World War 2 in the mid-90's drew a hard blow and left a serious
and lasting effect to many Asian countries. This however, did not
hamper the growth of countries such as China, Japan and Vietnam as
their government were taking serious steps to recover economically.

Thus, the global market cannot deny a place for these 'Asian Dragons',
because these countries are growing at a tremendous pace to the extent
of being capable in emerging as global market leaders.

China's capitalism and boom was born when their president, Deng

Xiaoping permitted the provinces to dismantle their communes and
collective farms. This led China to venture into free-market
economics, although they were still under the communist political
system. When President Deng announced that they needed Western money
and expertise, China flung their trade doors wide open and China went
on a capitalist drive without ever looking back. By mid 1960's, the

Chinese Revolution settled down to the job of ruling China. Its main
goal was essentially nationalist: a prosperous modern economy. While
there continued to exist substantially economic inequalities,
distribution of wealth was probably a bit more equal than in most

Western countries. ( Moise 171 ) While there were great variations in
income between different villages, and between different jobs in the
urban sector, the overall averages showed a clear pattern: the cities
were much richer than the countryside. Most capital investments were
going into urban industries. The urban workers, using considerable
amount of heavy machinery, had a much higher average level of
productivity compared to the rural workers. The natural consequences
was for the city people to arrange themselves an average income level
twice as high as that of the people in the countryside.

The most obvious way to attack this poverty problem was to
increase production, in all sectors of the economy. Though the easiest
way to increase production was to increase capital inputs, China could
only afford a limited amount of capital construction. In accordance to
this, China went on a construction binge. Whole factories were
purchased from abroad while others were built with local resources. By

1978, the frenzy for new projects reached a level that reminded some
people of the Great Leap Forward. In an effort to promote agricultural
production, the government released many of the restrictions on the'spontaneous capitalist tendencies' of the peasantry. (173) In the
late 1980's, the government decided to expand the scope of private
marketing. Then the next step was to increase the amount land assigned
to the peasants. The peasants were now not responsible to the
government for the use they made to the private plots. They simply
could grow what the wished, for the sale to the government or to
private markets. This led to furious rebuilding and inflow of foreign
investments. All this enabled China to remake itself into Asian's hub
of finance, trade and culture.

By 1984, they were producing more than $1 million worth of rice
and a range of side products, including rice wine. Their residential
earning was up to about $200 a year. ( Prager 52 ) This meant that
they could begin replacing their mud-and-straw hats with solid brick
houses. Shanghai today is a vast construction site with more than

20,000 projects, with 27,000 companies building bridges, tunnels,
flyovers, ring roads, hotels, villas, golf courses and also public
housing. This sparked national growth of about 10% a year.( 53 ) The

Chinese now are going home with fat wallets, stocks, bonds and large
bank accounts. Banks are reporting that savings have increased
sixty-fold and is still growing. This has led China to join the world
economic community and has become the globe's third largest economy.

China is now ranked 11th in the world in exports of trade goods. (54)

Of the coast of China, there was another growing country. Japan
recovered tremendously well after the bombing of Hiroshima in World

War 2. Under post war conservative governments, Japan made a
remarkable economic recovery. American aid of $2 billion gave an
initial boost and then the Korean War acted as a further stimulant by
creating a demand for military hardware. (Rich 191) By the early

1970's, Japan was the world's third biggest steel producer, one of the
biggest ship builders, and ranked very high as a manufacturer of
general engineering and chemical goods. Japan's motorcycles were
winning import races in Europe, and Japanese cameras, transistor
radios, cars, sewing machines, TV sets and optical goods competed
successfully in the global market.

Japan's economy is second only to the U.S in absolute terms with
a G.D.P of $3,385 billion dollars. By 1987, the Japanese were richer
than the Americans with per capita income of almost $20,000.