods, fabrics, footwear, toys, weapon systems, and electrical machinery and switches.
Main partners: Hong Kong, Japan, US, South Korea, Germany and Singapore.
Total US$151.07 billion (f.o.b., 1996)
Coal, iron ore, petroleum, mercury, tin, tungsten, antimony, manganese, molybdenum, vanadium, magnetite, aluminum, lead, zinc, uranium, and the world's largest potential hydropower.
In 1995 unemployment was 2.9%, and 3.0% in 1996 as the official rate, but more likely 8-10% with substantial unemployment and underemployment in rural areas.
614.7 million (1994) out of a total population of 1.2 billion.
By occupation: agriculture and forestry 54%, industry and commerce 26%, construction and mining 7%, social services 6% and other 7%.
Though the government is attempting to reform the economy, there are still many restrictions on business enterprises. The Chinese government is taking a cautious approach to downsizing the State-owned enterprises (SOEs) where total investment in 1996 amounted to US$1.2 trillion. These SOEs have been a drag on the Chinese economy, which the government has recognized and attempted to correct. They have established a project aimed at reforming 1,000 key SOEs.
Businesspeople trying to enter the Chinese market will find an enormous market potential if they can navigate the tremendous barriers that currently exist. Business success in China is often slow in coming and is not easy to achieve, but there is a great deal of long-term potential.
None
US$30.0 billion (7/98)
| 1995 | 1996 | 1997 |
| 12.9% | 6.9% | 2.8% |
Political Profile
As a Communist State the Chinese Communist Party (CCP) is the controlling party. There are eight registered small parties that are also controlled by the CCP.
In practice, leaders of the CCP make major decisions, but ministries along with the Standing Committee of the National People's Congress create policy day-to-day.
Economic disparities between rural and urban areas, governmental corruption, layoffs from state run enterprises, the economic gap between coastal and interior areas and inflation have all contributed to the growing dissatisfaction of the Chinese people. Northwest China has experienced unrest among ethnic and religious groups. This dissatisfaction and unrest has not translated into widespread political activity. There has not been any major political unrest since 1989. No meaningful political opposition groups exist.
China has 16 countries on its land border: Afghanistan, Bhutan, Burma, Hong Kong, India, Kazakstan, North Korea, Kyrgyzstan, Laos, Macau, Mongolia, Nepal, Pakistan, Russia, Tajikistan and Vietnam.
Officially the country is atheist, but there are Taoists, Buddhists, Muslims, and Christians.
China is a Communist state.