China Is A Communist Country That Denies Many Basic Civil Rights

752 Words Jul 2nd, 2015 4 Pages
Although China is still a communist country that denies many basic civil rights to their population, they have gravitated toward market economy during the past several decades. From 1978, Chinese government began to reform their economic system and committed to build a socialist market economy. A series of open-door policies and measures were established to support liberalization of foreign trade and decentralize of state control (China.org.cn). In late 1990s, large-scale privatizations allowed entrepreneurs and investors to take profit, which in turn promoted nation’s economic growth.

However, China has not relaxed state control over some strategically significant industries including finance, defense, energy and telecommunications. According to the research about China’s financial system, Chinese financial system is mainly controlled by the four largest state-owned banks, which are largely inefficient. The researches believe the high proportion of nonperforming loans hold by Chinese banks is one of the biggest risk threatening the economic growth (Allen & Qian, 2005). Foreign companies should pay attention to this economic risks associated with investment in China.

In 2012, the Chinese government began a new round economic reform in order to change the country’s economic fundamentals and ensure a sustainable growth model. However, the economic policies aimed at reducing nonperforming loans and overcapacity in heavy industries constrained the industrial output at the…

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