ABSTRACT
Chapter 2 (800–1990) demonstrates how historical patterns of political and economic organisation have persisted in China’s banking system in the Reform and Opening period. Historically, China’s banking system is characterised by a pattern of strong bureaucratic control of market activity. China had established a relatively sophisticated indigenous banking system prior to Western intervention in 1840. The subsequent loss of economic sovereignty, along with devastating episodes of instability and the ideological excesses of the Mao era, all informed Deng Xiaoping’s reform approach of ‘groping for stones to cross the river’. Initial systems of banking regulation selectively incorporated ideas from the modern banking systems of Western countries.
