The Chinese Miracle
A. The Great Leap Forward (GLF) Campaign (1958):
Initiated by Mao Zedong to rapidly industrialize the agrarian nation on a colossal scale:
- 1. People were encouraged to set up backyard steel blast furnaces in their homes and backyards.
- 2. The Commune System: Rural land was completely collectivized into 26,000 massive communes where families pooled land and farmed collectively. Severe drought and flawed planning caused a catastrophic famine (estimated 30 million deaths).
B. Great Proletarian Cultural Revolution (1966–1976):
Mao mobilized the youth ("Red Guards") to purge bourgeois influences, sending university students and professionals to rural villages to perform manual agricultural labor, paralyzing higher education for a decade.
C. Deng Xiaoping's 1978 Reforms: Dual Pricing & SEZs
Unlike India (which reformed under crisis in 1991), China launched economic reforms in 1978 from a position of agricultural stability:
- Phase 1: Agriculture: Communes were dismantled; land was leased to individual farm households under the Household Responsibility System. Farmers kept profits after paying a modest state quota.
- Phase 2: Industrial Reforms & Township and Village Enterprises (TVEs): Private small industries were encouraged.
- Dual Pricing System: Farmers and factories bought/sold fixed quota quantities at state-determined prices; all surplus output was traded freely at market-determined prices.
- Special Economic Zones (SEZs): Created coastal export enclaves (Shenzhen, Zhuhai) offering massive tax holidays, state-of-the-art ports, and flexible labor laws to attract colossal Foreign Direct Investment (FDI).
- One-Child Policy (1979): Drastically curbed population growth, but later created an aging demographic profile with a skewed sex ratio.