China

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Full Report: China

Overview

1910-1918: In 1911 a group of discontented army officers launches an attack against the Manchu (Qing) dynasty. The dynasty is unexpectedly toppled, and the Republic of China is born. The task of uniting the country is daunting as foreign powers maintain their own governments in coastal cities, and warlords throughout China battle each other for power.

1919: Chinese intellectuals take to the streets to protest the dividing up of China by foreign powers. They believe that imperialism and warlords have weakened their country, and they demand an end to foreign domination.

1920-1925: The new Nationalist (Kuomintang) government appeals for outside help in defeating the warlords and receives it from the Soviet Union, on the condition that the Soviets work with the newly formed Chinese Communist Party. The Whampoa Military Academy is set up outside Canton. Planning begins for an expedition to unite China.

1926-1927: Chiang Kai-shek leads the Northern Expedition army up the coast of China and in six months defeats 34 warlords. Communist organizers stage rallies along the way to win popular support. In Shanghai, Chiang suddenly turns on the Communists in a bloody massacre. He then establishes Nationalist headquarters in Nanjing, China's economic heartland.

1928-1930: The Communists disappear into the countryside after the Shanghai purge and set up a new government in Jiangxi Province, South China. Mao Zedong is one of the leaders. They initiate radical land reform, displacing hated landlords and building peasant support.

1931-1935: In 1931 Japan invades Northeastern China and sets up a puppet government. Instead of resisting Japan, Nationalist troops launch a series of military campaigns against the Communists and nearly destroy them. But 90,000 people break through a blockade and set out on the "Long March," a perilous 6,000-mile journey to a new base in Yenan. Along the way, Mao emerges as the undisputed leader of the Chinese Communists.

1936: Nationalist leader Chiang Kai-shek faces intense pressure to resist Japan, both from his own generals and from the Communists in Yenan. In an extraordinary turn of events, he is kidnapped by his own generals and pressured to fight Japan. He is only released when he agrees to a united front with the Communists.

1937-1944: Japan launches full-scale invasion of China in July 1937. Within five months the Japanese enter Nanjing and massacre 200,000 people. The government retreats to Chongqing, a remote area ruled by rival warlords. America enters the war in 1941 and finds Chiang saving his best troops for use against the Communists. In 1944 America sends the Dixie Mission to Yenan to gauge Communist fighting capacity.

1945-1948: When World War II ends in 1945, America airlifts Nationalist troops to take the Japanese surrender, but civil war soon erupts between the Nationalists and Communists, and all efforts at mediation break down. The Communists expand their support in the North with radical land reform and defeat the overextended Nationalist troops in the decisive battle of Huai-hai.

1949: Chiang Kai-shek resigns in January and retreats to Taiwan; two million Nationalists soon follow. The Communists move into Beijing and establish the People's Republic of China on October 1. They create political structures that reach down to every village in country, and receive limited aid and a defense treaty from the Soviet Union.

1950-1953: Responding to threats of invasion by UN forces, Mao sends massive numbers of Chinese troops across the border into Korea in "human waves." A "Resist America" campaign stirs national pride and proves how effectively the new government can mobilize the country. Chinese forces fight UN forces to a standstill and greatly increase Mao's prestige.

1954-1956: Soviet advisors help create industrial infrastructure in cities, and Mao Zedong turns to peasants to pay for it. Asked to pool their property into small cooperative farms, families are then pushed to the next stage: collectivization. By 1955 all of China's 600 million peasants live in collectives, and all of China's agricultural output is under government control.

1957: Mao's "Hundred Flowers" campaign encourages intellectuals to voice criticism, but when the Party becomes the intellectuals' focus, Mao reverses himself and condemns those who spoke out as "Rightists." Deng Xiaoping is appointed to lead the Anti-Rightist campaign, a brutal crackdown on Chinese intellectuals.

1958-1960: Mao launches the Great Leap Forward, a campaign to make China the West's industrial equal in 15 years. Farmers are herded into huge communes. Among the campaign's projects: the creation of steel in backyard furnaces, the killing of sparrows, and the close planting of crops. In an effort to please Mao, farmers over-report their yields. The world's worst manmade famine follows.

