APEC and liberalisation of the Chinese economy by Peter Drysdale, Zhang Yunling and Ligang Song

APEC AND THE CHINESE 
ECONOMY: STRATEGIC ISSUES

1 
LIBERALISATION OF THE 
CHINESE ECONOMY: APEC, WTO 
AND TARIFF REDUCTIONS 
ZHANG YIJNLING 
Significant progress has been made in the liberalisation of the Chinese economy 
since the late 1970s, a natural result of the reform and opening up of the economy. 
Gradual integration into the world market has promoted economic development. 
China's involvement in regional and international organisations is an integral part 
of this process. 
THE PROGRESS OF CHINA'S ECONOMIC LIBERALISATION 
REFORM OF FOREIGN TRADE 
Since 1979, China's foreign trade system has undergone remarkable changes. 
In 1988, foreign trade companies began to apply the contract management 
responsibility system. In 1991, export subsidies were abolished and companies 
were made responsible for their own profits and losses. In 1994, with the merging 
of the official rate and market rate of the renminbi (RMB) at its core, a single, 
managed RMB floating rate system based on supply and demand of the market 
was established. From 1996, the RMB became convertible for the current 
account. 
In 1994, mandatory plans on total import and export volumes, export earnings 
and import spending of foreign exchange, were relinquished and a system of 
guiding plans was introduced. A unified tax reimbursement system under central 
finance was gradually established. In accordance with the principles of efficiency, 
fairness and openness, favourable conditions were created for public bidding, 
auction and standardised allocation for the quotas on import and export 
commodities. Actions have been taken to deregulate export businesses gradually 
to increase competitiveness.

APEC and liberalisation of the Chinese economy by Peter Drysdale, Zhang Yunling  and Ligang Song