The Chinese Economy Is Not Socialist in Nature!

By Henry Kyambalesa

October 24, 2025

Naïve socialists in Zambia and elsewhere have continued to portray the People’s Republic of China (PRC) as having a remarkably successful socialist or communist economy whose economic outputs have continued to flood the entire world unlike any other country in modern history.

But the country’s remarkable economic performance is not a result of implementation of socialist or communist policies. Rather, its economic reforms that began in 1978 and which moved the country away from a socialist or centrally planned economic system towards a market-based, free-market economic system that is largely responsible for its current economic success.

In other words, it is this shift in the country’s economic system which has, by and large, led to the country’s remarkable economic performance.

In this regard, News China (2019:1) in an editorial summed up the actual reason for the country’s economic success in the following words: “China’s economic success in the past decades has been established [mainly] on the premise of a liberalized and [vibrant] … private sector.”

This is collaborated somewhat by the following statement excerpted from the same newspaper: “Chinese President Xi Jinping affirmed in a meeting on November 1 [2018] that the [Chinese] government will support the private sector to become bigger and stronger.”

Also, the following quote excerpted from the South China Morning Post (2023) highlights the country’s yearning for foreign private investment: “[Former] … Premier Li Keqiang said China will make greater efforts to attract and utilize foreign capital, by expanding market access to foreign investors, especially in the modern service sector.”

The following excerpts, too, corroborate the observation that “China’s economic success … has been established [mainly] on the premise of a liberalized and [vibrant] … private sector”:

(a) On a January afternoon in 2025, people were browsing a Tesla showroom that opened in 2021. Outside, Tesla vehicles—which could be found occasionally on the streets of Urumqi—were charging. Ford, Toyota and Mercedes, among others, also had authorized dealerships in Urumqi. Coca-Cola and its joint venture’s bottling plant in the region was still running.—Yoko Kubota (2025:B6). And

(b) Chinese leader Xi Jinping urged foreign business executives and business-group leaders from the United States, Europe and Asia to defend trade, and said globalization was unstoppable. He also assured them that China was open for business, and was eager to help foreign companies to thrive.—Liza Lin and Brian Spegele (2025:B6).

Private investors in the Chinese economy include indigenous capitalists, as well as investors from a wide range of countries, including Australia, Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States of America.

In fact, it is not enough to consider a country’s progress only in terms of its economic outputs. Other considerations include the rights and freedoms exercised by citizens of multi-party and democratic systems of government worldwide—rights and freedoms which are not catered for in socialist and communist countries like the People’s Republic of China, countries which are administered through a single political party and where dissent is treasonous.

And Chairman Mao Zedong’s legacy? His “Great Leap Forward” fantasy—a “mass mobilization” industrialization nightmare pursued from 1958 to 1962 designed to transform the country from an agrarian society to an industrialized society through the formation of “people’s communes”—led to over 20 million deaths in mainland China due to the famine and widespread poverty it caused.

By the way, inequality in China has risen during the period of economic reforms, particularly in terms of household income and consumption, and in terms of health status, educational attainment, and so forth.

Rejection of Socialism:

Two historical events have signaled the end or rejection of socialism and communism as alternatives to capitalism or the free-market economic system in the world’s quest to improve humanity’s socioeconomic vistas; that is:

(a) The worldwide quest for economic liberalization over the last 40 or so years by countries which have had socialist or communist national economies. And

(b) The introduction of “perestroika” and “glasnost” in the former Union of Soviets Socialist Republics (USSR) by the Mikhail Gorbachev administration in 1987, and the eventual break-up of the USSR on December 26, 1991.

This wind of change also occasioned the dismantling of the Berlin Wall, which separated communist East Germany (that was under the tutelage of the former Soviet Union) and capitalist West Germany, in November 1989, and the eventual reunification of the two countries into a united and capitalist Germany upon the signing of a reunification treaty on August 31, 1990.

The term “perestroika” refers to the profound reorganization or restructuring of the system of centralized planning and management of the entire economy of the former Soviet Union initiated by Mikhail Gorbachev (then leader of the Soviet Union) during the late 1980s.

Linked to “perestroika” was “khozrachot”—a concept or principle that provided for the following: (a) gradual elimination of subsidies, price controls and foreign exchange controls; and (b) conversion of state-owned and state-controlled monopolistic enterprises into competitive and independently operated business entities.

Jack C. Plano and Milton Greenberg (1993:532) have defined “perestroika” to refer to the restructuring of the economy of the former USSR, whose emphasis was “on modernizing the [Soviet] … economy to achieve greater productivity by introducing elements of private enterprise and competition, expanded foreign trade, [creation of joint ventures between local enterprises and] … capitalistic companies of the West, and a goal of a higher standard of living for the Soviet people.”

“Glasnost,” on the other hand, refers to the concept of openness introduced in the former Soviet Union in 1987 by the late Mikhail Gorbachev, which provided for a general relaxation of constraints on freedom of speech in the USSR. As noted by John W. Hall and John G. Kirk (2002:778), “Perestroika” and “khozrachot” were also introduced during the same year.

Plano and Greenberg (1993:532) have defined “glasnost” as “a Russian term that means ‘openness’ and involves many political, economic, and social changes aimed at opening up Soviet society and making it more efficient.”

Note: Prior to the end of World War II in 1945, a War that started in 1939, East Germany and West Germany were one country. After the War, Soviet forces occupied eastern Germany, while French, British and U.S. forces occupied the western half of the country. The Berlin Wall was constructed by East Germany with the help of the now-defunct Soviet Union in 1961 to prevent the country’s citizens from escaping to the more affluent and democratic West Germany.

According to History.com Editors (2019), at least 171 East Germans were killed trying to defect to West Germany, while more than 600 border guards and 4,400 other refugees –

“[Managed] … to cross the border [illegally] by jumping out of windows adjacent to the wall, climbing over … barbed wire, flying in hot air balloons, crawling through … sewers, and driving through unfortified parts of the Wall at high speeds.”

In conclusion, Socialist Party leaders in Zambia—and elsewhere as a matter of fact—should guard against duping some gullible citizens that socialism is the panacea to their country’s socioeconomic problems.

In The Manifesto of the Communist Party (1848), Karl Marx and Friedrich Engels agitated for the following, among other things: (a) abolition of free trade; (b) confiscation of privately owned means of production and distribution by the State; (c) the abolition of private property; (d) the abolition of religion; (e) centralization of means of communication; and (f) usurpation of economic and political power by means of a revolution—that is, by violently and extensively changing society’s enduring socio-cultural inclinations and existing state of affairs by means of a revolution.

These are certainly not the kinds of ideals civilized citizens in any country should be yearning for.