1961-1963: Mao retreats from view while Liu Shaoqi, Deng Xiaoping, and Zhou Enlai run the government. China becomes politically isolated. Chinese troops crush a revolt in Tibet in 1961. The Chinese government shifts its focus from heavy industry to the production of consumer goods. Relaxed controls on peasants allow them to make money farming on the side.

1964-1965: Mao Zedong emerges from isolation with the publication of "Quotations from Chairman Mao," also known as the "Little Red Book." Thus begins the cult of personality.

1966-1968: Mao launches the Great Proletarian Cultural Revolution. He sends millions of Red Guards through China to attack the "Four Olds": culture, ideas, customs, and habits. Top Party leaders are purged as "capitalist roaders," exiled, and killed. The cult of Mao reaches new heights. At the peak of chaos Mao disbands the Red Guards, sending them to the countryside for reeducation.

1969-1973: Border clashes flare between China and the Soviet Union. Mao Zedong and Zhou Enlai make overtures to the United States. With his visit to China in February 1972, President Richard Nixon takes the first step in normalizing relations with China and begins to establish the "strategic triangle" of China, the United States, and the Soviet Union.

1974-1976: Purged Party members begin to be rehabilitated. Deng returns to Beijing and helps initiate small reforms. Politics is dominated by the question of who will succeed the dying Mao Zedong. The worst excesses of the Cultural Revolution are blamed on the Gang of Four, who sought the implementation of communist ideology at the expense of traditional Chinese culture. In September 1976 Mao Zedong dies.

1977: While China is officially led by Hua Guofeng, Deng Xiaoping works behind the scenes to take his place. Deng moves to exonerate millions attacked during the Cultural Revolution. He puts economic prosperity before socialist purity and maintains a belief in the Party's absolute authority. Sent-down youths return home from the countryside to find Beijing a changed, more open place.

1978-1979: By 1978 Deng is China's paramount leader. With ambitious plans to modernize China, he visits America, where he negotiates full diplomatic relations. Beijing's Democracy Wall provides an outlet for people to criticize the Cultural Revolution, but when this freedom threatens Party authority, Deng crushes it. At the same time, he allows drastic reforms in Anhui province in response to severe drought.

1980-1984: Special Economic Zones (SEZs) in the South and innovative agricultural reforms in the countryside fuel stunning economic growth. Deng negotiates Hong Kong's return to China. By 1984 rural China is booming, and 14 more coastal cities are designated SEZs. When Party hard-liners voice concerns about foreign corruption, Deng appeases them with a short-lived campaign against "spiritual pollution."

1985-1987: Popular expectations rise along with economic prosperity. "Cultural Fever" encourages freedom of expression on college campuses, and students demonstrate for more say in their futures. The Party fears unrest and cracks down. Inflation soars; corruption increases. The population reaches an unprecedented 1.2 billion. There is no solution in sight for insolvent state-owned enterprises (SOEs).

1988-1989: Rising inflation, crime, and corruption fuel a conservative backlash against reforms. Students occupy Tiananmen Square upon the death of Hu Yaobang, a Deng protégé sympathetic to pro-democracy demonstrations and forced to resign as Party secretary. Protests last through Mikhail Gorbachev's historic visit. The government declares martial law June 4 and sends in troops to suppress demonstrations.

1990-1993: While maintaining strict political control, China's leaders launch their most spectacular period of economic growth. In 1992 Deng travels to the SEZs and calls on the country to copy their example. "Communism," he declares, "will not be saved by rhetoric but by improving people's living standards." Foreign investors return, and China produces its first millionaires.

1994-1997: Deng appears in public for the last time in 1994, and Jiang Zemin is named his heir-apparent. Foreign companies scramble for Chinese contracts, while China's state-owned factories operate at a loss, draining capital from government and banks. In 1997 Hong Kong returns to Chinese rule, and Deng Xiaoping dies.

1998-2001: Premier Zhu Rongji announces a three-year plan to reform state enterprises or let them die. Ending the "iron rice bowl" of jobs and benefits for life, he lays off millions of Party officials. China agrees to open its markets to gain World Trade Organization (WTO) membership. Beijing is chosen to host the 2008 Olympics. China struggles to maintain stability and prosperity amid growing labor unrest.

