Far-Reaching Freedom and Increasing Prosperity – 40 Years of Reform and Opening-up in China




SPEAKING about today’s China, we are looking at an up-and-coming, dynamic and rapidly developing country whose economic power has become a global benchmark. Some Chinese cutting-edge technologies are gradually occupying the world market, Chinese consumer goods have become an integral part of the world’s shopping centers, and Chinese travelers also dominate the tourism sector.


A giant billboard featuring Deng Xiaoping, chief architect of China’s reform and opening-up, in Shenzhen.


What seems to be quite natural today was hardly conceivable not so long ago. Personally, I had my first encounter with a person from China in the mid-1980s. It was only a few years earlier that the country, which at that time had been largely sealed off, had begun to open up cautiously to the outside world and to introduce important reforms at home. In this context, some Chinese students were allowed to travel abroad for exchange programs.


The friendly young fellow student I met at my university in Germany at that time was Li Jie. She had come to Germany to learn the German language for one semester at the Faculty of Economics at the University of Freiburg. Despite language barriers, many good conversations took place between us at that time.


It was quite exciting for me to learn first-hand about life in China. Li Jie, on the other hand, was curious to find out more about what moved people in Germany.


The Third Plenary Session of the 11th Central Committee of the Communist Party of China held in December 1978 paved the way to China’s reform and opening-up in the 40 years that followed.


I remember that she once gave me a tiny red tin of medicine for colds and sniffles. The medicine has long since been used up. The small container, however, I have kept as a souvenir until today.


These were eventful days when, from December 18 to 22 in 1978, delegates met in Beijing for the Third Plenary Session of the 11th Central Committee of the Communist Party of China. What was decided there in the Great Hall of the People was such a far-reaching change that historians sometimes speak of a “new revolution” or “second revolution” to describe it. We are talking about the introduction of the reform and opening-up policy.


The central themes of the plenary session in 1978 were emancipation of mind and shifting the focus of the nation to economic development. The reform and opening-up policy was first proposed in this session. Specifically, the term “reform and opening-up” referred to two important policy areas: internal reforms within China itself and the active external opening-up to the rest of the world.The reforms at home were intended to  change the economic system and other parameters that in the past had impeded the development of China’s productive forces.


As a first step towards opening-up, the new state leadership initiated the establishment of four special economic zones, including Shenzhen. As steps, the plan was to open up coastal, riverine and border areas in the following decades, and up to full participation in economic globalization in the 21st century. 


Reform and opening-up meant primarily turning away from class struggle as a guiding principle and turning towards the country’s economic development as the nation’s central task.


Shi Guangsheng, then Chinese minister of foreign trade and economic cooperation, toasts for China’s official entry into the WTO in Doha, Qatar on November 10, 2001.


The reforms introduced at that time indicated the definitive renunciation of the Soviet model of socialist planned economy and the shift towards Chinese socialism with the aim of peaceful development and socialist modernization of the country.


Speaking of China’s policy of opening-up, it is inextricably linked to the Chinese leader who initiated the shift from a strictly planned economy to a freer state and a freer economic system, and who is undoubtedly regarded as its architect: Deng Xiaoping.


Reformer Deng was not only the father of China’s opening-up policy. His reforms also built the basis for China’s breathtaking economic success – in less than three decades the country evolved from a poor third world country to one of the world’s economic powers. China outperformed my home country Germany in terms of GDP as early as almost 10 years ago.


With its policy of reform and opening-up, China has freed itself from poverty and stagnation and transformed itself into a society full of vigor and vitality. Anyone who today walks through the streets and squares of Chinese cities and villages will be amazed by the colorful and cheerful life of Chinese people.The policy of reform and opening-up revived the Chinese society and restored people’s self-confidence and pride with the growing economic and political success.


Forty years have passed since the introduction of the reform and opening-up policy. Without Deng Xiaoping’s courageous step, the visible openness in China’s political and social spheres would certainly not have been possible.


Stock trading is popular among Chinese.


