Now, those same firms are pulling back, shuttering their factories, abandoning joint ventures and calling employees home. Everyone is throwing going-away parties. Farmers were allowed to grow what they wanted and sell their crops at market prices. Urban residents were permitted to open small businesses, a freedom tens of thousands of families availed of, transforming parts of their homes into cafes, hair salons and boutiques. But the reforms never permeated the upper reaches of the economy.
Large factories are still state-owned.
So are banks. Businesses complain of onerous regulation and taxation policies. Internet content is regulated by the government, and access is available only through the state-run post office, whose connection speeds are maddeningly slow. At the root of the problem, say academics and other specialists who follow the country, is a deep-seated fear that opening up to the West will undermine the Communist Party's currently unchallenged grip on power. There are no large organized opposition or dissident groups in the country, and there are no perceived threats to central authority, such as the Falun Gong spiritual sect in China.