China's Reform and Opening Up

At the Third Plenum of the Chinese Communist Party's 11th Central Committee in December 1978, Deng Xiaoping consolidated power and launched a gradual, experimental shift away from three decades of a centrally planned command economy. Reform began in the countryside with the household responsibility system, which let farming families lease land and sell surplus output at market prices in place of collective farming, and extended into special economic zones opened to foreign trade and investment. Since 1978, China's GDP has grown at an average of more than 9 percent a year, lifting an estimated 800 million people out of extreme poverty.