ABSTRACT
Introduction China is a large country in terms of its size and population. It has the fourth largest territory in the world, just behind Russia, Canada, and the United States. It is the most populous country in the world containing about one in five of the world’s population. By 2007, its population had exceeded 1.32 billion, more than the sum of people living in Europe and North America (US Census Bureau, 2008). These two factors alone are sufficient to make China an important country in the world. When the country was first established in 1949, it intended to build up a Communist country based on Marxist doctrine where ‘everybody contributes based on their ability, and gets in accordance with their need’. China has adopted a strict planned economy system prior to the late 1980s and a free market was literally non-existent. Jobs were assigned by the state, and social protection was provided by the government or state-owned enterprises (SOEs). In addition, the Communist political ideology had resulted in its isolation from the outside world. It was not until 1978 when economic reforms were launched that China opened itself to the outside world. The open economic policy launched in 1978 has brought about remarkable economic growth. Statistics revealed that from 1978 to 2004, unadjusted per capita income increased 27-fold in urban areas and 22-fold in rural areas (Zhao and Guo, 2007). China’s economy has accounted for approximately one-quarter of the global growth in the past five years (International Monetary Fund, 2008).
