ABSTRACT

Over the last twenty years China's economy underwent tremendous changes. High economic growth was associated with structural changes in agriculture and industry, and far-reaching economic reforms. In particular, the opening up to foreign trade and foreign direct investment (FDI) was a powerful engine for enhancing the process of economic modernization. As a result, the importance of China in the world economy, in international trade and capital flows increased considerably. From 1980 to 2001 China trebled its share in world trade (from less than 1 per cent to about 4 per cent), and became by far the major recipient of FDI among developing countries.