The first reforms to affect China's economy were instituted between 1979 and 1984. The programs were systemic economic reforms aimed at revising China's foreign economic relations and refocusing the country's agricultural system. The desire to purchase foreign equipment and technology needed for China's modernization led to a policy of opening up to the outside world that would earn foreign exchange through tourism, exports, and arms sales (see Reform of the Economic System, Beginning in 1979 , ch. 5). The opening up policy included sending large numbers of students abroad to acquire special training and needed skills. The effect was to make China more dependent on major sectors of the world economy and reverse the Maoist commitment to the ideal of self-reliance. Not everyone was satisfied with this radical departure. The conservative reformers were especially apprehensive about the corrupting cultural and ideological influences that they believed accompanied foreign exposure and imports.

In China's rural areas, the economic reform program decollectivized agriculture through a contract responsibility system (see Glossary) based on individual households (see Rural Society , ch. 3 Agricultural Policies , ch. 6). The people's communes (see Glossary) established under Mao were largely replaced with a system of family-based farming. The rural reforms successfully increased productivity, the amount of available arable land, and peasant per capita income. All of these were major reform achievements. Their success stimulated substantial support in the countryside for the expansion and deepening of the reform agenda.

While the opening up policy and rural reform produced significant benefits to the Chinese economy and won enthusiastic support for the Deng reformers, they also generated substantial problems and brought political opposition from conservative leaders. The Maoist ideal of self-reliance still had proponents among the leadership in the 1980s, and many were openly critical of the expanding foreign influences, especially in such areas as the special economic zones (see Glossary). In rural areas, economic reform led to inequalities among economic regions and appeared in some instances to produce a new, potentially exploitative class of rich peasants. The official press contained accounts of peasants who carried the profit motive far beyond the intent of the reform program, engaging in smuggling, embezzlement, and blatant displays of newly acquired wealth. Thus, on the one hand, top leaders fully supporting the reform agenda could show major successes as they promoted further reform. On the other hand, those more concerned with ideological continuity and social stability could identify problems and areas1bf as of risk. The differing perceptions and responses of these reformist and conservative groups produced considerable tension in the political system.

Data as of July 1987