Once more, democratic Europe is being shaken by a load of bad news. Although the euro zone’s gross domestic product (GDP) suffers a 4% contraction in 2009, the PIIGS (Portugal, Italy, Ireland, Greece and Spain) launch a new challenge to the European Union (E.U.) as a whole. With the public deficits quite above from a 3% maximum previously established by the E.U., those countries have pushed Europe into either a more far-reaching macroeconomic coordination or shall get the entire European continent down to economic instability. Even though the economic crisis which have been worrying the world, China, in that same year, managed to maintain its GDP’s growth at 8,7%, a low average if we compare it with its historical however still above from the 8,0% regarded as a minimum required with the purpose of keeping an internal stability and vigorous growth, if we are to take into account the circumstances which were imposed to the global economy throughout that year. Nevertheless, China’s economic growth in the 21st century cannot be comprehended without placing it in a more far-reaching historical context, which includes a strategic process through economic reforms put into practice by the end of 1978 towards a market economy in which the advances seen in agriculture were crucial.

The advances in rural China that took place from 1978 onwards are notable because it was the success achieved with the fruitful reforms in the countryside which left the bases for the further reforms within the Chinese economy could be strengthened and moved forwards. Therefore, the transition process on the way to a market economy has happened gradually and can certainly be divided into two great periods. The first one, which goes from 1978 to 1992, comprehended a phase in which the Chinese government softened the strict control it would have over the economy while the economic growth rates were being kept high. In the second phase, which has been underway from 1993 to nowadays, the institutional configuration of the state was rebuilt aiming to make it compatible to a market economy, shrinking the public sector and bringing about conditions for a fairer dispute among the market’s agents.

The reforms, which got started in the countryside, were in fact generated by a coordination mechanism (plan and market) denominated Shuangguizhi, which allowed the production, distribution and commercialization of products from vegetal and animal origin, excluding the cereals, could be done without any intervention from the state. In relation to the cereals, the Chinese government was still fixing the production and its prices under a monopoly regime, nonetheless with higher values than the three previous decades. There was a system which would combine planning and liberty within the market sphere. There was also an important moment, which makes reference to the when the workers were relocated for non-agriculture activities in cities, which had as a result, the workers’ increasing income. Approximately in 1984 the seed production in China had increased by over 30% and the food security was guaranteed after the various hunger crisis felt along its history. The state reduction monopoly in agriculture has worked so well that it has been by the way extended to some other sectors in the national economy. As a result from that process, new companies entered the market, having all of them competed among one another following the market rules. The economy was growing, but out of control.

The second phase of the economic reforms can be differentiated substantially from the first one because it does focus on the regulatory changes and in its results. For that, this phase is known as “the phase of the reforms with losses”, once it imposed significant losses to some social classes just like the workers and the states under governmental rule. With the need of taking it forwards and deepen the process initiated in 1978, three politic measures were adopted: the end of the dual track system, the recentralization of fiscal resources and the macroeconomic austerity. The taxation system, of corporative governance, of the banks and the external sector (by China’s entrance at WTO) were restructured. The results from such measures were the prices stability which was lost during the previous phase, shrinking of the state protection for the companies under its power, a moderate number of privatizations and the well-known losses for some social classes who suffered from bankruptcy, privatization or acquisition of old state-owned companies. 

Such measures were also felt within the field which saw a bigger utilization of products such as fertilizers, irrigation and mechanization after 1994. Apart from the fall in seed production between 1999 and 2003 owing to the droughts in the north, China has presented a substantial growing in its seed production since 2004. According to information from the Chinese Bureau of Statistics, the seed production in China totalized 469, 5 million tons, a 9% increase considering the previous year. Between 2005 and 2007, the harvests rose from 484,02 million tons to 497, 5 and 501, 5 million tons, respectively. In 2008, the seed production reached 528,5 million tons and, currently, the Chinese government has set up another goal, which is to increase the production to 540 million tons until 2020. However, the development of agricultural sector is dealing with problems like a great income disparity between the farmers and city dwellers and less investments than the other economic sectors. The Chinese government, knowing those setbacks, managed to create the State Mid-and-Long Term Grain Security Plan for 2008-2020 Period, a plan in which there is a list of challenges that the Chinese agriculture will be facing to during the next years. Among them, there is an equilibrium even more narrowing between the demand and offer of seed, the deficits with the agricultural trade with other nations, the annual rises taking into account the imports of soya and cotton and remarkably the raises of the main agricultural items, shortage of water, losses of productive lands and the retardation in the process of agricultural productivity and climate changes.

It is visible therefore that the process of economic reforms felt by China’s economy is complex and it is unavoidably interwoven with the success from the reforms and from the stability in the countryside. It was the countryside which saved China’s economy - and many other ones – from the financial crisis in 2008/2009. To maintain an economy with high economic growth as well as keeping a middle class with an increasing consume standard impose huge challenges to the Chinese government. The government, by its time, tries to keep those high economic growth levels and is aware of the fact that the countryside is, undoubtedly, its main worry.  It demands reforms which could maintain the stability and further productivities and therefore a new agrarian reform has been thought of. Dramatic changes in the land rights combined with a strong rural exodus give us an impression about a new wave full of revolutionary changes which should restructure the entire agricultural sector in China.

If it is true that the economic reforms in China began with changes concerning the land use by the farmers to expand to other sensible and fundamental areas within the Chinese economy, then it is not true that the farmers have claimed success by taking part in a fair redistribution of goods which are generated in China. A good example would be the facts that, by numerous times, the farmers face themselves to the impossibility of having access to the basic services within the public wealth field. For China, a good and stable countryside means a fine and strong economy. If the Chinese government, through its vigorous presence in both politic and economic sectors, manages to make those benefits come back to the countryside itself, China shall be able to keep its economic course up until it becomes the biggest economy on earth in 2050.