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EXECUTIVE SUMMARY
Although the Peoples Republic of China's (PRC) is becoming more progressive, they are still criticized for their overcautious stance on entering the free market arena. This article explores China's reluctance toward foreign trade by examining past and present trade patterns along with future trade goals. The themes of culture, history and politics that remain blurred in Chinese culture are explored. The paper examines why foreign trade and capitalism cannot reproduce similar, instantaneous results in China to mirror western standards. Finally, the paper assesses the current and future economic climate and the emerging force of China in the global marketplace.
A TRADE HISTORY OF MIDDLE EARTH
Over 4,000 years of recorded history serves to explain life in China. For 2000 years China maintained a feudal dynasty of governance emphasizing complete isolation. The overall political structure within China remained relatively constant from the beginnings of the Qin Dynasty in 221 B.C. until the Opium War in 1840. The autocratic rule promoted little exchange of culture or commerce beyond the Great Wall.
While China was not historically a primitive or unenlightened society, isolation and a sense of ethnic pride left the country unaware of the outside world. China did, however, provide the world several gifts that had an impact on world history. Ancient China developed the bureaucracy and invented the compass, papermaking, gunpowder and printing ("Focus: History," 1995). Early China adopted, if not pioneered, capitalism in its most limited forms. The concept of a cellular economy empowered a distinctive division of small businesses which operated on the premise of autonomy and self-reliance (Dryer, 1996).
This form of early capitalism may be attributed to the lack of infrastructure and controls over land rather than a legitimate form of capitalism. The practice of trade in China was disadvantaged throughout its early history because the merchant class was the lowest rank of society during the Chou Dynasty (1100-256 BC). The society emphasized intellect over wealth or physical strength and was ranked as follows: scholars; farmers; artisans; merchants; and lastly, soldiers, thieves and brigands (Ralph, Lerner, Meacham, & Burns, 1990). This social hierarchy, devised by the writings of Confucius remains a cultural legacy deeply imbedded in modern China. (See Table 1 for an introduction to Confucianism).
The early...