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Changes in the organisation of economic activities in urban areas

Tom Faherty. Changes in the organisation of economic activities in urban areas. The Mao era. 5 year plans Economic growth model/guidelines Great Leap Forward Second 5 year plan 1958 onwards Movement from Agrarian to Industrial Development of communes Communes

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Changes in the organisation of economic activities in urban areas

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  1. Tom Faherty Changes in the organisation of economic activities in urban areas

  2. The Mao era • 5 year plans • Economic growth model/guidelines • Great Leap Forward • Second 5 year plan • 1958 onwards • Movement from Agrarian to Industrial • Development of communes • Communes • A group of people living together and sharing possessions and responsibilities • The cultural revolution • 1966-76 • Failure of the great leap forward

  3. Changes in the last 30 years • Changing political structure (Mao to Deng) • Open Door Policy • Introduction of SEZs • Changes to SOEs • Growth of new industries • Population growth

  4. Open door policy • Implemented in 1978 as a response to previous economic disasters of the Mao era • Chairman Deng Xiaoping implemented this policy to drive towards state-governed capitalism • To get China to look outwards for investment and for a marketplace • Allowing and encouraging FDI

  5. Special Economic Zones • SEZs are areas politically adapted for economic growth • The goal of an SEZ is to attract Foreign direct investment (FDI) because of: • Low tax levels to attract business • Planning regulations are relaxed allowing easy building of factories etc

  6. Shenzhen – The first SEZ • In the 1970s, just a small coastal village in the Guangdong province • On August 26th 1980 it became China's first SEZ • Over 30 years later it is now one of China's fastest growing cities, home to major Chinese enterprises, a stock exchange, libraries, and universities • Now a rich mix of foreign and domestic investment

  7. Shenzhen before Shenzhen after

  8. Changes to SOEs • Move to a more socialist market based economy • This includes the growth of new industries • Move away from heavy industry • High tech light industry • High profit margins due to the nature of high tech goods • Example: Sinopec, a succesful SOE which is company owned by the government but subject to company law

  9. Changes in Industry • Movement from heavy industry to light industry • Introduction of electronics industries because of their high profit margins • Movement from primary and secondary industry to tertiary and quaternary • Foreign investment in the service industry has increased by 66.3 • Sinopec, a petrochemicals energy company. A registered capital of £18.2 billion. A successful tertiary and quaternary industry

  10. Changes in Industry

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