Basic Economic System of Socialism and Market in China

The Chinese science’s recognition of the possibility of a market under socialism in China was a major breakthrough in the theory of Marxism. The combination of socialism and the market marked the beginning of formation of a socialist market economic system and development of mixed economy with the public property as basic. The principle of “public property is the basis，joint development of the economy of many forms of ownership” was officially called the specifics of Chinese socialism at the initial state of its development and one of its most important advantages, that made it possible to ensure high economic growth rates over the past 40 year and to transfer China into the second world economic power. But this specificity and the advantages of socialism with Chinese specifics can be manifested and realized on the institutional level only through a certain coordinate system, known as the fundamental system for state governance, namely through one of its system responsible for governing the Chinese economy, known as the basic economic system of socialism. In 2019 according to the decision of the 4th plenum of the CPC Central Committee of the 19th convocation, the status of the socialist market economy system was raised: it was announced as an integral part of the basic economic system of socialism, which is responsible for guidance and development of China’s economy at the institutional level. The role and significance of the market system of China has increased sufficiently: the market is going to become the decisive driver for socialist modernization of the Chinese economy.