The Reform and Opening-Up policy (改革开放政策) was adopted by the Chinese government in 1978, and it was an epochal movement which has significantly reshaped the overall structure of economy, administration and society in China.
The reform measures taken at that time were mainly to introduce market-oriented economic system, establishment of a decentralised management system decision and opening up of the external environment.
The economic reform and opening-up have been one of the most crucial reforms in the history of China. The reform measures taken then fundamentally changed the nation’s economic structure from economic closedness to economic openness. First of all, the economic reform and opening-up created more than 30 years of unprecedented rapid economic growth in China, and the nation achieved a transformation from the low income country to a middle-income country. During this period, China’s total economic output has grown rapidly and per capita income has increased greatly. In terms of industrial structure, the proportion of secondary industry in the gross domestic product has increased significantly. China’s foreign exchange reserves also soared to become one of the world’s largest reserve currencies.
In terms of administrative reform, the reform and opening-up of the former centralised planned economic system provided a good opportunity for implementing the system of decentralised economic decision-making. This gave more autonomy to local governments and in turn gave them more incentives and abilities to develop their local economies. It enabled local government to adjust their policies according to changes in the local conditions and to better serve the local population. Thus, provincial and county-level governments began to assume greater responsibilities in macro-economic management and to take actions such as promoting local economic development, increasing the efficiency of local government and increasing the transparency of administrative decisions.
In terms of social reform, the opening-up and reform of the Chinese economy also had an important influence on the structure of the Chinese society. The opening of the economy and increasing levels of prosperity brought about by reform and opening-up promoted social mobility and social integration. People were able to move up the social ladder and establish their own businesses, resulting in an increase in the number of entrepreneurs and middle-class citizens. At the same time, the reform and opening-up also greatly improved people’s living standards and the quality of their lives. Social stability was also enhanced through the economic reform, which enabled the Chinese people to enjoy greater freedom and more choices in terms of lifestyle.
The Reform and Opening-Up policy of 1978 marked an epochal moment for China, when it transformed from an isolated country with a closed economy to one of the most dynamic nations in the world. Through economic, administrative and social reforms, the Chinese government was able to successfully transition to a market-oriented economy and at the same time foster the development of society. Both the economy and society saw tremendous changes and the reform movement set in motion a new chapter in the history of China.