China - Comparing Environmental Policies in 16 Countries - page 258

garden. To the west is Beihai Park, 70 hectares of gardens with several
artificial lakes, originally reserved for the Imperial Court. Temples and
pavilions date to the Ming Dynasty and earlier. Farther away, one finds
the Temple of Heaven and the Temple of the Earth. Chinese urban plan-
ners were able to enforce the orderly arrangement over many centuries.
Even during the riots and chaos of the Cultural Revolution, Communist
leaders protected the Imperial Palace.
Economic Reforms: At the Party Congress in December 1978, Deng
Xiaoping announced economic reforms. Farmers could now sell their
surplus crops, foreign trade would be encouraged, many businesses could
sell on the open market, and towns and villages could operate busi-
nesses enterprises. Collective farms and communes nearly disappeared.
Employment in Townships and Villages Enterprises (TVEs) grew from
28 million in 1978 to a peak of 135 million in 1996. On the negative side,
they tended to produce much air and water pollution. Big state-owned
enterprises (SOEs) were not privatized but could enjoy more management
autonomy and could keep their profits (although now subject to taxation).
These were often steel mills, cement plants, and oil refineries that gener-
ated much pollution, and because they were only partially subject to the
price system had less incentive to economize by burning less coal.
The result of these economic reforms was spectacular. Since 1978 the
national rate of economic growth has been 9% or 10% year after year. The
GDP is $10 trillion, third highest in the world after the European Union
and the United States. Per capita income is $7600. For three decades after
1949, Mao had tried to make China self-sufficient, minimizing imports.
The PRC was isolated economically as well as politically. However, after
1978 this was reversed. Imports were seen as a source of profit, investment,
and new technology. The government established Special Economic Zones
to foster foreign trade. The SEZs enjoyed tax incentives and more auton-
omy for international trade. They relied on investment from overseas, and
their products were chiefly for export. They were to be guided by market
forces, not central planning. At first there were 4 SEZs, but the number has
increased to 20. The first ones were in the southeast near Hong Kong and
Taiwan and sparked a boom, which continues to the present. Cities in the
interior did not prosper as much.
Some observers expected that the economic freedom would lead to
political freedom. In 1979 a few protesters, mostly students, had written
criticisms on posters that they pasted on a wall in Beijing, soon getting the
nickname of “Democracy Wall.” Posters written in big characters, so they