#1: Agricultural Production“We must set about restoring agricultural production if we want to overcome difficulties and bring about a fundamental turn for the better in the financial and economic situation.” – Deng Xiaoping

Deng allowed farmers to sell crops on the free markets, and gave each farming household a plot of land which they could use as they wanted. With this increased independence, productivity increased.

#2: Special Economic Zones (SEZ)“We will cross the river by feeling the stones under our feet, one by one.” – Deng Xiaoping

Deng established SEZs along the Chinese coast to serve the dual purpose of attracting foreign investment and testing out various free market reforms. Successful reforms were scaled throughout the country.

#3: Export-led Growth“A basic contradiction between socialism and the market economy does not exist.” – Deng Xiaoping

Deng felt that the Chinese economy could grow the fastest if it focused on producing consumer goods for Western audiences. He encouraged foreign trade even further by buying plenty of machinery from the West.

#3: Education Abroad“When our thousands of Chinese students abroad return home, you will see how China will transform itself.” – Deng Xiaoping

Deng believed that there was much that China could learn from the West, and from free market economies in general. He sent tens of thousands of Chinese students to the U.S. to study – all on the government’s dime.