China's Industrial Performance Since 1978

In the late 1970s, Chinese industry was on the verge of collapse. Its high but erratic rate of growth since 1949 had been achieved by using ever-increasing amounts of labour and capital. Not only was industry operating inefficiently, but the output mix was inappropriate and inventories had accumulated to very high levels. However, the true state of affairs had been obscured by the political turmoil of the Cultural Revolution (1966–76) and the virtual disbanding of the State Statistical Bureau (SSB).