2002-2003: The 16th Party Congress replaces the aging leadership, but Jiang Zemin retains influence. WTO accession boosts foreign investment to record highs. The economy remains strong, but inequalities persist, and corruption and unemployment spread. The outbreak of the deadly virus Severe Acute Respiratory Syndrome (SARS), and the government's delayed reaction, threaten China's economy and social stability.

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Political

1910-1911: In the political vacuum left by the fall of the Manchu (Qing) dynasty, warlords battle each other for control. Many are supported by foreign powers that maintain "concessions" in China's main port cities.

1912-1923: Sun Yat-sen is one of the few political figures to address China's problems. In 1912 he helps establish the Nationalist (Kuomintang) Party, a coalition of small political groups. Educated in Hawaii, Sun looks to the West for financial support. The Dalai Lama returns to Tibet in 1913 and declares Tibet's independence from China.

1924-1925: The Nationalists and the newly formed Chinese Communist Party (CCP) work together at the Whampoa Military Academy on a plan to unify China. Chiang Kai-shek is appointed commander, Zhou Enlai director of political education. Sun Yat-sen holds this fragile alliance together. He dies of cancer in March 1925.

1926-1927: The Shanghai Massacre is the first bloody split between Communists and Nationalists. The Communists move underground while the Nationalists set up headquarters in Nanjing and establish security organizations to stop Communist growth in cities. Chiang Kai-shek adopts the title "Generalissimo."

1928-1935: Mao Zedong creates a government in Jiangxi and builds a base of support. He emerges the undisputed leader of the Chinese Communist Party during the Long March. In Nanjing, the Nationalists launch an ideological offensive called the New Life Movement, a mix of Confucianism and fascism.

1936-1945: The Nationalists lose their entire Northeastern power base as city after city falls to the Japanese at the start of the Sino-Japanese War. Meanwhile, the Communists are building a strong rural base of support in Northern China with a series of reforms, reducing land rent and taxes and holding elections. The two sides are officially united against Japan but clash frequently.

1946-1948: U.S. financial and military prop up the Nationalist government, and at the end of World War II Chiang Kai-shek is hailed as a hero. But despite U.S. mediation efforts, full-scale civil war soon erupts, and the Nationalist government flees to Taiwan. American foreign service officers who dealt directly with Communists are later blamed for the "loss of China."

1949: The People's Republic of China is established October 1. Communists forge new political structures, with a network of party branches in every village. Its first major legislation makes women legally equal to men. People are organized in work units that provide employment, health care, housing, and education. Mao Zedong is first in authority, followed by Liu Shaoqi, Zhou Enlai, and Deng Xiaoping.

1950-1959: China becomes increasingly isolated, but relies on the Soviet Union for loans and industry advisors. But theirs is an uneasy alliance, and it snaps in 1958 after Mao threatens to invade Taiwan, a move Premier Nikita Khrushchev fears could provoke a superpower confrontation. Within China, no one dares criticize Mao, even though his policies, such as the Great Leap Forward, are clearly disastrous.

1960-1965: Mao retreats from view after creating history's worst manmade famine. Pragmatists Liu Shaoqi, Deng Xiaoping, and Zhou Enlai run the government, determined to restore order and economic stability. "It doesn't matter whether a cat is black or white," Deng says, "so long as it catches mice." Mao believes they are betraying the revolution, and relies almost exclusively on Defense Minister Lin Biao.

1966-1968: Deng Xiaoping is struggled against and exiled to a remote village. Liu Shaoqi is attacked, beaten, and kept under house arrest for two years, after which he is finally flown to a remote prison, where he dies. Zhou Enlai is seen as a moderating influence, though he never openly challenges Mao. Factional warfare breaks out between Red Guard groups.

1969-1973: At the 9th Party Congress in 1969, Lin Biao denounces the U.S. and USSR as imperialist enemies. Opposed to Mao's forging relations with America, he plots a coup but is killed in a mysterious plane crash before he can execute it. Zhou Enlai is a key advisor to Mao in talks with President Nixon that result in the ambiguous Shanghai Communique, which contains U.S. and Chinese positions on Taiwan.

