Although China is still a developing country with a relatively low per capita income, it has experienced tremendous economic growth since the late 1970s. In large part as a result of economic liberalization policies, the gross domestic product (GDP) increased tenfold between 1978 and 2006, and foreign investment soared during the 1990s. China's challenge in the early 21st cent. will be to balance its centralized political system with an increasingly decentralized economic system.

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