this post was submitted on 21 Sep 2025
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Chapotraphouse
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To be more precise, we have about 26 years of planned economy under Mao (although the last few years were just turmoil from the Cultural Revolution), which led to the reform and opening up era that can be characterized by the first 20 years of Deng’s reform. The limits of the reform model was first tested in the 1995-96 economic crisis, caused by the mass privatization wave following the landmark 1994 Tax Sharing Reform.
Then we have the Transition Period from 1998-2001, when Zhu Rongji decided to unleash the property market to save the economy and ended the welfare housing program (everyone has to purchase their own houses now), and when the decision to join the WTO was being made.
Then we have the WTO/neoliberal double-digit growth “world factory” era from 2001-2009, and after the GFC moved into the infrastructure investment-led era from 2009 to 2020, during which the over-investment and land speculation by local governments created a huge property and debt bubble.
Then Covid hit… and everything went to shit really. The post-Covid growth that was promised simply never arrived, especially with the property bubble bursting. What we are seeing now, with all these amazing development in China, is really the long shadow from the early years of the infrastructure phase. The peak was about 10 years ago in the 2010s, and it should have been curbed long before it got out of control.
So the first 30 years of Deng’s reform and opening up was obviously critical, but just like you jump from the planned economy to a liberalized reform economy, clearly that phase will end some day (in fact, I believe we are already at least 10 years late) and the jump into a new (socialist) phase becomes the next step in the progress.