1974-1977: Even near death, Mao remains China's paramount leader. Zhou Enlai, however, is more popular, and when he dies in 1976, thousands go to Tiananmen Square to lay wreaths for him. Their pent-up frustration erupts in anti-Gang of Four demonstrations. Mao dies quietly that same year. The unknown Hua Guofeng becomes his successor in late 1976, and soon afterward he arrests the Gang of Four.

1978-1979: Deng Xiaoping returns to power, decisively ousting the ineffective Hua Guofeng. He brings millions of sent-down youths back to cities and from that pool cultivates new economic advisors with valuable rural experience. Deng maintains complete political control with his crackdown on the Democracy Wall movement, even as he displays a willingness for innovation in the economic realm.

1980-1984: Economic reformers Hu Yaobang and Zhao Ziyang work openly to reform China's economy. In 1982 Deng hosts Margaret Thatcher and negotiates the return of Hong Kong from Britain to Chinese rule. The Joint Declaration is signed in 1984, signaling China's growing power on the world stage.

1985-1987: Reformers try to address problems of state-owned enterprises (SOEs), but are resisted by conservatives like Chen Yun, who view SOEs as the backbone of the socialist system. Deng unsuccessfully pushes to oust older Central Committee members. Mao's legacy is debated. The Party faces mounting social instability.

1988-1989: The government is split between hard-liners intent on restoring old order and reformers seeking increased openness and economic reform. Deng views student and worker demonstrations in Tiananmen Square as a challenge to his authority and political stability and joins hard-liners in calling for a brutal crackdown. Zhao Ziyang is dismissed from his posts, and Jiang Zemin is named new Party chief.

1990-1992: After a period of retrenchment following the Tiananmen massacre, Deng begins to challenge conservative foes like Chen Yun, urging their retirement. His bold trip through the Southern Special Economic Zones (SEZs) confirms their importance to China's economic growth.

1993-1996: There are sharp disagreements within the Party about how to maintain government control, increase prosperity, join world markets, and stop the fiscal hemorrhaging of the state-owned enterprises.

1997-2001: Deng Xiaoping, the last veteran revolutionary, dies in 1997. Jiang Zemin becomes the Party's new leader at the 15th Party Congress. The government focus is on maintaining internal stability and economic growth, projecting itself forward into global organizations, and preventing Taiwan's permanent separation from China.

2002-2003: Jiang Zemin protégé Hu Jintao brings generational renewal as new Party secretary. Jiang heads the military and retains strong influence on the leadership. The Communist Party welcomes businesspeople in a further broadening of "socialism with Chinese characteristics." In 2003, the regime mishandles the SARS outbreak, then sacks the health minister and Beijing's mayor to try to regain credibility.

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Economic

1910-1927: The fall of the last emperor leaves China's economy disorganized and chaotic. The weak Nationalist government appeals to the United States for funds but is turned down. The Soviet Union provides the first backing that will help the Nationalists drive out warlords and unify the nation.

1928-1936: After splitting with the Communists, Chiang looks to the West for new technologies, science, and medicine. During the "Nanjing Decade," the government invests in construction, modernizes transportation and communications systems, and begins to unify the currency system. Shanghai becomes the trading and financial center of Asia, with foreign tycoons and a thriving stock market.

1937-1945: Chiang Kai-shek and his wife appeal to the world for help in fighting Japan. In 1943 Mme. Chiang visits America to ask for money and supplies. Chiang threatens to sign a separate peace with Japan. The United States sends millions of dollars to the Chinese war effort, with no accounting required. Corruption is rampant as funds are handled by the inner circle of Chiang relatives and friends.

1946-1948: Nationalist financial policies are chaotic, with black market trading and corruption widespread. The currency system changes frequently, from paper money to gold yuan to silver dollars, even American dollars. Inflation rises to 100 percent. With famine in the North and floods in the South, the UN Relief Agency sends China millions of dollars in aid.

1949: When the People's Republic of China (PRC) is established, peasants seize property and kill landlords. Nearly half of China's arable land is distributed to poor peasants. Foreign investment is seized, and private property is nationalized. China is nearly bankrupt, with all of the Central Bank and a huge number of art treasures now moved to Taiwan.

