China and the International Monetary Fund 1945–1985

Abstract

The history of China’s engagement with the IMF was complicated by China’s broader political and economic relations with the capitalist world during the first three decades of the IMF’s operations. Chinese officials, government ministers and bankers were prominent at the Bretton Woods conference in 1944, enjoying the support of the Allied powers while the Japanese war still raged. During the early years of the Fund’s operations, the civil war in China preoccupied the KMT regime. After the victory of the Chinese Communist Party China’s territorial boundaries were not resolved with both the KMT and the PRC claiming to be the legitimate government of ‘China’. In the early 1970s, Mao reached out to the US President Nixon to begin to re-engage with the global system, a process that culminated in Deng Xiao-ping’s Open Door Policy in December 1978. After 30 years of gradual opening to international trade and investment, China joined the IMF in April 1980, unseating the Republic of China (ROC). Although Chinese experts influenced the design of the Bretton Woods institutions, the PRC was thus a late-comer to the IMF, joining when many key structures were already in place and left with the legacy of China (Taiwan)’s policy choices over 25 years.