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.
Sino-Soviet split
The Sino-Soviet split allowed only written communications between the quarreling socialist countries; thus, the PRC and the USSR supported their geopolitical actions with formal statements of ideology concerning the true road to world communism, that is the general line of the party. In June 1963, the PRC published "The Chinese Communist Party's Proposal Concerning the General Line of the International Communist Movement", to which the USSR replied with the "Open Letter of the Communist Party of the Soviet Union". In 1964, as a theoretician of Communism, Chairman Mao said that, in light of their differences of interpretation of Orthodox Marxism, a counter-revolution in the USSR had re-established capitalism; consequently, the USSR and then the Warsaw Pact countries broke relations with the People's Republic of China .