1950-1957: Agriculture is collectivized, and private property is abolished. The government sets quotas for how much grain peasants can keep and fixes low prices for the state portion. U.S.-led trade sanctions are imposed on China for its support of North Korea, pushing Beijing towards Moscow. In 1953 the first Soviet-style five-year plan is adopted, with an emphasis on heavy industry, especially steel.

1958-1960: In an effort to create steel that will speed China's industrialization, people melt woks, tools, and bed frames in backyard furnaces, but the steel they produce is useless. Ideologically zealous farmers over-report farm output. The state takes grain based on false figures, using it to pay off Soviet debt and feed cities. China's economy does not advance, and 30 million people starve to death.

1961-1965: Mao leaves the government in the hands of pragmatists after his disastrous Great Leap Forward, and they initiate programs of careful economic growth which do work. China becomes increasingly prosperous.

1966-1976: The Cultural Revolution is a time of intense internal confusion and isolation from the rest of the world. The economy is in shambles as all economic pragmatists are purged from the government.

1977-1979: Deng Xiaoping wrests power from Hua Guofeng and by 1978 outlines an ambitious program for economic reform, including dismantling the communes and allowing peasants to produce food for private sale. This "household responsibility system," designed in response to the drought in Anhui, produces bumper crops. An open-door trade and investment policy is introduced.

1980-1984: Special Economic Zones (SEZs) allow China to accept foreign capital and adopt foreign technologies in controlled phases. Massive construction projects and high wages lure people from all over China to the SEZs. In the countryside, the first markets in decades open to sell surplus produce. Small factories make goods that have been in short supply, fueling the national economy.

1985-1987: State-owned factories are inefficient and heavily subsidized by central government. Agricultural output is exploited to support the failing state-owned enterprises (SOEs), reducing profits for farmers. Rural unemployment increases as factories cannot absorb the population freed from collective farming. The economy enters a period of high-speed growth, with rampant inflation and corruption.

1988-1989: Workers in SOEs used to an "iron rice bowl" of jobs, housing, and benefits for life are encouraged to become entrepreneurs, but few dare. Workers watch inflation eat into their fixed wages, becoming angered by government profiteering and corruption. Deng's plans for price reform plans ignite a run on banks and panic buying. Changing course, he now advocates economic stabilization, not reform.

1990-1991: The Shanghai Stock Exchange is allowed to open, although it is described as an experiment. The Shenzhen exchange follows soon after.

1992: Deng pushes SEZs to accelerate their reforms. China's economy booms, yet problems mount. Urban SOEs are losing money and draining capital from the state budget. Foreign companies do not invest inland, creating a large disparity in income between coastal regions and the rest of China. Millions are unemployed, and village factories often cannot pay their workers.

1993-1996: Zhu Rongji takes charge of the economy, heading the Central Bank and tightening regulatory controls over the stock and other markets. He tries to stem rising inflation after price rises soar more than 21 percent in 1994.

1997: On July 1 Hong Kong is handed back to China after 150 years of British colonial rule. Beijing inherits one of the world's most vibrant capitalist economies and an international financial center. In September Jiang Zemin consolidates his power following Deng Xiaoping's death. The Party begins to focus on reform of SOEs through mergers, acquisitions, bankruptcies, and share issues.

1998-2000: By 1999, with 1.25 billion people and a GDP of $3,800 per capita, China's is the fastest growing economy in the world, and also the second largest after the U.S. But the country remains poor, lacking the monetary and fiscal controls to manage its vast economy. The government turns to banks to provide failing SOEs loans, but they are not repaid. The banking system is threatened.

2001-2003: After China joins the WTO, foreign investment surges to a record high. Strong growth masks internal disparities between cities and rural areas, coastal and interior regions. Cuts in tariffs and rules streamline business, but the huge state-owned sector remains deeply troubled and extremely hard to reform. In 2003 the spread of the deadly SARS virus has a severe impact on China's economy.

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Social

1910-1926: China looks much as it has for centuries: mostly rural and poor. There is great inequality and foreign domination in "treaty ports." The May Fourth Movement is a reaction against this domination, and produces a generation of intellectuals that scrutinizes many aspects of Chinese culture and traditions.

