The decline of state-owned enterprises in China : causes, issues and challenges

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Journal article

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China Report

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Sage Publications India Pvt. Ltd.


Over the past twenty years China has achieved both an extraordinary decline in poverty and high levels of education and health. In 1978 China was among the world’s poorest countries, with 80 per cent of the population having incomes of less than US$ 1 a day and only a third of all adults able to read or write. By 1998 the proportion of the population with incomes less than US$ 1 a day had declined to about 12 per cent, life expectancy was an enviable 70 years, and illiteracy among 15- to 25-year-olds was down to about 7 per cent. A gradual introduction of economic reforms launched the growth process and rapid structural change that dramatically transformed the face of China and reduced the incidence of poverty. Official figures put the growth of China’s per capita real gross domestic product (GDP) at an annual average of 8 per cent during the 1978-96 period. Over that period per capita income doubled every ten years, faster than almost any country in recent history. Economic performance in the year 2000 as well promised to maintain the rebound, with 8.2 per cent growth in the first half of the year, surging exports and contracted foreign direct investment, and a 20 per cent increase in tax revenues compared to the previous year. Deflation, which has gripped the economy for more than two years, also appears to be ending.



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Recommended Citation

Lee, G. O. M., Wong, L., & Mok, J. K. H. (2001). The decline of state-owned enterprises in China: Causes, issues and challenges. China Report, 37(2), 165-212. doi: 10.1177/000944550103700203