Insight Article Desktop Banner
Big Picture
July 25, 2023

China's Past, Present and Future

Insight Video Mobile Banner
July 25, 2023

China's Past, Present and Future

Big Picture

China's Past, Present and Future

Share Icon

July 25, 2023


China's economy has undergone a remarkable transformation over the past 70 years, catapulting the country from its predominantly rural roots to a vibrant, urbanized industrial powerhouse. After the communists took control in 1949, the state exercised tight control over the economy. It was only after a series of transformative reforms initiated in 1978 that an entrepreneurial spirit was unleashed and propelled the country to become the world’s second-largest economy, with an annual growth rate that soared from 6.5% for the first 30 years to nearly 10% for the last 40.


Today, China faces binding constraints including unfavorable demographics, elevated debt levels, a productivity slowdown and rising income inequality, all at a time of rising geopolitical tensions. President Xi Jinping’s measures to reassert state control in economic planning mark a significant departure from the previous four decades of reforms and signal a shift away from the reform-driven tailwinds for private enterprises. The introduction of these new controls comes at a crucial time. Western governments and businesses are actively exploring alternatives to their Chinese suppliers to mitigate risks associated with relying on a single country. The tensions between the West and China have worsened due to Beijing’s increasing assertiveness on the global stage, including its efforts to control key technologies, its military expansionism and its territorial claims over Taiwan.

The paper takes a closer look at China's past, present and future, its transition from poverty under Marxist policies to a global powerhouse today, and its ongoing attempt to navigate the complex intersection of economic, technological and geopolitical realities to achieve its goals.


There is no assurance that a portfolio will achieve its investment objective. Portfolios are subject to market risk, which is the possibility that the market values of securities owned by the portfolio will decline and that the value of portfolio shares may therefore be less than what you paid for them. Asset allocation/Diversification does not protect you against a loss in a particular market; however it allows you to spread that risk across various asset classes. Market values can change daily due to economic and other events (e.g. natural disasters, health crises, terrorism, conflicts and social unrest) that affect markets, countries, companies or governments. It is difficult to predict the timing, duration, and potential adverse effects (e.g. portfolio liquidity) of events. Accordingly, you can lose money investing. In general, equities securities’ values also fluctuate in response to activities specific to a company. Investments in foreign markets entail special risks such as currency, political, economic, market and liquidity risks. The risks of investing in emerging market countries are greater than the risks generally associated with investments in foreign developed countries. Stocks of small-capitalization companies entail special risks, such as limited product lines, markets, and financial resources, and greater market volatility than securities of larger, more-established companies. The commodities markets may fluctuate widely based on a variety of factors. These include changes in overall market movements, domestic and foreign political and economic events and policies, war, acts of terrorism, changes in domestic or foreign interest rates and/or investor expectations concerning interest rates, domestic and foreign inflation rates and/or investor expectations concerning inflation rates and investment and trading activities of mutual funds, hedge funds and commodities funds.

Deputy CIO, Solutions & Multi Asset Group

Head of Macro & Thematic Research, Emerging Markets

Portfolio Manager,
Passport Equity



The views and opinions are those of the author as of the date of publication and are subject to change at any time due to market or economic conditions and may not necessarily come to pass. The views expressed do not reflect the opinions of all investment personnel at Morgan Stanley Investment Management (MSIM) and its subsidiaries and affiliates (collectively the Firm”), and may not be reflected in all the strategies and products that the Firm offers.

This material is for the benefit of persons whom the Firm reasonably believes it is permitted to communicate to and should not be forwarded to any other person without the consent of the Firm. It is not addressed to any other person and may not be used by them for any purpose whatsoever. It expresses no views as to the suitability of the investments described herein to the individual circumstances of any recipient or otherwise. It is the responsibility of every person reading this material to fully observe the laws of any relevant country, including obtaining any governmental or other consent which may be required or observing any other formality which needs to be observed in that country.

This material is a general communication, which is not impartial, is for informational and educational purposes only, not a recommendation to purchase or sell specific securities, or to adopt any particular investment strategy. Information does not address financial objectives, situation or specific needs of individual investors.

Any charts and graphs provided are for illustrative purposes only. Any performance quoted represents past performance. Past performance does not guarantee future results. All investments involve risks, including the possible loss of principal.

Prior to making any investment decision, investors should carefully review the strategy’s / product’s relevant offering document. For the complete content and important disclosures, refer to the link above.


Morgan Stanley Investment Management (Australia) Pty Limited operates under AFSL No: 314182.

Not to be shown, quoted or distributed to the public. The information shown in this website is not personal advice and does not take into account the investment objectives, financial situation or needs of any person.

Information on this website should not be considered a solicitation to buy, an offer to sell or a recommendation for any security in any jurisdiction where such an offer, solicitation or recommendation would be unlawful or unauthorized. In addition, investments may not be made via this website.

Past performance of any product described on this site is not a reliable indication of future performance.

Subscriptions    •    Privacy & Cookies    •    Your Privacy Choices Your Privacy Choices Icon    •    Terms of Use

©  Morgan Stanley | Investment Management (Australia) Pty Limited ACN 122040037