China, the Manufacturing Capital of the World... to-be (Part 1)

America was once very much like China, the manufacturing power-house of the world. America's manufacturing sector enjoyed being the world's largest and the most advanced starting from the late 1890's, surpassing Britain. Some say the wars helped boost America's economy, especially after the Great Depression of the 1930's, due to higher production of uniforms, weaponry etc.

A Cultural Revolution poster
(Source: Wikipedia)

It was not until the late 1970's that America started off-shoring manufacturing jobs to counties such as China because that was when China started relaxing regulations and encouraged foreign investment. During that time, China was undergoing economic reforms to make it more efficient and stimulate higher economic growth. At this time, many people in China were still very poor and had dismal living  conditions. You could say that this low standard of living was due to the communist regime and the Cultural Revolution of 1966-76. The Cultural Revolution aimed to make China more communist and 'modern' but the effects were devastating as economic activities slowed and stopped. Therefore, it was important for China to have economic reforms to try to bring China out of an economic slumber.

(To be continued in Part 2)

Cheers

zhusun

Further reading:

http://en.wikipedia.org/wiki/Chinese_industrialization#Industrialization_of_the_People.27s_Republic_of_China

http://en.wikipedia.org/wiki/Cultural_Revolution