Financial Reforms in China Between the 1970’s and 1990’s: Market Formation and the Consequences for Economic Development in the Country

Abstract

This article aims to reconstruct the formation of the financial system and its importance in the Chinese economic reform of the late 1970s and 1980s. The hypothesis defended in this study is to show how this expansion led the Chinese financial sector to the current logic centered on the performance and direction of the State. The financial reform developed under these premises, consolidating itself in the economic opening and in the financing of light industries aimed at exports, and together with joint ventures directed by the State policies, making it essential to increase the investment capacity in the country and recover the backwardness existing economic and industrial. The expansion of the financial system consolidated a robust economic growth, through the increase in the volume of deposits and the participation of this credit in strategic national business sectors. That way, managed to overcome its developmental delay, demonstrating that it is possible to accelerate and improve the quality of economic growth through the development and centralization of financial intermediation.