Socialist market economy
The socialist market economy is seen by the Communist Party of China as an early stage in the development of socialism (this stage is variously called the "primary" or "preliminary" stage of socialism), where public ownership coexists alongside a diverse range of non-public forms of ownership. The Communist Party of China maintains that despite the co-existence of private capitalists and entrepreneurs with public and collective enterprise, China is not a capitalist country because the party retains control over the direction of the country, maintaining its course of socialist development. Proponents of this economic model distinguish it from market socialism as market socialists believe that economic planning is unattainable, undesirable or ineffective and thus view the market as an integral part of socialism whereas proponents of the socialist market economy view markets as a temporary phase in development of a fully planned economy.
Communism
The People's Republic of China has reassessed many aspects of the Maoist legacy and along with Laos, Vietnam and to a lesser degree Cuba has decentralized state control of the economy in order to stimulate growth. Chinese economic reforms were started in 1978 under the leadership of Deng Xiaoping and since then China has managed to bring down the poverty rate from 53% in the Mao era to just 6% in 2001. These reforms are sometimes described by outside commentators as a regression to capitalism, but the communist parties describe it as a necessary adjustment to existing realities in the post-Soviet world in order to maximize industrial productive capacity. In these countries, the land is a universal public monopoly administered by the state, as are natural resources and vital industries and services. The public sector is the dominant sector in these economies and the state plays a central role in coordinating economic development.