1927-1936: China's countryside is marked by huge gaps between rich and poor. Rents are high, taxes are often collected decades in advance, and landlords are called the "masters of the earth." Young girls are sold as child brides.

1937-1945: War with Japan brings tremendous civilian casualties. Millions flee inland while millions more are killed when the dykes of Yellow River are broken in an effort to stop the Japanese advance. Meanwhile, in Yenan, there is atmosphere of idealism -- the "Yenan Spirit" -- as youths come to see reforms and learn how to fight Japan.

1946-1949: As the civil war advances, panic and inflation escalate. People rush out to buy goods in the morning before prices rise in the afternoon. The homeless and starving fill city streets. Peasant support for the Communists is challenged by their radical land-reform policies. Financial and social chaos plague the country.

1950-1957: Mao turns to the countryside to pay for industrialization. In 1953 families pool property and create cooperative farms; by 1955 private property is abolished under collectivization. People are invited to air their grievances during the "Hundred Flowers" campaign only to be brutally silenced in the subsequent "Anti-Rightist" campaign, as government control over intellectual life increases.

1958-1961: Parents work round the clock while children are cared for in communal nurseries. All meals are taken in communal dining halls, and family structure is abolished. People want to believe in Mao, and revolutionary fervor causes them to wildly over-report the success of the Great Leap Forward even as they begin to starve.

1962-1965: After the Anti-Rightist campaign, no one dares criticize Mao. When "Quotations from Chairman Mao" -- the so-called Little Red Book -- is published in 1964, all Chinese get a copy and are expected to memorize and live by his words.

1966-1968: The Cultural Revolution is a period of intense social chaos. Schools are closed for the academic year beginning in September 1966. Millions of Red Guards travel freely around the country, attacking officials and intellectuals. Violence spirals out of control, and Mao calls it "all-out civil war." As the cult of Mao heightens, people have to "report their thoughts" to Mao twice a day.

1969-1973: After the death of Lin Biao, many begin to question Mao's infallibility. Millions of students are still stranded at work in the countryside, where they have been sent for reeducation.

1974-1976: Thousands go to Tiananmen Square after the death of Zhou Enlai, with demonstrations that indirectly implicate Mao Zedong for his role in the Cultural Revolution. Yet he still cannot be openly criticized. In July 1976 the worst earthquake in history hits Tangshan, killing 400,000 people. Many think the disaster presages Mao's death two months later.

1977-1979: Poverty and hunger in the countryside worsens with Anhui province's drought. Despite personal risk, farmers agree to divide up their land and eat their surplus crops. The government allows them to continue the "household responsibility system" after great debates in Party. The one-child policy, adopted in 1979 and implemented with forced contraceptives and abortions, is unpopular in rural China.

1980-1984: Free to move around the country, people stream to coastal cities seeking high-paying jobs. As social controls loosen, smuggling, profiteering, prostitution, and pornography increase. In the countryside, peasants earn more than they ever dreamed of and buy televisions, fans, and refrigerators.

1985-1986: Expectations rise as China's economy booms, but social inequality grows as coastal cities thrive and rural areas struggle. As peasants watch the new prosperity pass them by, many feel abandoned by the government. Workers in failing state factories worry about keeping their "iron rice bowl" of lifetime security, but few dare to "jump into the sea" as entrepreneurs.

1987-1989: Encouraged to think and study freely, students become more vocal in their demands. After the death of reformist leader Hu Yaobang, they flock to Tiananmen Square to pay tribute and use the occasion to make political demands. The government tries to make the students leave, but they resist, and the movement gains momentum, ending only with the bloody crackdown on the night of June 4.

1990-1997: Reforms have created opportunity and risk for the Chinese. Workers are laid off and unable to find jobs, and the "iron rice bowl" is at risk, even as some in coastal areas become millionaires. The government couches capitalist reforms as a stage of socialism, eventually enshrining "Deng Xiaoping Theory."

1998-2002: Since reform of state-owned enterprises began, millions of Chinese workers have been laid off, with no social safety net remaining to catch them. The gulf between rich and poor grows. Entrepreneurship spreads. Internet use and consumer technology radically change urban lifestyles. The government recognizes the HIV/AIDS epidemic and begins to implement programs to fight it.