Now, a very cosmopolitan and diverse society has developed in China. During my many stays in the country from 2005 onwards, I noticed there was no subject off limits in my discussions with Chinese people. In fact, I was often surprised by the passion for discussions, the creativity and free thinking of many of my interlocutors.


In today’s China, you will find prosperity and diversity in the cultural sphere that had been unimaginable a few decades ago: From the Peking Opera to experimental theater, from folk songs to classical Chinese and European music to techno and rap, almost every genre is represented in China’s music sector nowadays.The picture is similarly colorful if we look at the performing arts or the field of writing. In 2009, as the guest country at the renowned Frankfurt Book Fair, China was able to present a huge variety of literary works, in plenty of genres and styles. Among them was the German-Chinese edition of my first novel The Magic of the White Snake.


It’s undeniable that there are still large economic and social differences among Chinese provinces, namely the rich east and the relatively underdeveloped west. However, allegations by some Western media that China neglects its western provinces in favor of the east are no doubt lacking in foundation.


Without economic prosperity of the successful regions at the Chinese coasts, it wouldn’t have been possible to comprehensively develop and promote the less developed regions as practiced by the Chinese government today. There are only very few countries in the world where the government is making such great efforts to level out differences in wealth for balanced regional development, as it can be seen in China in present days.


The project of the revitalization of the ancient Silk Road, in which more than 70 states and organizations are involved so far, will undoubtedly make a significant contribution to China’s development in all its regions. The Belt and Road Initiative,  the name of the project, was initiated in 2013 by Chinese President Xi Jinping during his official trip to Central and Southeast Asia. The aim of this project is to widen the scope of China’s opening-up, to intensify its cooperation with other countries on the basis of mutual benefit and thus to give new impetus to the national and international economy. With the Belt and Road Initiative, China has succeeded not only in continuing its reform and opening-up policy, but also in lifting it to a higher level.


The new concept of reforming the supply side is also to be understood as a continuation of Deng’s reform and opening-up policy. In his report to the 19th National Congress of the Communist Party of China Xi Jinping stressed: “We should pursue supply-side structural reform as our main task, and work hard for better quality, higher efficiency, and more robust drivers of economic growth through reform.”


Against this backdrop, in order to stimulate the economy through innovation, the Chinese government is making all efforts to release new productive forces in Chinese enterprises and improve their competitivenes. Measures have been taken to  phase out obsolete means of production, reduce debt, excess production capacity and tax burdens.


In addition, the Chinese government plans to intensify its active fiscal policy and continue the country’s current prudent monetary policy. The central goal is to optimize the economic structure and hence promote growth and prosperity.


At the opening of the B20 Summit in Hangzhou on September 3, 2016, Chinese President Xi Jinping gave a keynote address entitled “A New Starting Point for Chinese Development, A New Blueprint for Global Growth.”


According to Xi, China stands at a new historical starting point for the comprehensive deepening of its reforms and the creation of a new driving force for its economic and social development. It is the beginning of a new normal of economic restructuring development, an era of profound interaction between China and the rest of the world, as well as a time of even more extensive opening of the country.


After 40 years of reform and opening-up, one thing gets very clear: It is not only the Chinese people who benefit from the successful implementation of Deng Xiaoping’s policy, but the whole world.


Today, China has become one of the most important engines of the world economy. While people in Western countries have benefited from Chinese products that are both inexpensive and of high quality, China is also one of the world’s largest and most profitable markets for Western companies. The high level of prosperity that we enjoy today would be inconceivable without China’s economic power.


Looking back at the situation in 1978, the success of China’s reform and opening-up policy becomes particularly clear. China has undergone an astonishing transformation from a poor third world country to an extremely dynamic engine for the entire world economy.


At the G20 Summit in Hangzhou, Xi Jinping suggested a Chinese solution to global economic development. According to Xi, China is ready to “work with all parties involved at the G20 Summit in Hangzhou to promote strong, sustainable, balanced and inclusive development of the world economy.”  


HELMUT MATT is a German writer and an expert on China.