2003: After delaying reports of the actual toll of the pneumonia-like SARS virus, the Chinese government turns to the urgent task of preventing its spread. The virus, thought to have originated in Guangdong province, continues to claim lives despite aggressive quarantine measures and school closings. Panic spreads as the virus migrates across East Asia and to North America.

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Environmental

1910-1949: There are no recognized environmental problems or policies during this period.

1950-1969: Mao Zedong asserts that there are no environmental problems in socialist countries since the fundamental cause of environmental pollution lies in capitalist countries.

1970-1979: Acknowledging serious water pollution, Chinese delegates attend the UN Conference on the Human Environment in Stockholm in 1972. In '73 Beijing hosts the First National Conference on Environmental Protection. Delegates report environmental damage resulting from the disorder of the '50s and '60s. In 1978 the constitution declares environmental protection key to modernization.

1980-1988: Environmental agencies and legislation begin to appear. Planning begins for the Three Gorges Dam, designed to be the world's largest hydroelectric dam. It will displace nearly 1.9 million people, cost between $20 and $100 billion, and cause widespread environmental damage. Officials say the dam will generate a ninth of China's power and control the Yangtze, which often floods and kills thousands.

1989: Bowing to strong public opposition to the Three Gorges Dam project, the government votes to suspend it during the People's Congress. It remains a pet project of Premier Li Peng, however, and shortly after the Tiananmen Square uprising he resumes planning.

1990-1999: Construction begins on the Three Gorges Dam in the midst of protests by environmental groups lobbying the U.S. to stop financial support in 1994. The World Health Organization cites China as having seven of the 10 most polluted cities in the world. Acid rain falls on 30 percent of its land mass. China plans a costly renewable energy program that includes wind and solar energy in rural areas.

2000-2003: Halfway through construction, some Chinese officials, engineers, and activists say the Three Gorges Dam project is riddled with malfeasance, incompetence, and systemic weakness. There is fear that the massive project will never show a profit. China must address its greenhouse gas problem, as the country is projected to experience a huge increase in carbon dioxide emissions between now and 2020.

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Rule of Law

1910-1948: China has no strong tradition of rule of law. After the fall of the last dynasty the country is fragmented; it has no strong central government and is marked by great internal turmoil and foreign invasion. These conditions are not propitious for legal development.

1949-1965: Mao believes that the legal system only "dams up the free flow of revolution." The law is considered the ideological instrument of politics. The Communist Party enjoys absolute control over the creation of law by the organs of the state, and government is by decree rather than law. There is a 70 percent decrease in the number of lawyers by 1957. People's courts at all levels come to a standstill.

1966-1976: The Cultural Revolution disrupts all concept of law by eliminating virtually all legal professionals and closing all law schools. It is a time of anarchy during which "lawlessness" is praised. Lawyers are relocated to farms and factories for reeducation. China is essentially a lawless nation.

1977-1979: In 1978 Deng declares that democracy must be institutionalized and written into law so institutions will be consistent even as leaders change. All former laws and decrees are put into effect again. Criminal and counterrevolutionary cases brought during the Cultural Revolution are examined. The legal system is restored, legal colleges established, and thousands of new laws developed.

1980-1981: A new Criminal Code is adopted in 1980, and a month-long trial is held for the Gang of Four, who are charged with all the excesses of the Cultural Revolution. A guilty verdict is delivered for all four, and even Mao's widow, Jiang Qing, receives a death sentence, though it is later commuted to life in prison.

1982-1988: The government agrees that a market economy requires a modern legal framework. New laws are enacted to cover crime, civil life, administration, inheritance, contracts, patents, trademarks, and foreign joint ventures. "Law popularization" campaigns help educate the public about law and legality, but the CCP retains a monopoly of power over all important social, political, and economic institutions.

1989-1998: An estimated 800 to 1,300 protestors die when the army opens fire on them in Tiananmen Square in 1989. Another 10,000 to 30,000 participants are imprisoned, and many remain there today. China's longest held political prisoner, Wei Jingsheng, is released for "health reasons" in 1997 and later exiled to the United States.

1999-2003: Jiang Zemin declares his government fully committed to the rule of law, a requirement for WTO membership. But on the 50th anniversary of the People's Republic, Amnesty finds the country is in "the most serious crackdown on peaceful dissent for a decade." Corruption appears to be endemic. China is the world's most active user of the death penalty, which it applies for a wide range of crimes.

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Trade Policy

1910-1949: Foreign powers operate in treaty ports located throughout much of coastal and Eastern China. These ports are open to foreign commerce and are foreign-administered by the Chinese Maritime Customs office. The United States, England, France, Germany, and Japan are China's main trading partners. More treaty ports open in the early 20th century, facilitating the growth and spread of trade.

1950-1976: China has a largely closed economy with little trade. U.S.-led trade sanctions, imposed on China for its support of North Korea in the 1950-53 Korean War, push Beijing towards Moscow.

1977: Within the scope of broad economic reforms under Deng Xiaoping, an open-door trade and investment policy is introduced. Special Economic Zones along the coast are set up for foreign investment.

1978-1985: Foreign trade operations are decentralized. By 1985 trade represents 20 percent of China's gross national product. Textiles are the nation's leading export, with petroleum and food also strong. Leading imports are machinery, transportation equipment, manufactured goods, and chemicals. Japan is China's dominant trading partner, followed by Hong Kong and the U.S.

1986-1989: Trade becomes increasingly decentralized as China strives to integrate itself into the world trade system.

1990-1998: Foreign investment grows tenfold between 1990 and 1995. Despite unwieldy contractual and legal framework, China's billion-plus customers lure many investors, especially from ethnic Chinese in areas near Hong Kong and Taiwan.

1999: China's global trade totals $353 billion; its trade surplus is $36 billion. China's primary trading partners are Japan, Taiwan, the United States, South Korea, Hong Kong, Germany, Singapore, Russia, and the Netherlands. In November, the United States and China arrive at a bilateral market-access agreement that paves the way for China's accession to the World Trade Organization.

2000: China reaches a bilateral WTO agreement with the European Union and other trade partners and begins work on a multilateral WTO accession package. To increase exports, China encourages the formation of factories that assemble imported components into consumer goods for export. The U.S. approves permanent trade relations with China, and President Clinton signs the China Trade Relations Act of 2000.

2001-2003: In 2001 China serves as the Asia Pacific Economic Group's (APEC) chair; Shanghai hosts the annual APEC leaders meeting. After the 2001 World Trade Organization summit in Qatar, China becomes a full member of the WTO. Many tariffs and regulations are streamlined or ended, but foreign investors still face procedural obstacles. Trading partners complain that the Chinese currency is undervalued.

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Money

1910-1948: The Chinese currency system is centralized, minting is controlled, and millions of depreciated banknotes from provinces are recalled. In 1935 the Nationalists set up the new fabi currency. Prices plummet during World War II, and the U.S. lends China between $25 and $50 million to help stabilize itself. In a final effort to halt inflation in 1948, China switches to the gold yuan currency system.

1949-1975: A new "people's currency," the renminbi, is introduced, but the Chinese are allowed only a short time to exchange gold yuan notes for renminbi. Trading in gold, silver, and foreign currency is expressly forbidden. When America opens relations with the People's Republic of China, the ban on U.S. dollars is lifted, and Chinese-Americans send money to relatives on the mainland.

1976-1997: Reform in the 1980s allows foreign participation in banking and financial services, but the system remains under government control. Rapid and uneven development sparks rampant inflation, which continues into the 1990s after the drastic 1994 devaluation of the renminbi. Inflation then drops amid explosive economic growth under Jiang Zemin.

1998-2003: China withstands the Asian financial crisis of 1998; its large domestic market cushions the external shock, and the currency authorities succeed in avoiding a devaluation of the yuan that might have worsened the regional effect. The yuan's exchange rate is still fixed by the government; some of China's trading partners urge revaluation.

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Categories: Overview | Political | Economic | Social | Environmental | Rule of Law | Trade Policy | Money
Graphs: Growth | Income | Inflation | Unemployment | Well-being | Trade Volume | Trade (CAB) | Spending

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